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[2026] NSWCA 100
respondent. Appeal dismissed. The appellant was ordered to pay the respondents’ costs of the appeal. [101]
The Court of Appeal held that the will gave John an equal share of the residue, but that share was subject to the later direction requiring the value of the Blandford property to be counted against his gift. The deceased could give that direction even though she no longer owned the land, because the clause addressed how her estate was to be distributed. The court did not need to decide whether John had paid for the transfer. It also upheld the primary judge’s treatment of the transfer document and her decision not to consider John’s late, inconsistent submission about payment. The appeal was dismissed and John was ordered to pay the respondents’ costs.
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2,422 words · generated 07/10/2026
The appeal concerned the construction of Hilda Marion Tanner’s will. Hilda’s will, executed on 16 December 2021, first provided for pecuniary legacies, including $10,000 for a friend and $50,000 for each of four grandchildren who survived her and reached 25. Clause 3(c) then gave the rest and residue of her estate to her three children, James, Susan and John, “in equal shares”. [2], [4]
2 cited instruments linked from this judgment.
Two additional clauses addressed earlier benefits. Clause 4 directed that sums advanced to James during Hilda’s lifetime and recorded in her private books be brought into account against his gift. Clause 5 addressed land that Hilda and her late husband had transferred to John and his wife in 2001. It directed that the parcel be “treated as an advancement to John” and brought into account against his gift under cl 3(c). It also specified how the property was to be valued, depending on whether John still owned it at Hilda’s death or had sold it before then. [4]
The transfer document acknowledged receipt of $100,000 consideration. John’s affidavit said that the consideration “recorded on the Transfer was $100,000.00”, but did not say whether any money had in fact been paid. [12], [14] The respondents told the primary judge that it was unclear whether the amount had been paid. [21] During the hearing, John’s counsel repeatedly referred to the transfer as a gift. John later argued, in supplementary written submissions, that the transfer had been for consideration. [26]-[27], [41]-[42]
The executors proposed to account for the property’s value, then $825,000 for the purposes of the proceedings, when calculating distributions. John sought a declaration that he was entitled to an equal one-third share without that adjustment. [5], [18]-[19] The primary judge declared that he had an equal one-third share subject to the directions in cl 5 and cl 4. [7]
The Court of Appeal dismissed John’s appeal. It held that the will’s language made cl 5 operative against his residuary gift, and that the primary judge did not need to decide whether the earlier transfer was a gift. The Court also rejected challenges concerning the evidence and the late supplementary submission. John was ordered to pay the respondents’ costs of the appeal. [79], [84], [87], [90], [94], [98]-[101]
The Court treated the appeal as principally a question of construction. The relevant method was to ascertain the meaning of the will from its language, read as a whole. [71] The parties had accepted that there was no ambiguity in the relevant clauses. John’s argument was not that the words were unclear, but that cl 5 could not qualify the equal gift in cl 3(c), particularly because Hilda no longer owned the Blandford property when she died. [20], [25]
The Court rejected that reading. Clause 3(c) could not be read in isolation from the rest of the will. Clause 5 expressly directed that the property’s value be “brought into account and taken in satisfaction to that extent” of John’s gift. The Court held that this language qualified the earlier statement of equal shares, even though cl 3(c) did not itself say “subject to” cl 5. [76], [81] It also observed that John’s interpretation would leave cll 4 and 5 with no work to do. [83]
The Court distinguished counting the value of transferred property in distributing an estate from disposing of the property itself. Hilda was not purporting to transfer the Blandford property through her will or to distribute its sale proceeds. She was directing how the value of the property should be accounted for when dividing her own residuary estate. [82] The fact that she no longer owned the property did not, on this construction, prevent her from making that direction.
The Court also rejected the argument that cl 5 could operate only if the transfer had been a gift. It focused on the will’s actual words: cl 5 directed that the property “be treated as an advancement to John”. The clause therefore applied irrespective of whether the transfer was, as a matter of fact, a gift, advancement or settlement. [77] The Court explained that labels such as “hotchpot” or “equalisation” do not themselves create or restrict a legal power. The task remains to construe the will. [51], [71], [75]
This meant that the disputed factual question about payment did not determine the construction issue. The primary judge had correctly concluded that it was unnecessary to decide whether the transfer was a gift. [56], [66], [77]-[79] The Court accordingly rejected the claim that the primary judge had wrongly found the transfer to be a gift or advancement: she had made no such finding. [86]-[87]
On the evidence issue, the Court accepted that an acknowledgement of receipt in a transfer document may be prima facie evidence that money was received, but emphasised that its weight depends on the circumstances. [15] John’s affidavit repeated what the document recorded, but did not give direct evidence of actual payment. The Court considered that the careful wording of the affidavit, the absence of other evidence of payment, and counsel’s repeated descriptions of the transfer as a gift could properly inform the assessment. [13], [89], [97]
Finally, the Court upheld the primary judge’s refusal to engage with the new factual contention in supplementary submissions. The hearing had proceeded on the footing that the transfer was a gift, and the respondents had not had a fair opportunity to address the new position through evidence or cross-examination. The new point also went beyond the leave granted for supplementary submissions. [42]-[45], [93] In any event, the point could not affect the result because cl 5 applied regardless of the transfer’s character. [92]
The judgment presents its reasoning as an application of established principles of will construction, rather than as a change to succession law. The Court relied on the approach in Perrin v Morgan and Fell v Fell, identifying the task as reading the will’s language as a whole and in context. [24], [71] Its central holding is specific: on the wording of this will, cl 5 qualified John’s gift under cl 3(c). [81]-[84]
The Court’s discussion of Re Tennant; Mortlock v Hawker was important but carefully confined. Re Tennant concerned the construction and operation of directions requiring beneficiaries to bring earlier advances into account. The Court explained that the outcome in that case turned on the meaning of the particular will, not on a separate equitable doctrine that enlarged or restricted what the will could say. [46]-[51] It treated Re Tennant as supporting the proposition that a later direction can qualify an earlier residuary clause, even if the earlier clause contains no express qualification. [75]-[76]
The judgment also explained the historical background to the expression “hotchpot”. It described the concept as reflecting equality-related maxims and noted its statutory application to intestate estates under s 5 of the Statute of Distribution 1670. It recorded that the rule was abolished in New South Wales in 1977. [38] But the Court made clear that the appeal did not depend on applying an independent doctrine of hotchpot. The issue was the construction of Hilda’s will. [51], [75]
The Court considered Prichard v Prichard as an illustration of a clause that was construed to bring into account an advance made for consideration. It noted that the case was not binding on the Court, but consistent with the proposition that the words of the clause, rather than a categorical requirement that the earlier transfer be a gift, govern its effect. [52]-[54], [73]
For evidence, the judgment applied the principle that an acknowledgement of receipt can be evidence of payment without conclusively determining the fact. Its weight depends on context. [15] The judgment therefore does not establish that an acknowledgement in a transfer document is generally insufficient. It affirms that the court may assess it alongside the other evidence, including what a party could have said, the actual wording of their evidence and the way the factual issue was contested. [13], [15], [97]
At [71], the Court said: “The meaning of the will is to be ascertained from the language used, having regard to the will as a whole.” In plain English, a clause giving equal shares cannot automatically be read on its own. Other clauses in the same will may qualify how those shares are calculated.
At [76], the Court explained that Re Tennant supported the conclusion that a later direction can qualify an earlier gift. The point is not that every later clause overrides an earlier one. Rather, the words and structure of the particular will determine whether the later direction modifies the earlier gift.
At [77], the Court said that cl 5 was “not in any way dependent upon the transfer in fact being a gift, advancement or settlement”. In plain English, the will itself set the accounting treatment for the property. The Court did not need to decide the historical legal character of the 2001 transfer to interpret that direction.
At [82], the Court said Hilda was “not seeking to dispose of, or distribute the proceeds of,” the Blandford property. She was directing how its value should be counted when distributing her estate. This distinction answered John’s argument that she could not make a testamentary direction about property she no longer owned.
