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[2010] VSC 134
Supreme Court of Victoria
2010-04-16
VICKERY J
Original judgment source is linked above.
TESTATOR'S FAMILY MAINTENANCE - Application by stepchildren of deceased - Deceased held whole of estate of applicants' mother - Whether or not deceased had responsibility to make provision for claimants - Underlying test or standard of moral duty - Relationship between deceased and claimant - Administration and Probate Act 1958 (No 6191) s 91.
1 In this matter, the Plaintiffs, as stepchildren of the deceased, make application for provision to be made from the estate of their stepfather for their proper maintenance and support pursuant to s.91 .
2 The deceased, Franc Pozvek ("Franc"), died on 3 July 2006 aged 84 years. He left a will dated 10 December 2004. The executor is the Defendant, Zeljko Koska ("Mr Koska"). Probate of the will was granted on 2 July 2007. The First Plaintiff, Irene Robertson ("Irene"), is a stepdaughter of the deceased. The Second Plaintiff, Louis Przybyla ("Louis"), and the Third Plaintiff, John Przybyla ("John"), are stepsons of the deceased.
3 At the time of his death, Franc Pozvek, was a widower. He married only once during the course of his life to Helena Pozvek (nee Urban) ("Helena"), the Plaintiffs' mother. Franc married Helena in 1957. He was Helena's second husband. They had no children together, and Franc had no children of his own by any other relationship.
4 Helena Pozvek was born in the former state of Yugoslavia on 20 May 1930. She married her first husband, Stanislaus Przybyla ("Stanislaus") on 28 October 1946. Helena and her first husband had four children, the three Plaintiffs in this proceeding and Marianne Kamieniarz ("Marianne"). Helena predeceased her second husband Franc. She died on 8 January 2001.
5 Marianne is the youngest child of Helena and Stanislaus. She was born on 21 December 1951. She is not a plaintiff in this proceeding, having earlier settled a claim made upon the estate of the deceased.
6 The relevant part of the family tree is set out below:
7 The will of Franc Pozvek was dated 10 December 2004. He appointed his cousin-in-law, the Defendant, Zeljko Koska, as the executor of his estate. He bequeathed $5,000 to two acquaintances, Paul Vdovic and Matija Mertik. Subject only to those two legacies, he left the entirety of his residual estate to the Defendant , Mr Koska. The will made no provision for Marianne Kamieniarz or for any of the three Plaintiffs.
8 According to the inventory of assets filed by the executor, at the time of Franc Pozvek's death the principal asset of his estate consisted of the matrimonial home of Franc and Helena Pozvek, a property situated at 35 View Point Avenue, Glen Waverley (the "Glen Waverley property"). This was stated in the probate inventory prepared in 2007, to be then valued at $550,000.00. The Defendant relied upon the valuation report of Mr Joseph Lee dated 2 February 2010,[1] who says that in his opinion the present value of that property is $730,000.00. The Plaintiffs, whilst leading no evidence to challenge this valuation, believed that the realistic value of that property may be higher.
9 On the evidence, I accept that the present value of the Glen Waverley property is $730,000.00.
10 At the time of his death there was, in addition to the 35 View Point Avenue property, bank deposits in the Commonwealth Bank and ANZ Bank totalling $231,939.18; and government superannuation of $117.00. Mr Franc Pozvek had no liabilities.
11 The First Plaintiff, Irene Robertson, was born in Austria. She came to Australia in 1949, when she was approximately two years of age.[2] Initially her father, Stanislaus and her mother, Helena settled in Ingham, Queensland, where Stanislaus obtained work as a cane cutter.
12 The Second and Third Plaintiffs, John and Louis are twins. They were born soon after the family arrived in Australia, on 21 February 1950.
13 Marianne was born nearly two years later, on 21 December 1951.
14 Shortly after Marianne was born, Helena left Stanislaus and the four children and moved to Adelaide.
15 Several months later, Stanislaus and his children Irene, Louis, John and Marianne moved to Thebarton, Adelaide where Stanislaus reconciled with Helena. They lived together as a family for a period of time. Stanislaus worked for a steel company as a labourer. In 1954, the family moved to Port Vincent, where Stanislaus worked as a barman and Helena worked as a waitress in the local hotel.
16 A year later, in 1955, Stanislaus was offered seasonal work as a cane cutter in Queensland. He moved interstate to pursue this work. Whilst Stanislaus was in Queensland, Helena left Irene at Goodwood Orphanage and Louis and John at Royal Park Orphanage before moving to Melbourne with her youngest child, Marianne. She took up a relationship with another man[3].
17 About six months later, in mid 1955, Stanislaus returned from Queensland. He was shocked to find his wife had moved interstate with his youngest child and placed his other three children in orphanages. However, he was in no position to care for his children at this stage of his life. They remained in the orphanages while he took up a position as a labourer for the Department of Supply in Woomera. The Plaintiffs claim ill treatment during their time at the orphanages, saying that they were often subjected to physical punishment. They look upon their time in the institutions as being very distressing.[4]
18 In 1956, after a year at Goodward Orphanage, Irene moved to Royal Park Orphanage, where she joined her two brothers. She remained there until 1958. Their father Stanislaus then arranged for his three children to go into foster care after he obtained a job as a cook at the Department of Supply.[5]
19 After being placed into foster care, between 1960-1961, Robertson attended Woomera High School. She left at age 14 to work as a waitress for the Department of Supply, paying board to her foster parents with the money she earned. It was also during this time she met and commenced a relationship with her now husband, Colin Robertson.
20 Sometime later in 1961, Irene obtained her mother's contact details from Helena's sister, Sonia Ivezic ("Sonia"). Sonia also arranged for Helena to visit Adelaide where Irene had contact with her mother for the first time in about six years. During this visit, Helena introduced Irene to Franc, who she had married in 1957. Franc and Helena asked Irene to move to Melbourne to live with them. However, Irene refused their offer. She had just met Colin Robertson and did not want to leave him, her brothers or her father.[6] Irene swore in her affidavit:[7]
During this visit my mother was quite emotional. She said that she was scared that my father would see her and make quite a fuss over this. This annoyed my stepfather and he said he would never visit Adelaide with my mother again, and he never did.
21 Shortly after Franc and Helena visited Adelaide, Irene travelled to Melbourne to stay with them for a week. At this time, Franc worked as a builder and Helena worked at a wool mill. Franc and Helena lived with Marianne in a home in Pascoe Vale (the "Pascoe Vale prperty"). Franc had purchased this property prior to commencing his relationship with Helena. Franc and Helena together had also purchased an investment property in Kinross Street, Coburg in 1965.
22 Irene said in her evidence, which I accept, that she got on well with Franc and, at his invitation, called him "Dad". On one occasion Franc took Irene to the Slovenian Club to introduce her to his friends.[8] After this visit, Irene had regular contact with Franc and her mother. She visited Melbourne about once each year and exchanged letters and cards to celebrate Christmas, mother's day and father's day, Easter and birthdays. She also spoke to Helena and Franc regularly on the telephone.[9]
23 A few years later, in 1963, Louis and John moved to Melbourne to live with Helena and Franc. They stayed with them for approximately eight months. John said in his evidence, which I accept:[10]
I have fond memories of the time that I spent in Melbourne with my mother and stepfather. My stepfather insisted that Louis and I call him Pop and he treated us as his sons to many friends and workmates.
24 Louis and John both attended Coburg Technical School while they lived in Melbourne. Louis said in his evidence, which I accept, that whilst in Melbourne, Franc dropped John and Louis off at school by car every morning, and picked them up in the afternoon. Franc was accustomed to taking the boys out in Melbourne to enjoy places such as Captain Cook's Cottage, the Myer Music Bowl and the Myer Shopping Centre to see the Christmas windows. He also took them to the properties he was working on, teaching John and Louis basic carpentry skills.[11]
25 John and Louis returned to South Australia in 1964, after spending eight months in Melbourne. Louis left school at age 14 to work as a junior storeman for the Department of Supply in Woomera. John later joined him in 1966, also working as a storeman.
26 On 18 March 1963 whilst still living in Woomera, Irene married Colin Robertson ("Colin"). They travelled to Melbourne to stay with Franc and Helena. During this visit, Franc and Helena suggested that Colin and Irene move to Melbourne and live in their Coburg investment property. However, Irene and Colin were unable to leave Woomera as Colin was soon to complete his apprenticeship as a motor mechanic with the Department of Supply.
27 In 1964, Stanislaus was promoted to the position of head chef at the Department of Supply. As part of his remuneration package upon his promotion, Stanislaus was allocated a government rental property. Louis and John moved in with their father shortly after he commenced renting this property.[12]
28 Irene has two children, Angela, born on 6 November 1963 and Anthony, born on 3 January 1967. She also said in her evidence, which I accept, that her mother and stepfather were delighted at the births of her children. She produced a selection of photographs taken on various family occasions throughout the 1970s and 1980s. She also said, which I accept, that "My stepfather adored my children and they called him Pop" and that "My mother and I regularly spoke on the telephone and sent each other letters and cards".[13]
29 In 1965, Franc and Helena purchased the Glen Waverleyproperty. It was vacant land. They built their own home on the property over several months. After they moved into the home, they sold the Pascoe Vale property. At about this time, Franc and Helena commenced working at a local school. Franc worked full time as a maintenance man, and Helena worked full time as a cleaner.
