Family provision adoption and the court of appeal

The NSW Court of Appeal has dismissed an appeal bought following an action for family provision in Daley v Donaldson [2021] NSWSC 1507.

Background

A court may make a family provision order if it is satisfied that a consent order signed by the party’s representatives meets the requirements for making a family provision order under s 59 of the Succession Act.

A mediation of the applicant’s claim for a family provision order resulted in a compromise, from which the respondent resiled, saying she had been under a misapprehension.

Both parties were operating under the mistaken assumption that as a child of the deceased the Plaintiff was an eligible person, when, in fact, he was not: s 57(1) (c) of the Succession Act 2006.

The parties agreed to a settlement of a family provision claim before the applicant discovered he was adopted by his stepfather Keith John Daley.

First proceedings

The plaintiff sought the Court’s determination there was a binding enforceable agreement under s 73 of the Civil Procedure Act 2005 (NSW).

The plaintiff submitted that the settlement agreement constituted a binding contract, with the parties intending to be immediately bound to the performance of its terms: it embodied a compromise, and the parties have agreed, despite the uncorroborated possibility of an adoption having occurred, to settle the Plaintiff’s claim for a family provision order.

At first instance, the court declined to make orders giving effect to the compromise. The settlement agreement had been signed upon the basis of representations made, including by the deceased in his Will, and other objective evidence which was incorrect.

Appeal

The NSW Court of Appeal held the applicant was not a child of the deceased under s 57(1)(c) of the Succession Act and it was open for the primary judge to decline to make orders reflecting a compromise in which the executrix had entered into on a basis demonstrated to be false.

The Court of appeal stressed that objection to a family provision consent order is different from a party seeking to rescind a contract at common law or in equity, or to resist specific performance.

Administrators’ protection from liability

An administrator is responsible for the proper distribution of the estates assets to creditors or beneficiaries. The creditors must be paid in priority to the beneficiaries. If the administrator fails to fulfil its obligations, they may be held personally liable.

Section 92 of the Probate and Administration Act 1898 (NSW) enables an executor or administrator of an estate to distribute the estate assets to the beneficiaries free of the risk that they will remain liable to pay creditors of which they have no notice, through the publication of the approved notice, and delaying the distribution of the assets for the period required by the section.

Section 93 of the Succession Act 2006 (NSW) provides protection for an administrator who distributes an estate if the administrator serves the claimant with a notice disputing a claim, and the claimant does not prosecute the claim within three months thereafter, the administrator may apply to the Court for an order barring the claim.

Olsen v James [2020] NSWSC 1015 described the s 93 procedure as “the most direct way of bringing the question about the potential claim … to a head”. It requires a potential plaintiff to “put up or shut up”, particularly in respect of allegations which impact on the proper administration of the deceased’s estate at [118]

Background

Nola English, (the Plaintiff) is the administrator of the estate of her cousin Vivienne Snape (the deceased) who died, intestate, in March 2017. Nola was granted Letters of Administration of the deceased estate in April 2020.

At the time of the grant of administration, the estate was said to have an estimated value of approximately $3.1 million, comprising three parcels of real property, money in a bank account and shares in a public company.

Donald Stewart (the Defendant) submitted that, through his parents, he had a close familial relationship with the deceased for many years, and, has a family provisionclaim against the estate.

An administrator cannot disregard the claim, because it, honestly believes that the claim is without substance: Guardian Trust & Executors Company of New Zealand Limited v Public Trustee of New Zealand [1942] AC 115 at 128.

Hearing

In English v Steward [2022] NSWSC 268 the Plaintiff sought an order under s 93 of the Probate and Administration Act 1898 (NSW) that the Defendant be barred from making any claim against the Plaintiff, as administrator of the deceased’s estate.

The Defendant had known that the Plaintiff disputed his claim since at least July 2020, if not before. Notice of the claim was given within 18 months of the deceased’s death and particulars concerning the claim were provided to the Plaintiff, as administrator, over 2 years later. In this way, the Plaintiff had notice of the Defendant’s claim.

The Defendant had done little since August 2021 with no explanation as to why no steps have been taken to commence proceedings from when he knew that the Plaintiff, as administrator of the deceased’s estate, was disputing the claim.

