[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
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Judgment - ex tempore
EMMETT AJA: By notice of motion filed on 11 February 2016, Mr Waleed Sadiq asks the Court to restrain the respondent, NSW Trustee and Guardian (the Trustee), from selling an asset of the estate of the late Christina Coombes (the Deceased), consisting of a property situated in Paddington NSW (the Paddington Property). Mr Sadiq seeks that relief in aid of his notice of appeal filed on 1 July 2015. By the notice of appeal, Mr Sadiq appeals from orders made on 9 June 2015 by a judge of the Equity Division (the primary judge), by which the primary judge ordered that proceedings commenced by Mr Sadiq against the Trustee be dismissed.
The dispute between Mr Sadiq and the Trustee concerns the nature of the relationship, if indeed there ever was one, between the Deceased, on the one hand, and Mr Sadiq, on the other. Mr Sadiq sought a declaration that he was the spouse of the Deceased at the date of her death. He also sought consequential relief in the event that such a declaration was made. Alternatively, he sought a family provision order under Ch 3 of the Succession Act 2006 (NSW) in relation to the estate of the Deceased on the basis that he is an eligible person in relation to the estate.
The Deceased died intestate without issue on 13 June 2013. She had no spouse, other than Mr Sadiq, if Mr Sadiq is able to establish that he was indeed her spouse as claimed by him. Under s 104 of the Succession Act, spouse is defined as a person who is married to an intestate immediately before the intestate's death or who is a party to a domestic partnership with the intestate immediately before the intestate's death. Under s 105 of the Succession Act, a party to a domestic relationship includes a party to a de-facto relationship that has been in existence for a continuous period of two years or has resulted in the birth of a child. It is not suggested that Mr Sadiq was ever married to the Deceased or that any relationship between Mr Sadiq and the Deceased resulted in the birth of a child.
The question therefore, is whether Mr Sadiq and the Deceased were in a de-facto relationship that had been in existence for a continuous period of two years as at the date of the death of the Deceased. If that was so, then it appears to be common ground that, on intestacy, he would be entitled to the whole of the Deceased's estate. The alternative claim for a family provision order under the Succession Act only becomes relevant if his principal claim fails.
Mr Sadiq asserted that he is a person who was at some time wholly or partly dependent on the Deceased and was at the time of her death, or at some other time, a member of the household of which the Deceased was a member. In that respect he relies on s 57(1)(e) of the Succession Act. Alternatively, he relies on s 57(1)(f), on the basis that he was living in a close, personal relationship with the Deceased at the time of her death.
On 21 August 2013, the Supreme Court granted to the Trustee letters of administration in respect of the estate of the Deceased. The inventory of property attached to the letters of administration disclosed the Deceased's estate as having a gross value of $778,911, consisting of the Paddington, Property having a value of $700,000 and money on deposit in a bank or with a financial institution in the sum of $78,911.
The trustee disputes that Mr Sadiq was in a de-facto relationship with the Deceased for a continuous period of two years at the date of her death or at all. In addition, the Trustee denies that Mr Sadiq was otherwise an eligible person within the meaning of that term as defined in the Succession Act.
The primary judge found that Mr Sadiq was not living with the Deceased for the requisite period and, in any event, that they did not live together as a couple. It followed, his Honour concluded, that Mr Sadiq was not the spouse of the Deceased at the date of her death, with the result that his claim to the whole of the estate on intestacy must fail. His Honour was also, for similar reasons, unable to conclude that Mr Sadiq fell within the category of eligibility required in s 57(1)(b) of the Succession Act, namely that he was a person with whom the Deceased was living in a de-facto relationship at the time of her death. Having concluded that Mr Sadiq was not living with the Deceased, his Honour concluded that he is not a person with whom the Deceased was living in a close personal relationship at the time of her death.
The primary judge concluded that, whilst, on occasions, Mr Sadiq may have visited the Paddington Property and perhaps even stayed there overnight, that was insufficient to establish that he was ever living there. His Honour was not persuaded by documents produced by Centrelink or by Mr Sadiq's evidence that he was a member of the Deceased' household during the period between October 2012 and sometime in 2013 up to her death. His Honour also concluded that Mr Sadiq's assertions that he looked after and cared for the Deceased was somewhat inconsistent with the other. His Honour preferred the evidence of each of neighbours regarding the assistance that they and Mr Sadiq respectively provided to the Deceased.
The primary judge observed that the only evidence that Mr Sadiq was wholly or partly dependent upon the Deceased was his own, and that no banking records of the Deceased were produced to suggest regular withdrawals. Further, Mr Sadiq himself did not produce any records that otherwise demonstrated regular receipt of funds from the Deceased. His Honour also considered that it was significant that the Deceased did not inform any person of the alleged relationship with Mr Sadiq. His Honour considered that that did not suggest that Mr Sadiq had the status of a person who would generally be regarded the natural object of testamentary recognition by the Deceased. For those reasons, his Honour rejected Mr Sadiq's claim.
