Verzar v Verzar

Primary judge's reasons 31At the commencement of his reasons, the primary judge identified that the estate assets comprised: (a) the McEvoy Street property, which was the subject of a specific devise in favour of Thomas Verzar, (b) the McCauley Street property which passed to Susan Verzar as part of the residuary estate, and (c) the undisputed remaining assets in the estate, comprising two bank accounts with a total credit balance slightly over $55,000. The primary judge then observed: "11 An allowance should be made for rent received by the Plaintiff on the two Alexandria properties since Stephen's death. The precise amount of that rent has not been established by the evidence. 12 However, it is agreed that, subject to any orders made in her favour in these proceedings, the Plaintiff is obliged, as Stephen's executrix, to account to the Defendant for rents received on the McEvoy Street property since Stephen's death. It is also agreed that more than $100,000.00 has been received in net rents for the McEvoy Street property in that period. $48,000.00 was received, in net rents on that property, between the date of Stephen's death (29 March 2009) and December 2010. Another $55,000.00 or so has been received since January 2011. 13. The credit balance of slightly over $55,000.00 in estate bank accounts represents, in substance at least, part of the rents received on the McEvoy Street property since Stephen's death. ... 15 The Defendant accepts that the Plaintiff is entitled to the McCauley Street property under Stephen's Will and, despite the fact that it appears not yet to have been transmitted to her in her personal capacity, he does not seek in these proceedings to disturb her enjoyment of it. Not unnaturally, though, he does want her to account for income received by her on the McEvoy Street property, some part of which she appears to have applied towards repairs to, or improvement of, the McCauley Street property since Stephen's death." 32Having considered and concluded that it was appropriate to grant an extension of time to Susan Verzar under s 58(2) of the Succession Act sufficient to permit her claim for relief under s 59 to be determined on its merits, the primary judge then considered and concluded that adequate provision for the proper maintenance, education and advancement in life of Susan Verzar had not been made by Stephen Verzar's will. 33The primary judge next considered whether any, and if so what, relief should be granted to Susan Verzar. The trial judge considered the competing entitlements of Susan Verzar and Thomas Verzar in the context of their respective financial resources and the property comprising the estate and observed: "172 In weighing the competing entitlements of the Plaintiff and the Defendant, in the context of their respective financial resources and the property comprising Stephen's estate, in my assessment the proper course, at this time is: first, to recognise that since Stephen's death the Plaintiff has had the benefit of estate property (namely, the McEvoy Street property and accrued rents net of expenses) which, under the terms of Stephen's Will, should have been transferred to the Defendant but which has been deployed by her as an aid to improving other property (particularly the McCauley Street property) which she owns or to which she is entitled under the Will, as part of a process of adjustment of her affairs to life without Stephen; and, secondly, to take that benefit into account in quantification of a modest legacy to be granted to her in addition to the benefits to which she is otherwise entitled under the Will. 173 In the absence of a full, detailed accounting by the Plaintiff of all her dealings with estate assets since the death of Stephen, and bearing in mind that it is in the interests of both parties to make orders designed to bring their financial relationship and their related involvement in these proceedings to an end, I propose to proceed on the basis that an order should be made entitling the Plaintiff to the benefit of the income of Stephen's undistributed estate up until the time that final orders are made in these proceedings (net of any expenses incurred in the accrual of that income) as the foundation for a further legacy in the form of a lump sum amount of $100,000.00 to be charged against the McEvoy Street property. On the evidence as to receipt of rents from the McEvoy Street property, that represents a total of not less than $200,000.00 or thereabouts of provision to be made for the Plaintiff additional to that made for her in Stephen's Will."

The Court's powers 34The applicant seeks an order extending the time for the filing and service of a summons seeking leave to appeal and the notice of appeal. The power to make the order sought is provided by UCPR r 51.10(2) which permits the Court, in a case within UCPR r 51.10(1)(b), to extend the time for filing the summons seeking leave to appeal "at any time". 35Insofar as the applicant also seeks an order extending the time for the filing of a notice of appeal (which has not yet been filed), the power to make the order sought is provided by UCPR r 51.16(2) which permits the Court, in a case falling within UCPR r 51.16(1)(c), to extend the time for the filing of the notice of appeal "at any time". 36The summons seeking leave to appeal identifies "s 101(r)" of the Supreme Court Act 1970 as the reason leave is required. This is clearly a typographical error and should be read as a reference to s 101(2)(r) of the Supreme Court Act. Under that provision, an appeal shall not lie to the Court of Appeal, except by leave of the Court of Appeal, from a final judgment or order in proceedings of the Court, other than an appeal that involves a matter at issue amounting to or of the value of $100,000 or more, or that involves (directly or indirectly) any claim, demand or question to or in respect to any property or civil right amounting to or of the value of $100,000 or more. 37The affidavit of John Denes sworn 7 March 2013 in support of the application deposes that the prospective appeal involves a matter at issue of more than $100,000. This is on the basis that the gross rents on the McEvoy Street property relevantly totalled $151,360. Moreover, it was common ground in the proceedings below that the net rents on the McEvoy Street property were at least slightly in excess of $100,000. The respondent did not submit that the amount in issue was less than $100,000. In these circumstances, leave to appeal is not required for that reason, and it is appropriate to do deal with the application as one seeking an extension of time for the filing of a notice of appeal.

