Thompson v Sgro

Supreme Court of NSW|2016-11-21|Before: Hallen J

Background Facts

As in all claims for a family provision order, factual context is necessary. It is convenient to begin with a statement of facts since they provide that context. In relation to any disputed matters to which I refer, the following facts should be regarded as the findings of the Court.

Other Additional Facts

In addition to the background facts, I am satisfied that the following facts have been established (by reference to Ex. 1). Some of the facts mentioned are necessary to consider because the Defendant contends that the Plaintiff has a very poor track record in handling money.
The deceased and her husband purchased a property at Lackey Street Merrylands ("the Merrylands property") in September 1956 for £3,150. In September 1985, they transferred the Merrylands property to the Plaintiff, the Transfer revealing the consideration to be $25,000.
The Plaintiff and her husband, Stephen, obtained a mortgage securing a debt of $22,500 from the Commonwealth Bank at the time. However, they did not use the funds to pay her parents, but used it to effect renovations to the Merrylands property. Indeed, the Plaintiff accepted that she had paid nothing to her parents to enable the transfer of the Merrylands property to her.
The Plaintiff sold the Merrylands property in about February 1989 for $136,000. No part of the sale price was paid to her parents.
At about the time the Plaintiff sold the Merrylands property, she and her husband purchased a property at Winston Drive, Doonside ("the Doonside property") for $144,000. There was a mortgage registered on the title to the Doonside property securing a debt of $80,000, which mortgage was discharged in September 1997 and another mortgage, securing a debt of $64,750, was obtained. In addition, there was a second mortgage registered on the title to the Doonside property but for what reason, and to secure what amount, is not disclosed in the evidence. Each of these mortgages appears to have been discharged in August 2000, when a mortgage securing a debt of $175,000 was registered. This mortgage was discharged in May 2001, when another mortgage, securing a debt of $190,000 was entered into. That mortgage was discharged in June 2004, when another mortgage, securing a debt of $253,000 was entered into. That mortgage was discharged in April 2007, when another mortgage, securing a debt of $285,000 was entered into. That mortgage was discharged in June 2010, when they sold the property for $420,000.
The Plaintiff and her husband purchased a property at Gray Street, Southport in Queensland ("the Southport property") in February 1998 for $169,900. There was a mortgage registered on the title to the Southport property securing a debt of $141,000. The Southport property was sold in October 2002 for $139,900. It seems to have been an unsuccessful investment for the Plaintiff and her husband.
In May 2009, the Plaintiff and her husband purchased a property at Townsend Crescent, Ropes Crossing ("the Ropes Crossing property") for $560,000. There was a mortgage registered on the title to the Ropes Crossing property. The amount secured by the mortgage at the time of the purchase appears to have been $528,958.
The Plaintiff and her husband remain the registered proprietors as joint tenants of this property. (Ropes Crossing is a suburb of Blacktown in Sydney.)
The Ropes Crossing property has built on it a detached two-level brick veneer and tile residential property. The amenities include 5 bedrooms, three bathrooms, "excellent landscaping" with the rear yard including a timber deck. It is said to be in "above average" internal and external condition and repair.
It will be necessary to return to the current financial and material circumstances of the Plaintiff (and her husband) later in these reasons.

