Wright v Burg

Supreme Court of NSW|2017-11-24|Before: Ward CJ

Judgment

HER HONOUR: In this matter two of the three adult children of the deceased (Elva Marie Burg) have sought an order for provision out of the deceased's estate and/or notional estate. The application is made pursuant to s 59 of the Succession Act 2006 (NSW) (the Act). The defendant is the third (and youngest) of the deceased's children and the sole executor of her estate (his co-executor, the first plaintiff, having renounced probate). The defendant has put his own financial circumstances in issue in the proceedings.

Background

The deceased died on 14 October 2016 at the age of 81 years. Her husband had predeceased her in 1987. She was survived by their three children, Carmen Marie Wright, née Burg, the first plaintiff, who is now 66 years old; Carl Henry Burg, the second plaintiff, who is now nearly 61 years old; and Andrew Joseph Burg, the defendant, who is now 48 years old. Without intending any disrespect, I will refer to the family members by their first names.
Probate of the deceased's will was granted to Andrew on 19 June 2017. Under that will, dated 20 June 2012, the deceased gave the whole of her estate to Andrew and made no provision for either Carmen or Carl. Apart from a small amount of cash, the sole asset of the estate is a property at Dora Creek, which is unencumbered and presently occupied by Andrew.

Carmen

The eldest of the deceased's three children is Carmen. Carmen was married at the age of 16. She and her first husband lived with the deceased and the deceased's husband for a time at their then home in Lambton, in a studio in the backyard. Carmen and her first husband had two children while living at the Lambton home. Subsequently, they acquired a home in Shortland. They had three further children, one of whom died in infancy.
Carmen and her first husband separated in 1985. At that point, Carmen moved to a rented property in Newcastle, with three of her children. Another of her children, Ben (who was called to give evidence in his uncle Andrew's defence of the proceedings), remained living with his father in the former matrimonial home in Shortland. The couple were divorced in 1987. Under the property settlement with her first husband, Carmen received a sum of $25,000 (out of which she says she ended up with about $17,500 - see T 21.22) and her first husband retained the matrimonial home.
Carmen met her second husband, Mark, in about 1986. In about 1990, Carmen moved with Mark to Melbourne. At this point, of the three children who had been living with her, one - who was by then about 14 years old - moved in with the deceased at the Blackalls Park property. Another dependent child (then about 10 years old) moved back in with her father. The eldest of the three children who had been then living with Carmen was independent by this point (being by then about 22 years old).
Carmen and Mark moved from Melbourne to Sydney in about 1997 and after that to a property in Copacabana on the Central Coast. They were married in 2002. In about 2009, they purchased their current home in Morisset, which is on a one-acre property in a semi-rural area. A loan of about $250,000 was taken out to purchase the Morisset property (which was acquired in Mark's name) (see T 28.28). Carmen's evidence was that the reason the property in Copacabana was acquired in Mark's name (and by inference, presumably, this also applied to the acquisition of the property in Morisset) was because Carmen "had no credit reference where he had good credit" (see T 28.24).
About eight months after the purchase, the house in Morisset was badly damaged due to a fire caused by an electrical fault. The damage was only partly covered by insurance and it took about two years for the house to be repaired (with labour provided mainly by Andrew and Mark), during which time Carmen and Mark lived in a caravan on the property. There was some confusion in the evidence as to the amount that had in fact been received from the insurance company in relation to the fire damage and whether it would have been sufficient at the time to pay out the mortgage on the property. (Carmen thought the payment was about $280,000 (T 29.11); Mark said it was $180,000 but said that he had been required by the bank to pay down the mortgage by $50,000 at the time so the net effect was that they received about $130,000 (see T 59.1-37).) Out of the insurance proceeds, the couple bought a caravan for about $35,000 (in which Carl is presently living).
Carmen (who worked as a sales assistant for short periods during her first marriage and in a variety of positions in "sales and clerical" while living in Melbourne) is not employed. Her sole income is an aged pension. In her affidavit sworn 23 October 2017 (her third affidavit), Carmen deposes that the figures for the income from that pension stated in her affidavit sworn 25 April 2017 (her first affidavit) remain current - amounting to $1,432.60 in gross (and net) monthly income. Mark, who has a degree in computer science, no longer works.
None of Carmen's children now resides with her and none is dependent on her for support. The home at Morisset is mortgaged.
Carmen is an insulin-dependent diabetic. She suffers from lupus (which is an auto-immune disease), rheumatoid arthritis, and depression. She also suffers from cirrhosis of the liver (due to a previous episode of hepatitis C) and disc degeneration in her lumbar spine. These conditions limit her mobility and cause her pain. Mark is in receipt of a carer's allowance to care for her. For some time Mark was also in receipt of a carer's allowance in respect of the deceased (something which was apparently a cause of some tension within the family - see Mark's evidence at T 67.25 in which he recounts an argument with Andrew on the deceased's last birthday in 2016 and says that Andrew said to him, "it is so unfair that you get three pensions").
Carmen's evidence is that at the time she left the family home the family had a close and loving relationship and that she maintained a good relationship with the deceased (see her first affidavit at [9]ff). She also says (at [14]) that when Andrew was young he often spent time with her and that he was more like a son than a brother.
Carmen's evidence is that, after she and Mark moved to Copacabana, the deceased would stay with her for about half the year, a month at a time, and that this continued when the deceased moved from Blackalls Park to Weston in 2005 (see [36] of her first affidavit).
In 2011 the deceased had a fall at home in Weston and was taken to Kurri Kurri hospital. Carmen's evidence is that after the deceased was discharged from hospital she went to live with Carmen on a permanent basis (see her first affidavit at [45]). She says (at [46]-[48]) that the deceased became increasingly unable to care for herself and was looked after by her and Mark; and that later a domestic service went to the house twice a week to assist in the care of the deceased.
Carmen's evidence is that the deceased remained living with her and Mark until 14 June 2016 when she was admitted to Wyong District Hospital after another fall (see her first affidavit at [49]). The deceased was in hospital for about three weeks and from there went into an aged care facility where she died in October 2016. Carmen's evidence is that she visited the deceased every day while she was in the aged care facility (see at [52]).
As noted above (at [17]), Carmen lives with Mark in the home held in his name in Morisset, the value of which they put at $500,000 and on which at the time of the hearing there was a mortgage debt outstanding of $128,453 (although the balance of the mortgage has varied from time to time as it appears there is a re-draw facility with the mortgagee). Between June 2013 and June 2016, for example, the mortgage debt had reduced by some $40,000 to about $95,418 (see T 61.14). Mark has superannuation funds of $117,237; Carmen has superannuation funds of $6,000.
It is submitted that Carmen lives a very modest lifestyle. Her claimed needs are to reduce the mortgage over the Morisset home as much as possible and to perform repairs on the home following the fire damage (Carmen refers to "sagging" foundations and multiple cracks to the interior walls and ceiling, the repair of which she has not costed, and to the need to replace three aluminium windows at a cost of $2,310 - see her first affidavit at [64]). She also says that she requires a new mattress due to her medical conditions (at a cost of approximately $2,500).