Legal principles 38The matters to be taken into account in considering whether it is appropriate to grant an extension of time to file a notice of appeal are well settled. The four factors of general relevance to such an application are the length of the delay, the reason for the delay, whether the applicant has a fairly arguable case and the extent of any prejudice suffered by the respondent to the application (see Tomko v Palasty (No 2) [2007] NSWCA 369; (2007) 71 NSWLR 61 at [55]; Nanschild v Pratt [2011] NSWCA 85 at [39]-[42]). 39In Nanschild v Pratt, McColl JA explained the context of the Court's approach to an application to extend time for the filing of an appeal as follows: "38 The discretion to extend time is given for the sole purpose of enabling the court to do justice between the parties. This means that the discretion can only be exercised upon proof that strict compliance with the rules will work an injustice upon the applicant. In order to determine whether the rules will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time: Gallo v Dawson [1990] HCA 30; (1990) 64 ALJR 458 (at 459) per McHugh J. 39 The underlying premise to these propositions in Gallo (as is made apparent in Jackamarra v Krakouer [1998] HCA 27; (1998) 195 CLR 516 (at [7]) per Brennan CJ and McHugh J) is that the Court's approach to an application to extend the time for filing an appeal from a judgment determining substantive rights (or here to seek leave to appeal) "at any time" recognises that "the respondent to the application has a vested right to retain the judgment" proposed to be the subject of appeal: Jackamarra v Krakouer (at [4]); Tomko v Palasty (No 2) [2007] NSWCA 369 (at [55]) per Basten JA (Hodgson and Ipp JJA agreeing)."

Issues arising 40Four issues arise on the present application for an extension of time. First, the length of the delay. Secondly, whether the applicant has provided a sufficient explanation for the delay. 41Thirdly, whether, as contended by the respondent, any appeal, if permitted, would be doomed to failure because the applicant should not be permitted to resile from the position it took at the hearing before the primary judge in not pressing its claims in the administration proceedings, other than an order for costs. 42Fourthly, the extent of any prejudice suffered by the respondent.

Length and explanation for the delay 43The relevant orders of Lindsay J were made and entered on 30 November 2012. Any notice of appeal was required to be filed and served within 28 days after that date. The applicant's solicitor attempted to file the summons seeking leave to appeal on 7 March 2013, but the document was rejected by the Registry until a notice of motion was filed in the proceedings. Subsequently, the notice of motion seeking an extension of time together with the summons seeking leave to appeal was filed on 20 March 2013. 44The delay of about 11 weeks is not inordinate taking into account the period covered by the Christmas vacation and the unsuccessful attempt to file the documents on 7 March 2013. 45The applicant's explanation for the delay in filing the summons for leave to appeal and the appeal was contained in two affidavits of his solicitor, John Denes sworn 7 March and 5 April 2013 respectively. It is sufficient to note that the applicant's solicitor initially proceeded upon the belief that only one appeal was required in respect of all the orders that were made by the primary judge on 30 November 2011, and accordingly a notice of intention to appeal was filed on 27 December 2012 in respect of the family provision proceedings. It was not until 27 February 2013 that the applicant's solicitor was advised by new counsel who had been briefed to prepare the notice of appeal in the family provision proceedings, that a separate appeal may have to be brought in respect of the administration proceedings. 46Prior to this time, the applicant's solicitor believed that if the applicant was successful in the appeal in the family provision proceedings and the orders for provision in favour of the respondent were set aside, then the prayer for relief in the administration proceedings seeking an accounting by the respondent of her dealings with the estate's property would then be on foot without a further appeal. 47In his second affidavit of 5 April 2013, Mr Denes explained the reasons for the delay between 27 February 2013, when he was first apprised by new counsel briefed in the matter that an appeal may be necessary in respect of the administration proceedings, and the obtaining of instructions to pursue such a course, the time taken to draft the necessary documents and the difficulties experienced in relation to filing of those documents in the registry, which ultimately occurred on 20 March 2013. 48The respondent did not take any issue with the applicant's explanation for the delay, which was the result of a misunderstanding by the applicant's legal advisers as to whether a separate appeal was necessary in relation to the administration proceedings. I am satisfied that a sufficient explanation for the delay has been provided.

