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[2018] VSCA 342
General information, not legal advice.
Court of Appeal (Vic)
2018-12-12
Priest JA, Tate JA
Original judgment source is linked above.
PRACTICE AND PROCEDURE - Appeal - Application for summary judgment refused - Remnants of Originating Motion - Application for a grant of representation ad litem -Whether deceased died with valid will or intestate is a live issue - Hearing required -Lysaght Building Solutions Pty Ltd v Banalko Pty Ltd [2013] VSCA 158; (2013) 42 VR 27; Nolan v Nolan [2004] VSCA 109 considered - Civil Procedure Act s 62; Administration and Probate Act 1958 s 15.
LIMITATION OF ACTIONS - Appeal - When rights in an intestate taker accrue - Whether respondent, if intestate taker, statute barred by Limitation of Actions Act s 22 - Whether time accrues when there has been no commencement of the administration of the estate - Re Loftus (deceased) [2006] EWCA Civ 1124; [2007] 1 WLR 591; [2006] 4 All ER 1110 considered.
1 I have had the advantage of reading in draft form the reasons of Priest JA. However, I consider that leave to appeal ought be granted but the appeal dismissed.[1] Given the extensive reasons of Priest JA, I can briefly sketch my own observations.
2 Kimlarn Simmons ('the wife') died in a car accident on 1 January 1986. Under her Will dated 6 January 1985 the wife left 'all monies and possessions' to the respondent, Peter Simmons ('the husband'). In the event of the husband dying before the date of distribution, the wife left her estate in equal shares to their two children (Jeremy Simmons and Georgia Simmons) to be kept in trust until they reached the age of 21 years. Two of the wife's sisters, Jacquelyn Ross and Christine Deveson, were named as executors. It appears that Jacquelyn accepted the office of executor of the wife's Will but Christine did not.
3 More than thirty years later, the husband, as the residuary beneficiary of the estate of the wife, brought an Originating Motion, filed on 28 September 2017, against Jacquelyn Ross, as executor of the wife's estate, and others,[2] to bring what was described as 'the Will' into court for a grant of representation to be made, pursuant to s 15 of the Administration and Probate Act 1958.[3]
The husband sought, upon 'the Will' being brought into Court, either for probate to be granted to Jacquelyn Ross as the named executor or a grant of letters of administration (with 'the Will' annexed) to be made to the husband 'as the person with the greatest interest in the [wife's] estate'.[4] The Originating Motion accommodated the circumstance that Jacquelyn Ross might not have custody of 'the original Will' in which case the husband sought orders that the grant of letters of administration be made 'with the copy Will annexed' to Jacquelyn Ross as the named executor or to him.[5] By this proceeding, the husband sought for the estate to be administered by the calling back of the wife's shares in Edlyros Pty Ltd ('Edlyros') into her estate,[6] the shares having been transferred on 12 June 2008 to the wife's mother, Elizabeth Ross, 'contrary to the Will' of the wife.[7] This is one of two allegedly wrongful transfers of the wife's shares in Edlyros; that is, transfers made without authority. There is no allegation of fraud or dishonest concealment. The other allegedly wrongful transfer is the transfer of the shares on 12 April 2016 to Jacquelyn Ross, Christine Deveson and the wife's other sister, Shona Messer, under Elizabeth Ross's will.[8] If the shares could not be called back, the husband sought for the value of those shares to be repaid to the estate.[9]
4 In the Originating Motion, the husband sought orders that the administration of the estate be carried out by a transfer of the estate to him, 'as the true beneficiary of the estate'.[10]
5 It is difficult to escape the conclusion that the Originating Motion is premised upon the existence of a valid will, of which Jacquelyn Ross was alleged to have custody of the original or a copy. Indeed, this conclusion was not in contest on the appeal, the husband conceding that the Originating Motion is predicated on an assumption of a valid will.
6 Section 22 of the Limitations of Actions Act 1958 ('the Act') provides for a 15 year limitation period in respect of any claim to the personal estate of a deceased person from the date when the right to receive the interest accrued:
[N]o action in respect of any claim to the personal estate of a deceased person or to any share or interest in such estate, whether under a will or on intestacy, shall be brought after the expiration of fifteen years from the date when the right to receive the share or interest accrued.
7 Associate Justice Derham held that s 22 of the Act statute barred the claims of the husband based upon the Will:
If ... the Will is proved and Jacquelyn appointed executrix ... the plaintiff's claim to the ... shares is statute barred.[11]
8 As Priest JA observes, there has been no cross-appeal from this finding. It was thus not in contest on the appeal that the husband's claims made under the Will are statute barred because more than 15 years has expired since the date on which the husband acquired the right to receive his interest under the Will.[12]
9 If the Originating Motion contained no more than the husband's claims under the Will, I would consider that Derham AsJ was wrong to refuse to grant summary judgment in favour of Jacquelyn Ross and the other defendants as s 22 definitively bars the husband obtaining a remedy derived from the Will.