Carl

Carl lived at his parents' home until he was 17. He left school at the age of 16, after which he worked first as an apprentice chef and then as a coal miner. Carl was addicted to heroin by the time he left home and was injecting the drug daily. He has spent a considerable amount of time in prison over the years for offences committed to fund his drug habit. He was released on parole after his last term of imprisonment in 2008, after which he lived with his daughter and her husband and children for about 12 months. He then went to live with the deceased in 2010, by which time she was living at the Weston property. Carl has deposed that since his release from prison in 2008 he has been clean of prohibited substances (see his affidavit sworn 25 April 2017 at [31] (his first affidavit)). He takes the prescription drug suboxone, which blocks the effects of opiates.
Carl has given evidence as to the assistance he provided to his mother when he went to live with her in Weston (by providing transport, mowing her lawns, assisting with shopping, taking her to medical appointments, cleaning, and carrying out maintenance and repairs - see his first affidavit at [25]). He says that he and Carmen shared helping their mother and that during the time he lived with the deceased in Weston (which was for about two years), Carmen would collect the deceased and take her for a week or so at a time to Carmen's house (first at Copacabana and then at Morisset) (see at [25]-[26]).
Carl says that just before the deceased sold the Weston property he went to live in a drug rehabilitation unit at Parramatta, where he was for about 18 months and that after that he was "basically 'couch surfing'", living between a friend's house at Granville and a caravan on Carmen and Mark's property at Morisset (see his first affidavit at [27]). The caravan does not have shower and toilet facilities. When Carl is living in the caravan he uses the facilities in Carmen and Mark's house. As at the date of his most recent affidavit, sworn 9 November 2017 (his fourth affidavit), Carl remained living in the caravan at the Morisset property.
Carl's evidence is that he helped Carmen care for the deceased; that he would collect his mother and she would spend time in the gardens at Carmen's home when he was working in the garden; and that he spent many hours reading to his mother (see his first affidavit at [33]-[34]). He says that he provided transport for his mother if she needed to go out for medical reasons or social visits and that, during the time that he and his mother were living at Carmen's place (up until about four months before his mother's death), he took his mother to Sydney on four or five occasions for a week to two weeks at a time, as a holiday for her and to provide some respite for Carmen and Mark (see at [35]-[36]).
Carl's sole income is a disability support pension (in his first affidavit he deposes to a net monthly income as at that date of $1,733, although I note that he states his gross monthly income as $1,518 - it may be that these figures have been interchanged). He has no superannuation or "financial back up" (see at [52]). His monthly expenditure, including for the drug suboxone, is estimated at $1,333. He does not pay rent or board. He has a Toyota car and another vehicle which he says is no longer registered and is "waiting to be sold for parts" (see T 53.33ff). Other vehicles about which he was cross-examined have, he says, "gone long ago, years ago" (T 53.39).
Carl's needs include the need for dental treatment (for a dental plate for false teeth on his lower jaw), for which he has been on the public dental system waiting list for three years. In October 2017, a dentist within the public health system removed five of his teeth as the first step in this treatment; Carl says that he now requires a plate with dentures and that he has been advised that he will need to wait about 12 months for this to occur within the public health system (see his affidavit sworn 23 October 2017 at [5] (his third affidavit)). He has deposed that he has no idea of the cost for private treatment "other than it would be in the thousands of dollars" (at [52] of his first affidavit). He says he would like to have the dental work completed privately as soon as possible, because in the meantime his loss of teeth is affecting his ability to chew and eat food (see at [5] of his third affidavit). He would like to be in a position to help his daughter and her husband, who he says are living in a rental property with their children and saving for a deposit to buy their own home (see at [52] of his first affidavit).
Carl is hepatitis C positive due to his drug use and suffers from varices on his oesophagus, for which he says he is undergoing medical procedures and will require further treatment.

Andrew

Andrew is the youngest of the deceased's three children (being some 12 years younger than Carl). He is self-employed as a carpenter. He lived with his parents at the Blackalls Park property and continued to live there with his mother (after his father died in 1987) until March 1995. In 1995, he moved to a house around the corner from the Blackalls Park property with his then partner, with whom he had a child in June 1995. In September 1997, Andrew separated from his partner and moved back to the Blackalls Park property, where he lived with his mother until May 2000. In May 2000, he moved to Warners Bay with his then partner, with whom he had a child in June 2000. He separated from that partner in May 2001 and again returned to the house at Blackalls Park, where he lived with his mother until she moved to the Weston property in 2004.
Andrew's evidence is that in about November 2003 he had a conversation with the deceased (at a time when he had been looking to buy a house of his own), in which she said that she had wanted to live in the Kurri Kurri area since her husband had passed away and asked Andrew if he would consider buying her (Blackalls Park) property for the price she would have to pay for a property in the Kurri Kurri area (see his second affidavit at [10]-[11]). The deceased was in her late 60s at the time. Andrew deposes that approximately six weeks later the deceased telephoned him and said that she had found a cottage-style home in Weston that she had fallen in love with (at [13]).
Andrew's evidence is that his mother undertook all the negotiations and arrangements for the purchase of the property at Weston and that he was not involved in that (see his second affidavit at [14]). He deposed that he and his mother considered that the Blackalls Park property had a market value of $360,000 to $370,000 (by reference to advertisements for other properties and the sale of the adjoining house) (see [15]). The property at Weston was purchased in Andrew's name. The purchase price paid for the Weston property is somewhat unclear: Andrew refers to the agent asking a price of $195,000, but also refers to a deposit and mortgage finance which in total would amount to $201,000 (see [14], [19]). Andrew's evidence (at [15]) is that he and the deceased had a conversation in which she said to him words to the following effect: … you buy the house at Weston and when you have bought it, the Weston house will be mine and the Blackalls house will be yours. When I die, Carmel [sic] and Carl will get the Weston house and you will already have the Blackalls house.
Andrew deposes that he told his mother he was hesitant about buying a house without the deeds being in his name (his second affidavit at [17]) and refers to a conversation in which the deceased said to him that she had spoken to Carmen and that Carmen agreed with Andrew having the Blackalls Park property and her and Carl sharing the deceased's new house at Weston when the deceased died (at [18]).
Andrew's evidence is that when the purchase of the Weston property was settled in February 2004, he obtained a mortgage with Westpac in the sum of $156,000 (the maximum that he says he could borrow as a self-employed person); that the deceased borrowed $30,000 from Liberty Financial; and that he had saved approximately $15,000 towards the deposit (see his second affidavit at [19]). He says that his mother made the repayments on the Liberty Financial loan for 18 months, after which he commenced making the loan repayments by direct debit on his account (see [19]-[21]). Andrew says that he paid all the mortgage instalments payable on the Weston property (see [23]) and that, when the Blackalls Park property was sold on 16 November 2011, he arranged for the repayment of the outstanding loan to Liberty Financial from the proceeds of sale (the principal then outstanding being approximately $18,000) (see [23]; T 87).
The deceased moved into the Weston property in 2004. Between 2004 and 2011, Andrew lived at the Blackalls Park property. His evidence is that he spent an estimated $18,000 on renovations to the property (see his second affidavit at [26]). The title to the Blackalls Park property remained in the deceased's name.
Andrew has deposed that in March 2011, he spoke to his mother about selling the Blackalls Park property and buying a property at Dora Creek that he had seen, and that his mother agreed (his second affidavit at [28]). Andrew says that he attended to the negotiations with the conveyancer concerning the sale of the Blackalls Park property and presented the paperwork to his mother for signature (at [29]-[30]).
The Blackalls Park property was sold for $440,000 in about November 2011. The Dora Creek property was purchased in the deceased's name for the sum of $370,000, also in November 2011. Andrew says that he had a discussion with the deceased at the time he arranged for the sale of the Blackalls Park property, to the effect that there would be some money left over from the sale of the Blackalls Park property and that he proposed to pay that off the mortgage for the Weston property; he says that his mother agreed to this course (his second affidavit at [30]). Andrew agreed in cross-examination that what would presumably be about a $70,000 surplus following the sale of the Blackalls Park property and the purchase of the Dora Creek property could be explained by an amount of $51,000 shown in his bank records as received by him on 16 December 2011, and by his evidence that at this point he paid off the remaining $18,000 on the Liberty Financial loan (plus some expenses associated with the transactions) (T 93-94).
Andrew says that since the acquisition of the Dora Creek property in 2011, he has carried out renovations at that property at his expense (see [73] of his second affidavit, which actually follows [30]). Andrew also gives evidence of renovations carried out by him to the Weston property (at [35]).
Andrew's evidence is that in October 2012, the deceased said that she would like to sell the Weston property and buy a unit in an over 55s village somewhere closer to Carmen and him (see his second affidavit at [32]). Carmen agreed in cross-examination that the deceased had discussed with her and Andrew a wish to move to a unit in an over 55s village (see T 32.11) and had said to her that in order to do so, she (the deceased) wanted to sell the Weston property (see T 32.16).
The Weston property was sold in June 2013 for $200,000. Andrew gives evidence as to how the proceeds of sale were applied (see his second affidavit at [36]). He has deposed that after agent's commission, discharge of the mortgage to Westpac, settlement and conveyancing costs, and payment of some outstanding council and water bills, there was a surplus of about $75,000. His recollection is that he received $72,000, which he says he paid into his Westpac E-saver account on 14 August 2013, with his mother's assent (see [37]). Andrew deposes that the funds were "either spent on Mum or given to Carmen and Carl"; and that he did not "personally" spend any of that money (see [39]).
Andrew has deposed to various conversations with Carmen in relation to the arrangements with the deceased regarding the respective properties and as to his concern that Carl might contest the deceased's will (see his second affidavit at [22]). Those conversations include a discussion with Carmen in about June 2016 in which he says that he suggested that when the deceased died he would be in a position to obtain another mortgage (on the Dora Creek property) and then she and Carl would receive the value of the Weston property; and that he would borrow or sell his house and pay back a sum of $100,000 "when the times [sic] comes" (see [40]). He also deposes to a conversation in which he says that Carl said he did not deserve an inheritance (at [22]).
Andrew has deposed that it was his understanding that he would be responsible for the repayment of the mortgage that he obtained from the Westpac Bank to purchase the Weston property and that this was what he always proposed to do after the deceased's death (see his second affidavit at [40]), but that the bringing of the present proceeding had caused him to be cautious, "knowing I must abide as Mum's executor to any order made by this Court".
As noted above, Andrew is a self-employed carpenter. He lives by himself in the Dora Creek property. His average net fortnightly income is approximately $1,091 (see the longer of his two affidavits affirmed 27 October 2017 at [6] (his fourth affidavit)). He lists his assets as being a beneficial interest in the Dora Creek property (the value of which he estimates at $480,000), various motor vehicles, a motorcycle and a boat (collectively estimated to be worth about $49,000), and a small amount in his bank accounts. He acknowledges a notional liability to the deceased's estate of $116,000 in respect of the moneys used from the proceeds of sale of the Blackalls Park property to repay the mortgage over the Weston property (see [66]). His other liability is a personal loan in the order of $18,000 from Westpac. He says that any income he receives is spent on living expenses (estimated per fortnight at $1,038 (see [67])).
Andrew suffered an injury to his back in a motorcycle accident in the 1980s and says he continues to suffer back pain as a result (see his second affidavit at [74]).
Andrew has deposed to his assistance in maintaining the Blackalls Park property (his second affidavit at [77]) and to his relationship with his mother, including regular visits to the Weston property and daily visits from the time she was hospitalised and ultimately admitted to the aged care facility (at [78]).
Andrew's evidence is that the Dora Creek property had a termite infestation approximately 18 months ago, which necessitated the kitchen and bathroom areas to be totally stripped and structural timbers to be replaced. This work has not been completed. The replacement cost of the timber is estimated at $18,000 (see his second affidavit at [91]).
As to the work carried out by Andrew on rebuilding Carmen and Mark's house (after it was damaged by fire), Carmen accepts that Andrew did the majority of the work on the reconstruction of the house (T 30.1) and that he gave up all his other work to do so (T 29.40). She accepted that he had no other income while he was working on their home (T 30.21-24). She and Mark paid Andrew an hourly amount (the amount of which was disputed - see T 30.5) while he was doing that work.