At [15], the Court stated that an acknowledgement of receipt of consideration “may be prima facie evidence”, with weight depending on the circumstances. In plain English, the document mattered, but it did not necessarily settle whether money was actually paid. The Court considered it alongside the absence of direct evidence and the way John’s case had been presented. [89], [97]
At [93], the Court described it as “highly unsatisfactory” for the factual issue to be raised for the first time in supplementary submissions after the hearing had proceeded on a different premise. In plain English, a late change to the factual basis of a case may be procedurally unfair where the other side has not had a proper chance to respond.
The decision is most relevant where a will has an initial clause giving beneficiaries equal or specified shares, followed by another clause directing that a lifetime transfer, advance or property value be brought into account against one beneficiary’s share. The key question will be what the words of that particular will mean when read together. The judgment does not make the label “hotchpot” decisive. [71], [75], [81]
It may also be relevant where a beneficiary argues that an accounting clause cannot operate because the testator did not own the earlier-transferred property at death. Tanner distinguishes a direction governing distribution of the testator’s estate from an attempt to dispose of property already transferred. [82]
The case may be relevant when the will’s direction uses language such as “brought into account” or “taken in satisfaction”, and the parties dispute whether the direction is confined to gifts. Tanner holds that, in the will before it, the direction was not dependent on the transfer being a gift. It does not establish that every clause using similar words will have the same effect; construction remains tied to the particular terms and context. [77], [81]
The evidentiary discussion may matter where a transfer document acknowledges consideration but there is a separate dispute about whether payment actually occurred. The judgment indicates that the acknowledgement can be weighed with other evidence and with the circumstances in which the issue was raised. [15], [89], [97] It also illustrates the procedural risk of changing the factual premise of a case after a hearing, particularly if the other party might have sought evidence or cross-examination on the point. [93]
The judgment supplies no account of later judicial treatment of Tanner v Tanner. It is dated 28 May 2026, and the text contains no subsequent decision applying, distinguishing or reconsidering Tanner. [1]-[2], [102] It would therefore be unsupported by this source to say how later courts have treated it.
The decision itself explains how it used earlier authorities. It applied Perrin v Morgan and Fell v Fell on will construction, and treated Re Tennant as support for construing a later accounting direction as qualifying an earlier residuary gift. [24], [71], [75]-[76] It also applied Petersen v Moloney and Blatch v Archer to the evidentiary weight of the transfer acknowledgement and the significance of evidence a party could have produced. [13]-[15]
The Court referred to Prichard v Prichard as an illustration of a clause that could cover an advance made for consideration. It expressly noted that the decision was not binding on the NSW Court of Appeal. [52]-[54], [73] These are the authorities’ roles as described in Tanner, not a statement about their treatment in later cases.
The judgment resolves the construction of Hilda’s will, but it does not decide whether John or his wife actually paid the $100,000 recorded in the 2001 transfer document. The Court held that the question was unnecessary to the construction result and described the primary judge as making no finding on whether the transfer was a gift. [56], [66], [86]
Nor does the judgment set out a universal rule for every will that contains an equal-shares clause and a later accounting direction. Its holding turns on the wording of cl 5, including the direction that the property be “treated as an advancement to John” and brought into satisfaction of his gift. [77], [81] Different words or surrounding circumstances could require a different construction; the Court’s stated method is to read the particular will as a whole. [71]
The decision also does not revive or apply an independent hotchpot doctrine. It describes the historical doctrine and its statutory abolition in New South Wales, but bases the outcome on construction of the will. [38], [51] Any question about the operation of a different statute or equitable principle would require material beyond this judgment.
Finally, Tanner does not determine the broader evidentiary weight of every acknowledgement of consideration. It states that such an acknowledgement may be prima facie evidence and that its weight depends on circumstances. [15] The Court’s assessment was tied to this record: the affidavit did not say whether payment occurred, John’s counsel repeatedly called the transfer a gift, and the contrary contention was raised late. [12]-[15], [26]-[27], [97]
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Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: Tanner v Tanner [2026] NSWCA 100
Hearing dates: 19 May 2026
Date of orders: 28 May 2026
Decision date: 28 May 2026
Before: Bell CJ at [1];
Stern JA at [2];
McHugh JA at [102]
Decision: (1) Appeal dismissed.
(2) The appellant is to pay the respondents’ costs of the appeal.
Catchwords: SUCCESSION — construction — where will provided that rest and residue of deceased’s estate was to be given to her three children in equal shares following distribution of specified pecuniary legacies — where will further directed that a property which had been transferred by deceased and her late husband to the appellant and his wife be treated as an advancement to the appellant and be brought into account and taken in satisfaction to the extent of the gift in his favour — whether primary judge erred in construction of the will — whether primary judge required to decide whether transfer was a gift or advancement to appellant — whether primary judge erred in construing gift to appellant as being qualified by direction as regards property — whether primary judge erred in finding that transfer was a gift or an advancement — whether primary judge erred in approach to evidence
Legislation Cited: Statute of Distribution 1670 (22 & 23 Cha 2 c 10), s 5
Wills, Probate and Administration (Amendment) Act 1977 (NSW)
Cases Cited: AA v The Trustees of the Roman Catholic Church for the Diocese of Maitland-Newcastle [2026] HCA 2; 427 ALR 67
Australian Securities and Investments Commission v Hellicar (2012) 247 CLR 345; [2012] HCA 17
Australian Securities and Investments Commission v Idylic Solutions Ltd [2009] NSWSC 1306; 76 ACSR 129
Blatch v Archer (1774) 1 Cowp 63; 98 ER 969
Boensch v Pascoe (2019) 268 CLR 593; [2019] HCA 49
Caron v Jahani (No 2) (2020) 102 NSWLR 537; [2020] NSWCA 117
Carr v Finance Corporation of Australia Ltd (No 1) (1981) 147 CLR 246; [1981] HCA 20
Coleman v Lake (1903) 3 SR (NSW) 603
De Lorenzo v De Lorenzo (2020) 104 NSWLR 155; [2020] NSWCA 351
Dunn v Brown (1911) 12 SR (NSW) 22
Estate of Chaddock (Deceased) [2025] NSWSC 463
Estate of Tanner [2025] NSWSC 1078
Fell v Fell (1922) 31 CLR 268; [1922] HCA 55
Hoy Mobile Pty Ltd v Allphones Retail Pty Ltd (2008) 167 FCR 314; [2008] FCA 369
Kimberley Developments Pty Ltd v Bale [2023] NSWCA 25
Kuru v State of New South Wales (2008) 236 CLR 1; [2008] HCA 26
Maiden v Maxwell (1920) 21 SR (NSW) 16
Perpetual Trustees Victoria Ltd v Cox [2014] NSWCA 328
Perrin v Morgan [1943] AC 399; [1943] 1 All ER 187
Petersen v Moloney (1951) 84 CLR 91; [1951] HCA 57
Prichard v Prichard [2015] WASC 170
Re Tennant; Mortlock v Hawker (1942) 65 CLR 473; [1942] HCA 3
Russo v Aiello (2003) 215 CLR 643; [2003] HCA 53
Urquhart v Butterfield (1887) 37 Ch D 357
Wollongong City Council v Legal Business Centre Pty Limited (No 2) [2012] NSWCA 366
Texts Cited: JD Heydon, Cross on Evidence (LexisNexis, 14th ed, 2024)
Category: Principal judgment
Parties: John Andrew Tanner (Appellant)
James Colin Tanner (First Respondent)
Susan Louise Travers (Second Respondent)
Representation: Counsel:
D Flaherty with I Hoskinson (Appellant)
A Katsoulas with J Lee (Respondents)
Solicitors:
Kate Mailer & Associates (Appellant)
Sparke Helmore Lawyers (Respondents)
File Number(s): 2025/480869
Publication restriction: Nil
[This headnote is not to be read as part of the judgment]
The appeal concerned the proper construction of the deceased’s will. The deceased was the mother of the appellant. The deceased’s two other children, the respondents, were the executors of the will.