The Statutory Scheme

Next, I shall discuss the statutory scheme that is relevant to the facts of the present case. As the Plaintiff's eligibility and the commencement of the proceedings within time is not in issue, the sole questions for the Court to determine are whether at the time when the Court is considering the application, adequate provision for the Plaintiff's proper maintenance, education or advancement in life has not been made by the deceased's Will and whether an order for provision out of the estate ought to be made for her maintenance, education or advancement in life, having regard to the facts known to the Court at the time the order is made: s 59 of the Act.
The parties were largely agreed as to the principles to be applied on this topic so it is not necessary to re-state them in detail. I have dealt with them in many cases, one of which is Hinderry v Hinderry [2016] NSWSC 780.
Whether the disposition of the deceased's estate was not such as to make adequate provision for the proper maintenance, education or advancement in life of the Plaintiff will always, as a practical matter, involve an evaluation of the provision, if any, made for the claimant on the one hand, and the claimant's "needs" that cannot be met from his, or her, own resources on the other: Hunter v Hunter (1987) 8 NSWLR 573 at 575 (Kirby P). In the circumstances of this case, bearing in mind the agreement that there is no property which remains that falls within the residuary estate, the Plaintiff will receive nothing unless an order under the Act is made.
Although the existence or absence of "needs" which the applicant cannot meet from her, or his, own resources will always be highly relevant and often decisive, the statutory formulation, and, therefore, the issue in every case, is whether the disposition of the deceased's estate was not such as to make adequate provision for his or her proper maintenance, education and advancement in life: Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201 at 227 (Gaudron J).
"Need", of course, is also a relative concept: de Angelis v de Angelis [2003] VSC 432 at [45] (Dodds-Streeton J). It is different from "want" and does not simply mean "demand" or "desire". The latent difference between the words was stated by Lord Neuberger of Abbotsbury (now President of the Supreme Court of the United Kingdom), in the House of Lords decision, R (on the application of M) v Slough Borough Council [2008] UKHL 52; [2008] 1 WLR 1808 at [54]: "'Need' is a more flexible word than it might first appear. 'In need of' plainly means more than merely 'want', but it falls far short of 'cannot survive without'."
In Boettcher v Driscoll [2014] SASC 86; (2014) 119 SASR 523 at [41], David J at added: "'Need' is not so synonymous with 'want' such that the two are interchangeable."
In Jones (a pseudonym) v Smith (a pseudonym) [2016] VSCA 178, the Victorian Court of Appeal confirmed, at [65], that it was essential to success that a claimant establish need, but, at [38] and [66], that need is a relative concept, which "[is] to be assessed in light of all the circumstances having regard to the factors in s 91(4)(e)-(p). It is not a case of looking in isolation at the value of the assets that the claimant has and deciding whether the person has enough to get by on whether comfortably or otherwise. Rather, the claimant's assets and income are just two facts that go into the melting pot to determine whether there has been adequate provision made. Another important element for this consideration is the size of the estate. If there is more money to go around, then that will affect what is adequate for the proper maintenance and support of the claimant."
(The High Court recently, in Jones (a pseudonym) v Smith (a pseudonym) [2016] HCASL 310, stated that: "In view of the fact that the provisions of the Administration and Probate Act 1958 (Vic) which fell for consideration by the Court of Appeal of the Supreme Court of Victoria (Whelan, Ferguson and Kaye JJA) have now been amended in relation to estates of testators and testatrices dying on or after 1 January 2015, this application is not an appropriate vehicle for the grant of special leave.")
As Callinan and Heydon JJ emphasised in Vigolo v Bostin (2005) 221 CLR 191; [2005] HCA 11 at [122], the question of the adequacy of the provision made by the deceased "is not to be decided in a vacuum, or by looking simply to the question whether the applicant has enough upon which to survive or live comfortably". The inquiry is not confined only to the material circumstances of the applicant. The whole of the context must be examined.
All of the financial needs of an applicant have to be taken into account and considered by reference to the other factors referred to in the Act. What is proper provision is not arrived at by adding up all of the identified financial needs: Hyland v Burbidge [2000] NSWSC 12 at [56]. Nor does it follow that, if the Court decides it is inappropriate to make a specific provision in respect of one identified head of claim, that any identified financial need, even a contingent need, in relation to that claim becomes irrelevant to the final assessment: Mayfield v Lloyd-Williams [2004] NSWSC 419 at [89].
Whether to make an order for provision and what provision ought to be made is a question which Mason CJ, Deane and McHugh JJ, in Singer v Berghouse, at 211, affirmed involves an exercise of discretion in the accepted sense. The fact that the Court has a discretion means that it may refuse to make an order even though the jurisdictional question has been answered in the applicant's favour.
Section 60 of the Act provides: "(1)The court may have regard to the matters set out in subsection (2) For the purpose of determining: (a) whether the person in whose favour the order is sought to be made (the 'applicant') is an eligible person, and (b) whether to make a family provision order and the nature of any such order. (2) The following matters may be considered by the court: (a) any family or other relationship between the applicant and the deceased person, including the nature and duration of the relationship, (b) the nature and extent of any obligations or responsibilities owed by the deceased person to the applicant, to any other person in respect of whom an application has been made for a family provision order or to any beneficiary of the deceased person's estate, (c) the nature and extent of the deceased person's estate (including any property that is, or could be, designated as notional estate of the deceased person) and of any liabilities or charges to which the estate is subject, as in existence when the application is being considered, (d) the financial resources (including earning capacity) and financial needs, both present and future, of the applicant, of any other person in respect of whom an application has been made for a family provision order or of any beneficiary of the deceased person's estate, (e) if the applicant is cohabiting with another person-the financial circumstances of the other person, (f) any physical, intellectual or mental disability of the applicant, any other person in respect of whom an application has been made for a family provision order or any beneficiary of the deceased person's estate that is in existence when the application is being considered or that may reasonably be anticipated, (g) the age of the applicant when the application is being considered, (h) any contribution (whether financial or otherwise) by the applicant to the acquisition, conservation and improvement of the estate of the deceased person or to the welfare of the deceased person or the deceased person's family, whether made before or after the deceased person's death, for which adequate consideration (not including any pension or other benefit) was not received, by the applicant, (i) any provision made for the applicant by the deceased person, either during the deceased person's lifetime or made from the deceased person's estate, (j) any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person, (k) whether the applicant was being maintained, either wholly or partly, by the deceased person before the deceased person's death and, if the Court considers it relevant, the extent to which and the basis on which the deceased person did so, (l) whether any other person is liable to support the applicant, (m) the character and conduct of the applicant before and after the date of the death of the deceased person, (n) the conduct of any other person before and after the date of the death of the deceased person, (o) any relevant Aboriginal or Torres Strait Islander customary law, (p) any other matter the Court considers relevant, including matters in existence at the time of the deceased person's death or at the time the application is being considered."