The estate

As adverted to earlier, the deceased's estate comprises the Dora Creek property (the value of which is disputed) and a small cash amount held in a building society account (the Newcastle Permanent account).
Andrew's estimate, in his affidavit affirmed 3 July 2017 (his first affidavit) as executor, was that the likely value of those assets was $484,711.91, this being on the basis that the Dora Creek property had a value of $480,000 and that the Newcastle Permanent account contained $4,711.91 (see at [15]). In that first affidavit, Andrew estimated that the likely net distributable estate was an amount of $462,847.85 (at [17]). That figure was arrived at by deducting funeral costs, nursing home fees, probate costs, and Andrew's costs of defending the current proceedings (the latter being an amount of $6,027.24).
By way of updating affidavit in his capacity as executor (the shorter of two affidavits affirmed 27 October 2017 (his third affidavit)), Andrew deposed that the estate contained gross assets of $482,299.86, this being based again on valuing the Dora Creek property at $480,000 and on the Newcastle Permanent account now holding $2,299.86 (at [11]). An amount of $2,412.05 has apparently disappeared from the Newcastle Permanent account; as to which, Andrew deposes to his belief that Carmen was accessing the account following the deceased's death (see at [13]) (Carmen deposes that she did withdraw $1,000 from this account after the deceased's death: see her affidavit sworn 4 November 2017 at [5] (her fourth affidavit)). Andrew says that this explains why there is a difference between the Newcastle Permanent account proceeds as at date of death and 27 October 2017 (though I interpose to note that Andrew deposed on 3 July 2017 to the account then holding $4,711.91; the withdrawals, if this is correct, would have occurred between July and October 2017).
In his third affidavit, Andrew estimates the net distributable estate at $466,463.04, this figure being based on deduction of funeral costs, nursing home fees, and probate costs (at [14]).
The remaining liabilities of the estate to which Andrew deposes in his third affidavit (and which are not taken into account in the $466,463.04 figure) are legal fees for defending the current proceedings in the amount of $6,027.24 (as referred to in the first affidavit but now specified as for the period from 12 December 2016 to 31 May 2017); legal fees for defending the current proceedings in the amount of $38,569.99 (for the period 1 June 2017 to 26 October 2017); and property valuations of the Dora Creek property in the amount of $1,500.00.
With respect to the value of the Dora Creek property, in Carmen's affidavit sworn 15 September 2017 (her second affidavit), she attributed a value of between $680,000 and $700,000 to the Dora Creek property (at [26]) based on what she refers to as a "market appraisal" from a real estate agent, dated 19 August 2017. That appraisal in terms is stated to be a "kerbside appraisal". The real estate agent made clear that it was not a valuation "but an Agent's Opinion given current market conditions" and that it was not to be relied upon by any third party.
In his first affidavit, Carl attributed a value of "about $550,000.00" to the Dora Creek property (though without stating any basis for that belief) (see at [42]).
At the hearing Andrew sought to rely upon a valuation of the Dora Creek property obtained from a Certified Practising Valuer in October 2017. That was objected to on the basis that there had been no leave given for expert evidence to be adduced and that it was impossible to test the valuation as no affidavit had been filed from the valuer and he had not been made available to be cross-examined (see T 13.1ff). After some debate, Andrew sought to rely on this valuation as a kerbside appraisal, though it was clear from the document that was in due course handed up to me (see T 70) that the valuation in its terms went beyond a kerbside appraisal. Ultimately, the tender of the valuation was withdrawn and, instead, Andrew tendered (and I admitted without objection (see T 72; T 128)): first, a kerbside appraisal in the form of a letter dated 12 April 2017 from Wilson Britten, in which the value of the property was assessed at $480,000 to $520,000 (Exhibit 1); and a further kerbside appraisal by Lawson Estate Agents dated 24 November 2017 in which the property was assessed at $480,000 to $500,000 (see Exhibit 4).

Plaintiffs' submissions

No provision was made for Carmen and Carl in the deceased's will. They argue that, on the evidence of all the parties, the deceased acknowledged an obligation to provide for their maintenance and advancement in life. They submit that Andrew has had the benefit of the deceased's generosity in her lifetime, being provided with accommodation of a higher standard than that in which the deceased herself lived and having had the benefit of the proceeds of sale of the Weston property which was in his name and the Blackalls Park property which was in the deceased's name. They point out that he now lives in the Dora Creek property, for which he pays no rent. The plaintiffs argue that they are both deserving of the deceased's testamentary bounty and have demonstrated that they are in a position of financial need.