The relevant clauses of the will were: cl 3(c), which provided that the rest and residue of the deceased’s estate was to be given to her three children “in equal shares” following the distribution of specified pecuniary legacies, and cl 5 which relevantly “direct[ed]” that a parcel of land (the Blandford property), which had been transferred by the deceased and her late husband to the appellant and his wife in 2001 (the transfer) “be treated as an advancement to [the appellant] and shall be brought into account and taken in satisfaction to that extent of the gift in his favour in Clause [3](c)”. Before the primary judge both parties submitted that there was no ambiguity in the will. The appellant submitted that, on the proper construction of the will, cl 3(c) was not qualified by cl 5 and he was entitled to a one-third share in the deceased’s residual estate and that the deceased had no power to make the direction in cl 5 as she did not own the Blandford property at the time of her death. The primary judge rejected both of these contentions. Her Honour made a declaration that, on the true construction of the will, the appellant was entitled to an equal one-third share of the rest and residue of the deceased’s estate, after the payment of the specified pecuniary legacies, and the reasonable costs of administration of the estate, subject to the terms or directions in cl 5 of the will.
The memorandum of transfer for the Blandford property in 2001 recorded that the transferors, being the deceased and her husband, “acknowledge[d] receipt of the consideration of $100,000.00”. The appellant tendered this memorandum of transfer and also read an affidavit in which he said nothing about what, if anything, was actually paid for the transfer but recorded that “[t]he consideration recorded on the [memorandum of transfer] was $100,000”. In submissions filed in advance of the hearing, referring to this evidence in the appellant’s affidavit, the respondents submitted that it was “not clear whether the amount was paid” but the appellant did not tender any further evidence going to this factual issue. Moreover, during oral submissions before the primary judge the appellant’s counsel repeatedly described the transfer as a gift. Towards the end of the hearing, counsel for the respondents made submissions relying upon the decision of the High Court in Re Tennant*; Mortlock v Hawker* (1942) 65 CLR 473; [1942] HCA 3, and her Honour granted the parties leave to file supplementary submissions after the hearing on what she described as “the [hotchpot] provisions” and also upon issues raised by the appellant’s oral submissions. In his submissions filed after the hearing, the appellant submitted for the first time that the transfer was not a gift. The primary judge noted that there was no evidence that consideration was in fact paid for the transfer, held that it would be not appropriate to engage with this submission in circumstances where the appellant had had ample time otherwise fairly and explicitly to raise the issue and found in any event that it was immaterial whether the transfer was a gift having regard to the proper construction of the will.
Before this Court, the appellant contended that the primary judge erred in:
(i) finding that she was not required to decide whether the transfer was a gift or advancement to the appellant;
(ii) construing the gift to the appellant in cl 3(c) of the will as being qualified by the terms of cl 5;
(iii) finding that the transfer was a gift or advancement so as to give rise to the “hotchpot doctrine”; and
(iv) her Honour’s approach to evidence, namely the memorandum of transfer and the appellant’s affidavit.
The Court (Stern JA, Bell CJ and McHugh JA agreeing) held, dismissing the appeal with costs:
As to issue (i)
(1) Having regard to the proper construction of the will it was not necessary for her Honour to decide whether the transfer was a gift or advancement. The validity or effect of the direction in cl 5 did not depend on whether the transfer was a gift. Consistent with Re Tennant, the effect of the direction in cl 5 of the will turned on the proper construction of the will: [24], [46]-[54], [69]-[80].
Perrin v Morgan [1943] AC 399; [1943] 1 All ER 187, Fell v Fell (1922) 31 CLR 268; [1922] HCA 55, Re Tennant; Mortlock v Hawker (1942) 65 CLR 473; [1942] HCA 3, applied.
As to issue (ii)
(2) The primary judge correctly construed the will. The deceased’s power to make the direction in cl 5 was not limited to circumstances where she owned the Blandford property as at the date of her death or where the transfer was a gift: [80]-[85].
As to issue (iii)
(3) The primary judge did not make any finding that the transfer was a gift or advancement: [86]-[87].
As to issue (iv*)*
(4) Given her Honour’s correct approach to construction of the will, nothing turned upon her Honour’s approach to the memorandum of transfer and the appellant’s affidavit evidence as to this. In any event, her Honour did not err in finding that there was no evidence going to whether consideration was in fact paid for the transfer: [89], [91]-[92], [94]. Moreover, in light of the conduct of the proceedings below, the primary judge did not err in declining to consider the appellant’s submission in his supplementary written submissions that the transfer was a gift: [31], [93].
(5) Her Honour also was correct to reject the appellant’s contention that the memorandum of transfer was “uncontested evidence” of the receipt by the deceased and her husband of $100,000 consideration for the transfer. The weight to be given to such evidence depends on the circumstances. Here, there was no evidence that consideration was actually paid, during the hearing before her Honour the appellant repeatedly submitted through his counsel that the transfer was a gift, and the carefully worded phrasing of the appellant’s affidavit evidence, in particular his failure to say anything about the actual payment of consideration in circumstances where he would surely have known what consideration was actually paid, could all properly be taken into account by her Honour when weighing the evidence: [13]-[15], [96]-[98].
Petersen v Moloney (1951) 84 CLR 91; [1951] HCA 57, Blatch v Archer (1774) 1 Cowp 63; 98 ER 969, applied.
BELL CJ: I agree with Stern JA.
STERN JA: This appeal concerns the proper construction of a will executed by Hilda Marion Tanner (the deceased) on 16 December 2021 (the will). The deceased was the mother of the appellant, John Tanner. She died on 19 May 2024. On 15 August 2024 probate was granted to her other two children, James Tanner and Susan Travers, the respondents and the executors of the will. The inventory of property attached to the grant of probate valued the deceased’s estate at $2,593,766.13.
For convenience, and without intending any disrespect, I will refer to members of the deceased’s family by their first names.
The relevant clauses of the will are as follows:
[3] I GIVE the whole of my estate to my trustees UPON TRUST as follows:
(a) AS TO a pecuniary legacy in the sun of TEN THOUSAND DOLLARS ($10,000.00) for my dear friend KEVIN TAYLOR in recognition of the years of kind care and friendship he and his late wife Faye have given me;
(b) AS TO a pecuniary legacy in the sum of FIFTY THOUSAND DOLLARS ($50,000.00) for each of my grandchildren JOHN HENRY TANNER TRAVERS, WILLIAM JAMES TANNER TRAVERS, LUCY BEATRICE PENRITH TANNER and ISABEL MAY PENRlTH TANNER who shall survive me and attain the age of twenty-five (25) years;
(c) AS TO the rest and residue of my estate for my children JAMES COLIN TANNER, SUSAN LOUISE TRAVERS and JOHN ANDREW TANNER in equal shares.
[4] I DIRECT that any sum advanced by me during my lifetime to my son JAMES COLIN TANNER (and as recorded in my private books) shall be brought into account and taken in satisfaction to that extent of the gift in his favour in Clause [3](c).
[5] I ALSO DIRECT that the parcel of land formerly being part of ‘Eyton’ and transferred to my son JOHN ANDREW TANNER by my late husband and I during our lifetimes shall also be treated as an advancement to John and shall be brought into account and taken in satisfaction to that extent of the gift in his favour in Clause [3](c). If John shall still own that parcel as at the date of my death, then I DIRECT that its value, for the purpose of this clause, shall be its market value as at the date of my death as determined by a registered valuer appointed by my trustees. If it shall have been sold prior to my death, its value for the purpose of this clause shall be deemed to be its sale price.
There is no dispute that the parcel of land referred to in cl 5 of the will (the Blandford property) was transferred by the deceased and her husband, Craig Tanner, to John and his wife on 16 January 2001 (the transfer). It is also common ground that, for present purposes, the value of the Blandford property is $825,000 (as valued as at 19 May 2024, being the date of the deceased’s death, by Michael Wragge, Certified Practising Valuer, retained by the respondents).
The essence of John’s contention before the primary judge was that, on the proper construction of the will, cl 3(c) was not qualified by cl 5 and he was thus entitled to a one-third share in the deceased’s residual estate.
In a decision handed down on 19 September 2025 the primary judge rejected John’s claim: Estate of Tanner [2025] NSWSC 1078. Her Honour made the following declaration:
DECLARE that on the true construction of the Will of the late Hilda Marion Tanner (the deceased) dated 16 December 2021, the plaintiff is entitled to an equal (1/3rd) share of the rest and residue of the deceased’s estate (after the payment of the pecuniary legacies set out in clauses [3](a) and [3](b) of the deceased’s Will, and the reasonable costs of administration of the estate), subject to the terms or directions in clause [5] (and clause [4]) of that Will.
