Family Provision & the Deceased Estate in the UK

The Inheritance (Provision for Family & Dependants) Act 1975 (“the Act”) provides where the deceased has not made ‘reasonable financial provision’ under their will or on intestacy to a spouse or civil partner, ex-spouse or ex-civil partner, a child of, or someone treated as a child of the family by the deceased; a person who has lived with the deceased ‘as husband and wife’ for two years before the deceased’s death and a person who was financially dependent on the deceased. That person may bring a claim against the estate.

The Act limits ‘reasonable financial provision’ for adult children to what would be reasonable for their maintenance. The Court affirmed the definition provided in Ilott v The Blue Cross & Ors [2017] UKSC 17 that maintenance

… cannot extend to any or everything which it would be desirable for the claimant to have. It must import provision to meet the everyday expenses of living.” at [14]

The Test

The court will apply the following test:

(1) has there been a failure to make reasonable financial provision for the applicant, and if so,

(2) what order should be made.

Section 3 (1) of the Act sets out several factors that the court should consider when applying the two-stage test including ( but not limited to):

  • the financial resources and financial needs which the claimant has or is likely to have in future;
  • the financial resources and financial needs which any beneficiary of the estate has or is likely to have in future;
  • any obligations or responsibilities which the deceased had towards any claimant or beneficiary of the estate of the deceased;
  • the size and nature of the net estate of the deceased;
  • any physical or mental condition of any claimant or any beneficiary of the estate of the deceased; and
  • any other matter, including the conduct of the claimant or any other person.  

The Case

In Miles & Shearer v Shearer [2021] EWHC 1000 (Ch) a claim was brought against the estate of the former chief executive of the merchant bank Singer and Friedlander (“the Deceased”). Neither the Deceased’s adult daughters (”the claimant’s) from his first marriage nor their children benefitted under his Will. The claimants sought reasonable financial provision from their father’s estate under the Act. The defendant and principal beneficiary of the estate was the Deceased’s second wife.

In 2008, the Deceased made separate gifts of £177,000 and £185,000 to the claimants and clearly expressed to them that he would not provide them with any further financial assistance. Despite further requests, neither claimant received financial support from the Deceased after the gifts in 2008. In the last decade of his life, the Deceased and both claimants underwent periods of estrangement.

The Deceased had no legal obligation to maintain the claimants after they reached 18 years old. To rely on s.3 (1) (d), the claimants needed to show that the Deceased had an obligation or responsibility for them at the time of his death.

The Decision

The Court was critical of the basis that one of the claimants’ calculated their alleged financial needs on her current living standard, and not the far less luxurious lifestyle that she had accepted when she was married. The judge concluded that her financial needs should be assessed on that lower standard of living.

Similarly, the claimant had sought costs relating to her youngest daughter who suffers from a disability as part of her financial needs. Under s3(1)(f) of the Act an applicant’s disabilities can be taken into account however this does not extend to any disability of the applicant’s dependant. However, the Court took the impact of the applicant’s caring responsibilities for her daughter when assessing her earning capacity.

The other claimant sought £244,000 to enable the conversion of an existing interest only mortgage on her property to a repayment mortgage and £105,000 to buy out her ex-husband’s 11% equity in the property, which she was due to pay in 2034. The court found that this obligation did not fall within the claimant’s financial needs that she ‘has or is likely to have in the foreseeable future’, which was the requirement under s.3 (1) (a). The Court held that it was unlikely that the sum would fall within the ‘maintenance’ requirement under the Act.

In dismissing the claims under the Act the Court found that after applying the test outlined above the Deceased’s Will did not fail to make a reasonable financial provision for the claimant’s maintenance in the circumstances; therefore the second question does not arise.

A Will, Real Property & CGT

Joan Todd (“Joan”), a widow, died on 2 April 2018, leaving a will dated 11 September 2006 (“the Will”) appointing her four children, Alexander, Wendy, Bronwyn and Yvonne as her executors (“the executors”). Probate of the Will was granted to the executors on 7 November 2018

The following real estate assets were gifted under case 8 of the Will

(1)          A property at Clarence Gardens (“the Clarence Gardens property”) to Wendy

(2)          A property at Hawthorn (“the Hawthorn property”) to Yvonne

(3)          A property at Goolwa Beach (“the Goolwa property”) to Bronwyn  and Alexander as tenants in common and

(4)          A property at Millswood (“the Millswood property”) to Alexander, Wendy, Bronwyn, and Yvonne, in such a manner so as to ensure that as at the finalisation of the administration of my estate all of my said children have received an equal value of bequests under the Will

The Will distributed the residuary estate  equally amongst Joan’s  grandchildren and clause 11(1) of the Will provide that all gifts shall be:

“… free from all duties whatsoever which (whether presently or presumptively or prospectively payable) shall be paid out of my estate in the same manner as my funeral and testamentary expenses and debts shall be payable so that there shall be no subsequent adjustment or apportionment thereof as between any of the beneficiaries.”