Defendant's submissions

Andrew accepts that Carmen and Carl are eligible persons pursuant to s 57(1)(c) of the Act. He argues that the sum of $72,000 (which he says is the net proceeds of the sale of the Weston property), which he says he has paid either to Carmen, Carl or for the benefit of the deceased or the estate, should be notionally added back as testamentary expenses or liabilities of the estate such that the net estate, so adjusted, would amount to $409,463.00 (I note that this figure uses a valuation of the Dora Creek property at $495,000). Andrew accepts in his written submissions (at [7]) that he is able specifically to account only for $42,000 of that money (and the plaintiffs maintain that the said moneys are not properly accounted for in any event).
Andrew has put his own financial position in issue. It is submitted that he has a strong competing interest on the basis that he is in necessitous circumstances: his assets amounting to motor vehicles, personal property and bank accounts totalling $58,384 (but with a liability for a personal loan of $20,000, thus a net $38,384); and that his $13,500 interest in superannuation will be preserved for between 12 and 17 years (I interpose that Andrew's evidence in his fourth affidavit is of superannuation only amounting to $3,707.75 - see at [8]).
Andrew seeks to retain the Dora Creek property as his property absolutely, relying on the promises he says were made to him by the deceased during about 2003 and 2004. In that regard, I note that no estoppel claim was pleaded as such, but the course of Andrew's dealings with the deceased in 2003 and 2004 concerning her residence is relied upon as a relevant circumstance in Andrew's favour. It is said that the deceased's wills dated 12 September 2008 and 20 June 2012 (in which the whole estate was left to Andrew) were made in fulfilment of the deceased's obligations, as she saw them, to Andrew. (Reference is made to Kembrey v Cuskelly [2008] NSWSC 262, and it is submitted that the fact that there are two wills mirroring each other concerning the deceased's wishes for Andrew, suggests that Andrew has a much stronger claim upon her estate. It is submitted that it is highly unlikely that the deceased simply ignored Carmen and Carl's claims.)
Andrew estimates that he has a borrowing capacity of around $115,000 (see T 2), from which he says that his prospective lender, Westpac Bank, would require him to repay his personal loan (having a principal sum of $18,000). Andrew says that out of any such loan he would also need to meet the balance of his costs and disbursements in this claim (in written submissions this was said to be in a sum of $66,097.23, less a sum of $6,027.24 already paid, equating to a sum of $60,069.99; in oral submissions this was said to be in the order of $70,000 - see T 2.37), which would leave a balance of loan moneys (were he to take out such a loan) in the amount of between $36,930.01 and $27,000.
It is submitted that there may also be capital gains tax payable. In his written submissions, Andrew's estimate as to the amount that would be available for distribution (if the Dora Creek property had to be sold), taking the net value of the estate as $481,463.00 (which of course depends on the value to be attributed to the Dora Creek property), is $265,721. This assumes: that $72,000 is notionally deducted from the distributable estate (as I understand it, on the basis that it was expended for the benefit of the deceased or Andrew's siblings); that Andrew's costs of the proceedings are paid on an indemnity basis (though this was only put in the amount of $60,097.00); that Carmen and Carl's costs are paid on the ordinary basis (in the amount of $65,645.00); and that Andrew is reimbursed the sum of $18,000 for renovations paid for by him in respect of the Blackalls Park property. Andrew's calculations do not include the outgoings in relation to commission, legal/conveyancing costs, and auction costs, which he estimates will amount to some $18,200, nor do they include any capital gains tax which may be payable.
As to the competing claim of Carmen, Andrew points out that she and Mark have been married for 15 years (and together for 22 years). Although Carmen ascribes a value to the Morisset property (title to which is in Mark's name) of $500,000, Andrew contends that this is significantly understated and submits that the property has a more realistic value of up to $700,000 (I note that neither party has provided any basis for these estimates). It is submitted that Carmen's joint interest in property with her husband amounts to $748,502 and therefore that (commensurate with the extent of the estate), Carmen is not in straitened circumstances but is quite well off. Andrew notes that Carmen states she has assets of $19,000 and no liabilities; that she and Mark have joint net assets of $1,439; and that both derive income from their social security benefits.
Andrew also submits that Carmen did not have a good relationship with the deceased. It is submitted that the deceased was significantly disappointed with Carmen following her separation from her former husband and that Carmen did not see the deceased regularly for a significant period after that separation. Further, it is submitted that, following Carmen's move to Copacabana, the reason that the deceased spent time with Carmen was to care for Carmen, not vice versa (something which Carmen accepted in cross-examination at T 26.36ff).
Andrew maintains that Carmen berated the deceased and was emotionally cruel to her. Further, Andrew submits that the motivation for Carmen and Mark accommodating the deceased at their Morisset home was not to provide her with care but, rather, that the deceased was used by them as a "cash cow" (see Andrew's written submissions at [18]).
As to Carl's claim, Andrew accepts that Carl's financial position indicates significant needs (though Andrew argues that this is "entirely of his own making" - see Andrew's written submissions at [43]). Reference is made to cases of spendthrift applicants, such as Leary v NSW Trustee and Guardian [2017] NSWSC 1113, where it was said that a wise and just parent would be likely to take this into account both in fixing the amount of provision and in deciding whether any amount by way of provision should be protected in some way. Andrew also refers to Varis v Varis [2012] NSWSC 1553 at [52], where it was held that the plaintiff's completely inappropriate financial situation, being of her own making, was such that it could not be rectified by the deceased person.
Andrew submits that Carl made no contribution to the deceased's welfare or to the acquisition, conservation, maintenance and improvement of the deceased's estate; and says that the deceased made significant provision for Carl during her lifetime. Andrew also maintains that Carl had the benefit of drawings against the balance of the sale proceeds of the Weston property, which enabled him to purchase a motor vehicle and meet his living expenses. Andrew points, for example, to Carl's evidence that the deceased gave him $15,000 in 1987.
Andrew maintains that he also gave Carl sums totalling $16,000 (of which Carl only accepted that he had received two amounts: one of $4,000 (see his affidavit sworn 15 September 2017 (his second affidavit) at [5]; T 53.13), possibly in March 2014; and one of $5,000 in November 2016, which he used to purchase a VW car, that apparently being the car now waiting to be sold for parts (see T 52.31ff)). In his second affidavit Carl also admitted that he had received a loan from Andrew of $2,500 which has not been repaid. However, in cross-examination, he said he did not recall receipt of a sum of $7,000 in May 2014 (see T 53.20). Pausing here, Carl's recollection of moneys received from Andrew was vague (see for example T 53.6, in which he says that he only recalled two amounts but then says, "I am not saying it didn't happen, I am just saying I don't recall").
Andrew submits that Carl's relationship with the deceased was "somewhat vexed" (Andrew's written submissions at [22]); that Carl was a disappointment to the deceased (referring to his drug use and imprisonment); and that during his imprisonment Carl was away from the deceased.
As to his own position, Andrew points out that he lived with the deceased for approximately 32 years, with the exception of two periods between 1995 and 1997 and between 2000 and 2001. He says that he was hesitant to participate in the Weston property transaction, because the title to the Blackalls Park property would not be in his name, but nevertheless went ahead. He submits that the deceased was delighted that Andrew assisted her and informed him that her time at the Weston property was the happiest in her life. He argues that he changed his position in reliance upon the deceased's requests and continued to live in the Blackalls Park property; and that he came to regard the Blackalls Park property (and presumably by extension the Dora Creek property) as his own. It is submitted that the deceased made a promise to Andrew (to the effect that he was to have sole and absolute ownership of the Blackalls Park property), which promise, when coupled with her conduct, constituted encouragement for Andrew to change his position. While Andrew accepts that "the nature of the encouragement and promise [that he would own the Blackalls Park and later Dora Creek property] was not absolutely set in stone" (see his written submissions at [30]), he says that there was a sufficiently clear promise by the deceased and that the deceased's will reflects the fulfilment of her promise and encouragement to Andrew to purchase the Weston property; and that the deceased's testamentary disposition towards Andrew reflects the exercise of her good conscience to fulfil that promise.
It is submitted that Andrew acted to his detriment by: purchasing the Weston property; entering into a first mortgage over the Weston property for a substantial sum with the Westpac Bank; meeting the mortgage instalments as and when they fell due throughout the term of the mortgage; meeting the loan repayments on the Liberty Financial loan for a period of approximately eight years; expending moneys on the Blackalls Park property for the purposes of improving the same and investing his time and effort into the construction and improvement of the property; and expending moneys on the Dora Creek property and investing his time in improvement of the same. Andrew argues that, had the deceased resiled from her encouragement and promise, the consequences to Andrew would have been unconscionable, such that he would have been in a position to make an application for equitable relief. Pausing here, I note that despite these submissions bearing the trappings of an estoppel claim, no such claim was pleaded and Counsel for Andrew confirmed in closing submissions that there was no reliance on estoppel, but rather on the alleged promise and encouragement as circumstances relevant to the family provision inquiry, in keeping with s 60(2)(p) of the Act (see T 143-144).
Andrew emphasises that this is a very small estate, and points out that in Harrisson v Skinner [2013] NSWSC 736 at [108], Hallen J said that this was a significant consideration in determining an application for provision (his Honour there referring to what Salmond J said in the decision of In re Allen (deceased); Allen v Manchester [1922] NZLR 218 at 221).
It is submitted that Andrew made significant contributions to the deceased in respect of her welfare and accommodation in the last ten years of her life and that the making of provision for either Carmen or Carl would be an unfair and unacceptable burden upon Andrew.
Andrew argues that respect should be given to a capable testator's judgment as to who should benefit from his or her estate if it can be seen that the testator has duly considered the claims on his or her estate (referring to Saba v Saba [2016] NSWSC 1576 at [63] and Gersbach v Blake [2011] NSWSC 368 at [94]-[96]). Reference is also made in this context to Larkin v Leech-Larkin [2017] NSWSC 1418 at [79], where it was said: It has frequently been pointed out that the Court is rarely in as good a position as the testator to assess and weigh the factors which go to determining what provision is "proper" among various persons who might have a claim to the testator's bounty and that, accordingly, unless it appears that the testator has misused his or her advantage, or the circumstances existing at the time of the hearing were not reasonably foreseeable for the testator, the Court should be reluctant to depart from an apparently reasonable judgment on the part of the testator: Stott v Cook (1960) 33 ALJR 447 at 453-454; Slack v Rogan; Palffy v Rogan (2013) 85 NSWLR 253 at 284-285 [127].
Andrew submits that in matters relating to the acquisition and transfer of real estate, neither he nor the deceased was sophisticated, noting that neither had obtained legal advice or assistance. Andrew accepts that it is understandable that Carmen and Carl considered that the deceased's testamentary disposition to Andrew gave no regard to equality and was unfair to them; and he accepts that, no doubt, his siblings were hurt by this. However, he maintains that this does not constitute a basis for seeking provision under the Act.