The overarching issue raised in the appeal is whether the primary judge erred in finding that John’s one-third share of the deceased’s residuary estate under cl 3(c) of the will was to be adjusted as directed in cl 5 of the will, to bring into account the value of the Blandford property. In this regard, by amended notice of appeal John contends that the primary judge erred in:
finding that she was not required to decide whether the transfer of the Blandford property in 2001 was a gift or advancement to the appellant (ground 1);
her approach to the evidence and to John’s submission that an acknowledgement that consideration of $100,000 was paid for the transfer in the memorandum of transfer of the Blandford property in 2001 (the acknowledgement) was uncontested evidence that consideration was paid for the transfer (grounds 2, 3 and 4);
finding that the transfer was an advancement or gift so as to give rise to the “hotchpot doctrine” (ground 5); and
construing the gift to John in cl 3(c) of the will as being qualified by the terms of cll 4 and 5 (ground 6).
The outcome of this appeal ultimately turns upon the unambiguous meaning of the will construed having regard to relevant surrounding circumstances. However, given the matters raised in the grounds of appeal it is necessary in this judgment also to examine how the proceedings before the primary judge were conducted, in particular, as regards the factual issue whether or not, in 2001, the Blandford property was gifted by the deceased and Craig to John and his wife.
For the reasons set out below, the appeal should be dismissed with costs.
There is no dispute as to the validity of the will.
John read an affidavit affirmed on 2 April 2025 before the primary judge. In that affidavit he identified at [4] that in 2001 the Blandford property was part of a property owned by his parents, known as Eyton. He then said at [5]:
By a memorandum of Transfer dated 16 January 2001, my late father and the Deceased transferred the Blandford Property to me and my wife, Emma Louise Tanner. The consideration recorded on the Transfer was $100,000.00. Annexed hereto and marked “B” is a copy of that Transfer document.
That is all that John said in his affidavit that bore on the issue whether there was any consideration in fact paid for the transfer. In circumstances in which John would surely have known what, if any, consideration was actually paid for the transfer, the fact that he did not say anything on this subject beyond reiterating the terms of the acknowledgement is, to say the least, curious. As Gleeson CJ said in Russo v Aiello (2003) 215 CLR 643; [2003] HCA 53 at [11], a fundamental precept of the adversarial system of justice is Lord Mansfield’s proposition in Blatch v Archer (1774) 1 Cowp 63 at 65; 98 ER 969 that “all evidence is to be weighed according to the proof which it was in the power of one side to have produced, and in the power of the other to have contradicted”. The carefully worded phrasing of John’s affidavit evidence on the factual issue of the consideration for the transfer can properly be taken into account when considering whether he had produced evidence to satisfy his burden of proof: see, by analogy, Australian Securities and Investments Commission v Hellicar (2012) 247 CLR 345; [2012] HCA 17 at [256] (Heydon J).
The terms of the acknowledgement, in the memorandum of transfer annexed to John’s affidavit, are as follows:
(C) TRANSFEROR CRAIG OWEN TANNER & HILDA MARION TANNER
(D) acknowledges receipt of the consideration of $100,000.00
and as regards the land specified above transfers to the transferee an estate in fee simple.
Consistent with Petersen v Moloney (1951) 84 CLR 91 at 100; [1951] HCA 57, an acknowledgement of the receipt of consideration in a transfer may be prima facie evidence, the weight of which depends upon the circumstances, that money was received. By way of example, in Perpetual Trustees Victoria Ltd v Cox [2014] NSWCA 328 at [74]-[81], Leeming JA (Macfarlan JA agreeing) treated moneys as not having been paid to the borrowers notwithstanding an acknowledgement of receipt by them in a mortgage. Moreover, in Kimberley Developments Pty Ltd v Bale [2023] NSWCA 25 at [51]-[61] Leeming JA described Petersen v Moloney as stating the law in Australia and concluded, relying in part upon Lord Mansfield’s proposition in Blatch v Archer as extracted above at [13], that it was open to the primary judge in that case to find that money was not paid notwithstanding a signed document on a public register which acknowledged receipt of the money as consideration.
On 16 November 2004, Craig made his last will and testament. Whilst nothing ultimately turns on this, Craig’s will included clauses in broadly similar terms to cll 3(c) and 5 of the will, which took effect only if the deceased predeceased him. Craig died on 14 May 2008 and, as such, consistent with his will, his residual estate went to the deceased.
John has not sold or otherwise encumbered the Blandford property since it was transferred to him and his wife in 2001.
A distribution statement prepared by the respondents’ solicitors on 16 December 2024 calculated the total amount available for distribution from the deceased’s estate. The methodology used was to identify the balance of funds held in trust, less pecuniary legacies in cll 3(a) and (b) of the will ($1,152,148.71); plus the value of the deceased’s share portfolio as at 2 December 2024 ($1,261,806.73); and to add to that a notional credit for the value of the Blandford property transferred to John in 2001 ($825,000) and for funds advanced to James falling within cl 4 of the will ($399,497). This gave a notional total amount available for distribution of $3,638,452.44.
John disputed the correctness of this approach, ultimately filing a summons on 3 April 2025 seeking relief including a declaration that, contrary to what was proposed by James and Susan, after the payment of the legacies in cll 3(a) and (b) of the will and reasonable administration costs he was entitled to an equal one-third share in the deceased’s residuary estate, and an order that James and Susan forthwith do all things reasonably necessary to effect payment of this to him.
In written submissions filed on 20 August 2025, John referred to the transfer but was silent as to whether it was a gift or was for consideration. He submitted that the will was unambiguous. He contended that the expressed intention of cl 3(c) of the will was that he take an equal share of the residuary estate and that the deceased had no power to make the direction she purported to make in cl 5 of the will because she could not dispose by will of property she did not own. He also submitted that a direction such as that in cl 5 could not be construed to contradict or diminish the clear and unambiguous gift in cl 3(c).
In written submissions, also filed on 20 August 2025, the respondents submitted that there was no ambiguity as to the terms of the will and that, on its proper construction, the will provided that the value of the Blandford property ($825,000) was to be deducted from John’s one-third share in the residue of the deceased’s estate. As regards the transfer, the respondents submitted:
The consideration recorded on the transfer was $100,000, however, it is not clear whether the amount was paid: [referring to John’s affidavit at [5]: see [12] above].
At the hearing before the primary judge on 25 August 2025, John read his affidavit (including the annexed memorandum of transfer) but did not seek to adduce evidence to clarify this factual issue raised by the respondents.
Five aspects of the parties’ oral submissions before the primary judge should be noted.
First, there was no dispute as to the key principles applicable to the construction of a will, and in particular, that the leading authorities in this regard were Perrin v Morgan [1943] AC 399 at 406, 416; [1943] 1 All ER 187, and Fell v Fell (1922) 31 CLR 268 at 273-275; [1922] HCA 55.
Second, both John and the respondents submitted that there was no ambiguity in the will, including as regards cll 3(c) and 5. John’s submission was, however, that the Court had to apply the words the deceased used, that cl 5 could not contradict the gift “already made” in cl 3(c), and that cl 5 purported to do something that the deceased had no power to do because she did not own the Blandford property at the time of her death.
Third, the hearing before the primary judge was conducted on the common premise that the Blandford property had been gifted to John and his wife. John’s counsel consistently referred to the transfer as a “gift”. Early in his opening submissions he submitted “[s]he made a gift of property 20 years ago and partly with her husband” and “[i]rrespective of whether the sum of $100,000 was paid or not paid there is a presumption of events in any event. The gift, or I will call it a short transfer if I can use a neutral terms [sic], was made back then”. He submitted that the deceased “could have left a particular bequest to the other two [children] to take into account the gift she had already given to John 20 years prior”. He added that in cl 5 the deceased was “trying to say, ‘because I gave him the property back in 2001, I want that to come off’”, that she was “purporting … to bequeath something that she has already given”, and later, “[h]ow can she now talk about property, which was given, certainly in part, by someone else? That is the point. It wasn’t hers. You accept it is a gift in some ways, but it wasn’t a gift by her”. In his oral submissions in reply, as regards the Blandford property, he twice submitted that the testator had “given it away”.