30 Helena and Franc invested in other property in Melbourne. Irene said in her evidence, which I accept:[14]
My mother and stepfather were meticulous about maintaining their properties and during our visits to Melbourne, Colin often assisted my stepfather to carry out maintenance works such as painting, gardening and plumbing on the properties that he and my mother had purchased Colin and my stepfather were both quite handy and they enjoyed spending time together carrying out this work. Colin also assisted my stepfather to lay tiles and wallpaper at their home in Glen Waverley.
31 Irene also said that she and her husband Colin continued to visit her mother Helena and stepfather Franc. When her children grew older, sometimes they accompanied her on these visits, in turn bringing their children with them. A close relationship developed between Irene's grandchildren and Franc. She described the relationship in the following terms:
My stepfather loved my grandchildren and was particularly close to my grandson, Todd. He enjoyed playing billiards with the children and liked to buy them Kentucky Fried Chicken as a treat.
She produced a photo of the extended family including her mother, stepfather and her children.
32 Both Louis and John said in evidence that they also continued to visit their mother and stepfather after their eight-month visit in 1963. When John obtained his driver's licence in 1967 he sometimes drove to Melbourne with friends to see his mother and stepfather.[15] He said they always welcomed him into their home and continued a good relationship with him. He also said that he received birthday, Easter and Christmas cards from his mother and stepfather without fail. After Louis left the army in 1970, he lived with Helena and Franc in Melbourne for three months. Louis maintained a good relationship with Franc during this period and they enjoyed spending time together working in the garden.[16]
33 In 1970, John was called up for National Service duties and worked as a soldier in the Army Medical Corp. During this time, John was stationed in Melbourne, and visited Helena and Franc during his leave. On 29 December 1971, John married Robeena and they had two children, Donna Stow (nee Przybyla), born 16 June 1973, and Purdy Basford (nee Przybyla), born 4 June 1977.
34 In 1972, John returned to Woomera to work at the Department of Supply, and continued to have regular contact with his mother and stepfather during that period. He said in his evidence that he visited his mother and stepfather in Melbourne about five or six times over the years. He celebrated Christmas with them on occasions, and maintained regular telephone contact with his mother and stepfather, and continued to exchange cards and letters on special occasions like birthdays, Christmas, and on Mother's and Father's Days. During the late 1970's to the 2000's, he and his family visited Helena and Franc about five or six times. John continued in his evidence:[17]
Whilst visiting my mother and stepfather I often spent time with my stepfather in his workshop, which I loved as it allowed me to spend time alone with him and have a good chat.
35 Louis married his wife, Bronwyn, on 1 July 1978 and had three children: Simon Przybyla, born on 25 October 1979; Hayley Przybyla, born on 13 September 1982; and Jessica Przybyla, born on 18 October 1987. Louis said in his evidence, which I accept, that his mother and stepfather loved their children dearly. He recalled receiving a large parcel filled with baby clothes from them when Simon, their eldest, was born.[18] Louis and his wife Bronwyn and their children visited Helena and Franc in Melbourne every few years. During these visits, Franc and Louis enjoyed playing pool and spending time in his workshop together. Photographs were taken during these visits to Melbourne when Louis's children were young.[19]
36 John and Louis received some financial support from Helena and Franc. In the early 1980's, Helena gave Louis and his wife $3,000 as a gift, telling him that she was giving each of her children some money.[20] John said that his stepfather loaned him $3,000 in 1981 for a deposit on a house, and when he went to repay the money, his stepfather told him he did not want the money back.
37 Irene received some financial assistance provided by her mother and stepfather in 1993 when she and her husband Colin established a floristry business. They were given $2,000 and a further $5,000 several years later. She said that although these amounts were understood to be loans, when they attempted to pay the money back, her mother and stepfather refused to take the money, saying that the money was a gift.[21] Irene went on to say that her mother and stepfather retired in the early 1990's, and that the floristry business that she established failed shortly after she commenced work as a telemarketer.
38 The Plaintiffs' father, Stanislaus, died on 2 May 1996 leaving each of the Plaintiffs approximately $16,000.00 from his estate. John said that Franc telephoned to offer him his condolences at this time. John said that he remembers the conversation vividly because Franc suggested that he and his wife move to Victoria so that they could be closer to Helena and Franc. John said further that he did discuss the proposal with his wife, however in the end they decided that, with his wife's aging parents living in Adelaide, they didn't want to leave Adelaide.
39 In 1997, Irene had a heart attack and was diagnosed with Type 2 diabetes. Her mother Helena visited her in Adelaide during this time.
40 In 1998, Helena, was diagnosed with breast cancer. Irene said in her evidence that:[22]
During my mother's illness I spoke to her on the telephone at least once each week and visited her several times a year. In about 2000 my mother and stepfather sold their two investment properties in Glen Waverley. After this my mother told me she had gifted some money to my sister, Maryanne.
41 Helena died on 8 January 2001. He will was not produced in evidence. Irene gave evidence that she never saw a copy of her mother's will and her belief is that no probate was ever granted.[23]
42 After her death, each of Helena's children were paid an amount of $5,000. Marianne made the distribution on behalf of her mother.
43 Irene and John said that they remained in contact with their stepfather after their mother's death. Irene visited Melbourne to see him in 2001, 2002 and 2004; spoke to him on the telephone approximately once every couple of months; and continued to send him cards and letters for Christmas, Easter, Father's Day and his birthday.[24] John also stated that he remained in contact with Franc. He telephoned him about four times each year and continued to send cards on special occasions such as his birthday, Father's Day and at Christmas time.[25]
44 Mr Koska is 65 years old. He owns and resides in a property at 188 Elgin Street, Carlton, Victoria. He is self-employed and operates his own business known as "Elite Office Machines". He said that this business produces no income because the market for his products and services has now been superseded. He lives off a fortnightly pension of $490.[26] He owns his Carlton home, which had been modified so he could operate his business downstairs whilst living upstairs. The title to the property is unencumbered. The last rate assessment valued the property at $800,000 as of 1 July 2008. Mr Koska values the property at $850,000.[27] He also owns a holiday home at Toora that he purchased for $88,000 in 2001. The title to this property is also unencumbered. The last rate assessment valued the property at $156,000 as at 1 July 2008.
45 In addition to this real property, Mr Koska owns the following personal property: 368 ordinary shares in the Commonwealth Bank of Australia, which, at a current market value of $51.82 per share, amounts to $19,070; a 1986 Toyota Supra worth approximately $3,000; and a small boat worth about $3,000. As at about October 2008, Mr Koska had approximately $62,000 deposited in his bank accounts.[28] By February 2010, he said that he used $54,024.77 of his savings to fund the shortfall in monies available in the estate to pay the $220,000 settlement payment due to Marianne. He presently has monies totalling approximately $93,000, which are the proceeds of his pension scheme that he has redeemed. He also had a small superannuation policy with Firstchoice Personal Super worth approximately $3,869.80. This was recently redeemed to help pay his living expenses. He does not have any debts, save for the legal costs of these proceedings and a sum of money due to Marianne by way of reimbursement for her legal expenses arising from the proceeding in this Court No. 9853 of 2007, being an amount a little in excess of $70,000. This claim is disputed by Mr Koska.[29]
46 Mr Koska was born in the former Yugoslavia on 23 December 1942. He arrived in Australia on 10 February 1966 with wife Ljuba and young daughter Rebecca. His wife had an aunt and he had a cousin, Helena living in Melbourne. Mr Koska said in his evidence that he knew Franc for "the last 40 years of his life".[30] He cited a number of examples to demonstrate his relationship with Franc over those years.
47 Shortly after arriving in Australia, Mr Koska phoned Helena and spoke to her and Franc. He swore to the following:[31]
They invited myself and my family to visit them. Helena and Franc had married in 1958. Franc had had no other marriages and did not have any children of his own. Our two families got on well. It was a little difficult for us to visit Helena and Franc initially because we did not have a car but we would talk regularly on the telephone. The two families spent that Christmas together and Helena made me promise to her that we would always come to them for Christmas. That is what transpired over the years. During the holiday period after that first Christmas Franc took myself and my family to Flinders to show us where he used to work at the Naval Base and we then went to Somers where we stayed at the beach and had a picnic. A month or so later Franc and Helena took myself and my family to the Eltham Slovenian Club where we had a picnic during the day and finished with dinner and a dance. We would talk on the phone at least once a week.
48 In the mid 1960's when Franc and Helena purchased their investment property in Coburg, Mr Koska helped with the renovations on the weekends. On one occasion, when Mr Koska and his wife had a falling out, he stayed with Franc and Helena at their Pascoe Vale house for about a week while he continued to help them with renovations on their Coburg property. He reconciled with his wife after a week and returned to live with her. They subsequently placed a deposit on a house in Brunswick in 1971. The house needed to be renovated. Franc, a carpenter by trade, put in a new window and door in return for the work Mr Koska had done for him.