Application for provision

Pursuant to s 59 of the Act, on the application of an eligible person, the Court may make a family provision order in relation to the estate of a deceased person if the Court is satisfied, at the time the Court is considering the application, that adequate provision for the proper maintenance, education or advancement in life of the person in whose favour the order is to be made has not been made, relevantly in the present case, by the will of the deceased. If so satisfied, then the Court may make such order for provision out of the estate as the Court thinks ought be made for the maintenance, education or advancement in life of the eligible person, having regard to the facts known to the Court at the time the order is made.
Section 60(1)(b) of the Act provides that the Court may have regard to the matters set out in sub-s (2) for the purpose of determining whether to make a family provision order and the nature of the order. Relevantly, those matters include: (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, … (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 has been a debate in the authorities as to whether the same two-stage analysis as was engaged by the predecessor legislation (the Family Provision Act 1982 (NSW)), namely the test set out in Singer v Berghouse (1994) 181 CLR 201 at 210-11; [1994] HCA 40, continues to be applicable to applications for family provision orders under Ch 3 of the current Act (see the authorities referred to by White JA in Sgro v Thompson [2017] NSWCA 326 at [68]). As both White JA (at [69]), with whom McColl JA agreed (at [1]), and Payne JA (at [4]) make clear in Sgro, that debate should be of no real significance provided that the nature of the first stage of the inquiry (whether adequate provision has been made) is not misunderstood. The risk identified in the adoption of the two-stage approach (see Sgro at [71] per White JA) is if it is assumed that the first stage requires an evaluation of whether the applicant has been left without adequate provision for the applicant's proper maintenance, education or advancement in life, focusing primarily or exclusively on the applicant's financial needs. Their Honours made clear in Sgro that what is required is an evaluative judgment as to the adequacy of provision for the applicant's proper maintenance, education or advancement in life having regard to all the relevant circumstances, not merely the parties' financial circumstances. That inquiry includes taking account of matters such as other claims on the deceased's testamentary bounty and, relevantly in the present case, the family circumstances.
In Sgro, a relevant matter to be taken into account was the assessment of the testatrix of competing claims on the estate (in particular, that all the family members had understood that the applicant, for whom no provision was made in the will, had in effect received an 'early inheritance' when certain property was transferred to her inter vivos) (see, for example, [3] per Payne JA). A not dissimilar issue arises in the present case in circumstances where, on Andrew's own evidence, the deceased's understanding or intention was that the Weston property was to be for the benefit of Carmen and Carl (in circumstances where the Blackalls Park property was to be treated as Andrew's).
The issues for determination in the present proceedings therefore are whether, considering the matter as at the time of the application and having regard to all the circumstances (and not just their financial needs), Carmen and Carl have been left without adequate provision for their "proper" maintenance, education and advancement in life and, if so, what provision ought to be made having regard to the facts known to the Court as at the time any family provision order is made. In determining this, it is necessary to take into account, among other things, the nature and value of the estate and the competing claim of Andrew on the deceased's testamentary bounty.

Determination

I have set out above in some detail the positions of the respective adult children of the deceased, who are the only relevant objects of her testamentary bounty. Addressing the relevant matters referred to in s 60(2) of the Act, I note the following.

Sub-s 60(2)(a) - any family or other relationship between the applicant and the deceased person, including the nature and duration of the relationship

There is no dispute that both Carmen and Carl maintained a family relationship with the deceased over the course of her life (albeit with less contact while Carmen was in Melbourne and while Carl was in prison, respectively).

Sub-s 60(2)(b) - 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

Andrew does not dispute that the deceased recognised both Carmen and Carl as "natural recipients of her parental ties" (Andrew's written submissions at [43]). It is clear from the evidence that the deceased maintained contact with each of her adult children and, on Andrew's own evidence, that the deceased recognised a moral obligation towards all of her children. In this regard I note that the deceased spoke of Carmen and Carl sharing the Weston property, and Andrew having the Blackalls Park property, when she died. The fact that her will did not reflect this intention is explicable on the basis that the deceased no doubt expected Andrew to adhere to her wishes as to the distribution of her estate (he having been a party to the conversations in which those wishes were expressed and, it would appear, not having demurred therefrom).

Sub-s 60(2)(c) - 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

The nature and extent of the deceased's estate has been set out earlier. Apart from a small cash amount (which would be wholly subsumed by now by the testamentary expenses) the sole asset in the estate is the Dora Creek property. It is unencumbered. I have noted earlier (see above from [58]) the dispute as to its value. I was urged by the plaintiffs to adopt a figure produced by averaging out the respective appraisals (which ranged from $480,000-$500,000; $480,000-$520,000; and $680,000-$700,000), it being emphasised that this is waterfront property.
The difficulty with that is that one would have thought that a kerbside appraisal (of its very nature) would not reveal the quality of the interior of the house (unless, for example, there was a gaping hole through to the exterior - and it was not suggested that the termite damage to the Dora Creek property had extended that far). Nevertheless, it is clear that at least one of the appraisals (Exhibit 4) attached photographs showing what would appear to be a functional kitchen - which on Andrew's evidence in re-examination (see for example at T 120.28-43) is not the state of the property at present. There is no reason to doubt that evidence. Similarly, Andrew's evidence in re-examination as to the present state of the bathroom (see T 121.30-36) suggests that a purchaser would need to allow for costs in completing the works to that area as well. Therefore, I would be cautious about adopting a figure at the high end of the range. Moreover, the kerbside appraisal obtained by Carmen is substantially in excess of the values estimated by the other real estate agents and I would discount it as an outlier for that reason.
For the purposes of the current exercise (and accepting that a purchaser buying the property would need to take into account the requirement for renovation works to be carried out to complete the kitchen and bathroom), I would be inclined to adopt the lower end of the ranges given by the appraisals relied upon by Andrew (say, $480,000). (Even if I were to take judicial notice of the fact that real estate is said to be all about 'location, location, location', and that even a property that is uninhabitable may sell at a high price in the right location, there is nothing to suggest that a purchaser of the Dora Creek property would not take into account the necessary renovation works as a factor in reduction of the price he or she was willing to pay for the property.)
As to the estate's other asset, being the small amount of cash in the Newcastle Permanent account, there was some disagreement in the affidavit evidence over transactions after the deceased's death with respect to that account. I note, however, that these matters were not addressed in cross-examination of either Carmen or Andrew. In circumstances where the difference (some $2,400) is not great, I propose to proceed on the more conservative basis that the total value of the assets in the estate is $482,299.86 (using Andrew's figures in his third affidavit), this being the sum of the Dora Creek property valued at an amount of $480,000 and the $2,299.86 said to be the current proceeds of the Newcastle Permanent account.
In terms of liabilities, I accept the amounts specified in Andrew's third affidavit for funeral costs, nursing home fees, and probate costs, which leaves a net distributable estate of $466,463.04.
Were the Dora Creek property to be sold, there would be some reduction for commission or conveyancing costs (and it was suggested that there might also be capital gains tax implications, though there was nothing that would indicate what those might be in the present case). Ultimately, of course, the question of costs will also need to be taken into account. I address these matters more fully below (at [138]).