10 However, as Priest JA notes, the prospect that the wife may have died intestate arose during the course of the hearing before Derham AsJ; it did so in a spontaneous and sincere way, with no hint of concealment or duplicity. If the wife died intestate then the date on which the husband received an interest in his wife's estate may not yet have expired because it is arguable that no entitlement has yet accrued;[13] the interest arguably does not accrue until the formal appointment of an administrator.[14] It was not necessary for this Court to determine the issue because it was common ground between the parties that any claim based on the wife's intestacy would need to be brought in a separate proceeding.[15] This would require a fresh proceeding and could not be accommodated as an amendment to the Originating Motion.
11 On the appeal, senior counsel for the husband appeared to concede that, on the basis of the Originating Motion as filed, summary judgment was inevitable 'with one exception'. The inevitability arose because, if the will was valid, the proceeding was statute barred. If the will was invalid, and the wife died intestate, a separate proceeding would have to be commenced. The proceeding commenced by the Originating Motion would not assist. The 'exception' was submitted to lie in what was described as the 'remnants' of the proceeding brought by way of the Originating Motion. These remnants of the proceeding brought by the Originating Motion consist of the allegation, made in the alternative, at [11], that the husband:
seeks a grant of representation ad litem for the purpose of:
(a) bringing proceedings on behalf of the estate to recover [the wife's] shares [in Edlyros] in to the estate ... ; [and]
(b) carrying out the administration of the estate.[16]
12 The allegation that remains alive on the Originating Motion is an application for a grant of letters of administration ad litem (for or concerning a law suit) which may be made by the court at large.
13 The accompanying prayer for relief, paragraph G, reads:
Alternatively, an order that the plaintiff be granted letters of administration ad litem of the estate of Kimlarn Simmons, so that the estate can be represented in proceedings seeking to recover the Deceased's 32 shares of Edlyros back into the estate, so that the estate can then be administered.[17]
14 In making grants of letters of administration ad litem, courts determine 'to grant administration to such persons as they [think] fit, and in such limited form as the circumstances of the particular case require[s]'.[18] The grant may be limited to doing such acts as are necessary to bring or defend an action.[19] Such a grant can be made whether there is an intestacy or not.
15 Here, if the husband were to be granted administration ad litem it would be for the limited purpose of representing the wife's estate in the proceeding and enforcing her rights with respect to the allegedly wrongful transfers of ownership of the Eldyros shares. This is reflected in [G] of the prayer for relief.
16 Senior counsel for the husband submitted to this Court that she anticipates that any proceeding based upon the wife's intestacy would be heard by the court 'together with the remnants of this proceeding', that is, the proceeding brought by Originating Motion. She accepted that, insofar as the Originating Motion was concerned, there would be a need for fresh affidavit material and the proceeding would have to be amended to give a proper foundation for the ad litem application.
17 In my view it is appropriate that the remnants of the proceeding brought by the Originating Motion be tried to determine if a grant of representation ad litem should be made in favour of the husband so that he may represent the wife's estate. This is to enable the determination of the claim that the wife's shares in Eldyros be recovered into the wife's personal estate by reason of the alleged wrongful transfers of ownership. I make no comment on whether the circumstances of this case warrant a grant of representation ad litem.
18 In those circumstances, I do not consider that Derham AsJ erred in not entering summary judgment in respect of the husband's proceeding as constituted. In my view, this Court cannot confidently conclude that the remnants of the Originating Motion proceeding has no real prospect of success.[20] The question of whether the husband should be granted administration ad litem, and what limits might be placed on the grant, are real questions that should be tried. [21]
19 I consider that it is appropriate that a grant of leave to appeal be given, although the appeal should be dismissed, because it cannot be said that the prospects
of the appeal succeeding were no more than fanciful.[22] This is especially so given that the husband had made no application to cross-appeal the finding that, insofar as the Originating Motion was premised upon the existence of a valid will, the proceeding is statute barred. It is fair to say that the focus of the husband's case on appeal has shifted considerably from the case sought to be made below, as senior counsel for the husband properly recognised. Nevertheless, the claim relied upon on the appeal had a basis within the Originating Motion and, as mentioned, I consider that it should not be summarily dismissed.
20 The applicants in this Court seek leave to appeal against orders made by Derham AsJ on 8 June 2018, refusing their application for summary judgment in a proceeding brought by the respondent. That proceeding principally is concerned with shares in a company, forming part of the respondent's deceased wife's estate.[23]
21 For the reasons that follow, I would refuse leave to appeal.
23 At the time that she died in a car accident on 1 January 1986, Kimlarn Simmons (for convenience, 'Kim'), then married to the respondent, Peter Simmons, was the beneficial owner of 32 shares in a family company, Edlyros Pty Ltd ('Edlyros').
24 The then directors of Edlyros were Kim's father, William Lyle Ross ('Lyle')
and her mother, Elizabeth Ross ('Betty'). Lyle and Betty had four daughters: Jacquelyn Ross ('Jacquelyn'), born 17 March 1956; Kim, born 6 December 1957; Christine Deveson, ('Christine'), born 14 December 1959; and Shona Messer ('Shona'), born 30 January 1965.
25 Betty and her four daughters owned all of the shares in Edlyros. After Kim's death, the annual return of Edlyros for the financial year ended 30 June 1986 recorded that the 'Estate of KE Simmons' held the 32 shares.