The Court was satisfied that the actions of the Defendant have caused some delay in the administration of the deceased’s estate. Finding it would be oppressive and prejudicial not only to the administrator but also to those entitled to the distribution of the estate if the orders were not made.

Voluntary assisted dying NSW

Following the passage of the Voluntary Assisted Dying Bill 2022 (NSW), New South Wales became the last jurisdiction in Australia to provide terminally ill adults with the ability to choose to end their lives.

Who can access voluntary assisted dying?

Adults in NSW with decision-making capacity who have been diagnosed with a disease, illness or medical condition that is:

  • advanced and progressive and if neurodegenerative will cause death within 12 months or otherwise within six months; and
  • causing suffering that cannot be relieved in a way the person considers tolerable.

Section 16 of the bill provides that before making the first request; the person has been ordinarily resident in New South Wales for at least 12 months.

Decision-making capacity

For the person to have decision-making capacity, they need to understand and assess the following:

  • advice about voluntary assisted dying;
  • what’s involved in a voluntary assisted dying decision; and
  • the effect of a voluntary assisted dying decision.

The person cannot lose decision-making capacity throughout the decision-making process.

A person who is disabled has dementia, or has a mental health impairment has to demonstrate they meet the eligibility criteria.

As with other jurisdictions that have enacted voluntary assisted dying legislation, the Voluntary Assisted Dying Bill 2022 (NSW) will not take effect until 18 months after assent to allow for the training of medical practitioners and other healthcare professionals.

Lost will; animo revocandi

When an original Will has been lost or destroyed without the intention of revoking it, an application can be made for a grant of probate on the copy of the Will.

The order of the Court normally includes a direction that the grant be limited until the original Will or a more authentic copy can be found.

“if a will, traced to the possession of the deceased, and last seen there, is not forthcoming on his death, it is presumed to have been destroyed by himself; and that presumption must have effect, unless there is sufficient evidence to repel it”:

Re Demediuk (No 3) [2019] VSCA 79

Background

William Ditchburn who died from cancer on 22 December 2016 made a Will on 23 September 2011 that cannot be found.

The Will was prepared and witnessed by William’s solicitor who kept a copy of the unsigned will on file.

William appointed his sister Patricia Ulman as the sole executor and beneficiary of his estate which included real property in Cranbourne West (the Cranbourne property), and personal assets and liabilities.

Chheang Mom and William had met at work in 2012. Chheang lived with William at the Cranbourne property from about 2012 until his death. Chheang’s daughter, Sophear Khem and her grandchildren also lived at the Cranbourne property for several years.

After his stage four cancer diagnosis William’s solicitor advised that due to his illness and new living arrangements he should change his Will. William denied he was in a relationship with Chheang and chose not to update his Will as he was satisfied with his current arrangements.

The proceedings

Patricia Ulman submitted an unsigned and undated copy of the will seeking a grant of probate of that document until the original will, or a more authentic copy of it can be filed with the Court.

Chheang opposed the application for a grant of probate of the unsigned Will.

Patricia submitted that Chheang lived at the Cranbourne property as the deceased’s tenant. Although Chheang submitted that their relationship extended beyond that of landlord and tenant, the nature of their relationship remained unclear.

The Court reiterated the general principles required to prove a lost Will:

  • that the Will existed;
  • that the Will revoked all previous wills;
  • that the presumption of destruction by the deceased animo revocandi is overcome;
  • there must be evidence of the terms of the Will;
  • there must be evidence of due execution of the Will.

The decision

The Court was satisfied that the Will existed was rational and completely disposed of William’s estate.

Despite changes in William’s living arrangements following the execution of the Will discussions with his solicitor following a cancer diagnosis confirmed his testamentary intentions remained the same.

Patricia succeeded in overcoming the presumption of destruction and revocation with the Court making orders that probate of the Will copy be granted to her.

Will, Ambiguity and the Channel Islands

The Channel Islands which include Jersey are the last vestiges of the ancient Duchy of Normandy which, following the Norman Conquest of 1066, was united with the English Crown. They have their legislature, courts and legal system. The monarch continues to exercise jurisdiction over the islands as if they were Duke of Normandy.