Prejudice suffered by the respondent 49The respondent does not claim to have suffered any prejudice as a result of the delay in the filing and service of the summons seeking leave to appeal and any notice of appeal.

Is the appeal fairly arguable 50The applicant submits that notwithstanding the position stated to the Court below by the applicant's then counsel, the relief sought in the amended statement of claim in the administration proceedings was not abandoned, at least insofar as the applicant sought an accounting by the respondent. Additionally, the applicant submits that in view of the admissions by the respondent in her defence of failure to account, there was no issue "to be pressed"; that the accounting issue was always in contest during the hearing; and that the orders made by the primary judge in the administration proceedings simply reflect the way in which the primary judge determined to make further provision out of the estate in favour of the respondent. 51In support of the contention that the applicant did not abandon the accounting issue in the administration proceedings, the applicant points to the cross-examination of the respondent on the topic of the net rents on the McEvoy Street property. The applicant also points to the exchange between the primary judge and counsel for the parties during closing submissions, concerning what would be the position if no relief was granted to the respondent in the family provision proceedings. To that may be added, the references in the applicant's closing written submissions to the net rents on the McEvoy Street property. 52The applicant's submission that he never abandoned prayer 2 of the relief sought in the administration proceedings (which sought an account in respect of the property comprised in the estate and all dealings and transactions of the respondent therewith) is not borne out by an examination of the applicant's conduct below, as revealed by the transcript and the parties' respective submissions. 53First, it is clear that the applicant's then counsel informed the Court on three occasions, namely: (a) in written opening submissions, (b) during the exchange with the primary judge at the commencement of the hearing, and (c) during closing submissions, that the applicant abandoned all claims for relief in the administration proceedings other than the claim for costs. 54Secondly, the context in which the accounting issue was raised in cross-examination of the respondent was the identification of the size of the distributable estate in respect of which the respondent's claim for further provision was to be considered. 55Thirdly, the exchange between the primary judge and counsel for the parties concerning what would happen to the net rents on the McEvoy Street property if the respondent was unsuccessful in the family provision proceedings, did not prompt the applicant to change his position and either seek to pursue prayer 2 of the relief in the administration proceedings. Nor did it prompt him to otherwise seek an amendment in those proceedings to claim a specific order in relation to payment of the net rents on the McEvoy Street property. 56However, in light of the applicant's subsequent closing submission dated 24 September 2012, the course taken by the applicant's then counsel is not surprising. As noted above at [29], the applicant took the position below that if the respondent was unsuccessful in the family provision proceedings, the net rents on the McEvoy Street property would follow the property, once the administration had been completed. This was an express acknowledgement by the applicant that, having abandoned the claims for relief in the administration proceedings save for costs, the applicant could not call upon the executrix to pay over the net rents on the McEvoy Street property until the administration of the estate had been completed. There is no suggestion that the administration of the estate was complete, at the time of the hearing before the primary judge. 57It may be observed that the position taken by the applicant below was consistent with authority concerning the entitlement to income after the date of death on property the subject of a specific legacy or devise under a will. Income arising after the date of death on property which is left as an unconditional and immediate gift by a specific legacy or devise goes to the specific legatee or devisee (see O'Brien v McCormick [2005] NSWSC 619 at [38] per Campbell J, where the relevant authorities are collected). 58Fourthly, contrary to the applicant's written submissions the primary judge did not deliver a common judgment in both proceedings below. As a matter of both form and substance the judgment delivered on 16 November 2012 only related to the family provision proceedings. This is apparent from the cover sheet of the judgment where the file number of the proceedings only refers to "2011/115485", being the file number for the family provision proceedings. 59Further, as a matter of substance, the primary judge expressly refused to make any formal order that the two proceedings be heard together, rather he stood the administration proceedings over to the end of the hearing of the family provision proceedings at which time the costs application in the administration proceedings would be considered. Moreover, as noted above, during closing submissions on 18 September 2012, the primary judge again emphasised that the hearing was limited to a separate hearing of the family provision proceedings and counsel for the applicant agreed. 60Fifthly, the grounds of appeal which the applicant seeks to rely upon in its draft notice of appeal do not disclose any error which would entitle the applicant to the relief it seeks on appeal. That relief being setting aside the order dismissing the proceedings and that the proceedings be remitted back to the Court below to deal with the outstanding prayers for relief in the amended statement of claim. Counsel for the applicant identified that the applicant was seeking the relief in prayers 2, 3 and 4 (that an account be taken of all moneys received and disbursements by the respondent, that there be liberty to apply to the Registrar, and for interest). 