Mr Sadiq appeared in person before the primary judge, although at one stage he appears to have had pro bono assistance. In preparing his notice of appeal he has apparently received no legal assistance. His submissions filed in support of the notice of appeal have also been prepared without legal assistance. Mr Sadiq also appeared in person today on the hearing of the motion for a stay before me.
The notice of appeal is perhaps unsurprisingly unhelpful. In so far as it states any grounds, they are as follows:
First, most of the case was based on spurious evidence, possibly developer based (sic).
Secondly, some of the evidence should have found and some ignored (sic).
On 21 October 2015 Mr Sadiq filed an affidavit in support of the notice of motion and also filed submissions. Both are difficult to follow. The affidavit was, as I understand it, intended to specify grounds. It is not any more helpful than the notice of appeal. For example, the affidavit is said to be a summary of the information missing and incorrect in the judgment and I quote some of the paragraphs from the affidavit:
3. His Honour: ignored evidence we were rustics because I said that from where I was sitting.
4. Incorrect reported. In the judgment hand down about the bedhead. I said, 'Is mattress and a base,' and my second answer was, 'Special bars that I mean metal.'
3. Incorrect reported. But they just recorded what you told them?
A. They just recorded what I've been telling them because we never shared wrong should never said.
"6. Incorrect reported. He is not blind. Should be she is not.
7. Missing words and I was good in bed, fascinating her and attractive to her.
8. Incorrect reported. I was sitting on her door stop. That is wrong. It should be she was sitting on her doorstep.
9. Incorrect reported. Reference to Burns Street should to McClellan Street.
11. Incorrect reported. I was explaining from the beginning the deceased helped me for $400 for rent behind and $6,000 in 1996 and $5,000 in 1997 and $5,000 in 1988, 1999. Then $200 fortnight on regular basis since 1999 for 14 years.
12. Incorrect reported. Grieve Road it should be Greens Road.
It is difficult to find in that material any intelligible ground of appeal from the decision of the primary judge.
The submissions filed on 21 October 2015, which are somewhat discursive, run to some 86 paragraphs. Without disrespect to Mr Sadiq it is difficult to follow them. They appear to make complaints in detail about findings of fact made by the primary judge, many of which are adverted to in the affidavit to which I have just referred.
It is of significance that, in those submissions, Mr Sadiq says as follows:
I still homeless. I want to return to my house where Christina and I lived. I have been grieving for a long time. Since Christina became sick. I left the house on 15 June 2013. I receive a Newstart allowance every fortnight of about $530. I have no savings in my bank account. I received my fortnightly payment and by the end of the fortnight I have no money left. I sleep on the streets. I have no possessions.
The significance of that material is that the Trustee relies on evidence concerning the state of the Paddington Property, which is the only asset remaining of the estate. The balance of the funds of the estate have already been expended in litigation and in maintenance of the Paddington Property, to the extent that the Trustee has in fact expended some $5,000 more than the amount realised from the funds held by the Deceased at the time of her death.
In particular, the Trustee relies on a detailed report of an inspection of the Paddington Property by Durant Building Contractors Pty Ltd. That report indicates that the Paddington Property is presently inhabitable and that substantial sums of money would have to be expended to make it habitable. The total estimated cost to do so is $293,300.
More significantly the report indicates that there are internal areas of the Paddington Property that have asbestos related coverings that require sampling and testing. Those areas include the plaster ceilings and vinyl floor coverings. The report also says that lead paint could be an issue and should be tested. In addition, the floors are a safety issue as they are unstable, along with the general condition of the ceilings, walls, external rear yard and unsafe areas and the front first-floor balcony. The report expressed the opinion that the Paddington Property should be locked up for at least three months so that the areas named could be made safe and tests carried out for asbestos and lead paint. Once the tests have been carried out, further evaluation could be made to enter the site depending on test results.
Despite his submission that he has no assets and only a small income from Centrelink, Mr Sadiq asserted that he would be in a position to carry out repairs to the Paddington Property. While there was apparently some evidence from him that he carried out repairs over the years during which he knew the Deceased, there was no satisfactory evidence that Mr Sadiq is in a position to undertake the sort of work that is suggested in the building inspection report.
As I have said, the Trustee was granted letters of administration on 21 August 2013. At an earlier stage, the Trustee proposed to sell the Paddington Property and an auction was fixed for 29 July 2014. However, on 24 July 2014, Robb J granted an injunction restraining the sale of the Paddington Property until after the hearing of Mr Sadiq's proceedings before the primary judge in the Equity Division. The proceedings were heard on 28, 29 and 30 April 2015 and judgment was given on 9 June 2015. The judgment is a very detailed analysis of the facts, running to some 375 paragraphs.