The proceedings

Yvonne as executor sought the transfer of the Hawthorn property under the Will; the executors sought advice or directions under s 69 of the Administration and ProbateAct 1919 (SA) in respect of the proper construction of clause 8 of the Will, particularly with respect to the following issues (“the application”):

Whether the accumulated capital gains tax liability attached to each of the properties gifted referred to in the Will should be apportioned to each of the parties in their capacity as beneficiariesunder clause 8, or alternatively under clause 11 of the Will; if so from what date, and whether the net amount of the income and expenses relating to each property should be adjusted pursuant to the Adjustment Clause or alternatively under clause 11 of the Will.  

Yvonne submitted that the values of the three properties should be determined by reference to the Valuer-General’s value at the date of Joan’s death. Providing for potential CGT liabilities under clause 11(1) is misguided and would result in the finalisation of the estate being delayed, potentially indefinitely.  As such potential capital gain or loss based on hypothetical future disposal of the property should have no bearing on the “value” of a bequest made under Joan’s will. 

Wendy and Bronwyn (as executors) argued that the approach of “value received” is commonly applied in the Family Court in substantially identical circumstances where property which is subject to CGT is distributed to one spouse under a property settlement.  Furthermore, they submitted that the same approach to valuing assets is commonly undertaken in commercial cases.

Yvonne, in her capacity as a beneficiary of Joan’s estate on the hearing of the application, submitted that the issue for consideration is the meaning of the phrase “an equal value of bequests under this my will” in clause 8 and how that equal value is to be calculated in the circumstances. 

Conclusion

The Court held that “Value” in clause 8 is to be interpreted as market value, being

“the price agreed between a willing but not anxious purchaser and vendor, both of whom are aware of the circumstances affecting the value of the land and current market conditions”

Joan’s children acquired the properties under the Will; for the purposes of the Income Tax Assessment Act 1997 (Cth) the properties are CGT assets. However, as the transfer is not a CGT event CGT was not payable at the time the beneficiaries acquired the properties.

As CGT liability in respect of a property shall only arise when (and if) that property is disposed of, and only then will the resultant tax payable (if any) be able to be determined.

The Court held that the value of the properties should not depend on the tax affairs of the person to whom they are bequeathed, similarly it is incorrect to say a property bequeathed to a person in the highest bracket of income tax payable for a given year would have a higher value had it been bequeathed to a person who had nil taxable income. Valuation of a property on this basis would present a nearly impossible task, as such a hypothesis would involve too many variables (including events occurring that cannot be discerned on the evidence).

The Notorious Executor

David Rofe was a prominent NSW barrister, former mayor of Woollahra and a conservative political activist. Admitted to practice as a barrister in 1954, appointed Queen’s Counsel in December 1974, David retired from the Bar following surrender by his then Guardian (Brendan Hull, the first defendant) of his practising certificate in December 2012. In May 2014 following the intervention of another long time friend and fellow barrister, David informed the NSW Bar Association of his intention to retire from the Bar and withdrew his application for restoration of his practising certificate.

The Estate

David died in July 2017, aged 85 years, leaving an estate estimated at approximately $27 million; including twelve known testamentary instruments (comprising 10 wills and two codicils); he had never married and had no children.  During his life, David had relationships, with Gregg Hele and Nick Llewellyn and, in his later years a close personal friendship with Kathy Jackson and her partner, Michael Lawler.

Between 2010-2014 David executed several testamentary instruments, culminating in a will dated 17 December 2014 (”the Will”). The validity of each of those instruments was challenged principally on the basis that David lacked testamentary capacity or knowledge and approval of the nature of his estate. Some instruments but not the Will were said to have been invalid because Nick had procured their execution through undue influence.

Guardianship

Following medical assessments from late 2009 onward, concerns were raised regarding Davids testamentary capacity, including his knowledge and approval of several testamentary instruments signed by him, as he was suffering from vascular dementia, aggravated by a lifetime of heavy alcohol intake. In addition David’s friends became concerned with Nick’s eccentric behaviour and increasingly large demands; this led many of David’s friends to believe that Nick was abusing David’s generosity.