Jersey is not an independent state in international law. The UK government is responsible for the defence of the Channel Islands and their international relations. Jersey wasn’t a member of the EU. It is not part of the United Kingdom as defined in the Interpretation Act 1978, but is one of the ‘British Islands’. However, there are contexts where the UK has been held to encompass the Channel Islands.

The background

Nicholas Rossiter was domiciled in Russia when he died and had assets in several jurisdictions including, Jersey and the UK. Clause 1 of his will dated 13 June 2013 stated:

“I confirm that this will only have effect in relation to my UK assets”.

Shortly before his death, the deceased contacted his solicitor to request, dividing his estate ‘in the UK (incl Jersey)’ between his children and leaving his estate ‘outside the UK (incl Jersey)’ to his wife. These changes were not made before his death.

Where construction of a will is ambiguous, the Court should presume that the testator did not intend to die totally or partly intestate and in light of the nature and location of his assets evidence of the testator’s subjective intentions was admissible under sections 21(1)(c) and 21(2) of the Administration of Justice Act 1982.

The hearing

The court held at first instance that the will dealt with the Jersey assets and, in the alternative, that the will should be rectified to have that effect. As such the deceased’s children would inherit the Jersey assets as part of the deceased’s residuary estate. The deceased’s wife, who stood to inherit the Jersey assets under a partial intestacy if the will did not deal with them, appealed.

The appeal

The Court addressed the following question:

(a) is the devolution of the Jersey assets governed by the will?

(b) if not, should the will be rectified in order that it is?

If the will did not deal with the Jersey assets, there will be a partial intestacy; as a consequence Mrs Rossiter will inherit them.

If it the will dealt with the Jersey assets or is rectified to have that effect then the Jersey assets will fall into residue to which Mr Rossiter’s children are entitled.

On appeal the Court held that depending on the interpretation of the particular instrument in question the phrase “the United Kingdom” is capable of including the Channel Islands. However, since both an inclusive interpretation and an exclusive interpretation are possible the will is…ambiguous in the light of surrounding circumstances…both at the date of execution of the will and also at the date of the testator’s death.

In allowing direct evidence of the testator’s intention the Court held the deceased intended “the UK” to include Jersey and make specific legacies of his Jersey assets.

Family provision & common mistake

In NSW, once an adoption order is made the adopted child ceases to be regarded as the child of the birth parent: s95(2) of the Adoption Act 2000.

Background

Glenn Daley (the plaintiff) was given $5,000 in the will of his father John Richardson which stated

…I no longer have contact with my children GLENN and ROSEALIE, and due to the breakdown in our relationship, it is my wish that they don’t receive any further distribution from my estate.

Further, the Testator’s will gave

the rest and residue of my estate to my daughter DAWN

Mediation

The plaintiff brought a family provision application. At mediation on 12 April 2021, the parties reached a settlement where they agreed to further provision.

However, following the mediation, it was discovered that the plaintiff had been adopted out by John Richardson.

As a corollary the plaintiff was not an eligible person to bring a family provision claim against the estate of the deceased: s57(1)(c) of the Succession Act 2006.

Matter

In Daley v Donaldson [2021] NSWSC 1507 the plaintiff sought the Court’s determination under s 73 of the Civil Procedure Act 2005 (NSW).

On the day of the mediation, there was no evidence that the plaintiff had been given up for adoption by the deceased as such he was eligible to bring a family provision claim as the deceased’s biological child.

The Defendant submitted that both parties were operating under the mistaken assumption that the Plaintiff was an eligible person, when, he was not, and that the settlement agreement had been made upon the basis of representations, including by the deceased in his Will, which were incorrect.

The Defendant also submitted that

“[I]n light of the fact that the parties operated under a common misapprehension as to basis of their negotiations, the court … should decline to give effect to the settlement dated 12 April 2021”.

Although the circumstances surrounding the adoption, its precise date, and the documents evidencing the adoption order were not in evidence the plaintiff stated that he had been adopted by Keith John Daley who was married to his mother, the former wife of the deceased.

In his affidavit of 29 June 2021, the Plaintiff stated:

At the time of swearing my first Affidavit, I was not aware that I was formally adopted by Keith John Daley.

It has since come to my attention that I was…adopted by Keith John Daley.”

The defendant submitted that the plaintiff should be recognised as the lawful child of Keith Daley in the proceedings.