26 By her will, dated 6 January 1985, Kim left all her 'monies and possessions' to the respondent. The will has not, however, been the subject of a grant of probate. It seems that only a copy of her will has been located.
27 On 27 June 1986, Lyle asked the respondent to sign a document. He did so. The document was addressed to the directors of Edlyros, and requested the transfer of 'the right title and interest in any shares, assets or dividends' in Edlyros due to Kim to their children, Jeremy Simmons and Georgia Simmons. The respondent was seriously injured in the car accident that claimed Kim's life. He was still affected by his injuries at the time that he signed.
28 Two of Kim's sisters, Jacquelyn and Christine, were named as executors in Kim's will. By her actions, it would appear Jacquelyn accepted office as executor of Kim's will and estate, but it would also appear that Christine did not.
29 On 23 December 1986, Jacquelyn, as transferor, executed a share transfer of the 32 Edlyros shares in favour of her mother, Betty. She signed the transfer, 'Jacquelyn Anne Ross, Executor of the estate of Kimlarn Elizabeth Simmons'. Lyle filled out the transfer, and Betty signed as transferee. The transfer, however, was not registered.
30 Edlyros' annual returns between 1987 and 1992 recorded that the 32 shares continued to be held for the 'Estate of KE Simmons'. In the 1993 and 1994 financial years, the shares were held with the designation, 'KE Simmons (Estate) - Executor Jacquelyn Anne Ross'; and in the 1995 to 1999 financial years, the shares were held in the name, 'Executor Jacquelyn Anne Ross for KE Simmons Estate'. For the 2001 and 2002 financial years, the estate's shares were recorded as being non-beneficially owned by Jacquelyn; and the 2008 annual company statement once more recorded the estate's shares as being non-beneficially owned by Jacquelyn.[24] Edlyros' register of members recorded that up to 12 June 2008 'Jacquelyn Anne Ross for the estate of K E Simmons' held the 32 shares, at which time they were transferred to Betty.
31 Lyle died on 14 October 2003. On 2 January 2007, probate of his will was granted to his wife, Betty.
32 In June 2008, Edlyros' accountant raised a question about the 32 shares that Jacquelyn owned non-beneficially. Following the accountant's consideration of documents he held on file, he obtained instructions from Betty to transfer the 32 shares to her. (A record of instruction stated that the transfer 'should have been done on 23/12/86'.) By a transfer dated 18 June 2008, Jacquelyn, as executor of Kim's estate, transferred the 32 shares to Betty.
33 Betty died on 10 April 2015. Later that year, on 9 October 2015, probate of Betty's will was granted to Jacquelyn, Christine and Shona. Six months later, on 12 April 2016, Betty's Edlyros shares were distributed to Jacquelyn, Christine and Shona in accordance with her will.
34 By an Originating Motion filed on 28 September 2017, the respondent, as plaintiff, sought relief relative to the Edlyros shares, naming Jacquelyn - as the executor of both Kim's and Betty's estates, and in her personal capacity - and Christine and Shona - as executors of Betty's estate, and in their personal capacities - as the defendants. The respondent sought orders pursuant to s 15 of the Administration and Probate Act 1958 ('the Act') that Jacquelyn prove or renounce Kim's Will, or that he be granted letters of administration with the Will annexed (and related relief). Essentially, the respondent's claim is that Kim's deceased estate included the 32 Edlyros shares, and that these shares were wrongfully transferred to Kim's mother, Betty, and thereafter under Betty's will to Jacquelyn, Christine and Shona. He claims that the 32 shares should be called into Kim's estate; or that Jacquelyn, Christine and Shona should disgorge the shares they received from Betty's estate and that the 32 shares (or their value) should be transferred (or paid) to him.
35 By a summons dated 8 March 2018, the defendants, Jacquelyn, Christine and Shona, sought a declaration that the claim that they (as beneficiaries of Betty's estate) disgorge the shares which formed part of Kim's estate is statute barred pursuant to s 22 of the Limitations of Actions Act 1958 ('the LAA'). They also sought an order pursuant to s 63 of the Civil Procedure Act 2010, that summary judgment be given in their favour; and, alternatively, an order pursuant to r 23.02 of the Supreme Court (General Civil Procedure) Rules 2015, that the respondent's originating motion be struck out.
36 Derham AsJ conveniently summarised his conclusions as follows:[25]
This is not an appropriate case in which to grant summary judgment in favour of the defendants because their contention that the [respondent's] claims are statute barred proceeds upon an assumption that Kim made a valid Will appointing Jacquelyn executrix. This is not known at this time. It will only be known if the Will is proved. It is only then that it can safely be concluded that, by the conduct of the Jacquelyn's assent, the [respondent] became entitled to the 32 shares in Edlyros, and that his cause of action accrued more than 15 years before the proceeding was commenced. If, contrary to this assumption, there is an intestacy and a grant of administration to Jacquelyn or the plaintiff, the entitlement to the 32 shares, if they fall into the Kim's estate, has not yet accrued.