49 Mr Koska celebrated and socialised with Franc and Helena on a number of occasions throughout the 1980's until early 2000. Such occasions included: the birth of Mr Koska's second daughter, Vanessa, on 10 September 1973; the visit of Mr Koska's mother from Yugoslavia in 1974, when she stayed at Franc and Helena's house for some two weeks; visiting the Ballarat flower show, the Healesville Sanctuary and the Victoria Market. When Helena's brother Jakob visited Australia in or about 1978, Mr Koska took him fishing and pig hunting. Mr Koska's sister Blanka and his aunt visited Melbourne from Yugoslavia in 1980. Franc took them to the Slovenian Club for a dinner and a dance. They also socialised together on the occasion of the second visit of Mr Koska's mother in 1982, which lasted some four months.[32]
50 In early 1987, Mr Koska's wife left him. He was devastated and was supported by Franc and Helena during this period. He said as to these events:[33]
They sought to assist in reconciling my wife and I but unfortunately all efforts were in vain. They offered to provide me with any moral support that I needed. Fortunately my business was still performing well at that stage. Franc and Helena invited me to their place in Glen Waverley and I stayed with them for a few days because my world had just seemed to have collapsed like a house of cards. I felt as though I had lost the will to live, I did not feel hungry. Had it not have been for Franc and Helena's support I don't know how I would have managed through that difficult time. Franc and Helena offered for me to come to their place for meals which I did on several occasions. We would talk about my marital situation and it was good to have people to share the burden with.
51 After approximately eight months of separation, Mr Koska and his wife agreed on a division of their matrimonial assets; his wife retaining the matrimonial home and he retaining the Carlton property where he was running his business. During this time, he states he relied heavily on Franc and Helena for support. He said:[34]
Franc and Helena helped shift my personal things from the matrimonial home to the Carlton property. I felt ill during the whole process and I felt like being a stranger in my own place. I wouldn't have been able to get through that process without Franc and Helena's support. We loaded the heavy items on to a trailer and other items such as clothing into the back of our cars. Helena and Franc unloaded most of the materials because I felt so weak and ill. They stayed late that night trying to help me eat something and left after midnight. The next day Helena rang me to see how I was and to ask if I needed help. She was insistent that I come to her and Franc's place for dinner and to stay for a few days to help me recover. I stayed with them that night and left the next day.
52 Mr Koska spent the Christmas of 1987 with Franc, Helena, his daughter Vanessa and Helena's brother Jakob, who was visiting Melbourne again. He took Jakob away for another week's fishing in New South Wales. Jakob stayed for three months at Franc and Helena's, during which time Mr Koska played pool with Franc and Jakob and would sometimes stay overnight with them.
53 In the 1990's, Mr Koska saw Franc and Helena on several occasions. In December 1992, a surprise 50th birthday was arranged for Mr Koska at which Franc and Helena were present as well as family friends. Jakob visited Australia again, for the last time in 1994 and stayed for approximately three months. Not long after he returned overseas, was diagnosed with cancer, and subsequently passed away in 1998.
54 In 1997, Mr Koska's mother took ill in Yugoslavia, and he visited her for four months. Shortly after returning to Australia, Mr Koska became engaged to be married. Franc and Helena helped him organise the wedding by preparing salads, cakes, antipasto and other foods for close to 100 guests.
55 Mr Koska's marriage did not last long, and once again Franc and Helena were there to lend support.
56 Not long after the marriage break up, Helena was diagnosed with cancer. Mr Koska supported Helena during her illness by cooking meals and providing other practical assistance. Mr Koska visited Franc and Helena regularly, about twice a week, and rang them nearly every day.
57 In December 2000, Mr Koska received word that his mother's illness had worsened. He was gifted $5,000 by Franc and Helena to fly to her home to see her. His mother passed away on 1 February 2001. Whilst away, he received a phone call from Franc advising him that Helena passed away. He returned to Melbourne on 13 February 2001. Franc and Mr Koska spent time together during the year to the end of 2002. They enjoyed Christmas together in 2002, as well as New Year's Eve, and both hosted a visit from Mr Koska's sisters on 28 December 2002.
58 On 10 May 2003, Mr Koska received a call from Franc asking if he could come over to his house because he was signing a Will. When he arrived, Mr Koska was introduced to a solicitor, John MacMillan who read out the Will and asked Franc if that was what he wanted. Franc confirmed it was. In that Will Franc bequeathed his billiard table to Mr Koska. Mr Koska stayed with Franc that night and thanked Franc for the gift of the billiard table. Franc's response was that he knew that Mr Koska liked playing billiards and that the gift was something to remind Mr Koska of him because of the long association they enjoyed playing on the table.
59 Mr Koska continued seeing Franc weekly, bringing him bottles of brandy and food. He said that they spent Christmas of 2003 together eating Kentucky Fried Chicken, drinking a bottle of wine, and playing billiards.
60 On 29 December 2003, Mr Koska received a phone call advising him that Franc had fallen through a window or a glass door and had been taken to Clayton Monash Medical Centre. The next morning Mr Koska went to see Franc at the hospital. He was bruised and had a black eye. Franc told him that he had lost his balance and had fallen. He was discharged on 8 January 2004 but was in a weakened state. Mr Koska stayed with him for some days and made him his meals while he recovered.
61 Franc's condition, however, deteriorated. Mr Koska became concerned that Franc was losing weight. He started telephoning Franc more often to increase the frequency of contact.
62 On 28 July 2004, Mr Koska was advised that Franc had abdominal pain, could not stand up, and had been taken to Monash Hospital. Mr Koska visited Franc the next morning and was told that Franc had various health issues including cardiac arrhythmia, imbalance emphysema, and abdominal pain, but that his condition remained steady. Mr Koska telephoned the hospital the next day to see how Franc was doing and they said his condition was satisfactory. He visited Franc at various times, and on other days telephoned the hospital to check on how Franc was progressing.
63 On 16 August 2004, Franc was discharged from Monash Hospital. He was still weak and could not manage on his own. He was transferred to Aberfeldie Interim Care in Sandringham. After a month in interim care, Franc made an excellent recovery. His appetite came back, he gained strength, and was able to walk without his walking stick. By the end of September, Franc's recovery had reached the stage where he was nearly ready to go home. He was still physically weak and he did not want to drive. He asked Mr Koska to take care of his financial affairs for him until he was able to do so himself. A social worker at Monash Medical Centre made an application to VCAT for an administration order and on 29 September 2004, an order was made by the Tribunal. Franc was discharged from Aberfeldie Care on 11 October 2004. Mr Koska stayed one week at Franc's house helping him settle in, doing the cooking and cleaning, and generally providing company.
64 In late October 2004, Pauline Hamilton of the Peter James Aged Care Assessment team said that she would come to make an assessment as to how Franc had settled in and asked if Mr Koska could be present. They met at Franc's place. Franc's condition had improved and he was getting stronger with each passing day. Franc took the view that he felt strong enough to manage his own finances. Mr Koska immediately wrote to VCAT by letter dated 26 October 2004 advising that he was no longer needed as an administrator and sought to have control of Franc's financial affairs returned to him. He took Franc to a hearing at VCAT and the order was made to this effect on 19 November 2004.
65 At the beginning of December 2004, Franc telephoned Mr Koska and asked him if he knew of a good lawyer because he wanted to make a power of attorney. He said that he wanted Mr Koska to be given a power of attorney. Mr Koska said that the only lawyer he knew was in Carlton, but that was too far for Franc to travel. The following day Franc rang Mr Koska and told him that his neighbour, Howard Walsh, had recommended his lawyer to do the job. Franc made an appointment with the lawyer and asked Mr Koska to take him there, which he did. Mr Koska sat in on the consultation with the lawyer. Franc gave instructions to the solicitor to prepare Financial, Medical and Guardianship Powers of Attorney. Franc then proceeded to give instructions concerning a new Will. He did not forewarn Mr Koska that he was intending to do this nor did he give any indication that he was proposing to make Mr Koska the sole beneficiary of his residuary estate.
66 Franc and Mr Koska spent Christmas Eve together again in 2004. Franc had given up drinking alcohol by this time.
67 On 26 August 2005, Franc tripped on a carpet and fell on the floor, suffering a fractured pelvis. Franc stayed in hospital for two weeks and was visited by Mr Koska every couple of days. He was discharged on 15 September 2005. Mr Koska stayed with him for one week, again doing the cooking, cleaning and the shopping.
68 In early November 2005, Mr Koska's sisters visited again for approximately six months, leaving on 7 May 2006. Mr Koska, his sisters, and Franc spent Christmas Eve together, Franc gifting them all $100 each.
69 On 3 July 2006, while Mr Koska was visiting Franc at his home, Franc suffered a massive pleural effusion and passed away.