It can be seen that s 60(2) enumerates 15 specific matters, described by Basten JA in Andrew v Andrew [2012] NSWCA 308; (2012) 81 NSWLR 656 at [37], as "a multifactorial list", and by Lindsay J in Verzar v Verzar [2012] NSWSC 1380 at [123], as "a valuable prompt" to which the Court may have regard, together with "any other matter the court considers relevant", for the purposes of determining eligibility, whether to make a family provision order and the nature of any such order.
In Chapple v Wilcox [2014] NSWCA 392; 87 NSWLR 646 at [7], Basten JA wrote: "Section 60 of the Succession Act spells out the matters which the Court may have regard to in determining whether the claimant 'is an eligible person' and whether to make a family provision order: s 60(1). Most of the factors listed in s 60(2) will be irrelevant in relation to whether the applicant is an eligible person, a matter largely dependent upon the language of s 57. The matters set out must be available considerations in relation to both limbs of s 59(1) dealing with a family provision order, namely par (b) and par (c). Section 60 provides no assistance in relation to the different considerations which may arise in respect of each paragraph of s 59(1). The factors are also relevant to the determination of the 'nature of any such order', which presumably includes the discretionary element to be found in s 59(2): s 60(1)(b)."
The section does not prioritise the catalogue of matters that may be taken into account. No matter is more, or less, important than any other. The weight of such of the matters specified in the section, which may be taken into account, will depend upon the facts of the particular case. There is no mandatory command to take into account any of the matters enumerated. None of the matters listed is, necessarily, of decisive significance and none differentiate, in their application, between classes of eligible person. Similarly, there is no distinction based on gender.
The section also does not say how the matters listed are to be used to determine the matters identified in s 60(1). Considering each of the relevant matters does not prescribe a particular result, and whilst there is likely to be a substantial overlap in the matters that the Court may take into account when determining the answers to what is posed in s 60(1), those matters are not identical.
A reference to some of the matters in s 60(2) not only permits, but requires, a comparison to be made between the respective positions of the applicant and any other eligible person, as well as of any beneficiary, whilst others do not. Importantly, also, many of the matters in sub-section (2), of themselves, are incapable of providing an answer to the questions posed in s 60(1).
Leaving aside the question of eligibility, the matters referred to in s 60(2) may be considered on "the discretionary question", namely whether to make an order and the nature of that order. Importantly, under s 60(2), attention is drawn to matters that may have existed at the deceased's death, or subsequently.
Section 65(1) of the Act requires the family provision order to specify: 1. the person or persons for whom provision is to be made, and 2. the amount and nature of the provision, and 3. the manner in which the provision is to be provided and the part or parts of the estate out of which it is to be provided, and 4. any conditions, restrictions or limitations imposed by the Court.
If the provision is made by payment of an amount of money, the order may specify whether interest is payable on the whole, or any part, of the amount payable for the period, and, if so, the period during which interest is payable and the rate of interest (s 65(3) of the Act).
Unless the Court orders otherwise, any family provision order under the Act takes effect as if it were a codicil to the will (s 72(1) of the Act).
Section 66 of the Act sets out the consequential and ancillary orders that may be made.
Section 99(1) of the Act provides that the Court may order the costs of proceedings in relation to the estate, or notional estate, of the deceased (including costs in connection with mediation) to be paid out of the estate in such manner as the Court thinks fit.
The Court's discretion is not untrammelled, or to be exercised according to idiosyncratic notions of what is thought to be fair, or in such a way as to transgress, unnecessarily, upon the deceased's freedom of testation: Pontifical Society for the Propagation of the Faith v Scales [1962] HCA 19; (1962) 107 CLR 9 at 19 (Dixon CJ); McKenzie v Topp [2004] VSC 90 at [63].
In Stott v Cook (1960) 33 ALJR 447 at 453-4, Taylor J, although dissenting in his determination of the case, observed that the Court did not have a mandate to rework a will according to its own notions of fairness. His Honour added: "There is, in my opinion, no reason for thinking that justice is better served by the application of abstract principles of fairness than by acceptance of the judgment of a competent testator whose knowledge of the virtues and failings of the members of his family equips him for the responsibility of disposing of his estate in far better measure than can be afforded to a Court by a few pages of affidavits sworn after his death and which only too frequently provide but an incomplete and shallow reflection of family relations and characteristics. All this is, of course, subject to the proviso that an order may be made if it appears that the testator has failed to discharge a duty to make provision for the maintenance, education or advancement of his widow or children. But it must appear, firstly, that such a duty existed and, secondly, that it has not been discharged."
Of the freedom, in Grey v Harrison [1997] 2 VR 359, Callaway JA said, at 366: "... [I]t is one of the freedoms that shape our society, and an important human right, that a person should be free to dispose of his or her property as he or she thinks fit. Rights and freedoms must of course be exercised and enjoyed conformably with the rights and freedoms of others, but there is no equity, as it were, to interfere with a testator's dispositions unless he or she has abused that right. To do so is to assume a power to take property from the intended object of the testator's bounty and give it to someone else. In conferring a discretion in the wide terms found in s 91, the legislature intended it to be exercised in a principled way. A breach of moral duty is the justification for curial intervention and simultaneously limits its legitimate extent."
In Vigolo v Bostin, at [10], Gleeson CJ pointed out that the relevant legislation did not confer new rights of succession and did not create legal rights of inheritance. Rather, his Honour explained: "It preserved freedom of testamentary disposition, but subjected that freedom to a new qualification".
In Goodsell v Wellington [2011] NSWSC 1232 at [108], I also noted that: "Freedom of testamentary disposition remains a prominent feature of the Australian legal system. Its significance is both practical and symbolic and should not be underestimated."