Between 2012-2014, a dispute arose between Micheal Lawler (David’s then enduring attorney) and Nick about management of David’s affairs – which had been the subject of protective orders made by the Guardianship Tribunal an its successor, NCAT’s Guardianship Division in December 2012, May-June 2013 and August 2014. At a hearing in August 2014 (”the hearing”) NCAT made a financial management order in favour of Robert Horder (David’s accountant), and continued a guardianship order in favour of Ruth Coleman (David’s former secretary).

In the lead up to the hearing Ruth (as guardian) engaged Gregg Helle – who had recently completed training as a nurse – to be David’s full-time carer and companion. Under Gregg’s supervision, David’s lifestyle improved; his excessive drinking was curtailed and his medication was adjusted. In her role as guardian, Ruth limited Nick’s access to David and, with the assistance of his close friends organised a family reunion in October 2014.

The Named Executors

The Will named Jonathon Rofe, Kathy Jackson and Robert Horder as executors and trustees and following gifts of family heirlooms, pecuniary legacies to family members and  properties to Gregg and Nick, the deceased’s residuary estate was divided into ten parts and distributed among nine people (including two parts to Gregg and one part to Kathy and Nick)

The Court held that David’s choice of executors and trustees should be respected unless there is a strong reason for not doing so. Accepting that David was acutely aware of Kathy Jackson’s controversial reputation and that she has the support of those with a greater beneficial entitlement to the estate the Court refused to decline her appointment as a co-executor, (and in effect, re-write David’s Will) where there are no grounds to reasonably do so.

  “One does not have to be a saint to serve as an executor”.

The Court found that as a discharged bankrupt, Kathy has no legal impediment to her occupation of the office of executor. A criminal conviction is not, of itself, an impediment to the performance of an executors duties.

The Decision

In finding that David had testamentary capacity when he executed the Will and knew and approved of its contents the Court accepted the submissions from the following:

a psychiatrist who witnessed David executing the Will:

Kathy who accompanied David to his appointment with the psychiatrist – but not the examination;

Gregg who drove David, Kathy and a carer to and from the appointment and who spoke with David about the contents of the Will upon his return home;

Others who had dealings with David in the latter part of 2014.

The Court reserved for further consideration ancillary questions whether Nick has any (and, if so, what) liability for debts owed and the enforceability or otherwise of those debts.

A Document is Torn – Intestacy, CPD & Revocation

The Document

On 1 March 1996, John Webster executed a document, prepared by the Clerk of the Court in Barcaldine acting as agent for the Public Trustee entitled “Instructions for Will Appointing Lionel Walsh sole executor and trustee”(“the document”) directing that his entire estate be divided equally among his siblings: Margaret Walsh, Robert Webster, and Ronald Webster.

Of the two attesting witnesses to the document, one cannot recall the circumstances of its execution. The other swears that John was “capable of making decisions”, “knew what he was doing” and recalls that John described the document as “his Will”. After the document was executed John gave it to Lionel who placed it into his office safe in an envelope.

The Break-in

On the morning of 6 June 2000, it was found that Lionel’s office had been broken into overnight. The office safe had been opened and documents from the safe had been scattered all over the floor. The document was found in the office torn. Lionel placed sticky tape on the tears and then posted the document to the Public Trustee in Rockhampton for safekeeping.

Intestacy

John died on 13 May 2013. On 24 May 2013, the Public Trustee advised that due to the fact the document had been torn it was necessary to apply for letters of administration on intestacy.

John was predeceased by his brother Robert Webster who had four children, two of whom have renounced any interest in John’s estate, and the remaining two, Kim Webster-Coombes (“the respondent”) and Kerry Delahunty, were interested parties as beneficiaries under intestacy.

On 30 July 2013, Lionel instructed a solicitor to apply for letters of administration of the estate on the basis he had died intestate on 29 August 2013.

“…. There were cattle on one of the assets of the estate that were required to be sold because there is little feed and the waters are inadequate… some of the cattle must be mustered off the property quickly or they will die. We cannot shift them because they have John’s brand…”

The letters of administration were granted on 3 September 2013, the estate has yet to be fully administered.

CPD Seminar

Sometime following the grant of administration Lionel provided the solicitor with a copy of the document. In 2016, the solicitor attended a continuing professional development(CPD) seminar where the topic of “torn wills” arose. When the solicitor described how the Will had been torn he was informed that it could be the subject of an application for Probate as the deceased’s Last Will.