70 The First Plaintiff, Irene is 63 years old and is married to her husband Colin. She lectures in floristry at TAFE, and cares for a disabled person part-time. Last financial year, her taxable income was $28,351 and her husbands' income was $51,186. She owns jointly with her husband a home in Redwood Park which she estimates to be worth between $350,000 to $400,000 and a Mitsubishi Express van valued at about $24,000. As to her savings, she has a loan offset account with about $3,981.00; a cheque account with a credit balance of about $2,682.00; and a Visa Debit card with a balance of about $1,500.00. As at 30 June 2009, she has superannuation valued at $1,002.93 with Super SA and $73.98 with AMP and her husband has superannuation valued at $2,708.77. She has a mortgage on her home of approximately $64,200.00, and a personal loan of approximately $110,961.00 which was used to extend the house. They owe $17,279.46 on the Mitsubishi van loan and both have no other substantial assets or liabilities.[35]
71 The Second Plaintiff, Louis is 60 years old and is married to Bronwyn Przybyla. They live in Western Australia at Unit 8, 11 Hazlett Way, Canning Vale, and both work. Louis is a maintenance handyman and weekend service vending manager. They each earn approximately $40,000 per annum. They own the following real estate:
(a) a house at Unit 8, 11 Hazlett Way, Canning Vale, Western Australia, worth about $385,000.00 with an outstanding mortgage of $279.300.00;
(b) an investment residential property at Unit 18, 11 Hazlett Way, Canning Vale, Western Australia worth about $365,000.00, and with a mortgage of about $303,200.00 outstanding. It is rented out at $365.00 per week;
(c) an investment residential property at 21 Emerald Boulevard, Aldinga, South Australia valued at approximately $340,000.00 and rented out at $280.00 per week. Louis and his wife jointly owe $110,000.00 pursuant to a line of credit secured against this property.
(a) superannuation savings of about $8,029.00 with ING and $13,675.00 with Host Plus; his wife has superannuation of savings $14,095.00 with ING and $41,282.00 with Mercer Super;
(b) they have investments totalling about $130,000.00 in a managed portfolio and $10,000.00 in an interest bearing account, both owned in the family trust by Louis's wife in her capacity as trustee of the Przybyla Family Trust;
(c) additionally, they own a 10 year-old Subaru valued at $10,000; and
(d) both have a $20,000.00 personal line of credit, on which $18,000.00 is currently owed. They have credit card debts totalling $7,679.00, and no other substantial assets or liabilities.[36]
73 The Third Plaintiff, John is 60 years old and married to Robeena Przybyla. They live at Lot 2, Checker Hill Road, Forreston, South Australia. He suffers from various health problems including Ischemic heart disease, chronic anxiety and depression. He also suffers from neck and back problems caused by a car accident in 1986 and injuries at work in 1990 and 1993.[37] As a result, he receives a disability support pension of $506.50 per fortnight, which he has been receiving since 1998. His wife Robeena receives a partner's allowance of $411.50. His taxable income for the last financial year was $2,078; his wife's, $10,176.00. They jointly own a home in Forreston, which was valued at $450,000 according to his last rates notice; however, he presently values the property at between $550,000.00 and $600,000.00. He owns shares valued at about $28,021.51 as at 10 February 2010 and his superannuation and managed investments are valued at $183,202.80 as at 10 February 2010. He has $722.00 in a savings account, $231.00 in a second savings account, and $102.00 in a Christmas Club savings account. His wife, Robeena, has $534.00 in a savings account and $69.15 in a second savings account. She owns shares worth about $4,500.00 and has about $5,000.00 in superannuation. Together, they have about $9,200.00 saved in a cash management trust. They own a Toyota Rav 4 Station Wagon valued at about $15,000.00 and a 1995 Mazda 121 worth about $1,200.00. John owes about $1,260.00 on his credit card and his wife owes about $350.00 on her credit card. They also owe their son-in-law $4,800.00. They have no other substantial assets or liabilities.[38]
74 In addition to their present assets and liabilities, the Plaintiffs believe they may receive a benefit from the estate of their mother's mother, Rose Urban in the future. They said in evidence in this respect:
I understand that my grandmother owned a half share of a property in Coburg with my uncle Peter Urban, who is now aged in his 60's. I have been informed that by her will my grandmother left Peter a life interest in her share of the property and directed that upon expiration of the life interest, the property be divided equally amongst her five children. I am also informed that the will states that if any of my grandmother's children are not then living, their share will be divided amongst their surviving children. As my mother is deceased, I may receive an equal portion of her share with my siblings.[39]
75 The relevant legal principles are well settled and were accepted as such by the parties to the present proceeding.
76 Section 91 of the Administration and Probate Act 1958 (the "Act") provides as follows:
(1) Despite anything in this Act to the contrary, the Court may order that provision be made out of the estate of a deceased person for the proper maintenance and support of a person for whom the deceased had responsibility to make provision.
(2) The Court must not make an order under subsection (1) in favour of a person unless -
(a) that person has applied for the order; or
(b) another person has applied for the order on behalf of that person.
(3) The Court must not make an order under subsection (1) in favour of a person unless the Court is of the opinion that the distribution of the estate of the deceased person effected by -
(a) is or her will (if any); or
(b) the operation of the provisions of Part I, Division 6; or
(c) both the will and the operation of the provisions -
does not make adequate provision for the proper maintenance and support of the person.
(4) The Court in determining -
(a) whether or not the deceased had responsibility to make provision for a person; and
(b) whether or not the distribution of the estate of the deceased person as effected by -
(i) the deceased's will; or
(ii) the operation of the provisions of Part I, Division 6; or
(iii) both the will and the operation of the provisions -
makes adequate provision for the proper maintenance and support of the person; and
(c) the amount of provision (if any) which the Court may order for the person; and
(d) any other matter related to an application for an order under subsection (1) -
must have regard to -
(e) any family or other relationship between the deceased person and the applicant, including the nature of the relationship and, where relevant, the length of the relationship;
(f) any obligations or responsibilities of the deceased person to the applicant, any other applicant and the beneficiaries of the estate;
(g) the size and nature of the estate of the deceased person and any charges and liabilities to which the estate is subject;
(h) the financial resources (including earning capacity) and the financial needs of the applicant, of any other applicant and of any beneficiary of the estate at the time of the hearing and for the foreseeable future;
(i) any physical, mental or intellectual disability of any applicant or any beneficiary of the estate;
(j) the age of the applicant;
(k) any contribution (not for adequate consideration) of the applicant to building up the estate or to the welfare of the deceased or the family of the deceased;
(l) any benefits previously given by the deceased person to any applicant or to any beneficiary;
(m) whether the applicant was being maintained by the deceased person before that person's death either wholly or partly and, where the Court considers it relevant, the extent to which and the basis upon which the deceased had assumed that responsibility;
(n) the liability of any other person to maintain the applicant;
(o) the character and conduct of the applicant or any other person;
(p) any other matter the Court considers relevant.
77 The application of this legislation has been helpfully summarised by Robson in Boyd v State Trustees Ltd, [40] where his Honour said:
Section 91(4) of the Act envisages a three stage approach to each application. The first stage is to determine whether or not the deceased had responsibility to make provision for a person; secondly whether or not the distribution of the estate of the deceased makes adequate provision for the proper maintenance and support of the person and thirdly the amount of the provision (if any) which the court may order for the person. In determining each of these matters the court must have regard to paras 91(4) (e) to (o) and, pursuant to s 91(4)(p), to any other matter considered to be relevant.
The court is bound in answering each of those questions to have regard to the matters mentioned in ss 91(4)(e)-(o) and pursuant to s 91(4)(p), to any other matter considered to be relevant. Self evidently, such matters (referring to the matters mentioned) in [sic] are of themselves incapable of providing an answer to either question (referring to the first two questions). To reason from the matters mentioned in ss 91(e) to (p) to a conclusion that a testator had a responsibility to make a provision for a claimant, or that the testator failed to made adequate provision for the claimant, necessitates the application of a test or standard to the matters considered. The test remains one of whether and if so what provision a wise and just testator would have thought is his moral duty to make in the interests of the claimant.
In Bosch v Perpetual Trustee Co Ltd the Privy Council said in relation to the moral duty test that:
Their Lordships agree that in every case the court must place itself in the position of the testator and consider what he ought to have done in all the circumstances of the case, treating the testator for that purpose as a wise and just, rather than a fond and foolish, husband or father ... The Act is ... designed to enforce the moral obligation of a testator to use his testamentary powers for the purpose of making proper and adequate provision after his death for the support of his wife and children having regard to his means, to the means and deserts of the several claimants, and to the relative urgency of the various moral claims upon his bounty. The provision which the court may properly make in default of testamentary provision is that which a just and wise father would have thought it his moral duty to make in the interests of his widow and children had he been fully aware of all the relevant circumstances.
Of course the Act is no longer limited to the spouse and children of the testator. But that is not relevant to these applications.
The breach of the moral duty is an objective test to be measured against all the relevant facts and in particular the matters referred to in 91(4)(e) to (o) of the Act and any other matter the court thinks relevant under (p).