White J referred to these principles in Slack v Rogan; Palffy v Rogan [2013] NSWSC 522; (2013) 85 NSWLR 253, at [127]: "In my view, respect should be given to a capable testator's judgment as to who should benefit from the estate if it can be seen that the testator has duly considered the claims on the estate. That is not to deny that s 59 of the Succession Act interferes with the freedom of testamentary disposition. Plainly it does, and courts have a duty to interfere with the will if the provision made for an eligible applicant is less than adequate for his or her proper maintenance and advancement in life. But it must be acknowledged that the evidence that can be presented after the testator's death is necessarily inadequate. Typically, as in this case, there can be no or only limited contradiction of the applicant's evidence as to his or her relationship and dealings with the deceased. The deceased will have been in a better position to determine what provision for a claimant's maintenance and advancement in life is proper than will be a court called on to determine that question months or years after the deceased's death when the person best able to give evidence on that question is no longer alive. Accordingly, if the deceased was capable of giving due consideration to that question and did so, considerable weight should be given to the testator's testamentary wishes in recognition of the better position in which the deceased was placed (Stott v Cook (1960) 33 ALJR 447 per Taylor J at 453-454 cited in Nowak v Beska [2013] NSWSC 166 at [136]). This is subject to the qualification that the court's determination under s 59(1)(c) and (2) is to be made having regard to the circumstances at the time the court is considering the application, rather than at the time of the deceased's death or will."
In Henry v Hancock [2016] NSWSC 71 at [69], Brereton J wrote: "Formerly, the yardstick which was applied was that of the wise and just testator. Nowadays, it is fashionable to couch it in terms of "community standards", although I am not at all sure that this is any different from the moral obligation of a wise and just testator and, as has not infrequently been pointed out, there is no ascertainable external community standard to guide the decision, which involves a broad evaluative judgment unconstrained by preconceptions and predispositions, and affording due respect to the judgment of a capable testator who appears to have duly considered the claims on his or her testamentary bounty - subject to the qualification that the court's determination is made having regard to the circumstances at the time of the hearing, rather than at the time of the testator's will or death."
In Revell v Revell [2016] NSWSC 947, Pembroke J wrote at [5]: "It is desirable to re-iterate two principles that underlie this area of the law. The first is that courts do not rewrite the will of a deceased person simply because it appears to be unfair, unequal or unwise. Fairness and equality are not touchstones for relief under the Succession Act. Within the limits of the law, a testator may dispose of his estate as he sees fit. Adult children have no automatic right to a share in the estate of a parent. Nor do they have an automatic right to equality between them. That may be the system in most European countries, of which the French law of inheritance is a well-known example, but it is not the law in Australia. Freedom of testamentary disposition, subject to disturbance only where the requirements of the Act are met, is an integral part of our law."
In all cases under the Act, what is adequate and proper provision is necessarily fact specific. The nature and content of what is adequate provision is not fixed or static. Rather, it is a flexible concept, the measure of which should be adapted to conform with what is considered to be right and proper according to contemporary accepted community standards: Pontifical Society for the Propagation of the Faith v Scales at 19; Vigolo v Bostin, at 199 and 204; Camernik v Reholc [2012] NSWSC 1537.
In a claim by an adult child, the following principles are useful to remember: 1. The relationship between parent and child changes when the child attains adulthood. However, a child does not cease to be a natural recipient of parental ties, affection or support, as the bonds of childhood are relaxed. 2. It is impossible to describe, in terms of universal application, the moral obligation, or community expectation, of a parent in respect of an adult child. It can be said that, "ordinarily the community expects parents to raise and educate their children to the very best of their ability while they remain children; probably to assist them with a tertiary education, … where that is feasible; where funds allow, to provide them with a start in life - such as a deposit on a home, although it might well take a different form. The community does not expect a parent, in ordinary circumstances, to provide an unencumbered house, or to set his, or her, child up in a position where she or he can acquire a house unencumbered, although in a particular case, where assets permit and the relationship between the parties is such as to justify it, there might be such an obligation": Taylor v Farrugia [2009] NSWSC 801 at [57]; McGrath v Eves [2005] NSWSC 1006; Kohari v Snow [2013] NSWSC 452 at [121]; Salmon v Osmond [2015] NSWCA 42 at [109]. 3. Generally, also, "the community does not expect a parent to look after his or her children for the rest of [the child's life] and into retirement, especially when there is someone else, such as a spouse, who has a primary obligation to do so. Plainly, if an adult child remains a dependent of a parent, the community usually expects the parent to make provision to fulfil that ongoing dependency after death. But where a child, even an adult child, falls on hard times and where there are assets available, then the community may expect a parent to provide a buffer against contingencies; and where a child has been unable to accumulate superannuation or make other provision for their retirement, something to assist in retirement where otherwise they would be left destitute": Taylor v Farrugia at [58]. 4. If the applicant has an obligation to support others, such as a parent's obligation to support a dependent child, that will be a relevant factor in determining what is an appropriate provision for the maintenance of the applicant: Re Buckland, Deceased [1966] VR 404 at 411; Hughes v National Trustees Executors and Agency Co of Australasia Ltd at 148; Goodman v Windeyer [1980] HCA 31; 144 CLR 490 at 498, 505. But the Act does not permit orders to be made to provide for the support of third persons that the applicant, however reasonably, wishes to support, where there is no obligation of the deceased to support such persons: Re Buckland, Deceased at 411; Kleinig v Neal (No 2) [1981] 2 NSWLR 532 at 537; Mayfield v Lloyd-Williams at [86]. 5. There is no need for an applicant adult child to show some special need or some special claim: McCosker v McCosker [1957] HCA 82, (1957) 97 CLR 566; Kleinig v Neal (No 2) at 545; Bondelmonte v Blanckensee [1989] WAR 305; Hawkins v Prestage (1989) 1 WAR 37 at [45] (Nicholson J). 6. The adult child's lack of reserves to meet demands, particularly of ill health, which become more likely with advancing years, is a relevant consideration: MacGregor v MacGregor [2003] WASC 169 at [179]-[182]; Crossman v Riedel [2004] ACTSC 127 at [49]. Likewise, the need for financial security and a fund to protect against the ordinary vicissitudes of life are relevant: Marks v Marks [2003] WASCA 297 at [43]. In addition, if the applicant is unable to earn, or has a limited means of earning, an income, this could give rise to an increased call on the estate of the deceased: Christie v Manera [2006] WASC 287; Butcher v Craig [2009] WASC 164 at [17]. 7. The applicant has the onus of satisfying the Court, on the balance of probabilities, of the justification for the claim: Hughes v National Trustees, Executors and Agency Co of Australasia Ltd at 149.
A very similar statement of the principles, which I set out in Bowditch v NSW Trustee and Guardian [2012] NSWSC 275 at [111], was cited with approval in Chapple v Wilcox at [21] (Basten JA); and at [65]-[67] (Barrett JA); and was referred to, with no apparent disapproval in Smith v Johnson [2015] NSWCA 297 at [62] (although in that appeal there was no challenge to the correctness of those principles).
In Foley v Ellis [2008] NSWCA 288 at [88], Sackville AJA noted that Singer v Berghouse "strongly suggests that the court cannot consider the propriety and adequacy (or inadequacy) of any testamentary provision for an applicant in isolation from the resources and needs of other claimants on the deceased's bounty".
In this case, the only other claimant on the bounty of the deceased is the Defendant. She does not advance her financial and material circumstances, but as previously stated, this does not mean that the Court may disregard her entirely, as she is the chosen object of the deceased's testamentary bounty. She does not have to prove an entitlement to the provision made in the deceased's Will for her or otherwise justify such provision. Nor can her claim as the chosen object of testamentary bounty be forgotten.