Following this the solicitor explained to Lionel they could bring an application for probate; however, Lionel was concerned about the costs of going to court with such a small estate. This discussion went on “for several years. Meanwhile, the solicitor was attending to matters regarding other family estates, including the estate of the grandmother, and the father of the respondents.

The Application

On 10 August 2020 Lionel sought orders that the grant of letters of administration be revoked, and Probate of the document be granted.

The issues to be determined in the application were:

1. is the document the Last Will and Testament of John Dyson Webster; if it is not, the grant of letters of administration would not be revoked.

2. if the document is a Will, was it revoked?

3. if the document is the Last Will and Testament of John Dyson Webster, is it appropriate under the Uniform Civil Procedure Rules 1999 (Qld) (“UCPR”) to exercise the Courts discretion in favour of revoking the grant of letters of administration.

The respondent argues that the discretion ought not to be exercised as the applicant elected to pursue the grant of letters of administration and there has been a significant delay between John’s death in May 2013 and the bringing of the application on 10 August 2020.

The Decision

The Court accepted that the document was intended by John to constitute his Will and was not revoked. The grant of administration was made due to the mistaken advice that the Will could not be admitted to probate because it had been torn.

As the document is the Will of John Webster, and expresses his true testamentary intention, the Court considered it is appropriate to exercise the jurisdiction under s 6(1) of the Succession Act and r 642 of the UCPR to revoke the grant of letters of administration made on 3 September 2013 and admit the document to probate as the Last Will and Testament of the deceased.

Bankrupt, Family Provision, Chose in Action, Out of Time

In PERGOLETO v CHANDLER & ORS [2021] SASC 30 the applicant is one of the children of Antonia Pergoleto (“the deceased”) who died in August 2018. A grant of probate was made in March 2019 and the entire estate was distributed in accordance with the terms of the will.

The family members have been estranged for many years with the respondents becoming aware that the applicant was an undischarged bankrupt following commencement of proceedings. Although the applicant became a bankrupt on 1 June 2015 due to his lack of cooperation with his trustee in bankruptcy, the period of bankruptcy has been extended to eight years.

Initially the applicant was legally represented, but at the time of the proceedings was self-represented.

Time in which application can be made

An application under theInheritance (Family Provision) Act 1972 (“the Act”) made more than six months after the date of the grant of probate may prove difficult in respect of an extension of time as the entire estate has been fully distributed prior to the commencement of the action. The applicant commenced proceedings out of time on 20 November 2019.

An extension of time

Where there has been a final distribution of the estate, no order for provision can be made. As the court has no power to grant an extension of time and no beneficiary who has received a distribution would be vulnerable to either a proprietary or personal claim. Therefore a claim under the Act must be dismissed.

In the alternative the applicant sought other common law remedies in the event that the statutory claim is unsuccessful claiming that he was misled by the respondents, about progress of the grant of probate and the status of the distribution of the estate. The respondents deny those claims and submit the applicant knew the position in relation to the application for a grant of probate.

The interlocutory application seeking summary dismissal was set for argument on 2 March 2021. In early February, citing health reasons the applicant requested by email that the argument be adjourned. The respondents objected; the Court refused the application with the parties being notified on 9 February 2021 that the argument would proceed on 2 March. There was no attendance by the applicant.

The effect of bankruptcy

Additionally a bankrupts property (including a chose in action) vests in the trustee in bankruptcy therefore, it could be argued that the claim of the bankrupt under the Act would vest in the trustee as soon as it is acquired by the bankrupt. Thus, the question of whether a bankrupt retains the right to bring a claim under the Act may largely be academic. As once the property of a bankrupt vests in a trustee, the bankrupt no longer has standing in legal proceedings in respect of that property.

The Court accepted the submission that only the trustee can “agitate that question” and has choosen not to do so. Therefore the applicant has no standing to proceed with the causes of action in deceit or conspiracy to defraud. The respondent is entitled to summary dismissal in relation to the causes of action in deceit or conspiracy to defraud as well.

Executor, De facto, Family Provision, Devastivit

A devastavit means ‘to have laid waste’ defined legally as – a mismanagement of the estate by the deceased’s legal personal representatives

in squandering and misapplying the assets, contrary to the duty imposed on them”;

for which they shall answer out of their own pockets as far as they had, or might have had, assets of the deceased’.