Sub-s 60(2)(d) - 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 financial resources of each of the three children have been set out above. Both Carmen and Carl derive their income from pensions. Carl is obviously in the position of most financial need, having no home and being dependent on Carmen's support for his accommodation. Carmen, though not owning her own home, is in a long-term relationship with her second husband, Mark, and lives with him in a secure home (albeit subject to a mortgage). Andrew's income is dependent on what he earns from his carpentry business and, if required to sell the Dora Creek property by virtue of the making of a family provision order in favour of Carmen and/or Carl, it is obvious that he will be left with the need to find his own accommodation either by renting or buying property.
In relation to Andrew, it must be noted that the evidence of his financial affairs was not complete. He had been served with a notice to produce all bank statements and documents relating to his bank accounts. In his list of assets, he disclosed two bank accounts (a Westpac Choice account, that as at 27 October 2017 had a balance of $726, and a Westpac E-Saver account, that Andrew deposed had a balance of about $2 - see his fourth affidavit at [7]). He did not produce documents in relation to the E-Saver account. He said that the Choice account was the account "where all the main transactions happen" (see T 89.29).
The E-Saver account was the account to which the surplus proceeds of sale from the Weston property were deposited (see p 61 of Ex-AJB1; T 89.43ff). As at 5 May 2014, that account had nothing in it, following the withdrawal of a sum of $58,000 (which must have been part of the Weston sale proceeds of about $72,000 to which Andrew has elsewhere deposed). The account appears to have been opened with a deposit of $69,400 from a term deposit, which Andrew accepted was part of the proceeds of the sale of the house at Weston (T 90.45).
Andrew's evidence in cross-examination was that he was always going to make sure that the value of the Weston property went to Carmen and Carl (see T 90.50-91.3), but that this was no longer his position because "[w]ell they are suing me" (T 91.9).
There was no record of withdrawals from that E-Saver account to substantiate Andrew's evidence in his second affidavit that the moneys from the Weston property were spent on the deceased or given to Carmen and Carl. He said that the amounts he gave to Carmen he withdrew as cash, and handed that cash to her (T 92.25, 92.34), but that there would not be any record of the cash withdrawals "because it comes from my normal savings account then its [sic] going to be just be mixed in with any other transactions I did" (T 92.37).
Exhibit 3 is a bank statement recording a deposit of $51,396.22 on 19 December 2011. Andrew's evidence at first was that he thought this would have been the money left over from the sale of the Weston property, but then accepted that as this was before the sale of that property, it must have been from the sale of the Blackalls Park property (see T 93.43-50). Andrew accepted that this amount, together with the moneys paid to discharge the Liberty Financial loan (of $18,000) would represent an amount close to $70,000 (T 94.7), being the difference between the sale price of the Blackalls Park property and the purchase price of the Dora Creek property.
Cross-examined as to whether he had had the benefit of that $51,000 (the proceeds from the sale of Blackalls Park property), Andrew asserted that he had negotiated with the vendor of the Dora Creek property to reduce the price and that he had put a lot of work into the Blackalls Park property to raise its value. He said (at T 94.13ff): I don't see why Carmen and Carl should benefit from the work that I put into creating that little bit that was left over from the sale. That was only there because of the work that I put into it.
Andrew accepted that in December 2015 he opened a Newcastle Permanent Investment Account with a deposit of $40,000 (T 95.1; and see Exhibit B). He said that this money came from one of the Westpac accounts, but he could not recall which one (T 95.4-13); and that the withdrawal from that investment account in April 2016 (of $3,500 in cash and $36,693.31 by cheque) "could have gone back into the normal savings account" but he was not sure about that (T 95.25ff). Questioned as to the payee of the cheque, Andrew thought it could have been the time he lent some money to Ben (Carmen's son) (see T 95.27-31); though when Exhibit B was produced to me it became apparent that the entry recorded Andrew as the payee of the cheque. Later, Andrew gave evidence of a personal loan that he obtained from Westpac (in the amount of $20,000), from which he said he had lent Ben $16,000 (see T 99), but his evidence was unclear on the amounts in question; and it was unclear regarding the funds of $25,000 transferred in September 2016 from or between the Choice and E-Saver accounts.
The significance of the lack of clarity in Andrew's evidence of his financial dealings and circumstances is that it has been made clear in the authorities that it is incumbent on an applicant for a family provision order to disclose to the Court as fully and frankly as possible all details of his or her financial and material circumstances (see Collings v Vakas [2006] NSWSC 393 at [66]-[67] per Campbell J, as his Honour then was; Foye v Foye [2008] NSWSC 1305 at [14]-[15] per McLaughlin AsJ; In the Estate of the late Anthony Marras [2014] NSWSC 915 at [238] per Bergin CJ in Eq; and, more recently, Singh v Singh [2015] NSWSC 1457 at [152]-[154] per Black J; and my judgment in Leary v NSW Trustee and Guardian at [53]).
Strictly speaking, of course, Andrew is not an applicant for a family provision order but he does seek to have his financial circumstances taken into account and hence there is a need to have an adequate understanding of his financial position. In Collings v Vakas, the application for family provision was dismissed in circumstances where a crucial element of the applicant's financial situation (her income and expenditure) had not been satisfactorily proved. In that context, Campbell J said (at [67]): …before a court can be satisfied that a plaintiff has been left without adequate provision, the court needs to be persuaded that it has been presented, at least in broad outline, with the whole picture concerning the plaintiff's financial situation.
Nevertheless, the fact that there is not a complete picture of the deposits and withdrawals from Andrew's bank accounts over the period does not mean that I am left without a sufficiently clear picture of his current assets. Moreover, failure to make all of his bank statements available is not necessarily determinative. Indeed, even in a case where a family provision claim had been made on the basis of a totally false and intentionally misleading affidavit as to the applicant's financial circumstances (Ahmad v Ahmad [2002] NSWSC 579), McLaughlin M, as his Honour then was, considered such conduct (though reflecting badly on the credit of the plaintiff and being a serious abuse of the process of the Court) was not of itself determinative of the claim for provision (see at [44], reference there being made to Re the Will of Gilbert (1946) 46 SR (NSW) 318). (Of course, in Ahmad v Ahmad, the plaintiff had 'come clean' by the time of the hearing, whereas in Leary v NSW Trustee and Guardian, even though the plaintiff had disclosed the falsity of his previous affidavit evidence, I could not be satisfied that I had a sufficient understanding of his financial circumstances.)
In the present case, the missing bank statements would potentially have shed light on distributions said to have been made by Andrew to his siblings and the use made by him of the surplus proceeds of sale of the Blackalls Park and Weston properties respectively. In those circumstances, I have proceeded on the basis that where there is no evidence to support Andrew's contention as to distributions made to his siblings (so, for example, in Carl's case other than where receipt of amounts was accepted by him), I should assume the moneys were used for Andrew's personal benefit. That, however, merely leads to the conclusion that Andrew has had greater provision out of the estate of the deceased both during her life and after her death than has been admitted by him. It does not affect the fact that, if compelled to sell the Dora Creek property so as to satisfy family provision orders in favour of his siblings, Andrew will be left with no accommodation and little in the way of assets.