His oral submissions in chief concluded with the submission:
But when you are giving something away, like she has here, and don't forget she didn't do it on her own, she did it with her husband, she can't now say, you must now take this account. That's not a direction. It's not a gift. She could have done it many different ways to achieve the result which she probably intended to achieve, but the words she used - and I keep hammering this point your Honour and sorry to sound repetitive - the words don't achieve that object at all. That's our case.
Counsel for the respondents also referred to the Blandford property as having been gifted by the deceased and her late husband jointly but also contended that, “[w]hether that’s right or wrong is, in my submission, immaterial”.
Before making these submissions, counsel for John was aware that the respondents intended to rely upon Re Tennant*; Mortlock v Hawker* (1942) 65 CLR 473; [1942] HCA 3, as he was informed of that on the morning of the hearing and told the primary judge that he had “had a look at [Re Tennant]” that morning. Indeed, before concluding his oral submissions in chief, he submitted:
My friend recently referred to the doctrine of hotchpotch [sic], which is back in 1978 when they invented the Succession Act and it only applies, but that is not this case. I will let him say what he wants to say about that and I will do something in reply.
Moreover, John’s counsel’s oral submissions in reply that the transfer was a gift were made after counsel for the respondents had orally submitted that the judgment of Dixon J in Re Tennant at 475-476 supported both the respondents’ proposed construction of the will and that the deceased had power to give the direction she did in cl 5 of the will.
Whilst the outcome of this appeal does not turn on this, and the primary judge did not make any finding to this effect, in circumstances where the respondents’ written submissions had raised the question whether or not the transfer was a gift (see above at [21]), and the onus on this issue rested on John, John’s repeated submission before the primary judge that the transfer was a gift amounted to an admission that that was in fact the case. That had the consequence that (unless and until the admission was withdrawn) that factual question was no longer in issue between the parties: Damberg v Damberg (2001) 52 NSWLR 492; [2001] NSWCA 87 at [154].
Counsel has authority to make admissions against the interests of his or her client during a hearing: Hoy Mobile Pty Ltd v Allphones Retail Pty Ltd (2008) 167 FCR 314; [2008] FCA 369 at [17]-[18]; Urquhart v Butterfield (1887) 37 Ch D 357 at 369; Dunn v Brown (1911) 12 SR (NSW) 22 at 41; JD Heydon, Cross on Evidence (LexisNexis, 14th ed, 2024) at [3165]. An admission by counsel is “conclusive as far as it goes if not withdrawn”: Dunn v Brown at 51; see also AA v The Trustees of the Roman Catholic Church for the Diocese of Maitland-Newcastle [2026] HCA 2; 427 ALR 67 at [60]-[63] (Gageler CJ, Jagot and Beech-Jones JJ). Further, a court is entitled to act upon such an admission, at least where there is no reason to doubt its correctness: Damberg v Damberg at [157], [160]. Given the very careful terms in which John phrased his affidavit at [5] and the principles set out in Blatch v Archer, the statement on the memorandum of transfer that consideration was received for the transfer was not, itself, reason to doubt the correctness of John’s admission, through counsel, that the transfer was a gift.
Thus, whilst the primary judge was not bound to act on the admission, in circumstances in which leave was not sought to withdraw the admission, her Honour would have been entitled to do so.
Fourth, as already adverted to, in his oral submissions, counsel for the respondents relied upon Re Tennant. He submitted that “the important thing” about Re Tennant in the present case was that:
[L]ike the will in the present case we’ve got a residuary clause which doesn’t say “subject to later direction”, and we have an express direction in very similar terms, in particular, saying that there will be taken deduction from their share under will.
When a disposition requires that a fund should be distributed equally among a class and then goes on to provide that those members of the class who have received advancements should bring them into hotchpot, the effect is to qualify the statement that the shares in the fund shall be equal and to direct a method of calculation which may be expected to result in some other proportions. The purpose of directing the hotchpot commonly is to ensure that children obtain from their parent by advancement and under his will equal portions or equality of benefit.
In light of these oral submissions, and the fact that Re Tennant had not been relied upon in the respondents’ written submissions, the primary judge indicated that she would be assisted by a note which gave some legal context to the respondents’ oral submissions, including as to the hotchpot doctrine and its abolition, and how these matters fit with the respondents’ written submissions. Her Honour offered to give John’s counsel time to answer the respondents’ oral submissions, but he indicated that he could respond to the respondents’ submissions in the course of his oral submissions in reply. He did so, submitting that the hotchpot doctrine was abolished by statute, “and so then you’re driven back to the meaning of … what the will says”.
Her Honour then indicated that she would “like more fulsome written submissions having regard to [the] whole of the legal, context, including any statutory amendments or impacts” and also “where the [hotchpot] submissions you’re making fit in with the context of your written submissions”. She granted leave to both parties to file supplementary submissions “on the [hotchpot] provisions” and, at the request of counsel for the respondents, “other issues raised in the oral submissions by counsel for the plaintiff”.
By way of context to her Honour’s orders, the legal concept of hotchpot broadly reflects the maxim ‘equality is equity’, supplemented by the maxim ‘he who seeks equity must do equity’: Caron v Jahani (No 2) (2020) 102 NSWLR 537; [2020] NSWCA 117 at [56]-[58] (Bell P, Bathurst CJ and Macfarlan JA agreeing), citing with approval Australian Securities and Investments Commission v Idylic Solutions Ltd [2009] NSWSC 1306; 76 ACSR 129 at [60]. This concept has been applied in a number of legal contexts to require a “bringing into account” of benefits received, for example, as between co-sureties and in bankruptcy: Idylic Solutions at [56]-[59]. As regard wills, the doctrine of hotchpot was applied by statute, but only as regards intestate estates, where gifts were made to beneficiaries during a testator’s lifetime: s 5 of the Statute of Distribution 1670 (22 & 23 Cha 2 c 10); Coleman v Lake (1903) 3 SR (NSW) 603; Maiden v Maxwell (1920) 21 SR (NSW) 16. That rule was abolished in New South Wales in 1977: Wills, Probate and Administration (Amendment) Act 1977 (NSW).
Fifth, responding to the primary judge’s request and the leave granted, the respondents commenced their supplementary written submissions with the heading “The Abolishment of Hotchpot Rule: a non-issue”, summarised the history of the doctrine and its abolishment at [1]-[3], and submitted at [4] that “neither the doctrine itself or its abolishment affect the present proceedings or detract from the High Court’s reasons in ”. The respondents then submitted, in summary, that:
9. Paragraphs 1 – 4 of the Defendant’s Supplementary Written Submissions [detailing the history and abolishment of the hotchpot doctrine] and paragraph 5 of the Deceased’s will assume that the transfer of land to the Plaintiff and his wife in 2001 was an “advancement” or “settlement” or “gift” of the same or similar type discussed In re Tennant.
10. Here, the uncontested evidence is that the land was transferred to the Plaintiff and his wife in 2001 for a stated consideration of $100,000.00 the receipt of which was acknowledged by the Deceased and her late husband. See paragraph 5 and annexure “B” of the affidavit of the Plaintiff sworn 2 April 2025 [the memorandum of transfer of the Blandford property].
- Further, the “Directions” in the second and third sentences of clause 5 take no account of the $100,000.00 the receipt of which was acknowledged in 2001.
12. It is thus submitted that that transfer of land cannot be subject to the “hotchpot” doctrine as alleged by the Defendants. Nor can the “Directions” in the 2nd and 3rd sentences of clause 5 of the will be made. The Deceased simply had no power to make such directions in respect of someone else’s property.
(Emphasis in original.)
The contention in these submissions at [10] that the transfer was not a gift was inconsistent with the premise upon which both parties had conducted the hearing before the primary judge. John made no reference to this inconsistency in his supplementary written submissions. He offered no explanation as to why, up until the filing of the supplementary written submissions, he had repeatedly submitted that the transfer was a gift if that was not in fact the case. He did not seek leave to adduce supplementary evidence on this factual issue. Nor did he seek leave to withdraw the admission made in the course of the hearing before her Honour.