The decision

The Court agreed that as the parties were mistaken about the status of the plaintiff. Furthermore, the common misapprehension concerning the status of the plaintiff as an eligible person attracts the exercise of the Court’s jurisdiction in the interests of justice.

The Court refused to make orders that reflect any compromise that was reached between the parties.

Posthumous donation of human tissue

In New South Wales where the deceased has provided consent the Human Tissue Act 1983 permits removal of human tissue after death for transplantation or other therapeutic or medical use in another person.

The Assisted Reproductive Technology Act 2007 (NSW) provides that use of gametes or embryos is permitted after death if

  • the donor has consented to such use;
  • the woman who is to use the gametes has been notified of the gamete provider’s death; and
  • the woman consents to use the gametes.

However, the Act does not cover situations where the deceased did not consent to the use of their gametes prior to death.

The Transplantation and Anatomy Act 1978 (ACT) permits the posthumous removal of tissue where the deceased:

  • expressed the wish for, or consented to, the removal, and
  • the senior available next of kin does not object to the removal for transplantation into the body of a living person.

Importantly there are no specific laws governing the posthumous use of gametes.

Background

Mr Baratikeshe died in a motorcycle accident in June 2019. Before his death, he and his wife Ms Hosseini had been attempting to conceive a child but had not commenced IVF treatment. Ms Hosseini was named executor and beneficiary of her husband’s estate.

Ms Hosseini posthumously obtained permission for sperm retrieval from the deputy Coroner. She arranged for its retrieval and storage by Genea Ltd.

Decision

In Hosseini v Genea Ltd [2021] NSWSC 1568 the plaintiff applied for a declaration that

  • she was entitled to the sperm and
  • the defendant was entitled to release it to her for transportation to the ACT for use.

The court held that the sample was lawfully removed from the deceased’s body and, as his executor, beneficiary and senior available next of kin under the Human Tissue Act 1983 (NSW), the plaintiff was entitled to possession of it.

Additionally, as the defendant did not

  • claim any rights to the sample
  • dispute the plaintiff’s ownership or right to possession and
  • object to the orders sought being made

its storage of the sample is finished and it may be released to the plaintiff.

Presumption of death ACT

Section 9A of the Administration and Probate Act 1929 (ACT) provides that probate of the will or administration of the estate, of a person may be granted by the Supreme Court if it is satisfied, by direct evidence or by evidence supporting a presumption of death, that the person is, or may be presumed to be, dead.

This is usually done using a death certificate which is annexed to the supporting affidavit for a grant of probate or letters of administration of the deceased estate.

At common law

The common law presumption of death after the lapse of seven years was described by Dixon J in Axon v Axon:

“…at least seven years have elapsed since he was last seen or heard of by those…likely to have received communication from him…in the absence of evidence to the contrary, it should be found that he is dead.”

(1937) 59 CLR 395 at 405

Reliance upon the presumption is not necessary when the facts establish, even by inference, that the person is deceased.

In the ACT death can be proved by an application to the ACT Supreme Court under r 3012 of the Court Procedures Rules.

Background

EI married in January 2020. He lived with his wife, two of his daughters and his stepdaughter at a house in a suburb of Canberra.

EI suffered from anxiety and post‑traumatic stress disorder. His first partner had died under tragic circumstances. At about midnight on 15 July 2021, EI left the family home in an emotional and intoxicated state. Shortly after he left, he sent a text message which included a statement that he loved the plaintiff and a statement that he hated the world and could not live in it anymore.

Police ceased searching on 17 July 2021 they considered that he may be dead due to the bad weather conditions. They ceased searching on that date.

The decision

In Re Estate of EI [2022] ACTSC 55 the plaintiff sought a declaration that EI died on 15 July 2021. The plaintiff submitted that EI has not:

  • returned to the family
  • used the joint bank account he held with the plaintiff.
  • used their shared email address to send any emails.
  • contacted the plaintiff or any other members of his family.

The court was satisfied that on the balance of probabilities EI died on 15 July 2021. Ordering the costs of the application be paid out of the estate.

Removal of an Executor by the Victorian Supreme Court.

An executor’s role is to get in the assets of the deceased, to pay the estate debts, the legacies given by the will, and distribute the estate assets. It is common for a will-maker to appoint the same person as executor and trustee. Once they have completed the executorial duties, they hold the property as trustee.