If, on the other hand, the Will is proved and Jacquelyn appointed executrix, on the arguments advanced by the defendants and considered below, the [respondent's] claim to the 32 shares is statute barred.
37 The applicants seek leave to appeal against the primary judge's decision on four grounds as follows:
38 The applicants submitted that if the primary judge's decision is not set aside they will suffer substantial injustice, in that they will be required to defend a proceeding relevant to Kim's estate, she having died more than 30 years ago. They submitted that the putative appeal has real prospects of success.[26]
39 With respect to grounds 1 and 2, the applicants submitted that the respondent's claim initially was premised on the assumption that Kim left a valid will under which he was entitled to the shares in Edlyros. As so constituted, the proceeding cannot succeed because it is statute barred. It was only late in the piece that the respondent submitted that Kim may have died intestate having destroyed the original of her will with the intention of revoking it. Although it was accepted that the issue of possible revocation and intestacy had arisen in a 'spontaneous and sincere way during the course of the hearing' before the judge, that did not mean that there was a matter to be investigated, preventing the grant of summary judgment. It was submitted that the primary judge should not have permitted such a change in position. The originating motion cannot be amended to broaden the case to take in a situation of intestacy.
40 Counsel for the applicants submitted that a distinction needs to be drawn between a situation where a will is made during a testator's lifetime but cannot be found at the time of her death, and that where the will exists at the time of death but cannot be found at the time of the application for a grant of probate. In the former case, the presumption of revocation by destruction arises; but in the latter, the Court has power to admit secondary evidence of the will and make a grant in respect of the copied will.
41 Very importantly, so counsel submitted, the primary judge held that if it were assumed that there were a valid will, the respondent's claim is statute barred and should be summarily dismissed. Significantly, there is no cross-appeal by the respondent against that finding.
42 With respect to grounds 3 and 4, counsel submitted that the primary judge went on to hold that, if there is an intestacy, the respondent's claim will not be statute barred because there can have been no assent by the administrator until after the grant, as the title of administrator depends on the grant of letters of administration.[27] But, so counsel for the applicants submitted, even if it is a proper investigation to determine whether Kim died intestate or left a valid will, and whether the presumption of revocation by destruction is rebutted on the facts of the case, 'it takes the respondent nowhere' since, even were it ultimately to be determined that Kim died intestate, any claim that the respondent may have had to the Edlyros shares on intestacy is still barred by s 22 of the LAA.
43 The applicant's counsel argued that, if there were an intestacy, first, Jacquelyn became an executor de son tort under s 33 of the Act[28] (as then in force),[29] having obtained, received or held Kim's shares without full valuable consideration; secondly, as Kim's surviving spouse and intestate successor, the respondent had a right to recover his interest in the shares from Jacquelyn as an executor in her own wrong;[30] and, thirdly, it is clear that the respondent's entitlement against Jacquelyn under s 33 must have accrued more than fifteen years before he commenced his proceeding, since, Kim having died on 1 January 1986, it cannot be supposed that the respondent could not have claimed an entitlement to the shares from Jacquelyn as executor in her own wrong under s 33 prior to 2002.
44 So much was important, counsel submitted, because any proceeding to recover from an executor in her own wrong is caught by s 22 of the LAA. If the proceeding against the executor in her own wrong is statute barred, counsel submitted, so is any proceeding against people taking from the executor in her own wrong.[31] Section 22 of the LAA, it was submitted, is premised upon an entitlement having accrued, not upon a grant of administration having been made. Any proceeding in this case would not lie against an administrator - 'who will be some innocent ... appointed by the Court' - but be against Jacquelyn as the original executor de son tort. Any entitlement the respondent had to Kim's Edlyros shares therefore accrued more than fifteen years prior to the institution of this proceeding. Hence, summary judgment should have been entered in favour of the applicants.
45 Resisting any grant of leave to appeal, the respondent contended that the primary judge's decision is not attended with substantial injustice. An appellate court will be slow to intervene where a decision has permitted a proceeding which does not finally determine rights to continue.[32]
46 Counsel submitted that Jacquelyn swore an affidavit on 27 February 2018 in which she deposed that she had an envelope containing a copy of Kim's will, but did not know the whereabouts of the original. Up to that point, the respondent had no reason to believe that the applicants did not have Kim's original will. The uncertainty about the status of the will arose in the course of the hearing, and the applicants were afforded ample opportunity to address the issue.
47 Although the respondent's counsel acknowledged that the primary judge had found that, should there be a valid will in existence, any action was statute barred under s 22 - and conceded that the respondent had not brought a cross appeal against that finding - counsel did not accept that the applicants were thereby necessarily entitled to summary judgment. In that regard, counsel pointed out that the extant paragraph 'G' of the prayer for relief in the respondent's originating motion sought an order (among others) as follows:
G. Alternately [sic.], an order that the [respondent] be granted letters of administration ad litem of the estate of Kimlarn Simmons, so that the estate can be represented in proceedings seeking to recover the Deceased's 32 shares of Edlyros back into the estate, so that the estate can then be administered.