Qualifications on "Principles"

As long ago as 1980, in White v Barron (1980) 144 CLR 431; [1980] HCA 14, at 440, Stephen J wrote: "[T]his jurisdiction is pre-eminently one in which the trial judge's exercise of discretion should not be unduly confined by judge-made rules of purportedly general application."
As I have stated in a number of cases (see, for example, Bowditch v NSW Trustee and Guardian), I do not intend what I have described as "principles" to be elevated into rules of law, propositions of universal application, or rigid formulae. Nor do I wish to suggest that the jurisdiction should be unduly confined, or the discretion should be constrained, by statements of principle found in dicta in other decisions, or by preconceptions and predispositions. Decisions of the past do not, and cannot, put any fetters on the discretionary power, which is left largely unfettered. I identify them merely as providing useful guidance, which may be applied, with circumspection, in considering the statutory provisions, the terms of which must remain firmly in mind.
The importance of the qualifications to which I have referred in the last paragraph has been stressed in Chapple v Wilcox by Basten JA, at [18]-[20], and by Barrett JA, at [66]-[67]. They must be remembered.

Additional Facts

I set out additional facts I am satisfied are either not in dispute, or that, in my view, have been established by the evidence. I do so by reference to s 60(2) of the Act. Where necessary, I shall express the conclusions to which I have come. I have taken this course, not "to dwell on particular matters as if they were, in themselves, determinant of the broad judgments required to be made under s 59" (Verzar v Verzar at [124]), but in order to complete the recitation of facts that will assist me to determine the questions that must be answered. (a) any family, or other, relationship between the applicant and the deceased person, including the nature and duration of the relationship
As stated, the relationship between the deceased and the Plaintiff is that of child and mother. That relationship existed throughout the Plaintiff's life. I am satisfied that the relationship was a close one and that it endured until the death of the deceased. They kept in contact throughout the Plaintiff's life with the Plaintiff visiting, or being visited by, the deceased. They also holidayed together at different places in New South Wales, including at the Defendant's Central Coast holiday home. In the latter years, the Plaintiff did some housework for the deceased and cared for the deceased's husband. The Plaintiff received a carer's benefit whilst doing so. After 2012, the deceased regularly stayed with the Plaintiff at the Ropes Crossing property.
The Plaintiff also took the deceased to see her husband in hospital.
I am satisfied that the relationship of the Plaintiff and the deceased existed throughout the Plaintiff's life and that it was a close and loving relationship. (b) the nature and extent of any obligations or responsibilities owed by the deceased person to the applicant, to any other person in respect of whom an application has been made for a family provision order or to any beneficiary of the deceased person's estate
There is no definition of the words "obligations" or "responsibilities" to which the sub-section refers in the Act. Each word is to be understood in its ordinary, grammatical meaning as the condition of being morally or legally bound.
The responsibility of the deceased was expressed by Lord Romer in Bosch v Perpetual Trustee Co Ltd [1983] AC 463 at 478-479: "Their Lordships agree that in every case the Court must place itself in the position of the testator and consider what he ought to have done in all the circumstances of the case, treating the testator for that purpose as a wise and just, rather than a fond and foolish, husband or father. This no doubt is what the learned judge meant by a just, but not a loving, husband or father."
This factor requires a balancing of potentially competing obligations as between the applicant and the beneficiary.
Leaving aside any obligation, or responsibility, arising as a result of their relationship as parent and child, the deceased did not have any legal obligation to the Plaintiff as a child, once she became an adult, imposed upon her by statute or common law. Yet, an obligation or responsibility to make adequate provision for the proper maintenance, education or advancement in life, continues to be recognised.
In Flathaug v Weaver [2003] NZFLR 730 at [32], the origin of the obligation which underpins the Act's recognition of the duty owed by a parent to a child was put in this way: "The relationship of parent and child has primacy in our society. The moral obligation which attaches to it is embedded in our value system and underpinned by the law. The Family Protection Act recognises that a parent's obligation to provide for both the emotional and material needs of his or her children is an ongoing one. Though founded on natural or assumed parenthood, it is, however, an obligation which is largely defined by the relationship which exists between parent and child during their joint lives."
Yet, there is no "presumptive testamentary entitlement of an [adult] offspring": Underwood v Gaudron [2015] NSWCA 269, at [73] (Basten JA). (c) the nature and extent of the deceased person's estate (including any property that is, or could be, designated as notional estate of the deceased person) and of any liabilities or charges to which the estate is subject, as in existence when the application is being considered
I have earlier dealt with these matters. The value of the estate is reasonable, albeit not large. (d) the financial resources (including earning capacity) and financial needs, both present and future, of the applicant, of any other person in respect of whom an application has been made for a family provision order or of any beneficiary of the deceased person's estate
The Plaintiff lives with her husband, Stephen Thompson, and their three adult children, Allison Rose Thompson, who is 28 years of age, Sarah Ann Thompson, who is 27 years of age and Peter Andrew Thompson, who is 20 years of age.
The Plaintiff sets out her and her husband's (but not each of her children's) assets and liabilities as follows (as at October 2016): Combined assets Home at XXX Townsend Cr, Ropes Crossing $840,000 Household furniture $ 10,000 CBA Smart Access Account $ 292 CBA Complete Access Account $ 53 St George Bank Complete Freedom Account $ 427 Hyundai Car $ 28,000 2008 Astra Coupe $ 6,000 Total $884,773

Liabilities CBA home loan 52XXX $124,874 CBA home loan 85XXX $402,526 School fees $ 2,810 Blacktown city council $ 1,060 Esanda car loan $ 30,100 Total $561,371