Sub-s 60(2)(e) - financial circumstances of any person with whom the applicant is cohabiting

This is only applicable in relation to Mark. His financial circumstances include assets estimated at $656,516.12 (this sum includes the Morisset property with an estimated value of $500,000; a yacht with an estimated value of $25,000; the balance of a savings account; and superannuation). The Morisset property is subject to a mortgage in the amount of $128,453 (this being Mark's only liability). Mark is not employed but receives a carer's payment and additional carer allowances which (on Carmen's evidence) produce a net monthly income of $1,802.60 (see Annexure F to Carmen's first affidavit; and see T 57.24-58.27).

Sub-s 60(2)(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

Each of the children suffers from health conditions of some kind. Both Carmen and Carl are on disability support pensions by reference to their different physical conditions.

Sub-s 60(2)(g) - age of the applicant when the application is being considered

This has been noted earlier.

Sub-s 60(2)(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

Carmen's contribution to the deceased's estate appears to have been limited to the provision of accommodation for the deceased after the Weston property was sold. Carl appears to have made no contribution to the estate of the deceased as such. Andrew's contribution to the estate of the deceased was in part his improvements to the Blackalls Park (and later Dora Creek) properties and his assistance in meeting the deceased's desire to move to the Weston property. The extent of the contribution by Carmen and Carl towards the deceased's welfare was disputed by Andrew, and vice versa. I consider the criticism made in relation to Carmen's conduct in more detail below when addressing the matter referred to in sub-s 60(2)(m). As to Carl, his contribution to the deceased's welfare was limited to a large extent to his companionship with the deceased when she was living with Carmen towards the end of her life.

Sub-s 60(2)(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

As to the provision made for each of the children during the deceased's lifetime, it was not suggested that the deceased had not supported each child up to the time that he or she left home. After Carmen returned from Melbourne to Copacabana, the deceased provided support in caring for her (as Carmen accepted in cross-examination at T 26.36ff) during the time she was afflicted by the illnesses she describes in her first affidavit (from [67]). As to Carl, the deceased provided him with cash from time to time. Each of the three children received $15,000 from an inheritance the deceased received in late 2005 from the estate of the children's paternal grandmother.
Andrew has clearly received the most financial support from the deceased in her later years - having regard to the fact that the deceased provided her support (in the form of the borrowing from Liberty Financial) for the acquisition of the Weston property in Andrew's name and allowed him to live in the Blackalls Park property (free of rent) and then to live in the Dora Creek property (also free of rent). The surplus proceeds of sale of the Blackalls Park property appear to have been held by Andrew (a receipt of at least $51,000 evidenced by bank records for 16 December 2011 demonstrates this) and in the absence of evidence to establish that they were used for the deceased's benefit, I would infer that Andrew had the benefit of those funds for his personal use.
Andrew also obtained the proceeds of sale of the Weston property. He says that he did not use them for his personal benefit but, as noted earlier, accepts that he can only account specifically for some $42,000. The inaccuracy of his reconciliation of the moneys spent out of the proceeds of sale of the Weston property was exposed in the course of his cross-examination. In the circumstances, I cannot be satisfied that the whole of the benefit of those proceeds was expended for the deceased's benefit or by way of gift to the siblings. On one view, since the Weston property was acquired largely through Andrew's contributions (he took out the mortgage and paid the deposit to purchase the property, albeit with a contribution from his mother by way of the Liberty Financial loan in relation to which he assumed responsibility for the repayments after about 18 months), what he did with the proceeds of sale would be a matter for him. (To the extent that any of the proceeds from the Blackalls Park property sale may have been used to reduce the mortgage over the Weston property, this would in effect be a contribution by the deceased to Andrew's financial position during his life - but that is already taken into account in the inference I have drawn that those moneys were used for Andrew's personal benefit.)
As to the benefits received after the death of the deceased, it must be noted that Andrew has continued to have the benefit of the occupation of the Dora Creek property.

Sub-s 60(2)(j) - any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person

The evidence of the deceased's testamentary intentions can most clearly be drawn from the two wills in which Andrew was the sole beneficiary. However, her conversations with Andrew (on which he relies) also make clear that she intended in some fashion that her other children would be provided for (i.e., that they should share equally in the Weston property). Had the proceeds of sale of the Weston property been retained and then distributed between Carmen and Carl after the deceased's death, there would have been a sum of at least around $72,000 to be shared between them. And, indeed, Andrew's own evidence is that he had intended at one stage to sell or mortgage the Dora Creek property in order to make provision for each of his siblings in the sum of $100,000 (which I infer accords with his understanding of what the deceased had intended).

Sub-s 60(2)(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

None of the adult children was being maintained by the deceased at the time of her death; save that Andrew was occupying the Dora Creek property (held in the deceased's name) rent-free at that time.

Sub-s 60(2)(l) - whether any other person is liable to support the applicant

There is no other person who is liable to support Carl (or for, that matter, Andrew). Carmen's position is different insofar as she has an expectation of support from her husband, Mark.

Sub-s 60(2)(m) - character and conduct of the applicant before and after the date of the death of the deceased person

The nub of the complaints made by Andrew in relation to Carmen's conduct towards the deceased was that during the deceased's later years (when, on Carmen's evidence, the deceased had begun to suffer from dementia of some kind) Carmen was "cruel" to her mother, and that Carmen and Mark had treated the deceased as a "cash cow" (relying on Mark's carer's pension relating to the deceased). Andrew was critical of the fact that when Carmen and Mark's house was being rebuilt after the fire, the deceased slept in makeshift accommodation in a carport at the house and he was critical that Carmen and Mark did not shower the deceased regularly (see, for example, T 108).
Carmen, on the other hand, was adamant that showering the deceased was not her responsibility (and that it was difficult for her to do this) (see T 38); and her husband, Mark, suggested during his cross-examination that criticism of the carport accommodation was unjustified in circumstances where Andrew had not made accommodation available for the deceased at his home at Dora Creek (T 65.44-45, 66.33). Carmen appeared to accept that on at least one occasion she had been too rude to her mother; but generally denied the accusations that she had berated her mother and put certain of the comments ascribed to her down to being jokes (see, for example, T 39-40, 41.44-45). Mark appears to attribute Andrew's complaints about Mark's carer's pension in relation to the deceased to some kind of jealousy on Andrew's part at the fact that Mark and Carmen had three pensions between them and Andrew had none (T 67).
As to this, it must be noted that Carmen (and Mark) did provide accommodation for the deceased during the last years of her life and did take on what was no doubt a stressful role in the care of an elderly person suffering from dementia towards the end of her life. (Carmen's evidence in the witness box as to the physical difficulty she had in showering her mother rang true; and the difficulty for someone in Mark's position to do so is obvious.)
Carl's criminal conduct no doubt would have caused the deceased worry and disappointment, but the evidence is that towards the end of her life Carl was a support for his mother (reading to her and spending time in her company). Carl's evidence that he would take his mother for holidays to give Carmen respite from time to time also points to a recognition that caring for the deceased was not easy towards the end of her life.
As to Andrew, criticism seems to be made by one or both of his siblings of the fact that he pushed his mother into the housing arrangements that eventuated. It is suggested that if the living arrangements at Carmen's house for his mother were so bad he could have accommodated his mother at the Dora Creek property (a suggestion that Andrew dismisses on the basis that he worked full-time while Carmen, Mark, and Carl were basically home "24/7" and could look after the deceased - see T 108.40).
It is evident from the evidence before me that there is animosity between, on the one hand, Andrew and on the other hand, Carmen and Mark. Mark was at pains to emphasise in the witness box that it was Andrew's decision to carry out the work on the Morisset property whereas he (Mark) had wanted his own brother to do the work; and it was suggested that Andrew had misstated the amounts paid to him for that work (see T 60.6-28). Andrew, on the other hand, appears to consider that Carmen and Mark are ungrateful for the assistance he gave them (at the expense of carrying out other work) in rebuilding their home after the fire (see T 88.33-35). There were allegations made by Carmen and Mark as to damage to their house caused by Andrew (and Andrew admitted in the witness box to an incident of spitting on Mark's car - see T 120.14-15). Ultimately, the evident tension between those family members (in which Carmen's son, Ben, was embroiled to a degree - having given evidence that cast his mother in an unfavourable light) means that I treat with some caution their respective accounts of events. The position as between Andrew and Carl appears less strained, although Andrew was disparaging of Carl for not working and Carl clearly regarded Andrew as being the favoured son.
As to Andrew, while he accepted that his evidence was inaccurate as to the number of weekends that he would take his children to visit his mother at Carmen's house, I accept that he also maintained a close relationship with his mother up to the time of her death.
Viewing the evidence as a whole, and bearing in mind the tensions in the family relationships, the relevant point to note is that the deceased clearly regarded all of her children as objects of her testamentary bounty (having regard to the conversations on which Andrew relies as supporting his assertion that, had the deceased resiled from her alleged promises in relation to the Blackalls Park and then the Dora Creek properties, he would have had a claim for equitable relief).