In Blair v Blair an adult son was successful in obtaining an order under s. 91 of the act. Naturally each case turns on its own facts. But it is clear from Blair v Blair that an adult son need not establish a special need or special claim before the court can exercise its discretion in his favour.
We must not underestimate the significance, both practical and symbolic, of freedom of testation. It is one of the badges of a society that has graduated from primitive conditions and a notable human right. Part IV of the Administration and Probate Act is to be construed accordingly.
79 In Grey, Callaway JA expanded further on the freedom of testation and the limit it imposes upon the Court in approaching questions under Part IV of the Administration and Probate Act 1958 (Vic). His Honour said:[44]
[I]t is one of the freedoms that shape our society, and an important human right, that a person should be free to dispose of his or her property as he or she thinks fit. Rights and freedoms must of course be exercised and enjoyed conformably with the rights and freedoms of others, but there is no equity, as it were, to interfere with a testator's dispositions unless he or she has abused that right. To do so is to assume a power to take property from the intended object of the testator's bounty and give it to someone else. In conferring a discretion in the wide terms found in s.91, the legislature intended it to be exercised in a principled way. A breach of moral duty is the justification for curial intervention and simultaneously limits its legitimate extent. So much may be derived from the concept of 'proper' maintenance and support but also, and more fundamentally, from those considerations.
80 In Schmidt v Watkins [45] Harper J, in considering the 1998 amendments which introduced s. 91 into the Act in its current form, concluded that the Act in its pre-amended form existed for the protection of family members or those whose relationships had assumed an analogous closeness. In short, the removal of the old relational restrictions on applications had not been to create a new class of claimant but to expand the boundaries of the old. In this regard, his Honour said:[46]
Clearly enough, the deficiency which the amendments were designed to remove was a lacuna in the extent of the legislation's previous reach. According to modern notions of what is right, some may properly look to others for maintenance and support even though there is no tie of blood or marriage between them. While, therefore, all citizens have a moral duty to make adequate provision out of their estate for such of their surviving spouse or children who would otherwise be left without proper maintenance and support, that moral duty is not necessarily restricted to those family members. Others (including those who were not related) may fall within its reach. Until the passage of the Wills Act 1997, Victorians in such a position could not look for assistance to the legislative provisions dealing with testator's family maintenance. On the other hand, one's moral duty is by definition a limited duty. Accordingly, the remedy was not a wholesale enlargement of the field of prospective claimants. Nor was it left to the courts in the exercise of an unprincipled discretion to decide whether a particular claimant was or was not a person for whom the deceased had the requisite responsibility. Rather, the remedy was the inclusion into the class of those claimants of persons who, although not numbered among the deceased's immediate family, nevertheless had "a moral claim to the deceased's estate".
When the above list is read in the light of the Second Reading Speech, it is in my opinion clear that the amendments effected by the Wills Act were seen by Parliament as part of a continuum rather than as a complete break from the past. By referring to the unamended provisions of Part IV as "quite restrictive" and as "excluding the ability of other persons who may have a moral claim on the deceased's estate from making a claim", the Ministers indicated that they saw the amendments not as creating a new class of claimant but merely as expanding the boundaries of the old. Both before and after the amendments, the courts were and are required to ask whether, in the particular circumstances of the individual case, the deceased has abused the freedom of testamentary disposition and so has breached his or her moral duty to the claimant. In answering that question, the courts must have regard to the list to be found in s.91(4). That list is entirely consistent with those considerations which, in dealing with applications under the legislation before the 1998 amendments came into operation, the courts customarily took into account.
In the context of this case (as will be seen when the facts are examined) it is relevant to observe that friends, neighbours and even mere acquaintances not infrequently provide to another assistance of an extraordinarily generous kind over an extraordinarily long period; but neither they, nor the recipients of their generosity, nor the community, would necessarily or even ordinarily conclude that as a result the recipients had a responsibility to make adequate provision in their wills for the proper maintenance and support of their benefactors.
"Proper Maintenance and Support" and "Adequate Provision"
81 The words "proper maintenance and support" and "adequate provision" are carried over from the statutory regime which pre-dated the 1998 amendments.
Indeed, in order to succeed, an applicant must show what would have amounted to "proper maintenance and support" of the applicant and at the same time show that the distribution made by the testator's Will (or resulting from intestacy) was not "adequate" or sufficient to provide for such proper maintenance and support having regard to that applicant's needs.
83 Ormiston J then referred to the judgment of Lord Romer in Bosch v Perpetual Trustee Co. Ltd [50] where his Lordship said:
The use of the word "proper" is of considerable importance. It connotes something different from the word "adequate". A small sum may be sufficient for the adequate maintenance of a child, for instance, but having regard to the child's station in life and the fortune of his father, it may be wholly insufficient for his "proper" maintenance. So, too, a sum may be quite insufficient for the "adequate" maintenance of a child and yet may be sufficient for his maintenance on a scale which is "proper" in the circumstances. A father with a large family and a small fortune can often only afford to leave each of his children a sum insufficient for his "adequate" maintenance. Nevertheless, such a sum cannot be described as not providing for his "proper" maintenance, taking into consideration "all the circumstances of the case".
84 More recently, in Vigolo v Bostin, Gleeson CJ said:[51]
The "testamentary duty" which justified legislative interference with a free exercise of testamentary capacity, that is, the duty of a man to make provision for his wife and children, was seen as a moral duty. The legislation was not merely, or even primarily, concerned with relieving the State of the financial burden of supporting indigent widows and children. The courts were not empowered merely to make such provision for an applicant as would rescue the applicant from destitution. The legislative power was to make 'proper' provision. Judicial explanation of what was meant by proper provision was based upon the idea of a moral obligation arising from a familial relationship. That is one of the fundamental ideas upon which the structure of our society is based.
Discretion to be Exercised in a Principled Way
85 The Court has a wide discretion in deciding such applications. Nevertheless, this must be exercised in a principled way. As Menzies and Fullagar JJ said in Blore v Lang:[52]
The Testator's Family Maintenance Act is legislation for remedying within such limits as a wide discretion would set, breaches of a testator's moral duty to make adequate provision for the proper maintenance of his family-not for the making of what may appear to the Court to be a fair distribution of a deceased's person's estate amount the members of his family. As it has been said in another context, the Act is to provide maintenance, not legacies. Equality is not something to be achieved by the application of the Act, although in some cases equality may set a limit to the order to be made- for instance where there is not enough to provide proper maintenance for all entitled to consideration whose need is the same.
86 A number of cases in New South Wales that have dealt with the entitlements of stepchildren. However, they have been principally concerned with the question as to whether stepchildren were sufficiently accepted as part of the testator's family to have a claim upon his or her estate under the Family Provision Act 1980 (NSW). Nevertheless, the analysis undertaken in these cases is instructive as to the way in which the relationship between step parents and their step children may be consisdered for the purposes of s. 91 of the Act in Victoria.
87 For example, Graziani v Graziani[53] was a case determined by the New South Wales Supreme Court concerning a claim by stepchildren whose parents had separated. The stepchildren lived with their mother and stepfather for a number of years during their secondary schooling. The stepfather was the only breadwinner during this time. The plaintiffs were eligible persons under the relevant provisions of the Family Provision Act 1980. However, by reason of their relational status they were required to show "factors warranting" the making of provision. Cohen J said that in the case of stepchildren, the court should consider the following matters under the legislation:[54]
Accordingly, it seems to me that those who were raised as part of the family as stepchildren would have less difficulty in establishing factors which warrant their application than would those at the other end of the spectrum who may have been members of the family for only a brief period and with only limited dependence.
88 Cohen J held that the claims were made out in that case because the stepchildren were "quite young" when they became part of the deceased's household in which they remained for some years. The relationships continued after the stepchildren left his home. However, Cohen J considered it significant that the strongest relationship (between the stepdaughter and the deceased) was "one more of general friendliness than of the love and affection which might have been established between the testator and one of his children". This was a factor which enabled his Honour to conclude that the testator did not need to place her at the same level as his own children.[55]
89 Re Fulop (deceased)[56] was another such case concerning an application made by a stepson under the New South Wales legislation. The plaintiff's mother had died when he was four years of age, after which his father married the deceased. The deceased did not work. However, the plaintiff and his father both worked and supported the deceased, until the plaintiff left home at the age of 18. McLelland J found that there were factors warranting the making of an order for provision for the plaintiff, saying:[57]
In the case of Mr Fulop the main factor is that from an early age (about 4 years) he became a child of the family unit comprising the deceased and his father and remained so until he left home at 18 years of age in the normal course and thereafter the family relationship thus established was recognized on all sides as continuing as if Mr Fulop were a child of the deceased as well as his father.
There is an additional factor in Mr Fulop's case, namely that on the evidence it seems reasonably clear that the only substantial asset in the deceased's estate, her home at Wentworthville was acquired from funds derived to a substantial extent directly or indirectly from moneys earned by Mr Fulop's father. Mr Fulop derived no benefit from the estate of his father.