The Plaintiff did not include any reference to superannuation. She had a superannuation balance of about $2,109 (as at 30 June 2014) and her husband has a superannuation balance of $38,542 (as at 12 October 2016).
The Plaintiff runs a very small hairdressing business from which she earns approximately $50 per week. She has also been employed casually as a carer, with Senior Helpers, since July 2016, earning approximately $430 per fortnight after tax.
Since October 2016, her husband has been employed by Panucci Transport Pty Ltd as a fleet controller, and receives a net weekly income of $797. (It is said that, recently, he has had a checkered employment history).
The Plaintiff set out the weekly income of her and her husband as being $1,262, and the family's weekly expenses as being $1,208 (as at 3 November 2016).
Although the Plaintiff noted in her affidavit of 21 October 2015 that "[t]he expenses of my husband and myself often exceed his income", the most recent estimates provided by the Plaintiff show that their income is about $44 a week more than their expenditure.
However, their current expenditure on mortgage repayments is lower than it will be in the future, because as they were experiencing financial difficulties, they requested the bank to allow them to enter into a payment schedule under which they make lower repayments until the end of 2016. They are also currently in arrears in repaying their car loan and their council rates.
The Plaintiff submitted: "The financial position of the plaintiff, having regard to her age and health, is poor, with a very modest equity in their home and ongoing mortgage commitments of $590 per week. Having only modest equity in their house exposes them to considerable financial difficulties as the plaintiff and her husband age. Although they can probably expect their children to leave home, even without children to house, their financial predicament is likely to continue to be difficult."
As noted, the Defendant does not raise her financial and material circumstances, although she did give evidence that she lives on a farm of 6.25 acres from which she operates a chicken-raising business. She and her husband also own a house at Copacabana in the Central Coast, which is mortgaged for about $350,000. No evidence was given as to the value of the farm or of the Copacabana house.
The Defendant also gave evidence that Anthony, one of her two adult children, was diagnosed with motor neuron disease in 2014. He lives with the Defendant and her husband, in a granny flat on the farm. The Defendant and her husband have made renovations to make the granny flat wheelchair accessible for Anthony. Currently Anthony is relying on his superannuation and savings to support his own family, but the Defendant and her husband will support him when his assets are depleted. (f) any physical, intellectual or mental disability of the applicant, any other person in respect of whom an application has been made for a family provision order or any beneficiary of the deceased person's estate that is in existence when the application is being considered or that may reasonably be anticipated
The Plaintiff suffers from obesity, type 2 diabetes, chronic back pain and residual sciatica, plantar fasciitis, depressive illness and anxiety disorder, calcaneal spurs and chronic sinusitis. There was no medical evidence to suggest that any of these conditions affect her capacity to work.
The Defendant gave evidence that she suffers from an illness called scleroderma (which I understand to be a chronic connective tissue disease generally classified as one of the autoimmune rheumatic diseases, one hallmark of which is the thickening or hardening of the skin). (g) the age of the applicant when the application is being considered
As stated, the Plaintiff is currently 52 years old. (h) any contribution (whether financial or otherwise) by the applicant to the acquisition, conservation and improvement of the estate of the deceased person or to the welfare of the deceased person or the deceased person's family, whether made before or after the deceased person's death, for which adequate consideration (not including any pension or other benefit) was not received, by the applicant
The Plaintiff gave evidence of her contributions, particularly to the welfare of the deceased and the Plaintiff's father. I am satisfied that she did make such a contribution. There is no evidence that she made any contribution (whether financial or otherwise) to the acquisition, conservation and improvement of the estate of the deceased. (i) any provision made for the applicant by the deceased person, either during the deceased person's lifetime or made from the deceased person's estate
The Plaintiff acknowledged that she received some financial assistance from the deceased during the deceased's lifetime. She accepted that, effectively, she had been gifted the Merrylands property by her parents. She acknowledged that the gift to her had been on the understanding that when they both passed away, the Greystanes property would be devised to the Defendant. This was a clear and unwavering intention, known by both daughters of the deceased for more than 30 years.
The Plaintiff also acknowledged that in about 1981, her parents purchased a hairdressing salon, which they transferred to her, and which she sold, several years later, for $21,000.
More recently, in 2013 the deceased gave each of the Plaintiff and the Defendant $5,000.
As stated, in the events that have happened, the Plaintiff receives no provision out of the estate of the deceased. (j) any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person
The deceased made clear her testamentary intentions both in her Will and otherwise. She had made a Will in September 1985 which, after providing for her husband, devised the Greystanes property to the Defendant. By this date the Merrylands property had been transferred to the Plaintiff.
The Plaintiff acknowledged that she knew that the Greystanes property was to be devised to the Defendant. She was referred to a document, said to have been written by the deceased, in Italian, which she denied had been written by the deceased. I do not accept her denial.
This answer in cross-examination made the Plaintiff's knowledge of the intentions of the deceased abundantly clear (T33.37-42): "Q. Can I suggest to you that not only did she not wish to change her will but she went and wrote it down in Italian, her clear intention that you were to have one house and that Carmela was to have the Greystanes property? A. That was never in dispute, about the properties. It has never been my dispute about who gets what, I'm just simply asking for provision, that's all." (k) whether the applicant was being maintained, either wholly or partly, by the deceased person before the deceased person's death and, if the court considers it relevant, the extent to which and the basis on which the deceased person did so
The Plaintiff was not being maintained, wholly or partly, by the deceased before her death, other than as a child. I have referred to the provision made for the Plaintiff during the deceased's lifetime. (l) whether any other person is liable to support the applicant
There is no person, other than her husband, liable to support the Plaintiff. (m) the character and conduct of the applicant before and after the date of the death of the deceased person
An evaluation of "character and conduct" may be necessary, not for the sake of criticism, but to enable consideration of what is "adequate and proper" in all the circumstances. Importantly, the Act does not limit the consideration of "conduct" to conduct towards the deceased.
In Collicoat v McMillan at [40], Ormiston J wrote, in relation to the manner in which an applicant's behaviour towards the deceased is to be considered: "Ordinarily each of the persons who have a statutory right to make [an] application are entitled to have their position considered by a testator but their behaviour (right or wrong) towards the testator may only provide a basis for measuring appropriately the testator's obligation to make provision for each of those applicants. Their sins are irrelevant except in so far as a testator might properly take exception to their behaviour."
I am satisfied that there is no relevant conduct of the Plaintiff before, or after, the death of the deceased. I have dealt with her relationship with the deceased earlier. (n) the conduct of any other person before and after the date of the death of the deceased person
I am satisfied that the conduct of the Defendant impacts on the determination of what provision should be made for the Plaintiff out of the estate of the deceased. She was a loving daughter to the deceased and was her principal carer. The personal care she provided, particularly in the deceased's last years before moving into the nursing home, and the assistance the Defendant provided with activities of daily living should not be underestimated. There can be no doubt that the Defendant has a very strong competing claim on the bounty of the deceased, which, of course the deceased recognised by making her the principal chosen object of the deceased's bounty. (o) any relevant Aboriginal or Torres Strait Islander customary law
This factor is not applicable. (p) any other matter the court considers relevant, including matters in existence at the time of the deceased person's death or at the time the application is being considered
There is no other matter that I consider relevant.