The notice of appeal was filed on 1 July 2015. However, the motion seeking a stay was not filed until 11 February 2016. At no stage in between those dates was any effort made to seek a stay, although Mr Sadiq said that some weeks before 11 February 2016 he tried to file an application for a stay. Even so that would have been some six months after the judgment. The Trustee has now fixed an auction of the Paddington Property for 24 February, namely, in two days' time.
Following the decision of the primary judge, the task of realising the property of the Deceased was allocated to one of the Trustee's officers, who obtained a sales report from Di Jones Real Estate on 16 July 2015. An updated valuation was obtained from Quaid Partners Valuers on 17 July 2015. In preparation for sale of the Paddington Property, a new survey was undertaken by G V Ho and Associates, who provided a report on 30 July 2015.
Prior to placing the Paddington Property on the market, it was necessary to stabilise a water-damaged kitchen floor caused by rising damp and rain water. The works were approved on 20 November 2015 and subsequently the real estate agent recommended that an auction take place on 10 February 2016. The day was moved back to 24 February 2016 because the agent was of the view that the market was only just starting to "get back into motion" and having an extra fortnight would allow momentum to build and allow more interest to be generated.
No distribution has yet been made to the next of kin of the Deceased, who appear to be a brother and the children of a deceased sister and half-siblings of the Deceased in the United Kingdom. There is no suggestion that, at present, any of them is in need.
However, if the public auction fixed for 24 February 2016 is delayed, the estate will incur further expenses, being $4,628.50 for advertising and $330 for legal work done to date. In addition, further repair and maintenance costs, particularly over winter months, are likely to be incurred. Water rates, council rates, insurance continue to accrue.
There is evidence that several buyers have expended time and energy in preparing for the auction. Several prospective buyers have taken builders through the Paddington Property and have completed formal valuations in connection with finance applications. It may well be that such buyers would have a claim to compensation from the Trustee if the auction were postponed.
On an application for the stay of orders pending an appeal, the applicant must demonstrate a reason or an appropriate case to warrant the exercise of discretion in his favour. The matters relevant to be considered include an assessment of whether the appellant has an arguable case and a consideration of whether the appeal will be rendered of no effect or utility unless a stay is granted. There is certainly no automatic right to a stay or an injunction as in these circumstances and ordinarily the Court would not deprive a successful party of the fruits of its victory.
In one sense there will be an irreparable loss to Mr Sadiq if the auction proceeds and the sale is made and he is ultimately successful in his appeal. It is therefore a question of weighing the balance of convenience in order to determine whether a stay should be granted. In those circumstances the strength of the appeal is a relevant consideration. This is not a case where Mr Sadiq will be thrown out of his home. It is unclear to what extent he resided, if at all, in the Paddington Property before the death of the Deceased. In any event, he certainly has not lived there in the intervening period since her death. His circumstances appear to be unfortunately dire. However, that is not a matter that has been brought about by the judgment of the primary judge, except in so far as the primary judge did not accept his case. The judgment of course was not given until the middle of 2015, whereas the Deceased died in June 2013.
While there was an application for an injunction filed before the hearing of the proceedings in the Equity Division, that injunction was dissolved once the primary judge gave his decision. As I have said, no application has been made in the meantime for a further stay and the Trustee has expended time and money as have third parties in the possible sale of the Paddington Property. It is unrealistic to suggest that Mr Sadiq, with his present means, could render the property habitable. However, the Trustee has indicated that the proceeds of sale, after reimbursement of the expenses that have been paid out by the Trustee, would be maintained in trust pending the outcome of the appeal.
While one must feel some sympathy for Mr Sadiq, if it be the fact that he was in the relationship that he claimed, I am not persuaded that there are at all strong prospects of success in the appeal. The grounds of appeal that have been foreshadowed certainly do not suggest that there are any prospects of success. Whether there are other grounds that might be formulated is not a matter for me to speculate about. I can only decide the application on the basis of the material that is before me.
I am not persuaded that the appeal has any real prospects of success, having regard to the detailed analysis of the facts by the primary judge and the absence of any grounds to indicate that his Honour erred. The balance of convenience seems to me to be in favour of the Trustee, who has an obligation to administer the estate and to get in the assets, realise them and distribute them. Mr Sadiq waited until the very last moment before he made an application for an injunction to restrain the sale. In all of the circumstances I am not persuaded this is an appropriate case to grant the application for an injunction.
The Trustee asks for costs. The ordinary rule is that where an application is made and it is unsuccessful, the unsuccessful party pays the costs. Mr Sadiq complains that he has no assets to pay costs. That is not a reason for departing from the usual order. I order that the notice of motion filed on 11 February 2016 be dismissed. I order the applicant on the motion pay the costs of the respondent on the motion.
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Decision last updated: 06 April 2016