His submission that the transfer was not a gift also fell beyond the grant of leave her Honour gave for submissions to be filed after the hearing. It went well beyond elaboration of his oral submissions on the hotchpot provisions, or responding to the respondents’ submissions on Re Tennant, and did not arise out of his own oral submissions. A party is not at liberty to file submissions after the conclusion of a hearing other than with the leave of the court, as Mason J observed in Carr v Finance Corporation of Australia Ltd (No 1) (1981) 147 CLR 246 at 257-258; [1981] HCA 20; see also Wollongong City Council v Legal Business Centre Pty Limited (No 2) [2012] NSWCA 366 at [32]. The primary judge would have been entitled to reject those submissions on that basis, albeit that, as set out below, her Honour did not rely upon her limited grant of leave in her reasons for not considering these submissions.
As to John’s contention at [11] of his supplementary written submissions regarding the directions in the second and third sentences in cl 5 of the will, which go to the mechanics of how the Blandford property was to be valued when being “brought into account” or “taken in satisfaction” for the purposes of cl 3(c), this was also beyond the grant of leave to file supplementary written submissions. It was also a submission which had not been advanced, even indirectly, before the primary judge. Nor did John articulate why it was that the directions in the second and third sentences in cl 5 of the will “[could] not be made”.
Further, John did not in these submissions explicitly contend that a direction such as that made in cl 5 of the will, or in Re Tennant, could only take effect as regards a gift made by the testator during his or her lifetime. Nor did he make any attempt to support this contention with any authority or by reference to any legal principle. In any event, if such a submission were to be advanced in supplementary written submissions filed after the hearing, then it should have been clearly articulated.
Before turning to the primary judgment it is convenient to explain both the factual context of Re Tennant and some key aspects of the judgments in that case.
The deceased, Andrew Tennant, made a will in which he provided that residuary funds in trust should be held “for all my [children] in equal shares”. He also directed that “the value of any land shares or property transferred by me in my lifetime to any child of mine … shall be taken as part of the share to which any such child is entitled under this my will and my Trustees shall accordingly deduct the value thereof from the share or portion to which such child is entitled under this my will” and made a similar direction as regards money. The directions were referred to in the submissions and judgments in Re Tennant as the “hotchpot clause” (and I will refer to them in the same way). The will also included directions as to how such land, shares or property should be valued for the purpose of the hotchpot clause, including directing that one property should be valued for this purpose at a particular sum even if sold for more during Mr Tennant’s lifetime, but the will was silent as to the date of valuation, the timing of the ascertainment of proportions and as to the treatment of interest. The issues on appeal were as to the mechanics of giving effect to Mr Tennant’s directions, not as to whether, or the circumstances in which, the hotchpot clause was valid and effective.
Whilst observations were made in Re Tennant as to the “intention of a testator in inserting a hotchpot clause in his will” being “that there shall be a fair division among his children, and that they shall be equal inter se” and as to the manifest intention of Mr Tennant being to secure equality between his children (Rich J at 482; McTiernan J at 508), ultimately the question of construction raised turned on Mr Tennant’s intention as expressed in the will (Rich J at 482, 484-485; Dixon J at 489, 495, 497, 506; McTiernan J at 508-510).
Before the primary judge the respondents relied in particular upon the judgment of Dixon J at 487 (at [39] above). On the issue of construction, Dixon J also observed at 491-492 that:
The hotchpot provision may say that the advances are to be “deducted" from the advanced child's share, to be “taken in satisfaction" or "in part satisfaction" or "in or towards satisfaction of the share" or to be "taken" or " brought into account." Sometimes the words "by way of hotchpot" are added or there is some other express reference to “hotchpot.” With all such expressions it is natural to understand the direction as referring to a “deduction” from, “satisfaction” of, or “accounting” against a money fund …
By way of context, the money and property the subject of the directions in Re Tennant had been given by Mr Tennant to some of his children by way of advancement. That was the factual premise upon which that case was decided. Having regard to that factual premise, there is no basis to read references in the judgments in Re Tennant to the hotchpot clause relating to a “gift or gifts” as if the effect of such a clause is limited to gifts made during a testator’s life. Nor is there any basis to read the judgments as limiting the effect of hotchpot clauses to circumstances in which such a clause in fact achieves equality as between beneficiaries. Thus, for example, no question was raised by the Court as to whether the value which Mr Tennant directed be given to one of the properties dealt with in the hotchpot clause did or did not in fact achieve equality between the beneficiaries.
As is apparent, the analysis and outcome in Re Tennant turned upon the meaning to be given to Mr Tennant’s will. It is a case about construction, not about supervening principles which somehow expand, or contract, what could otherwise be achieved by the clear words of a will. More particularly, contrary to John’s submission, it is not a case that turns on the application of either a “doctrine” of hotchpot, or upon any equitable doctrine or principle.
The respondents also referred this Court to a decision of Jenkins J in Prichard v Prichard [2015] WASC 170. The testator in that case left the balance of his estate on trust for his five children, as tenants in common in equal shares but declared that:
[E]very advance of money or property made by me as set out in the paper writing kept with this Will … to any child of mine and every sum of money or property advanced by me to any child of mine shall be brought into hotchpot by such child upon the division of my residuary estate … and be accounted for accordingly and shall be brought into account …
A list of advances for this purpose was attached as a schedule to the will.
Consistent with the approach taken in Re Tennant, Jenkins J in Prichard v Prichard at [46] held that “a hotchpot clause must be construed according to its terms and in light of the circumstances in which it was made”. Having regard to the language of the will, which her Honour held at [55] was “clear”, at [54]-[55] she rejected the contention of one of the testator’s children that an advance that had been made for consideration could not be brought into hotchpot under the will.
The primary judge approached the case as one turning on the proper construction of the will. Her Honour upheld the construction of the will contended for by the respondents, finding that the words in cl 3(c) were qualified by the directions in cll 4 and 5. In this regard, there was no dispute before her Honour that she should approach the issue of construction by reference to the well-established authorities of Perrin v Morgan at 406, 416, Fell v Fell at 273-275, and De Lorenzo v De Lorenzo (2020) 104 NSWLR 155; [2020] NSWCA 351 at [50], as summarised by Richmond J in Estate of Chaddock (Deceased) [2025] NSWSC 463 at [22]-[29].
Her Honour accepted the respondents’ submission that, in construing the will, she was not required to make a finding as to whether or not the transfer was a gift and therefore made no finding on this factual issue, holding that it was an issue that “does not influence the resolution of this dispute”. Her Honour also observed that, in any event, “there would have been a very slim evidentiary basis on which the Court would have been able to consider this issue”. Her Honour referred to the multiple instances in which John submitted that the transfer was a gift (citing many of the references at [26] above) and observed that:
[W]hilst [John] appeared to me to assume it was common ground that the [t]ransfer represented a gift, he did not make any explicit submissions in relation to this issue nor did he put before the Court any evidence (other than the transfer itself) going to the issue.
In making this observation, her Honour was plainly aware of John’s affidavit evidence which went no further than reciting what was recorded on the memorandum of transfer.
Her Honour then addressed the proper construction of the will taken as a whole. Her Honour noted that both John and the respondents submitted that there was no ambiguity in cl 5 of the will, and her Honour was also of that view. Her Honour rejected John’s contention that the deceased had no power to give the direction in cl 5 as she did not have a proprietary interest in the Blandford property at the time of her death, and found that cl 5 was not seeking to confer an interest in property but was, rather, directing that property previously advanced be brought into account.
Her Honour approached the issue of construction on the “armchair principle” referred to in the speech of Lord Romer in Perrin v Morgan at 420. On that basis she held that, on construction, she could take account of a number of facts that the deceased could objectively be taken to have known, including the transfer, and that the signed memorandum of transfer recorded that the transferors acknowledged receipt of the consideration of $100,000. It is thus clear that her Honour took that evidence into account.
Consistent with what was done in Re Tennant, her Honour used the label “hotchpot”, or “equalisation” clause to describe cl 5 of the will. Her Honour added that, as illustrated by Re Tennant, equalisation clauses “may arise in circumstances where there have been inter vivos transfers (or gifts) in the course of a testator’s lifetime”. Nothing should be read into her Honour’s use of such labels as her Honour was doing no more than reflecting her view that the purpose and effect of cl 5 was to adjust, or qualify, the gift made in cl 3(c) of the will by reference to a transfer made during the deceased’s lifetime.