Submissions

I have earlier referred to the Plaintiff's submissions. In substance, she says that she should receive the benefit of substantial provision.
The Defendant submitted that the Plaintiff's and her husband's current financial position was, to a large extent, their own fault or as she put it "of [the Plaintiff's] own making". Examples were given of what were said to be the poor investment choices made. It was submitted that, in those circumstances, the Defendant should not have to lose part of her inheritance, in effect, to bail them out of the consequences of her (or their) poor investment decisions.
I am not inclined to criticise the Plaintiff (and her husband) for her (or their), investment choices, even if, subsequently, they may have come to recognise some of them as having been somewhat ill-advised. There was no suggestion that the Plaintiff and/or her husband had been reckless, or frivolous, in choosing the investments that were made.
Whilst it is true that the borrowings to which I have referred continued to increase, and even though part of those borrowings were likely to have been used for living expenses, I do not accept the broad submission that: "The plaintiff chose to sell the house she was given as well, and then to embark on a spiral of ever increasing debt through investment properties and (it appears from the bank statements) a cavalier attitude to spending."
More importantly, it was not suggested, and it does not appear, that they were living a particularly luxurious lifestyle. Indeed, when they went on a holiday, it was to Narooma.
As was recently written in Bates v Cooke [2015] NSWCA 278 at [3], by Leeming JA: "…I agree that an approach which disentitles an adult claimant whose need is generated from well-intentioned, but improvident, investment decisions where the estate can alleviate the need without having a significant deleterious effect on any other relevant person is unduly narrow…."
And as Sackville AJA pointed out at [66] - [67]: "The appellant's financial circumstances, whatever their causes, were factual matters that the Court might be expected to take into account in making the determination required by s 59(1) of the Succession Act.… …the Court should not be deflected from considering the circumstances of the case and the words of the statute by applying a constraint that does not find its source in the Succession Act."
The Court of Appeal considered it to be erroneous to interpret community expectations to disentitle an adult child, with financial needs, from claiming a family provision order if those needs were created by well-intentioned, but improvident, investment decisions. An adult claimant is not necessarily disentitled, in such circumstances, from succeeding in a claim for provision, where the estate is sufficient to alleviate her, or his, needs without having a significant deleterious effect on any other relevant person.
Considering the facts of this case, the poor investment decisions (if that is what they were), or other lifestyle choices, do not disentitle the Plaintiff to additional (or in this case, some) provision out of the estate of the deceased.

Determination

Claims for a family provision order present particular difficulties where the actual estate is not very large, where there is only one asset, being real estate, and where there is a competing claim upon the bounty of the deceased by the beneficiary. Any provision made by the Court in favour of an applicant must, in this class of case, be made at the expense of the beneficiary who has had to defend the claims and who is the principal chosen object of the deceased's bounty.
As I have recently written in Morier v Liem [2016] NSWSC 582, the fact that the Plaintiff does not receive any provision under the Will of the deceased, of itself, does not bespeak inadequacy. That fact is not all that the Court is required to consider. The totality of the relationship of the Plaintiff and the deceased, the age and capacity of the Defendant, the claim of each on the bounty of the deceased, and the size of the estate, are very relevant factors in determining the answer to the question whether the Court is satisfied, for the purposes of s 59(1)(c) of the Act, that the deceased did not make adequate provision for the proper maintenance and advancement of the Plaintiff.
Basten JA wrote in Chan v Chan [2016] NSWCA 222 at [22], that the Court must remember: "A significant set of factors in many cases is that identified as "the financial resources (including earning capacity) and financial needs, both present and future, of the applicant…". However, it is important not to elide the distinction between needs and adequate provision; the former is but one indicator of the latter. The adequacy of provision is not to be determined by a calculation of financial needs. The background to any consideration of the appellant's needs required determination of the size of the estate and the claims of others on the beneficence of the testator."
Thus, in determining what is adequate for the proper maintenance, education or advancement in life of an applicant, the Court also considers the nature, extent and character of the estate and the other demands upon it, and also what the deceased regarded as superior claims or preferable dispositions.
It is beyond argument that the deceased made generous provision for the Plaintiff during her lifetime. The deceased and her husband provided her with a business which was sold for a reasonable amount (indeed three times its purchase price). In addition, they gifted to the Plaintiff an unencumbered home, which the Plaintiff then encumbered to enable repairs and renovations to be made. This demonstrated that the deceased (and her husband) had done everything in her (and their) power to give the Plaintiff the best start in life possible bearing in mind her (and their) financial circumstances.
However, the level of provision made during the lifetime of the deceased for the Plaintiff, alone, cannot determine what is "proper" on the deceased's death. Of course, the fact that generous provision has already been made is one of the matters to be taken into account in determining what is "proper". The situation must be looked at when the Court is determining the Plaintiff's application.
Furthermore, even though the applicant manages to live within her, or his, income, does not mean that the income fulfils all her or his reasonable needs.
The Defendant is the only other person who would have any claim on the deceased's bounty. She has not alleged a financial claim on that bounty. The Court does not ignore her claim as a beneficiary, being the principal chosen object of the deceased's testamentary bounty. It is necessary for the Court to consider the individual circumstances of each of the deceased's children at the date of the hearing. Her competing claim is not founded upon any competing financial need, but on her contributions to the deceased, both financially and in other ways, during the deceased's declining years.
When the Court considers the Plaintiff's financial and material resources, one cannot but reach the conclusion that the provision made for her in the Will of the deceased is inadequate for her proper maintenance and advancement in life. Accordingly, the Court's jurisdiction to make an order is established.
Then, one turns to the provision, if any, that ought to be made. In my view, some additional provision ought to be made for the Plaintiff.
In Grey v Harrison at 366-367, Callaway JA observed: "There is no single provision of which it may be said that that is the provision that a wise and just testator would have made. There is instead a range of appropriate provisions, in much the same way as there is a range of awards for pain and suffering or a range of available sentences. Minds may legitimately differ as to the provision that should be made. Furthermore, it is not at all clear that reasons for an appropriate provision need be fully articulated. To borrow again from the analogy of sentencing, what is required is an instinctive synthesis that takes into account all the relevant factors and gives them due weight."
This is a case in which, firstly, the Plaintiff has a need to meet her obligations, all of which cannot be met from her own resources. Secondly, the value of the deceased's estate provides the means to alleviate that need, at least in part. Thirdly, having regard to the competing claim upon the deceased's bounty, which does not include any competing financial claim by the Defendant, a proportion of the estate can be used to alleviate part of the Plaintiff's needs.
It seems to me that the Plaintiff should receive a lump sum that equates to 40 per cent of the net proceeds of sale of the Greystanes property. The net proceeds of sale should be calculated by deducting from the gross sale price, the costs and expenses of sale, including agent's commission, advertising costs, and the legal costs of sale. The legal costs of these proceedings, namely the Plaintiff's costs calculated on the ordinary basis and the balance of the Defendant's costs, calculated on the indemnity basis should also be deducted from the gross sale price.
Earlier, I have calculated the estimate of the value of the distributable estate to be about $690,000. Deducting $19,000, being the cash, results in the net proceeds of sale being about $671,000, with the result that the Plaintiff would receive an estimated lump sum of $268,400. This equates to almost one half of the liabilities that the Plaintiff and her husband have disclosed. If used to reduce liabilities, the Plaintiff may have available more income. Alternatively, the amount, or part of it, could provide a sum for exigencies of life.
That amount of provision made for the Plaintiff will still leave slightly more than $420,000 available for the Defendant.
The Defendant, as the executrix, should have control of the sale of the Greystanes property, although, as a matter of comity, her solicitors should advise the solicitors acting for the Plaintiff of what is being done in that regard. The Greystanes property should be put on the market for sale as soon as reasonably possible, but no later than 6 weeks from the date of making orders, or such other time as the parties are able to agree in writing. Provided the amount to which the Plaintiff is entitled, is paid within 7 days of completion of the sale of the property, no interest is payable on the amount to be paid. Otherwise, interest at the rate prescribed under s 84A(3) of the Probate and Administration Act 1898 (NSW) is payable from that date.
I am also prepared to make an order granting leave to any party to approach the Court to make additional orders for the purpose of giving effect to the family provision order to be made.
The Court orders: 1. Having found that the Plaintiff is an eligible person; that the proceedings were commenced within time; and that the provision made for her in the Will of the deceased is inadequate for her proper maintenance or advancement in life, that she is to receive, in lieu of the provision made for her in the Will of the deceased, a lump sum that equates to 40 per cent of the net proceeds of sale of the Greystanes property. 2. The net proceeds of sale are to be calculated by deducting from the gross sale price, the costs and expenses of sale of the Greystanes property, including agent's commission, advertising costs, and the legal costs of sale as well as the legal costs of these proceedings, namely the Plaintiff's costs calculated on the ordinary basis, and the balance of the Defendant's costs, calculated on the indemnity basis. 3. The Plaintiff's costs calculated on the ordinary basis of the proceedings, and the balance of the Defendant's costs, calculated on the indemnity basis, of the proceedings, are to be paid out of the estate of the deceased. 4. The Defendant is to place the Greystanes property on the market for sale, as soon as is reasonably possible, but no later than 8 weeks from the date of making orders, or such other time as the parties are able to agree in writing. 5. Provided that the amount to which the Plaintiff is entitled is paid within 7 days of completion of the sale of the Greystanes property, no interest is payable on the lump sum to be paid to her; otherwise, interest at the rate prescribed under s 84A(3) of the Probate and Administration Act 1898 (NSW) is payable from that date. 6. That liberty is granted to any party to apply, in these proceedings, for consequential and ancillary orders for the purpose of, or with respect to, giving effect to, and implementing, the family provision order made in favour of the Plaintiff. 7. The Exhibits should be dealt with in accordance with the Uniform Civil Procedure Rules 2005 (NSW) (rule 31.16A and rule 33.10) and Practice Note No SC Gen 18 (Para 22)