91 Accordingly, Mr Fulop was granted further provision, although its extent is not clear from the report.
92 In Victoria, McKenzie v Topp ("McKenzie")[59] was the first case to consider an application made by a step child under Part 1V, either under the pre-amended Act or in its amended form, where the natural parent of a step child had made a contribution to the estate of the deceased step parent. In an earlier case in Victoria, Henderson v Rowden,[60] Beach J dealt with a claim by a stepson for provision out of the estate of his stepmother, but in that case there was no evidence that the plaintiff's father made any financial contribution to the purchase of the property.
93 The claim in McKenzie was an application by a stepson against his stepmother's estate. The plaintiff's mother had died when he was aged six. At the age of 10, his father remarried. The plaintiff lived with his father and stepmother at her house for the next 20 years. The plaintiff's father died and left the stepmother his entire estate, which, in 1967, was worth about $12,500. This was approximately the value of the stepmother's house in which the family had been living at that time of the father's death. Thereafter, the plaintiff returned to live with the stepmother from time to time, at first paying board and ultimately moving into her home at her request to become her permanent carer, a role he undertook for about six years. Nettle J in speaking of their relationship said:[61]
Granted that the plaintiff was not the deceased's own child in that she did not bear him and granted that he did not come into her life until he was ten years old and she was thirty-eight, from then on until her death she was the only mother figure that he knew and in effect she was the only mother figure that he ever knew.
94 The contention advanced by the plaintiff as to the relevance of the his natural father's estate was analysed by Nettle J in McKenzie in the following terms:[62]
I turn therefore to the significance of the plaintiff's father's estate. Counsel for the plaintiff submitted that because the plaintiff's father left all of his estate to the deceased there arose a moral obligation or responsibility upon the deceased to continue the arrangements set in place in her latter years whereby the plaintiff was provided with accommodation. The argument was that where a man who has children from an earlier marriage leaves to his second wife the entirety of his estate, and thereby deprives the children of his first marriage of the provision which they might otherwise have expected, it falls to the second wife as a matter of moral responsibility to make adequate testamentary provision for those children. More specifically, it was said, because it is often the case that a husband cannot know with certainty the extent of the support that his widow will require, and in those circumstances it may be that anything less than the entire estate would be inadequate provision for the widow's proper maintenance and support, the children of the first marriage must forgo the provision which they might otherwise have received in order that their stepmother receive adequate provision. But if then later when the stepmother dies there is sufficient in her estate to make good some or all of the provision of which the stepchildren were earlier deprived, it is her responsibility to make it good.
The proposition is novel. It is only recently that the legislation was amended to allow stepchildren to make claims under Part IV[27] and so far nothing of this kind has been considered in any of the cases. There are a number of cases in New South Wales that have dealt with the entitlements of stepchildren, but they have been concerned with questions of whether stepchildren were sufficiently accepted as part of the testator's family to have a claim upon his bounty. In Henderson v Rowden Beach J dealt with a claim by a stepson for provision out of the estate of his stepmother, but in that case there was no evidence that the plaintiff's father made any financial contribution to the purchase of the property. Nor is there anything analogous in the decided cases to serve as much guidance. The question only arises because of the way in which the class of possible plaintiffs is now defined in Part IV: in terms of people to whom the testatrix had responsibility to make provision. It does not arise under other States' legislation in which the class of plaintiffs is exhaustively defined in terms of relationships. [Citations omitted]
95 Nettle J was appropriately cautious in his approach. In determining the two threshold questions required by the legislation to be considered under s.91 (before any question arises as to the amount of provision (if any) which the Court should order in favour of an applicant), his Honour considered that, if children of a first marriage have stood aside in order that their father might make adequate provision for the widow of a second marriage, and upon her death there are assets in her estate, the amount left by their father to the widow may be relevant to the question of whether she is responsible to provide for them. In taking this approach, it was clearly not intended by his Honour to lay down a rule of general application to be unswervingly applied in every such case. At most, and in the appropriate case, it may be treated as one of the matters Court considers relevant under s.91(4)(p) of the Act, along with all of the other matters to which the Court must have regard under s.91(4)(e) to (p). Nettle J expressed the matter in the following way:[63]
Be that as it may, however, it appears to me that the proposition should be accepted, up to a point. For just as community attitudes are the touchstone of adequate provision, so too are they the criterion of responsibility to provide. Other things being equal, right thinking members of society are likely to accept that the needs of the widow of a second marriage should rank in priority ahead of the claims of the children of a first marriage; although of course it is always a question of fact. But equally, upon the death of the widow, and as it were in the event of a surplus, most would surely say that the children of the first marriage should rank for their fair share. For once the widow is gone, and therefore no longer in need of provision, her needs no longer warrant that the children rank behind her or thus her chosen successors.
Of course that is to speak in terms of broad generality and upon the assumption not only of an estate of sufficient value to provide for the children of the first marriage but also of a need for their provision. Furthermore, although the question for present purposes is confined to the first or jurisdictional aspect of the inquiry - of whether children of the first marriage may be regarded as persons for whom the widow of the second marriage has a responsibility to provide - the size of the estate and the circumstances of the children may be critical to the answer. But the need to look forward to the second stage of the inquiry in order to complete the first is endemic to most of the considerations listed in s. 91(4). It is the consequence of defining the class of eligible plaintiffs in terms of persons for whom a testator or testatrix has a responsibility to provide. The first stage of the inquiry is now informed as much by the answer to be given to the second stage as the second stage will be informed by the answer that is given to the first. But there are still two stages.
That said, the point of principle for present purposes is one of modest proportions. If children of a first marriage have stood aside in order that their father might make adequate provision for the widow of a second marriage, and upon her death there are assets in her estate, the amount left by their father to the widow maybe relevant to the question of whether she is responsible to provide for them.
96 The approach discussed by Nettle J was applied in McKenzie in the following context: the plaintiff's father had left the stepmother an amount of money that would then have been sufficient to purchase the house which, many years later, formed the bulk of her estate, its value at death being between $650,000 and $700,000; the plaintiff was aged 67, in receipt of an old aged pension and had no substantial assets except a car. In all of those circumstances, Nettle J made provision for the plaintiff in the amount of $275,000, being the cost of purchasing a home for him.
97 McKenzie was cited in two Victorian cases which followed: James v Day ("James"),[64] and Keets v Marks ("Keets")[65]. However, in my opinion, the approach taken in both cases was not faithful to the principle as it was stated by Nettle J in McKenzie. In James, the approach taken by the trial Judge appeared to be shaped by treating the natural parent's contribution as if it was the only factor justifying provision to the step child, rather than simply comprising one of the relevant factors. In Keets, the trial Judge appears to have also approached McKenzie as if it was something of a formula to justify the return of the value of the natural parent's contributions to her son, the plaintiff.
98 In my opinion, the approach taken in a later Victorian case, Peterson & anor v Micevski ("Peterson"),[66] is to be preferred. In Peterson, Hansen J considered the position where a father of four adopted daughters made an inter vivos gift of the proceeds of sale of his house to one of them, who used the money to buy land and build a home in which they then both lived together until the father died. The daughter then died shortly afterwards, leaving the property to only one of her sisters. The other two sisters claimed against her estate. In dismissing the claim, Hansen J issued the following caution, after observing the distinguishing features of McKenzie, James and Keets from the case then before his Honour:[67]
... it is to be noted that even if the limited principle stated by Nettle J applied, the result is that the amount left by the father to the widow "may" be relevant to the question of whether the stepmother was responsible to provide for the children. As his Honour made clear, it was a factor to be considered along with facts pertaining to the relationship between the plaintiff and the testatrix and whether the plaintiff had a need for provision. In the particular circumstances Nettle J concluded that the plaintiff had established both that he had given the testatrix assistance worthy of recognition and that he had a need for maintenance and support.
...
A matter to be noted about counsel's recast formulation is that the consequence of a responsibility to make provision follows automatically on the establishment of the factual premises. That was not the approach of Nettle J, nor could it be, bearing in mind the factual nature of the inquiry under s 91.
99 The Plaintiffs submit that this case falls within what they loosely referred to as the "stepchildren category" of cases, which consist of the line of authority of the decisions to which I have already referred, namely McKenzie v Topp, [68] James v Day [69], and Keets v Marks. [70] They say the principle is that, in situations where a person dies and leaves all their estate to their spouse, a right thinking spouse, if the person inherits significant assets from the deceased spouse either through a will or through the rules of survivorship, ought take into consideration in making his or her own will what claims may have been upon their deceased spouse's assets.
100 The Defendant contends, on the other hand, that in this case that the relationship between all Plaintiffs and the deceased is completely different to that seen in McKenzie v Topp. Accordingly, it was submitted, even though there was a joint asset that passed to Franc from Helena:
101 I turn to the specified matters to which I am required to have regard, by reference to the statutory sub-paragraphs designated in s.91(4)((e) to (p) of the Act.
(e) Any family or other relationship between the deceased person and the applicant, including the nature of the relationship and, where relevant, the length of the relationship.