Her Honour referred to the respondents’ submissions as to the relevance of Re Tennant (including the submissions set out at [39]-[45] above), and noted that John did not appear to challenge the relevance of the legal principles in Re Tennant, but rather focussed his supplementary written submissions on factual assumptions made by the respondents, with reference to John’s supplementary written submissions set out at [40] above. Her Honour found that her construction of the will was:
[I]n keeping with the construction contended for by the [respondents], which includes reference to the ‘hotchpot doctrine’ (see [respondents’ supplementary written submissions]) and finds support from the reasoning of Dixon J in Re Tennant at 487 [referring to the passage extracted at [30] above].
Having reached her conclusion as to construction, her Honour focussed upon the parties’ supplementary written submissions, in particular, John’s submission set out at [41] above that, as her Honour put it, “appear[ed] to invite an inference that consideration was actually paid” for the transfer. Her Honour responded to these submissions in three ways.
First, by reference to the evidence, noting that there was no evidence before the Court that “consideration was in fact paid” for the transfer and referring, again, to the careful phrasing of John’s affidavit evidence on this point. In making this observation, her Honour was plainly aware of the terms of the memorandum of transfer (which she referred to in the next paragraph of her judgment and which was the subject of John’s affidavit evidence in this regard). Thus, her Honour should be understood here as drawing a distinction between what appeared on the face of the memorandum of transfer and evidence directly addressing the factual issue whether John and/or his wife actually paid any consideration for the transfer.
Second, by reference to the way in which the proceedings had been conducted prior to the filing of John’s supplementary written submissions. As to this, her Honour said that:
At no point before [John’s] written submissions in reply, either in written submissions or in the course of the hearing itself, did [John] seek to suggest the consideration recorded on the [memorandum of transfer] was actually paid.
Her Honour held that “[f]rom the perspective of procedural fairness alone it would not be appropriate for the Court to engage with this part of [John’s] submissions, in circumstances where [he] ha[d] had ample opportunity otherwise fairly and explicitly to raise [that] issue”. It is clear that, here, her Honour was referring the “the issue” of whether John paid consideration for the transfer. Whilst her Honour said that she did “not propose to deal with these submissions”, she added that she did not accept the accuracy of John’s reference to the memorandum of transfer being “uncontested evidence”, referring in this regard to the fact that there was no evidence that any consideration was actually paid and to counsel for John’s use of the term “gift” as describing the transfer in his oral submissions.
Third, and in any event, her Honour held that it was immaterial whether the deceased was “right or wrong when she referred to the Transfer as a ‘gift’”. Given that the deceased did not, in the will, refer to the transfer as a gift, and read in context, her Honour was plainly holding here that it was immaterial to the outcome of the case whether the transfer was in fact a gift. That holding was consistent with her Honour’s earlier finding (at [56] above) to this effect.
For convenience, in this part of my judgment I will refer to clauses such as those in cll 4 and 5 of the will, or considered by the Court in Re Tennant, as “hotchpot clauses”. However, consistent with my reasons, nothing flows from the adoption or use of such labels.
Given the matters raised, I propose to deal with the grounds of appeal raised by John adopting the numbering used in the notice of appeal, but out of the numerical order in which they appear.
In ground 1 John contends that the question whether the transfer was a gift, advance or settlement was critical in determining whether the hotchpot clauses were relevant to the construction of the deceased’s will. As counsel for John confirmed in his oral submissions, the underlying premise of this contention is that cl 5 of the will is unambiguous but must be put to one side if consideration was in fact paid for the transfer. This flows from John’s key contention that the deceased only had power to make a direction such as that made in cl 5 of the will as regards gifts and not as regards a transfer for which consideration was paid. This contention, in turn, rests upon John’s submission (which I have already rejected at [51] above) that Re Tennant reflects an exception to what would otherwise be the case, and is premised upon a hotchpot clause achieving equality when a gift has been made by the testator during their lifetime to one of the beneficiaries of the testator’s residuary estate. John thus contends that the primary judge erred in finding that it was unnecessary to reach any finding as to whether or not the transfer was a gift.
John’s contention should be rejected.
Consistent with the first and second principles set out by Isaacs J in Fell v Fell at 69-70, the meaning of the will is to be ascertained from the language used, having regard to the will as a whole. That is so irrespective of whether cll 4 and 5 are described as “hotchpot” or “equalising” clauses. Such labels, or descriptions, do not curtail the testator’s power to make provision in a will providing for how an estate is to be distributed after their death, nor do they curtail or dictate the available construction of such clauses. The task of the court remains one of ascertaining the meaning of the will as a whole.
Counsel for John candidly accepted during his oral submissions before this Court that he was not aware of any case which supported the proposition that property transferred during a testator’s lifetime can only be the subject of a hotchpot clause if it was transferred by way of gift.
John sought, instead, to locate support for his contention in ground 1 in the references by the Court in Re Tennant to the testator’s direction in the hotchpot clause covering “gifts” made during Mr Tennant’s lifetime (as noted above at [50]). However, as I have already explained, there is nothing in Re Tennant to indicate that either the approach to construction, or the outcome, in that case turned on the transfers made during Mr Tennant’s lifetime to his children being gifts. Nor, as a matter of principle, is there any reason why this would be so. Just as it was open to Mr Tennant to direct that one of his properties should be valued for the purpose of the hotchpot clause at a particular sum irrespective of whether it had been sold for more during his lifetime, it is open to a testator to direct that a particular transfer be the subject of a hotchpot clause even if made for consideration. , while not binding on this Court, is an illustration of such a case.
In ground 6 John challenges her Honour’s construction of the will, in particular, her conclusion that cl 3(c) is qualified by the direction in cl 5.
As reflected in the position taken by the parties both at first instance and on appeal, and as found by the primary judge, the terms of cl 5 of the will are clear. They unambiguously require that the value of the Blandford property (calculated as directed) be “brought into account and taken in satisfaction to that extent of the gift in [John’s] favour in Clause [3](c)”. Contrary to John’s submission, this is so irrespective of the fact that the qualification to the effect of cl 3(c) comes not from the language of that sub-clause, but from the language of the will as a whole.
John’s submissions to the contrary rest on two propositions which, he says, mean that, notwithstanding the unambiguous language used, the deceased could not do what she purported to do in cl 5 of the will. First, he submits that the deceased could not make a direction in her will in respect of property she did not own. This submission should be rejected. In cl 5 the deceased was not seeking to dispose of, or distribute the proceeds of, the Blandford property. She was simply directing as to how the value of that property should be brought into account in the distribution of her residuary estate. No reason was advanced by John why the deceased was not able to do that in her will. Second, John submits the deceased had no power to make directions in respect of property which was not an advancement, gift or settlement. I have already rejected that contention.
Her Honour’s conclusion as to construction was clearly correct. This is particularly so given that, as John accepts, on his construction of the will, cll 4 and 5 have no work to do.
Ground 6 should be rejected.
John’s counsel accepted in oral submissions before this Court that his appeal must fail if the primary judge was correct to find that cl 3(c) of the will was subject to cl 5. It follows from my conclusion as to construction, set out above, that that is the case. Notwithstanding this, consistent with Kuru v State of New South Wales (2008) 236 CLR 1; [2008] HCA 26 at [12] and Boensch v Pascoe (2019) 268 CLR 593; [2019] HCA 49 at [8], I will deal with the remaining grounds of appeal.
In ground 5 John contends that the primary judge found that the transfer was an advancement, gift or settlement. That contention can be dealt with briefly. Her Honour made no such finding. Her Honour found that that transfer fell within the ambit of cl 5 irrespective of whether it was a gift.
Ground 5 should be rejected.
In ground 2 John challenges the primary judge’s holding that “there was no evidence before the Court that any consideration was in fact paid for the [t]ransfer”. John contends that this finding was erroneous having regard to the acknowledgement of receipt of consideration of $100,000 on the memorandum of transfer and that her Honour erred in dismissing or ignoring that evidence.
As I have already noted, her Honour did not ignore that evidence. Her Honour expressly referred to it on a number of occasions and found that it was one of the surrounding circumstances to which regard should be had on construction of the will. Moreover, as I explain at [63] above, in making the finding John seeks to impugn in ground 2, her Honour’s focus was upon the absence of any evidence going to the actual fact of payment being made, drawing a distinction between that fact and the acknowledgement of receipt recorded on the memorandum of transfer. Her Honour did not err in drawing that distinction, to which she attached some significance, bearing in mind the careful phrasing of John’s affidavit at [5].