Amendments 08 June 2017 - [143] Deleted the words "Click here to enter text." DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 08 June 2017

Family Provision Act 1982(NSW)

Chan [2016] NSWCA 222 Chapple v Wilcox [2014] NSWCA 392; 87 NSWLR 646 Christie v Manera [2006] WASC 287 Collicoat v McMillan [1999] 3 VR 803 Crossman v Riedel [2004] ACTSC 127 de Angelis v de Angelis [2003] VSC 432 Flathaug v Weaver [2003] NZFLR 730 Foley v Ellis [2008] NSWCA 288 Goodman v Windeyer [1980] HCA 31; 144 CLR 490 Goodsell v Wellington [2011] NSWSC 1232 Gorton v Parks (1989) 17 NSWLR Grey v Harrison [1997] 2 VR 359 Hawkins v Prestage (1989) 1 WAR 37 Henry v Hancock [2016] NSWSC 71 Hinderry v Hinderry [2016] NSWSC 780 Hughes v National Trustees Executors & Agency Co of Australasia Ltd (1979) 143 CLR 134; [1979] HCA 2 Hunter v Hunter (1987) 8 NSWLR 573 Hyland v Burbidge [2000] NSWSC 12 Jones (a pseudonym) v Smith (a pseudonym) [2016] VSCA 178 Jones (a pseudonym) v Smith (a pseudonym) [2016] HCASL 310 Kleinig v Neal (No 2) [1981] 2 NSWLR 532 Kohari v Snow [2013] NSWSC 452 MacGregor v MacGregor [2003] WASC 169 Marks v Marks [2003] WASCA 297 Matthews v Wear [2011] NSWSC 1145 Mayfield v Lloyd-Williams [2004] NSWSC 419 McCosker v McCosker [1957] HCA 82, (1957) 97 CLR 566 McKenzie v Topp [2004] VSC 90 McGrath v Eves [2005] NSWSC 1006 Morier v Liem [2016] NSWSC 582 Poletti v Jones [2015] NSWCA 107 Pontifical Society for the Propagation of the Faith v Scales [1962] HCA 19; (1962) 107 CLR 9 R (on the application of M) v Slough Borough Council [2008] UKHL 52; [2008] 1 WLR 1808 Re Buckland, Deceased [1966] VR 404 Salmon v Osmond [2015] NSWCA 42 Sammut v Kleemann [2012] NSWSC 1030 Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201 Slack v Rogan; Palffy v Rogan [2013] NSWSC 522; (2013) 85 NSWLR 253 Stern v Sekers; Sekers v Sekers [2010] NSWSC 59 Stott v Cook (1960) 33 ALJR 447 Tobin v Ezekiel (2012) 83 NSWLR 757; [2012] NSWCA 285 Underwood v Gaudron [2015] NSWCA 269 Verzar v Verzar [2012] NSWSC 1380 Vigolo v Bostin (2005) 221 CLR 191; [2005] HCA 11 Walker v Walker (Supreme Court (NSW), Young J, 17 May 1996, unrep) White v Barron (1980) 144 CLR 431; [1980] HCA 14 Wilcox v Wilcox [2012] NSWSC 1138 Category: Principal judgment Parties: Ms Rosa Thompson (Plaintiff) Ms Carmela Sgro (Defendant) Representation: Counsel: Mr R Tregenza (Plaintiff) Ms V McWilliam (Defendant)

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