102 This is an important consideration in this case. The Plaintiffs are the step children of the deceased.
(a) The Plaintiffs were quite young when they first met their step father, Franc Pozvek. Irene was aged 14 years and Louis and John were aged 13 years when Louis and John came to live with their stepfather and their mother for approximately 8 months in 1963;
(b) However, apart for the 8 month period when the two boys became part of the deceased's household, none of the Plaintiffs resided with their step father. In fact, all took up residence in or around Adelaide, while their stepfather resided in Melbourne with their natural mother;
(c) Nevertheless, I am satisfied that all three Plaintiffs enjoyed a relationship of ongoing friendship with and affection for their stepfather. Although Franc Pozvek lived in Melbourne and never travelled to Adelaide, the Plaintiffs visited him, albeit intermittently, over the years on most occasions when they came to Melbourne. They maintained contact with him by cards and letters on special occasions like birthdays, Christmas, Easter and on Mothers and Fathers Days, and by telephone.
(d) Franc invited his step children to call him "Dad" or "Pop", which they did. I take this to be evidence of Franc extending to the Plaintiffs recognition of a familial bond.
(e) However, although they kept in contact with him, the Plaintiffs did not attend to their stepfather in his old age when he was infirm and in need of assistance following the death of his wife, Helena, the natural mother of the Plaintiffs.
(f) Further, following the death of their mother, the testator did not feature in the lives of the Plaintiffs to the same extent as he had while she was alive, especially in the case of Louis and John.
(e) However, I am not in a position, on the evidence available to me, to distinguish between the relationships of any of the Plaintiffs with their stepfather in any material way.
(f) Any obligations or responsibilities of the deceased person to the applicant, any other applicant and the beneficiaries of the estate.
(a) In my view, Franc owed no special obligation to the Plaintiffs beyond that which any parent owes to an adult child. He had no children of his own to whom he owed any responsibility.
(b) The youngest step daughter, Marianne made an earlier claim for provision from the estate under Part 1V. A settlement of her claim was achieved by terms of settlement dated 24 July 2009, which resulted in an obligation to pay her a capital sum of $220,000. There were insufficient funds in the estate to make the settlement payment. The executor (the Defendant) paid the outstanding sum from his own funds in an amount of $54,024. Legal fees on Marianne's claim remain to be resolved. Marianne is presently claiming the sum of $70,367 for legal fees from the estate.
(c) I am satisfied that the position of Marianne was quite different to that of the Plaintiffs. She was brought up by her mother and stepfather and was effectively a daughter of the deceased since 1957.
(d) I accept that the Defendant, Mr Koska, did provide assistance to his friend the deceased of a generous kind over the long period of his infirmity in the later years of his life. However, I do not conclude that as a result, Franc had any responsibility to make adequate provision in his will for the proper maintenance and support of Mr Koska, although, in the exercise of his testamentary freedom, the deceased was perfectly entitled to confer a generous benefit upon him.
(e) There is therefore no competing moral claim from any family member or other person to the bounty of the testator in this case.
g) The size and nature of the estate of the deceased person and any charges or liabilities to which the estate is subject.
(a) This is a relatively modest estate. The principal asset of the estate is represented by the former family home of the deceased, which I accept has a value of $730,000.
(b) At the time of the death of the deceased, the estate had cash deposits in two banks totalling $232,000.
(c) Taking into account current liabilities, I accept that the present value of the estate for the purposes of making the assessment I am required to undertake, is $484,000.
(h) The financial resources (including earning capacity) and the financial needs of the applicant, of any other applicant and of any beneficiary of the estate at the time of the hearing and for the foreseeable future.
(a) The financial circumstances of the Plaintiffs have already been described. The Second Plaintiff, Louis is relatively comfortable in financial terms, but is not wealthy. The other two Plaintiffs are not well off, but they are not poor.
(b) I proceed on the basis that none of the Plaintiffs are in any precarious or immediate financial need.
(i) Any physical, mental or intellectual disability of any applicant or any beneficiary of the estate.
(a) In 1997, Irene suffered a heart attack and was diagnosed with type 2 diabetes. In the absence of any further evidence on the matter, I infer that the diabetes is a permanent condition.
(b) John suffers from various health problems including Ischemic heart disease, chronic anxiety, depression, and neck and back problems caused by a motor traffic accident in 1986 and injuries suffered at work in 1990 and 1993.
(c) The Plaintiffs all suffered a deprived childhood, surviving in orphanages between 1955 to 1958 and then in foster care, to 1961 in the case of Irene, and to 1963 in the case of Louis and John. In 1955 Irene was aged 8 years, and Louis and John were aged 5 years. In 1961 Irene was aged 14 years, and Louis and John were aged 11 years. In foster care the children were moved between numerous foster parents. They suffered from neglect and a degree of abuse in the orphanages and under foster care. Their early abandonment as children was bound to have left them with enduring emotional scars which linger to this day.
(d) In relation to Louis, there is no material before me in relation to his health and I proceed on the basis that his health is good and that he does not suffer from any relevant disabilities, apart from the residual emotional difficulties which I have described.
(a) Irene is 63 years of age.
(b) Louis is 60 years of age.
(c) John is 60 years of age.
(k) Any contribution (not for adequate consideration) of the applicant to building up the estate or to the welfare of the deceased or the family of the deceased.
(l) Any benefits previously given by the deceased person to any applicant or to any beneficiary.
110 The Plaintiffs did receive some modest benefits from the deceased during his life time. Although these were provided by both the Plaintiffs' mother, Helena, and Franc, I regard them as joint gifts. As I have already found, in the early 1980's Louis and John each received $3,000, and in the early 1990's Irene received a total of $7,000.
(m) Whether the applicant was being maintained by the deceased person before that person's death either wholly or partly and, where the Court considers it relevant, the extent to which and the basis upon which the deceased has assumed that responsibility.
111 None of the Plaintiffs were being maintained by the deceased.
(n) The liability of any other person to maintain the applicant.
(o) The character and conduct of the applicant or any other person.
113 I find that Irene, Louis and John were persons of good character and exhibited no conduct which could be taken to adversely affect any entitlement to an order in their favour from the estate of the deceased.
(p) Any other matter the Court considers relevant.
114 The other matter which I do consider to be relevant relates to the amount left by the natural mother of the Plaintiffs to their stepfather. On this issue I make the following findings:
(a) Upon the death of Helena, virtually all her estate went to the deceased, Franc Pozvek. No portion of her estate of any significance was paid out to any of the Plaintiffs. Upon his death, there being assets in his estate, the amount left by the Plaintiffs' mother to her husband is relevant to the question as to whether he had a responsibility to provide for them.
(b) The Plaintiff's mother, Helena, died on 8 January 2001. Subject to a relatively small amount of cash, the only evidence before the Court as to the contents and value of her estate immediately prior to her death was her interest in the Glen Waverley property which she owned together with her surviving spouse, Franc. It appears that prior to Helena's death, in about 2000, Helena and Franc had sold their two investment properties in Glen Waverley. [71]
(c) As to cash, there was evidence that each of the Plaintiffs received a gift of $5,000 shortly after their mother's death, which they understood at the time to be a distribution from her estate.[72]
(d) Irene said in her evidence that: "The property at View Point Road, Glen Waverley was owned by my mother and stepfather jointly."[73] There being no other evidence, I accept that she held her interest as a joint tenant with her former husband. This being the case, upon her death her interest was extinguished, it passed by operation of law to Franc and could not be bequeathed or disposed of by her in her will. This raises a point of distiction with McKenzie v Topp. In this case Helana's joint tenancy interest in the property could not have comprised part of her estate upon her death, because it passed automatically to her husband Franc by the rules of survivorship. This was not therefore a case, as in McKenzie, where a child or children of a first marriage stood aside in order that their natural parent might make adequate provision for the widower of the second marriage in a will, and gain moral advantage thereby.
(e) However, in the circumstances of this case, I do not consider that the point of distinction makes any material difference to the outcome. It is to be noted that this point was not a factor considered relevant by Cummins J in James v Day in determining that a testatrix, who had been provided for by her husband, the father of the plaintiffs, by joint ownership of the real property which passed to her through survivorship, assumed a moral responsibility to provide for her step children upon her death. The source of the moral responsibility in that case emanated not from the plaintiffs refraining from making a claim upon the death of their parent because they did not wish to disturb the step parent's last years, but rather from the increment in the deceased's financial position achieved upon the death of the spouse, which included gaining sole ownership of the major asset of the marriage, the real property in the matrtimonial home, by the step parent's survivorship and extinguishment of the joint tenant's interest.
(f) On this issue, I take a similar approach to that taken in James v Day.
(g) Although I accept the submission of the Defendant that prior to the marriage of Franc and Helena in 1958, the deceased brought a property into the relationship, namely the Pascoe Vale property, while Helena at that time contributed no real estate, there is evidence from which I infer that Helena contributed to the purchase of property during the marriage, including the Glen Waverley property. They purchased this property as vacant land in 1965, seven years after their marriage. Their marriage lasted 44 years. They bought and sold a number of properties together during their life as a married couple. Helena worked during her marriage to Franc and contributed to the purchase of properties which they acquired together.[74] Helena also helped Franc with the renovation of properties they purchased together.[75] Franc and Helena built their own home on the Glen Waverley property which they then occupied it as their matrimonial home for the rest of their lives together.[76] The property was acquired early in their long marriage and became their jointly owned property as a matter of law.