If the trustee has to deal with later discovered estate assets, they take them as executor. Therefore the same person may be both executor and trustee of different assets at the same time.

Where the executor who has been granted probate remains out of Victoria for more than two years or is unfit to act or incapable of acting, the Victorian Supreme Court can remove an executor under s 34 of the Administration and Probate Act 1958 (Vic). Additionally, the court may appoint a trustee under s48 of the Trustee Act 1958 (Vic).

The decision to remove an executor or trustee is at the courts discretion. It depends on the facts of each case and what is best for the welfare of the trust or estate as a whole after considering;

  • the interests of the beneficiaries,
  • the security of estate property, and
  • the efficient and satisfactory execution of the trusts and a faithful and sound exercise of the powers held by an executor or trustee.

Back ground

Avgi Demetrios Vasiliades died on 14 September 2019 leaving a will dated 27 November 2016 (the will). Avgi was survived by her four children: Xenia, the plaintiff, Socrates, the defendant, Maria and Vasil. Socrates and Maria live outside of Australia.

The will appointed Socrates as executor, with Maria appointed as the substitute executor. The residue of the estate is bequeathed to the four children in equal shares.

Xenia and Vasil were appointed by Avgi as her financial and medical attorneys prior to her death. There were a number of disputes between Xenia and Vasil as to the management of Avgi’s affairs one of which was the subject of a VCAT proceeding.

The proceedings

Xenia believed that Socrates should renounce probate; he refused. Xenia lodged a probate caveat and sought orders that Socrates be replaced by an independent administrator.

Xenia’s application for Socrates’ removal was supported by Maria who as she lived overseas did not want to be appointed as executor. Socrates and Vasil opposed the application.

After the probate caveat lapsed Socrates was granted probate on 29 June 2020.

Xenia submitted on several grounds that Socrates should be removed as executor under s34 of the Administration and Probate Act 1958 (Vic) including that he had remained outside of Australia since August 2008.

The decision

The court held that Xenia failed to provide sufficient evidence that Socrates’ conduct was sufficient to have him removed as an executor.

The VCAT proceeding was not considered sufficient grounds for removal as Socrates was not a party to and the estate did not have an interest in the proceeding.

Similarly, Socrates overseas residency was not sufficient as he had not been overseas for two years from the date of the grant.

Adoption, Intestacy and the Biological parent.

In Australia, following adoption, the adopted child becomes a full member of the adopting parents’ family and generally, all prior legal familial relationships cease to exist.

In most jurisdictions, this applies equally to intestacy so that where a person has been adopted, previous family relationships have no recognition on intestacy.

Background

Werner Ihenfeld was born in Tasmania and adopted by Werner and Anna Ihenfeld when he was 3 days old in June 1963. The Ihenfeld’s became Werner’s adoptive parents under the Adoption of Children Act 1920 in September of that year.

Following the deaths of his adoptive parents in the mid-1980s Werner sought out his biological mother Dianne Zimmerman; for the next thirty years, they enjoyed a mutually loving and caring relationship that often exists between a child and parent.

Werner died intestate without leaving a spouse or issue with the result that under s29 of the Intestacy Act (“the Act”)

The parents of an intestate are entitled to the whole of the intestate estate if the intestate leaves – (a) no spouse; and (b) no issue.

(2) If there is only one surviving parent, the entitlement vests in the parent and, if both survive, it vests in equal shares.

If there was no surviving parent the estate would pass to other relatives.

As a result of the intestacy and uncertainty as to the identity of the next of kin Letters of Administration were granted to the Public Trustee on 1 March 2019.

The matter

Dianne applied to the Supreme Court of Tasmania for the determination of whether as a result of both their loving relationship and biological relationship, gives her a right of distribution of a parent under the Act.

Under s10 of the Act an adopted child is considered to be the child of the adoptive parent or parents; biological relationships that are inconsistent with the relationship created by adoption, are to be ignored.

The Act does not provide for reversion to the biological relationships following the death of adoptive parents or to evaluate the existence, strength or type of family relationships.

The decision

In dismissing the application the Court found that Dianne was not Werner’s parent within the meaning of the Act and therefore was not entitled to a distribution from the intestate estate.