48 The respondent's counsel further accepted that, if there is to be an application based on intestacy, it is not a matter of amending the current proceeding, but of bringing a fresh proceeding to be heard together with the 'remnants' of the current proceeding. Her submission was that paragraph G permits the respondent to be granted letters of administration ad litem, which is a grant that can be made by the Court 'at large'. The prayer for relief, counsel submitted, is not predicated on the existence of a valid will. A grant of administration ad litem can be granted to any person, whether or not they are clothed with executorial authority.
49 Counsel for the respondent further submitted that a deceased's personal assets do not vest in the administrator until a grant is made. It must therefore follow that there are no rights in an intestate taker until that time (or until that time plus the time for administering the estate). Counsel's 'primary submission' was that, as a matter of law, since there has been no grant of administration, there is yet to be an administrator clothed with any authority to administer the estate. Since administration of Kim's estate has not been commenced or completed, no right to bring any action with respect to Kim's personal estate can have accrued.
50 It was also put by counsel that, 'as a matter of fact', a finding as to whether there has been the completion of any administration on an intestacy would require some analysis by the court of what 'actually happened', and that is not a task that has been undertaken. That, counsel argued, 'would be within the facts that comprised the very investigation that [Derham AsJ] was referring to'.
51 The failure to prove the copy will, counsel argued, was not irrelevant. If the copy will is capable of being propounded, the respondent is the sole beneficiary; but if it is not capable of being propounded, in the absence of another will, rights arise in the respondent and in the children, Jeremy and Georgia Simmons. In order for the respondent to receive an accrued right in Kim's estate, there needs first to be a grant of representation and then ascertainment of the residue to determine the entitlement of any person entitled in the intestacy.
52 Section 62 of the Civil Procedure Act 2010 ('the CPA') permits a defendant to apply for, and s 63 permits a court to grant, summary judgment in a civil proceeding if the plaintiff's claim (or part of it) has no real prospects of success:[33]
62 Defendant may apply for summary judgment in proceeding
A defendant in a civil proceeding may apply to the court for summary judgment in the proceeding on the ground that a plaintiff's claim or part of that claim has no real prospect of success.
53 In Lysaght Building Solutions Pty Ltd v Banalko Pty Ltd,[34] Warren CJ and Nettle JA made clear that the 'no real prospect of success' test under s 63 of the CPA should be construed as one of whether the respondent to the application for summary judgment has a 'real' as opposed to a 'fanciful' chance of success,[35] and observed:[36]
[I]t must be borne in mind that the power to terminate proceedings summarily should be exercised with caution and thus should not be exercised unless it is clear that there is no real question to be tried; and that is so regardless of whether the application for summary judgment is made on the basis that the pleadings fail to disclose a reasonable cause of action (and the defect cannot be cured by amendment) or on the basis that the action is frivolous or vexatious or an abuse of process or where the application is supported by evidence.
54 Even though a claim has no real prospects of success, however, a court may permit a proceeding to proceed to trial if satisfied that the proceeding should not be disposed of summarily because it is not in the interests of justice to do so, or the dispute is of such a nature that only a full hearing on the merits is appropriate. Thus, s 64 of the CPA provides:
64 Court may allow a matter to proceed to trial
Despite anything to the contrary in this Part or any rules of court, a court may order that a civil proceeding proceed to trial if the court is satisfied that, despite there being no real prospect of success the civil proceeding should not be disposed of summarily because -
(a) it is not in the interests of justice to do so; or
(b) the dispute is of such a nature that only a full hearing on the merits is appropriate.
55 Moreover, the High Court has made it plain that limitations questions should not be determined at an interlocutory stage except in the clearest of cases. Hence, in Wardley Australia Ltd v Western Australia,[37] a case where the High Court had before it a proceeding in which a statement of claim had been amended to plead a cause of action that the defendant asserted was statute barred, Mason CJ, Dawson, Gaudron and McHugh JJ observed:[38]
We should, however, state in the plainest of terms that we regard it as undesirable that limitation questions of the kind under consideration should be decided in interlocutory proceedings in advance of the hearing of the action, except in the clearest of cases. Generally speaking, in such proceedings, insufficient is known of the damage sustained by the plaintiff and of the circumstances in which it was sustained to justify a confident answer to the question. ...
56 As I have indicated, in the present case the applicants relied on s 22 of the LAA, which provides:
22 Actions claiming personal estate of a deceased person
Subject to the provisions of subsection (1) of the last preceding section[[39]] no action in respect of any claim to the personal estate of a deceased person or to any share or interest in such estate, whether under a will or on intestacy, shall be brought after the expiration of fifteen years from the date when the right to receive the share or interest accrued.
57 By its terms, s 22 prevents the bringing of any action in respect of any claim to the personal estate (or any share or interest in it) of a deceased person - whether the claim is made under a will or on intestacy - after the expiration of 15 years from the date when the right to receive the share or interest accrued.