61In oral submissions, counsel for the applicant frankly conceded that no criticism could be made "at the moment" of the order of Lindsay J dismissing the administration proceedings. Rather, it was only if the applicant succeeds in his appeal in the family provision proceedings that complaint is made, because then the applicant would be left "high and dry" as no relief had been obtained in the administration proceedings. 62The difficulty with the applicant's draft notice of appeal is that the order which it seeks to set aside (order 1 dismissing the proceedings), is an order which the applicant effectively agreed to on 17 September 2012 in advance of the outcome of the family provision proceedings being known. Further, at no time during the conduct of the family provision proceedings did the applicant seek to resile from this position. 63A party is bound by the conduct of his or her case. Except in the most exceptional circumstances, a party should not be allowed after a case has been decided against him or her, to raise a new argument which, whether deliberately or by inadvertence, he or she failed to put during the hearing when he or she had an opportunity to do so (see Metwally v University of Wollongong [1985] HCA 28; (1985) 60 ALR 68 at 71). The applicant did not suggest that any exceptional circumstances existed in the present case. 64Sixthly, having regard to the above matters, the grounds of appeal in the draft notice of appeal cannot be said to be fairly arguable. In particular: (1)Ground 1 which asserts that the administration proceedings were heard with the family provision proceedings is incorrect. The transcript below reveals that the primary judge was careful to delineate the two proceedings, and the parties agreed that there would be a separate hearing of the family provision proceedings, and that the only issue in the administration proceedings, being costs, would be dealt with at the conclusion of the hearing of the family provision proceedings. (2)Contrary to ground 2, the primary judge did not make any formal order that evidence in one proceeding was to be evidence in the other. Even if that was the basis upon which the two proceedings were dealt with because of any earlier order of the Court before the hearing, it is no answer to the express abandonment of all claims for relief in the administration proceedings save for costs. (3)As to the grounds 3 and 4, order 1 in the administration proceedings (that the proceedings be dismissed) did not follow as a consequence of the respondent's successfully obtaining the order for further provision, in particular the order in [2(b)] in the family provision proceedings. That order followed as a consequence of a decision by the applicant at the commencement of the hearing on 17 September 2012 not to seek any relief in the administration proceedings save for costs. (4)As to ground 5, success by the applicant in his appeal in respect of the family provision proceedings does not mean that the order dismissing the administration proceedings is no longer valid and should be overturned. The applicant chose not to pursue the substantive relief in the administration proceedings, and it may be taken (there being no evidence to the contrary) that he did so upon the express basis stated in the applicant's closing submissions. This was that the net rents on the McEvoy Street property would follow the property, once the administration of the estate had been completed. That is, the applicant's submissions below recognised that the appropriate time for the applicant to make such a claim (having chosen not to pursue the relief sought in the administration proceedings) had not yet arisen. (5)As to ground 6, it is irrelevant that the primary judge in the exercise of his discretion set off the costs orders in the two proceedings. This is not a proper basis for permitting the applicant to resile from the position it took below in not seeking any relief in the administration proceedings save for costs. 65During the course of argument on the motion, the Court inquired of Counsel for the respondent as to what would be the position if the applicant was denied an extension of time to file a summons for leave to appeal and a notice of appeal in respect of the administration proceedings, but was ultimately successful on the appeal in respect of the family provision proceedings. 66Counsel for the respondent stated that in those circumstances the respondent, as executrix of the estate, would be obliged to account to the estate in relation to the rents on the McEvoy Street property and that this income would pass pursuant to the terms of the will with the property, which was given to the applicant. That is undoubtedly correct. It is also consistent with the agreed position of the parties in the family provision proceedings, as noted by the primary judge (at [12]). 67Refusal of an extension of time for the filing and service of the summons for leave to appeal (which is unnecessary) and the notice of appeal will not affect the applicant's rights against the respondent to receive the net rents on the McEvoy Street property since the date of death, should the applicant be successful on the appeal in respect of the family provision proceedings (see O'Brien v McCormick at [38]). In such event, if the parties could not agree on that amount, then the applicant could seek an account from the respondent as executrix of the estate of the income and expenses on the McEvoy Street property since the date of death to November 2012. 68No issue estoppel arises from the family provision proceedings, because there was no finding by the primary judge concerning the amount of net rents on the McEvoy Street property since the date of death (see the observations of the primary judge at [11]). It was simply common ground between the parties that the net rents on the McEvoy Street property were in excess of $100,000. The precise amount of net rents covering the period from the date of death to the date of the hearing (September 2012) was never agreed by the parties or quantified by the primary judge. 69In the circumstances, the extension of time should be refused because leave to appeal is not required under s 101(2)(r) of the Supreme Court Act, and the notice of appeal is not fairly arguable. Indeed, the notice of appeal is without merit. The applicant's notice of motion filed 20 March 2013 should be dismissed with costs.

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