Ground 2 should be rejected.
In ground 3, John challenges the primary judge’s holding that it was not appropriate for her Honour to engage with that part of his supplementary written submissions where he contended that the consideration recorded on the memorandum of transfer was actually paid (see above at [40]). He contends that her Honour erred in finding that the respondents had had no opportunity to respond to those submissions as, he submits, there was nothing to stop the respondents from seeking leave to submit further submissions and/or leave to adduce further evidence.
The short, and conclusive, answer to this contention is that nothing turns upon her Honour’s conclusion in this regard, in circumstances where her Honour correctly held that the outcome of the case did not turn upon whether the transfer was or was not a gift. That was one of the three, independent, reasons her Honour gave for rejecting John’s supplementary written submissions in this regard (see [63]-[66] above).
In any event, her Honour did not err in declining to consider the issue, raised for the first time in John’s supplementary written submissions, as to whether the transfer was a gift. It was highly unsatisfactory for that factual issue to be raised in supplementary written submissions filed after the hearing in circumstances where the proceedings had been conducted up until that point in time on the basis that it was a gift and where her Honour did not grant leave for this factual issue to be raised in supplementary written submissions. If John had alleged in his written submissions before the hearing, or in oral submissions at the hearing, that the transfer was not a gift, such that the factual issue whether the transfer was a gift had been live, the respondents may have, for example, sought to cross-examine John on the issue. In these circumstances, her Honour did not err in declining to engage with John’s supplementary written submissions insofar as they were premised on the transfer not being a gift and in, correctly, observing that the respondents had had no opportunity to respond to that submission. That was, in fact, the case. That is so irrespective of whether some attempt could have been made by the respondents to seek that the proceedings be reopened in order to ventilate the factual issue whether or not the transfer was a gift.
Ground 3 should be rejected.
Had it been necessary to do so, I would have rejected ground 3 on the separate basis that (for the reasons set out at [26]-[33] above) John’s counsel’s repeated submission that the transfer was a gift constituted an admission and that he did not seek leave to withdraw that admission.
In ground 4 John contends that the primary judge erred in not finding that the memorandum of transfer was uncontested evidence of the receipt by the deceased and Craig of the sum of $100,000 as consideration for the transfer. Her Honour’s finding in this regard is set out at [65] above.
Her Honour’s finding was premised upon two matters. First, that there was no evidence before the Court that consideration was actually paid. Second, that the proceedings had been conducted by John on the premise that the transfer was a gift. In light of these matters, and in light of the principles discussed at [15] above, her Honour was correct not to accept John’s contention that there was “uncontested” evidence that consideration was in fact received for the transfer. John conducted the proceedings at all times until the filing of his supplementary written submissions on the premise that the transfer was a gift in circumstances where that factual issue was raised in the respondents’ written submissions filed in advance of the hearing. Further, as I have already explained, John’s failure in his affidavit evidence to say anything as to whether consideration was in fact paid could properly be taken into account by her Honour when weighing the evidence.
Ground 4 should be rejected.
It follows that the appeal should be dismissed.
As to costs, John contended that his costs should be paid out of the estate but advanced no submissions as to why costs would not follow the event if his appeal was dismissed. The respondents sought an order that their costs be paid by John. Given the comprehensive rejection of John’s grounds of appeal, the appropriate order is that John should pay the respondents’ costs of the appeal.
The orders I propose are:
Appeal dismissed.
The appellant is to pay the respondents’ costs of the appeal.
McHUGH JA: I agree with Stern JA.
**********
Tanner
Tanner
[2008] HCA 26
[2015] WASC 170
(2012) 247 CLR 345
(2019) 268 CLR 593
(2020) 102 NSWLR 537
(1981) 147 CLR 246
(2020) 104 NSWLR 155
(1922) 31 CLR 268
(2008) 167 FCR 314
(2008) 236 CLR 1
(1951) 84 CLR 91
(1942) 65 CLR 473
(2003) 215 CLR 643
(2001) 52 NSWLR 492
Appeal dismissed. The appellant was ordered to pay the respondents’ costs of the appeal. [101]
cll 3(c), 4 and 5 of the will were clear: cll 4 and 5 directed that certain advances be taken in satisfaction of the gifts in cl 3(c) and that this was the “only construction available on the document”; and
the judgment of Dixon J in R**e Tennant at 487 supported their submission that the deceased had the power to direct in the will that certain advances in her lifetime be brought into account in satisfaction to that extent of the gift in John’s favour in cl 3(c) of the will. They submitted that the will in Re Tennant contained similar provisions to, and gave “guidance and context” to, the clauses in the will in the present case because, as in this case, the residue clause in Re Tennant was not itself expressed to be qualified by any subsequent directions. In Re Tennant at 491-492 Dixon J had observed that directions that advances be brought into hotchpot may take varying forms, including that they be “taken in satisfaction” or “brought into account” and that, “[w]ith all such expressions it is natural to understand the direction as referring to a ‘deduction’ from, ‘satisfaction’ of, or ‘accounting’ against a money fund”.
In this way, as with the respondents’ oral submissions before the primary judge, the respondents’ supplementary written submissions did not rely upon any “doctrine” of hotchpot.
In his responsive supplementary written submissions, John also summarised the history of the development and abolishment of the doctrine of hotchpot. Then, under the heading “Response to Defendants’ Supplementary Written Submissions”, he made the following contentions:
To the extent that John contends that the construction and outcome in Re Tennant were dependent upon the hotchpot clause in fact achieving equality as between the beneficiaries of Mr Tennant’s residuary estate, that contention is misplaced for the reasons set out at [48]-[50] above, namely, that that was subject always to the intention disclosed by the will. Had the validity and effect of the hotchpot clause in Re Tennant turned upon the clause actually achieving equality as between the beneficiaries, then it would not have been permitted to stand without some enquiry as to whether the prescribed value of one of the properties to which the clause related reflected its actual value.
As noted above at [61], her Honour observed that her construction of the will was “in keeping with the construction contended for by the [respondents], which includes reference to the ‘hotchpot doctrine’” and that it was also supported by the reasoning of Dixon J in Re Tennant at 487. That observation must be read having regard to the respondents’ supplementary written submissions as to the relevance of Re Tennant which her Honour extracted in her judgment (and which I have summarised at [39] above). So read, her Honour’s references to the hotchpot doctrine and Re Tennant suggest nothing more than an acceptance of the respondents’ supplementary submissions, which were not in any sense predicated upon the transfer being characterised as a gift or upon any doctrine of hotchpot. In that context, her Honour’s reference to the “hotchpot doctrine” should be read simply as a reference to the approach taken by the High Court in Re Tennant to the construction of a hotchpot clause, in particular, that it could qualify an earlier clause in a will dealing with the division of a residuary estate even if there were no words of qualification in that earlier clause.
Moreover, as is apparent from the analysis of Re Tennant at [46]-[54] above, her Honour was correct to find that her construction of the will was supported by the judgment of Dixon J in Re Tennant at 487, in which his Honour confirmed that the effect of a later direction in a hotchpot clause is that it qualifies a gift made in the will. That is inconsistent with John’s contention that cl 5 “contradicted” cl 3(c) of the will in this case.
It is also of significance that cl 5 of the will directed that the Blandford property was to be “treated as an advancement to John”. That language makes it clear that cl 5 is not in any way dependent upon the transfer in fact being a gift, advancement or settlement. In these circumstances, there was no error in her Honour finding that cl 5 applied to the transfer irrespective of whether it was a gift.
To the extent that her Honour did not deal expressly with John’s contention before this Court that a hotchpot clause can only operate as regards a gift, that is of no moment for three reasons, each of which independently supports the correctness of her approach. First, her Honour rested her decision on the unambiguous language of the will and the support that Re Tennant gave for her construction of the will and her conclusion in this regard was, for the reasons I have already given and those set out below as regards ground 6, correct. Second, her Honour expressly declined to deal with John’s contention in his supplementary written submissions that the transfer was not a gift. Third, no such submission was ever clearly articulated before her (see [41]-[45] above).
Ground 1 should be rejected.