Sub-s 60(2)(n) - conduct of any other person before and after the date of the death of the deceased person

This has largely been dealt with above. The only other person whose conduct would be relevant in this regard is Mark, who I accept provided support for the deceased in the provision of accommodation and who assumed, at least to some extent (leaving aside the issue of the showers), the role of carer for his mother-in-law in her last years.

Sub-s 60(2)(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

Finally, as to other matters to be taken into account, Andrew placed much weight on the promises he said were made to him, and upon which he says he relied to his detriment, in relation to the acquisition of the Weston property.
I accept that the arrangement contemplated by the deceased was that Andrew would purchase the Weston property in his name so that she could live in the property and that he would be able to remain in the Blackalls Park property. Carmen accepts that the deceased made her aware of such an arrangement at the time (and Carl also accepted that Carmen had told him something about the arrangement - though he was in prison at the time and did not wish to become embroiled in a dispute between Carmen and Andrew about it). I am also prepared to accept that the arrangement later encompassed the sale of the Blackalls Park property and the acquisition of the Dora Creek property.
Andrew contributed (by way of the mortgage he took out at the time and his savings of $15,000) around 88% (87.69% on my calculations) towards the purchase price of the Weston property and then paid most of the repayments in respect of the loans taken out to purchase the property (other than during an 18 month period in which the deceased made repayments on the Liberty Financial loan) until the time of the sale of the Blackalls Park property. It seems likely that he then used part of the surplus proceeds from that sale to reduce the borrowings on the Weston property. He appears to have subsequently used the surplus proceeds of the sale of the Weston property at least in part in a manner for which he cannot account, and which I infer was for his personal use. He is left, if the Dora Creek property is to be sold to provide for Carmen and Carl, with no accommodation and only what may be then left in the estate to provide for himself.
Had Andrew not participated in the arrangements for the acquisition of the Weston property then he would have retained his savings of $15,000 and presumably have been able in due course, with additional borrowings, to have paid a deposit for a property of his own, but would no doubt have incurred borrowings for such a property which he may well still be repaying.
The difficulty with Andrew's reliance on an estoppel in his favour (apart from the fact that no such claim was pleaded) is that I am not persuaded that it would have been unconscionable for the deceased to depart from the (testamentary) promise in circumstances where, after the Weston property was sold in 2013, the proceeds of sale were not distributed to Carmen and Carl. On the arrangement apparently contemplated by the deceased, the Weston property was to provide for her other adult children after her death. The fact that that has not happened is due to Andrew's decision to retain the proceeds of sale and to use them in ways for which he is unable now wholly to account.

Conclusion

Taking all of these considerations into account, I am satisfied that the deceased's will does not make adequate provision for the proper maintenance, education and advancement in life of Carmen and Carl. The will makes no provision at all for Carmen and Carl.
Carl is undoubtedly in a position of need: being currently dependent on Carmen and Mark for accommodation (that accommodation being a caravan without shower or toilet facilities); having what must be accepted are limited employment prospects given his criminal history and his experience in seeking work after his last employer became aware of his criminal antecedents and dismissed him; and suffering physical health conditions (including a need for further dental work). Carmen is in a more secure position insofar as she has what seems to be comfortable accommodation (to which Andrew made a not insignificant contribution) and the expectation of support from her husband. However her health is poor and she does not appear to have any reasonable prospects for employment. (Mark's position is different in that he has had employment in the more recent past, although that work has not continued in recent times and he is in the role of carer for Carmen).
Taking into account the circumstances of each of Carmen and Carl, and bearing in mind the deceased's testamentary intentions as expressed to Andrew to the effect that each of her children would share in the respective properties (the Blackalls Park and Weston properties at the time), I have concluded that although the estate is a small one (and any order for provision will necessarily impact on Andrew's position) nevertheless the deceased's will does not make provision for the proper maintenance and advancement in life of Carmen and Carl (and even taking into account that some provision was made during the course of the deceased's life for her two eldest children that is not now adequate for their respective needs). Accordingly, orders for provision in their favour should be made.
However, the needs of Andrew must also be taken into account; he also being a natural object of his mother's testamentary bounty and having made a significant contribution to her welfare particularly in relation to the arrangements made for her to live in the Weston property over the years she did and in the improvements made by him to both the Blackalls Park property (the benefit of which has to an extent enured to the estate through the price obtained on its sale, which allowed the acquisition of the Dora Creek property) and to the Weston property.
I bear in mind that Andrew was unable fully to account for the proceeds of sale of either the Blackalls Park property or the Weston property; and though the evidence permits a conclusion that some part of those proceeds was used to benefit the deceased or to provide sums for the benefit of Carmen and Carl, respectively, I cannot be satisfied that the whole of those proceeds went to the benefit of the deceased or Andrew's siblings.
In determining the provision to be made for the proper maintenance of each of Carmen and Carl (balanced against the needs and legitimate expectation of Andrew), I place weight on the testamentary intentions of the deceased to make some provision for all of her adult children - it appears, in the case of Carmen and Carl, that the deceased's intention was to make provision by way of sale of the Weston property and/or Andrew giving to Carmen and Carl an amount reflective of the value of the Weston property.
In all the circumstances, I am of the view that the appropriate provision to be made for Carl (who is in the position of greater need) is the amount of $100,000 and that the appropriate provision in Carmen's favour is the amount of $50,000.
Adopting a value for the Dora Creek property at $480,000 and using the lower figure for the Newcastle Permanent account, the assets of the estate amount to $482,299.86 as explained earlier. The uncontroversial liabilities are, first, funeral costs, nursing home fees, and probate costs, deduction of which yields a net distributable estate of $466,463.04. There is then the issue of legal costs. Carmen and Carl should have their costs on the ordinary basis out of the estate. On the evidence before me these are estimated at approximately $54,645 (see affidavit of Stephen Churches sworn 23 October 2017). Andrew should have his costs out of the estate on the indemnity basis (which, on the evidence before me, are estimated at approximately $66,097.23 - see affidavit of Adrian Corbould affirmed 27 October 2017). Accepting that this is an inexact exercise, that leaves the distributable estate somewhere in the order of $346,000.
It may be that (contrary to his current expectations) Andrew is in a position to mortgage the currently unencumbered Dora Creek property - if that is so, he would be able to retain the property and the orders for provision could be met out of the borrowings. If not, some additional deduction for costs associated with sale would need to be made (Andrew submitted that these costs might be in the order of $18,000). In any event, I am satisfied, having regard to all of the circumstances referred to above and weighing in the balance the needs of Carmen, Carl, and Andrew, as well as the intentions and disposition of the testatrix, that family provision orders in Carmen and Carl's favour of $50,000 and $100,000 respectively should be made.
When I publish these reasons, I will invite submissions from the parties as to whether a timetable should be put in place, either for the sale of the Dora Creek property or to permit finance to be obtained, and if the parties wish to make submissions I will list the matter for directions for that purpose.

Orders

The Court: 1. Orders that, pursuant to the Succession Act 2006 (NSW) s 59: 1. the first plaintiff receive a lump sum of $50,000 out of the estate of the deceased; and 2. the second plaintiff receive a lump sum of $100,000 out of the estate of the deceased. 1. Orders that, unless any party makes an application for a different costs order, the plaintiffs' costs of the proceedings, calculated on the ordinary basis, and the defendant's costs of the proceedings, calculated on the indemnity basis, be paid out of the estate of the deceased.

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: 07 May 2018

Pursuant to Succession Act 2006(NSW)s 59, order

Family Provision Act 1982(NSW)

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