58 As previously mentioned, counsel for the respondent accepted that, if there is a valid will in existence, then the respondent's action in respect of Kim's personal estate is barred by reason of s 22, since more than 15 years has elapsed since his right to any share or interest in the estate accrued. For their part, counsel for the applicants vigorously pressed the contention that the respondent's originating motion proceeded upon the assertion that there was a valid will. Indeed, so the applicants' counsel argued, the respondent had sworn that Kim had left a valid will. Thus, the applicants' counsel placed a deal of reliance on part of the respondent's affidavit in support of the originating motion, sworn 25 September 2017, as follows:
Kim left a will dated 6 January 1985 in which she left her whole estate to me. It appointed her sisters Jacqueline [sic.] and Christine as executors. I have a copy of that will in my possession, provided to my solicitors by the solicitors Arnold Bloch Leibler. I do not have the original, It appears to me that one of the Ross family has the original. ...
59 In my view, however, the above paragraph of the respondent's affidavit does not amount to an unequivocal statement of fact that Kim left a valid will. Rather, I consider that it simply reflects the respondent's understanding - given that he had only a copy - that Kim had left a will and that Kim's family held the original.
60 Moreover, as I have indicated, counsel for the applicants accepted that the issue of possible revocation - and thus possible intestacy - had arisen in a 'spontaneous and sincere way during the course of the hearing' before the primary judge. In that regard, Jacquelyn, in an affidavit sworn 27 February 2018, deposed that after her father died on 14 October 2003, she assisted her mother 'in assembling information about [his] estate'. She swore:
Among my father's papers was an envelope. Inside the envelope was a copy of my sister Kim's will. This was the first time I had seen a copy of Kim's will. I have never seen the original and do not know who has possession of it. ...
61 The original of the will - if it exists - has not been produced. Given the very cogent argument - apparently accepted by the respondent's counsel - that, should Kim have left a valid will at the time of her death, any action by the respondent based on the will would be statute barred, it is curious that the will - if it exists - has not been produced. Indeed, in such circumstances it might readily be inferred that the applicants do not know whether or not it still exists. Taken at her word, Jacquelyn, at the very least, has not sighted the original will and does not know who might have possession of it. In that regard, it will be remembered that counsel for the applicants submitted that where a will is made during a testator's lifetime but cannot be found at the time of her death, the presumption of revocation by destruction arises.[40]
62 In these circumstances, I consider that there is a live issue as to whether a valid will existed at the time Kim's death - thus probably defeating any action by the respondent against the testate estate - or whether Kim died intestate, her will presumed to have been revoked prior to her death. That issue is not suitable for resolution on an application for summary judgment. It is suitable for resolution only after a full hearing on the merits.
63 But that is not the end of the matter. As I have said, counsel for the applicants argued that the originating motion was not apt to seek any appropriate relief if Kim died intestate; and that, in any event, even if the evidence established that she did die intestate, any claim by the respondent for a share or interest in Kim's estate must also be barred by operation of s 22 of the LAA. Hence, the primary judge was wrong to refuse summary judgment.
65 Letters of administration ad litem may be made when it is necessary for a deceased's estate to be represented in legal proceedings and for some reason an executor (or next of kin) fails or refuses to take out a grant.[41] Although relief in the way of the appointment by an administrator ad litem was not at the forefront of the relief sought in the originating motion, it nonetheless partially formed the basis of the respondent's proceeding.
66 At the risk of repetition, the respondent argued that, since title to the personal estate does not vest in an administrator until the grant of letters of administration,[42] no rights vest in an intestate taker until that time (or until that time plus the time for administering the estate); and that, since administration of Kim's estate has not been commenced or completed, no right to bring action with respect to Kim's personal estate can have accrued. That being so, s 22 of the LAA can have no application. In my view, those arguments cannot be said wholly to lack merit.
67 Counsel for the respondent sought to draw some support for her position from Re Loftus (deceased).[43] In that case, the deceased died intestate in August 1990, and the first defendant was granted letters of administration in December 1991. On 20 January 2003, the claimants commenced proceedings seeking the removal of the first defendant as personal representative and the appointment of an independent solicitor in her place, and an account of the administration. Among other defences, the first defendant claimed the proceedings were statute barred by reason of s 22(a) of the Limitation Act 1980 (UK)[44] (which in its terms closely resembles s 22 of the LAA).[45] The trial judge decided, however, that the proceedings were not statute barred under s 22(a), holding that time did not begin to run until the end of the 'executor's year' provided by the Administration of Estates Act 1925 (UK) (under which a personal representative was not bound to distribute the estate of the deceased before the expiration of one year from the death). Chadwick LJ (with whom Thomas and Lloyd LJJ agreed) observed:[46]
As I have said, the better view is that the period under s 22(a) of the 1980 Act (in cases to which that section applies) will not begin to run until the administrator has paid the costs, funeral and testamentary and administration expenses, debts and other liabilities properly payable out of the assets in his hands, and provided for the payment of any pecuniary legacies. It is not until then that he is in a position to distribute the residuary estate to those entitled under s 46 of the Administration of Estates Act 1925; because it is not until then that 'the residuary estate of the intestate' can be identified - s 33(4) of that Act.[[47]] That is not, of course, to say that a beneficiary has no remedy against an administrator who delays in getting in the assets and paying the administration expenses and debts: it is only to say that, in such a case, time does not run against the beneficiary under s 22(a) of the Limitation Act 1980.