(h) Accordingly, I accept that Helena, during her marriage to Franc, contributed significantly to the purchase, development and maintenance of the Glen Waverley property. For the purpose of considering this element, I find that Helena's contribution to the asset wealth of Franc amounted to not less than one half of the value of the matrimonial home at 35 View Point Road, Glen Waverley.
Whether or not the Deceased had Responsibility to Make Provision for the Plaintiffs
115 On the question as to whether deceased had responsibility to make provision for the Plaintiffs, after having regard to the matters mentioned in ss.91(e) to (p) of the Act and the facts in relation to each of the matters to which I have referred, I consider that a wise and just testator would have thought is his moral duty to make provision for each of them.
116 In this regard, although the Plaintiffs did not enjoy regular contact with their stepfather, they did maintain family ties with him. Of particular relevance in this case is the value of the property which passed from the Plaintiffs' natural mother to the stepfather of the Plaintiffs upon her death, consisting of her half interest in the Glen Waverley property.
117 Accordingly, I am satisfied that each of the Plaintiffs are persons for whom the testator had a responsibility to make provision in his Will for their proper maintenance and support.
Whether or not the Distribution of the Estate of the Deceased Made Adequate Provision for the Proper Maintenance and Support of the Plaintiffs
118 On the question as to whether the deceased made adequate provision for the Plaintiffs, after having regard to the matters mentioned in ss.91 (4) (e) to (p) of the Act and the facts in relation to each of the matters to which I have referred, I am satisfied that the testator did not make adequate provision in his will for the proper maintenance and support of each of the Plaintiffs.
119 In this regard I place particular weight on the value of the estate, after payment of the settled amount to youngest step daughter, Marianne, the means and financial resources of each of the Plaintiffs and the fact that there is no other remaining family member or other person to whom the testator owed any moral duty in making provision in his Will.
The Amount of the Provision (if any) which the Court Should Order for the Plaintiffs
120 Section 91 of the Act confers wide power to make such order as is thought fit in all the circumstances of the case. It is plain, however, as Nettle J observed in McKenzie v Topp,[77] that the discretion is not untrammelled or to be exercised according to idiosyncratic notions of what is thought to be fair or in such a way as to transgress unnecessarily upon the testatrix's freedom of testation, but rather carefully and conservatively according to current community perceptions of the provision which would be made by a wise and just testatrix.
121 It is important to recall, as Fullagar J said as long ago as 1948 in Re Sinnott,[78] that no two cases in this area will be exactly alike: "In each the immediate and probable need and the extent of the moral claim must be carefully weighed".
122 In determining the question as to the amount of provision (if any) which the Court should order for the Plaintiffs, after having regard to the matters mentioned under ss.91(4)(e) to (p) of the Act and the facts relevant to each issue, I approach the task with these principles in mind.
123 In relation to the First Plaintiff, Irene Robertson, provision should be made out of the estate of Franc Pozvek pursuant to s.91(1) of the Act in the sum of $55,000.
124 In relation to the Second Plaintiff, Louis Przybyla, provision should be made out of the estate of Franc Pozvek pursuant to s.91(1) of the Act in the sum of $55,000.
125 In relation to the Third Plaintiff, John Przybyla, provision should be made out of the estate of Franc Pozvek pursuant to s.91(1) of the Act in the sum of $55,000.
126 I will make the following order to give effect to my findings:
There be provision made out of the estate of Franc Pozvek in favour of the Plaintiffs by way of a lump sum payment to each of them in the amount of $55,000.
[2] Affidavit of Irene Robertson dated 13 May 2008, paragraph 10.
[3] Ibid paragraph 15. Sonia Ivezic contests this statement in her affidavit dated 27 October 2008, paragraph 11(a).
[4] Affidavit of Irene Robertson dated 13 May 2008, paragraph 19; Affidavit of John Przybyla dated 12 May 2008, paragraph 4; Affidavit of Louis Przybyla dated 13 May 2008, paragraph 4.
[5] Affidavit of Irene Robertson dated 13 May 2008, paragraph 22.
[6] Affidavit of Irene Robertson dated 13 May 2008, paragraph 26. Sonia Ivezic contests this statement in her affidavit dated 27 October 2008, paragraph 11(d).
[7] Affidavit of Irene Robertson dated 13 May 2008, paragraph 27.
[8] Ibid paragraph 28. This statement is contested by Sonia Ivezic in her affidavit dated 27 October 2008, paragraph 11(f).
[10] Affidavit of John Przybyla dated 12 May 2008, Paragraph 7.
[11] Affidavit in Reply of Louis Przybyla dated 25 January 2010 paragraph 2(c).
[12] Affidavit of John Przybyla dated 12 May 2008, paragraph 8.
[13] Affidavit of Irene Robertson dated 13 May 2008, paragraphs 35 and 36.
[14] Affidavit of Irene Robertson dated 13 May 2008, paragraph 40.
[15] Affidavit of John Przybyla dated 12 May 2008, paragraph 11.
[16] Affidavit of Louis Przybyla dated 13 May 2008, paragraph 10. Sonia Ivezic contests this statement in her affidavit dated 27 October 2008, paragraph 12(b) stating, "Franc told me that Franc and Louis had an altercation and that Louis had tried to hit Franc. He said to me that following that episode he insisted that Louis leave his home".
[17] Affidavit of John Przybyla dated 12 May 2008,paragraph 20.
[18] Affidavit of Louis Przybyla dated 13 May 2008, paragraph 14.
[20] Affidavit of Louis Przybyla dated 12 May 2008, paragraph 13.
[21] Affidavit of Irene Robertson dated 13 May 2008, paragraph 42.
[22] Affidavit of Irene Robertson dated 13 May 2008, paragraph 47.
[23] Affidavit of Irene Robertson dated 13 May 2008, paragraph 49.
[24] Affidavit of Irene Przybyla dated 13 May 2008 paragraph 50. Sonia Ivezic contests this level of contact in her affidavit dated 27 October 2008, paragraph 11(p).
[25] Affidavit of John Przybyla dated 12 May 2008 paragraph 28.
[26] Affidavit of Zeljko Koska dated 27 October 2008 paragraph 57.
[27] Affidavit of Zeljko Koska dated 11 February 2010, paragraph 4.
[28] Affidavit of Zeljko Koska dated 27 October 2008 paragraph 54.
[29] Affidavit of Zeljko Koska dated 11 February 2010, paragraphs 4 and 5.
[30] Affidavit of Zeljko Koska dated 27 October 2008, paragraph 4.
[31] Affidavit of Zeljko Koska dated 27 October 2008, paragraph 5.
[32] Affidavit of Zeljko Koska dated 27 October 2008, paragraphs 9-15.
[33] Affidavit of Zeljko Koska dated 27 October 2008, paragraph 16.
[34] Affidavit of Zeljko Koska dated 27 October 2008 paragraph 17.
[35] Affidavit of Irene Robertson sworn 17 February 2010, paragraphs 3-8.
[36] Affidavit of Louis Przybyla dated 17 February 2010 paragraphs 3-7.
[37] Affidavit of John Przybyla dated 12 May 2008 paragraphs 22-23.
[38] Affidavit of John Przybyla dated 17 February 2010, paragraphs 3-5.
[39] Affidavit of Irene Robertson dated 13 May 2008, paragraph 22; Affidavit of Louis Przybyla dated 13 May 2008, paragraph 22; Affidavit of John Przybyla dated 12 May 2008, paragraph 31.
[40] [2008] VSC 18 at [44] - [49].
[43] [1997] 2 VR 359 at 363.
[47] [2005] VSCA 127; (2005) 11 VR 270 at [7], [9], [53] and 57].
[50] [1938] AC 463 at 476.
[51] [2005] HCA 11; 221 CLR 191 at [12].
[52] [1960] HCA 73; 104 CLR 124 at 135.
[53] Unreported decision of NSWSC, BC 8701578, 20 February 1987 per Cohen J.
[57] Re Fulop (deceased) (1987) 8 NSWLR 679 at 683 per McLelland J.
[71] Affidavit of Irene Robertson dated 13 May 2008, paragraph 48.
[72] Affidavit of Irene Robertson dated 13 May 2008, paragraph 49.
[73] Affidavit of Irene Robertson dated 13 May 2008, paragraph 58.
[74] Affidavit of Irene Robertson dated 13 May 2008, paragraph 29; Affidavit of Zeljko Koska dated 27 October 2008, paragraph 6.
[75] Affidavit of Zeljko Koska dated 27 October 2008, paragraph 6.
[76] Affidavit of Irene Robertson dated 13 May 2008, paragraph 37.
[78] [1948] VicLawRp 48; [1948] VLR 279 at 281.
Roberston & Ors
Koska [2010] VSC 134
(1962) 107 CLR 9
(2003) 11 VR 95
(2005) 11 VR 270
(1987) 8 NSWLR 679