68 Neither the researches of counsel, nor my own, reveal that the views expressed by Chadwick LJ in Re Loftus (deceased) have been applied in any Australian jurisdiction.[48] Were they held to be sound, I consider that they would lend support to what the respondent's counsel characterised as her 'primary submission' of law that, in circumstances where there has been no grant of administration, no right to bring an action can have accrued. So much emphasises that it is difficult to conclude at this stage that the respondent's proceeding has no real prospects of success.
69 Further, based on the evidence currently available, I find myself unable to determine that the respondent's apparent secondary position - that a finding as to whether there has been the completion of any administration on intestacy would require some analysis of what in fact occurred (that being a task not yet undertaken) - has no real prospects of success.
70 As the foregoing discussion demonstrates, quite apart from the issue whether the respondent's proceeding has real prospects of success, there are difficult questions of fact and law thrown up by the dispute between the parties which are of such a nature that a full hearing on the merits is appropriate. In my view, it is in the interests of justice to permit those difficult questions to be determined at a trial.
71 For the sake of completeness, I should make it clear that I have not ignored the attractive arguments based on Nolan's case that were advanced by the applicants' counsel with respect to executors de son tort.[49] It is enough to observe at this stage, however, that Nolan's case did not involve an intestate estate. Against that background, it is far from clear that the opinions expressed by Ormiston JA with respect to executors in their own wrong would be found to be applicable in the case of an intestacy (should Kim ultimately be found to have died intestate).
72 In light of the above, the applicants have failed to demonstrate that the primary judge's decision was attended by error. The putative appeal thus has no real prospect of success.[50]
73 For these reasons, I would refuse leave to appeal.
74 I have had the considerable advantage of reading in draft form the reasons of Tate JA and the reasons of Priest JA. I agree with the reasons of Tate JA and with the 'ad litem'[51] element of the reasons of Priest JA. I would grant leave to appeal but dismiss the appeal.
75 In very short compass, my reasons for this conclusion are as follows:
(a) The Originating Motion was underpinned by the proposition that Kimlarn Simmons' will dated 6 January 1985 was valid and it, or a copy of it, was in the possession of Jacquelyn Ross, the named executrix to the will.
(b) If this indeed was the case, then the claims of the husband based upon the Will are statute barred.[52] No remedy derived from the will is available.
(c) There is a chance that the husband's claim may not be statute barred if, contrary to the asserted factual position, Kimlarn Simmons died intestate.[53] Assuming this to be the case, the husband's interest may
(arguably) not start to accrue until an administrator is appointed.
(d) If the husband's interest has not started to accrue, the proceeding commenced by the Originating Motion, predicated as it is on an accrued interest, cannot survive, save that the husband may be able to persist with claiming a grant of representation ad litem for the purposes of bringing proceedings on behalf of the estate to recover the wife's shares in Edlyros, and for carrying out the administration of the estate.
(e) A claim premised on Kimlarn Simmons' intestacy would be made in a separate proceeding brought under r 4.01 of the Supreme Court (Administration and Probate) Rules 2014.
(f) A grant of letters of administration ad litem could be made by the court that determines this Originating Motion. That court may grant administration ad litem to entitle the husband to represent his wife's estate in the proceedings to seek to enforce her rights relating to the impugned shares.
(g) It follows that there was no error on the part of Derham AsJ in declining to enter summary judgment. His Honour could only do so if he were satisfied that the Originating Motion had no real prospect of success.[54] In my view, there is some prospect of a successful outcome insofar as the 'ad litem'[55] component of the action is concerned.
76 I would grant leave to appeal but dismiss the appeal.
(as executor of the estate of Kimlarn Elizabeth Simmons)
JACQUELYN ANNE ROSS, CHRISTINE HELEN DEVESON AND SHONA MEREDITH MESSER
[1] For convenience, in what follows, I shall refer simply to 'the appeal'.
[2] The other defendants are Jacquelyn Ross, Christine Deveson and Shona Messer as executors of the estate of Elizabeth Ross, and each of them in their personal capacity.
[11] Simmons v Ross [2018] VSC 306 [6], [88]-[91] ('Reasons').
[12] That is, well before 27 September 2002 (15 years and one day before the husband commenced the proceeding).
[15] An application would need to be made under r 4.01 of the Supreme Court (Administration and Probate) Rules 2014 for a grant of administration of the estate of a deceased person upon intestacy.
[16] Originating Motion [11] (emphasis added).
[18] In the Estate of McGown [1947] VicLawRp 14; [1947] VLR 113, 118 (O'Bryan J); r 16.03 of the Supreme Court (General Civil Procedure) Rules 2015.
[19] Greenway v McKay [1911] HCA 25; (1911) 12 CLR 310, 315 (Griffith CJ) 319 (O'Connor J).
[21] Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd [2013] VSCA 158; (2013) 42 VR 27, 40 [35].
[22] Kennedy v Shire of Campaspe [2015] VSCA 47 [12].
[23] Simmons v Ross [2018] VSC 306 ('Reasons').
[24] Annual returns were abolished in 2003, and the Australian Securities and Investments Commission introduced a system of annual company statements.
[26] Citing Kennedy v Shire of Campaspe [2015] VSCA 47; Note Printing Australia Ltd v Leckenby [2015] VSCA 105; (2015) 50 VR 44, 71 [80].
[28] Section 33 provided (emphasis added):
33. Liability of person fraudulently obtaining or retaining estate of deceased
(1) If any person, to the defrauding of creditors or without full valuable consideration, obtains receives or holds the estate or any part of the estate of a deceased person or effects the release of any debt or liability due to the estate of the deceased, he shall be charged as executor in his own wrong to the extent of the estate received or coming to his hands, or the debt or liability released, after deducting any payment made by him which might properly be made by a personal representative.
(2) Where a person as personal representative of a deceased person (including an executor in his own wrong) wastes or converts to his own use any part of the estate of the deceased, and dies, his personal representative shall to the extent of the available assets of the defaulter be liable and chargeable in respect of such waste or conversion in the same manner as the defaulter would have been if living.
[30] Counsel relied on Nolan v Nolan [2004] VSCA 109, [43] (Ormiston JA) ('Nolan').
[31] Counsel cited Nolan, [46] and [48].
[32] Citing Deputy Commissioner of Taxation v Reading (1991) 22 ATR 251.
[33] Rule 23.02 of the Supreme Court (General Civil Procedure) Rules 2015 also permits a pleading to be struck out. It is in the following terms:
Where an indorsement of claim on a writ or originating motion or a pleading or any part of an indorsement of claim or pleading -
(a) does not disclose a cause of action or defence;
(c) may prejudice, embarrass or delay the fair trial of the proceeding; or
(d) is otherwise an abuse of the process of the Court -
the Court may order that the whole or part of the indorsement or pleading be struck out or amended.
63 Summary judgment if no real prospect of success
(1) Subject to section 64, a court may give summary judgment in any civil proceeding if satisfied that a claim, a defence or a counterclaim or part of the claim, defence or counterclaim, as the case requires, has no real prospect of success.
(2) A court may give summary judgment in any civil proceeding under subsection (1) -
(a) on the application of a plaintiff in a civil proceeding;
(b) on the application of a defendant in a civil proceeding;
(c) on the court's own motion, if satisfied that it is desirable to summarily dispose of the civil proceeding.
21 Limitation of actions in respect of trust property
(1) No period of limitation prescribed by this Act shall apply to an action by a beneficiary under a trust, being an action -
(a) in respect of any fraud or fraudulent breach of trust to which the trustee was a party or privy; or
(b) to recover from the trustee trust property or the proceeds thereof in the possession of the trustee, or previously received by the trustee and converted to his use.
[40] Counsel also submitted that, where a will exists at the time of death, but cannot be found at the time of the application for a grant of probate, the Court has power to admit secondary evidence of the will and make a grant in respect of the copied will.
[41] Rule 16.03 of the Supreme Court (General Civil Procedure) Rules 2015 provides:
(1) Where a deceased person was interested, or the estate of a deceased person is interested, in any question in a proceeding and the deceased person has no personal representative, the Court may -
(a) proceed in the absence of a person to represent the estate of the deceased; or
(b) by order (with the consent of the person appointed) appoint a person to represent the estate for the purpose of the proceeding.
(2) An order under paragraph (1), and any judgment or order subsequently given or made in the proceeding, shall bind the estate of the deceased person as it would had a personal representative of the deceased been a party.
(3) Before making an order under this Rule, the Court may require notice of the application for the order to be given to any person having an interest in the estate.
[42] With respect to real estate, see s 13 of the Act.
[43] [2006] EWCA Civ 1124; [2007] 1 WLR 591; [2006] 4 All ER 1110 (Chadwick, Thomas and Lloyd LJJ).
[44] Section 22 of the Limitation Act 1980 (UK) provided (so far as relevant):
(a) no action in respect of any claim to the personal estate of a deceased person or to any share or interest in any such estate (whether under a will or on intestacy) shall be brought after the expiration of twelve years from the date on which the right to receive the share or interest accrued; . . .
[46] [2006] EWCA Civ 1124; [2007] 1 WLR 591, 601 [28]; [2006] EWCA Civ 1124; [2006] 4 All ER 1110, 1120 [28] (citation not in the original).
[47] Compare s 70H of the Act (and s 38 as repealed by s 7 of the Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017.
[48] The case was cited (as Green v Gaul) with respect to an unrelated aspect, in Sze Tu v Lowe (2014) 89 NSWLR 317, 390 [414] (Gleeson CJ).
[50] Supreme Court Act 1986, s 14C. See also Metricon Homes Pty Ltd v Softley [2016] VSCA 60; (2016) 49 VR 746, 769-70 [68]; Kennedy v Shire of Campaspe [2015] VSCA 47, [13]; Secretary, Department of Justice and Regulation v Zhong [2017] VSCA 18, [4].
[52] Limitations of Actions Act 1958 s 22.
[53] There is some factual support for this proposition. See [11] above.
Ross
Simmons [2018] VSCA 342
(2013) 42 VR 27
(1911) 12 CLR 310
(2015) 50 VR 44
(1992) 175 CLR 514
(2014) 89 NSWLR 317
(2016) 49 VR 746