Devastavit actions are usually brought against executors who have spent estate money extravagantly or misapplied estate assets.

Chronology

Olga Hart and James Ross lived together for about 20 years; separating ‘in or around 2003’. Neither Olga, nor James sought a property settlement under the Domestic Relationships Act 1993 (ACT), the Family Law Act 1975 (Cth), or by informal arrangement.

Olga made wills in 1996, 2009, 2015, 2016, and 2017. James claimed that in each of these wills he was named executor and was to receive a percentage of the value of Olga’s residential property upon her death.

The Trust

In December 2017, Olga suffered a heart attack and was diagnosed with stage four lung cancer in February 2018, in August 2018, she met with a solicitor who advised that a “no contest” clause in her will would be unenforceable however in the ACT if a deceased estate has no net value there would be no funds available for a family provision claim. Olga was advised to create an express trust and to write cheques to the trust to “exhaust” her estate.

On 29 August 2018, Olga as settlor, appointor and trustee established the Olga Hart Trust (“the Trust”); around this time Olga drew two cheques (the Cheques) totalling $1.2M  in favour of the Trust. Clause 10 of the Trust deed provided that upon Olga’s death her daughter Donna Gordon succeeded her as trustee.

Olga’s Last Will

On 5 September 2018, Olga prepared her final will (the Will) naming Donna as the sole executor and making a provision that James receive a cash sum of $200,000.00 but no property from the estate. James was not made aware of the existence of this will until after Olga’s death.

Following Olga’s death on September 30 2018 Donna became the trustee of the Trust. James filed a caveat on 18 October 2018  against the probate of Olga’s estate (the Estate). On 25 October, James was informed that the Estate had insufficient assets to pay the Cheques issued by Olga to the Trust, therefore any gifts and bequests in the Will would not be satisfied. However, if James agreed to abandon any rights against the Estate by 14 November 2018 he would be paid the bequest in the Will.

Relief sought

In commencing proceedings seeking declaratory relief and an order for provision under s 8 of the Family Provision Act 1969 (ACT) (Family Provision Act) James claimed, (and Donna denied) that following the separation he and Olga maintained a close relationship based upon mutual emotional and financial support. In the alternative, James sought damages for the tort of devastavit, and relief in equity against Donna in her own right; in her capacity as trustee of the Trust, and, in her capacity as Executor of the estate.

Donna was granted probate on 25 March 2019. In late April 2019 the Cheques were presented and dishonoured by a financial institution. The Cheques were dishonoured on 26 April 2019.

Issues before the Court

The issues for the Court to determine was does the Estate, have sufficient assets to make the bequests provided for in the Will?

If the answer is “No”, has the defendant, by presenting the Cheques: Laid waste to the estate giving rise to liability for devastavit ? Committed a fraud on the power? or; Breached her fiduciary duty?

Donna submitted and the Court agreed the Cheques, indorsed by Olga were held in her capacity as trustee of the Trust. Similarly, the Cheques were each a chose in action, and therefore property (or value) capable of being held on trust prior to Olga’s death. As such, all of her assets were held in the Trust under the control of the trustee, as prescribed under the terms of the Trust deed. Therefore, immediately before Olga’s death, the liabilities exceed the assets of the Estate.

In the Court’s analysis of the law and the facts of the case James claims for declaratory relief, damages for the tort of devastavit, relief in equity, and further provision pursuant to s 8 of the Family Provision Act all fail. Alternatively, the trustee has established a claim under the Cheques Act. Therefore the Estate has no positive value.

Lex Domicilli, Lex Situs & International Intestacy

In September 2010 KH died aged 63 in Kochi City, Japan leaving an estate in Japan valued at more than $1.2 million and three bank accounts (“moveable property”) in Queensland valued over $1.5 million. KH had never married and left no issue. His only sibling, a sister, had died in infancy. His father died in 1991 and his mother in 1999. KH had at least one maternal first cousin living in Japan at the time of his death.

KH was born in Japan and between 1986 and 1995 travelled regularly between Japan and Australia. He lived in Australia from 1997 to 1999 and returned to live in Japan in 1999. KH died without a will; the Japanese Rules of Succession (“the rules”) do not recognise first cousins; therefore the deceased’s estate in Japan was deemed to belong to the Japanese Treasury.

A Japanese solicitor appointed by the Japanese Family Court to administer the estate,( “the Japanese administrator”) engaged a Queensland solicitor to act on his behalf in administering the Australian estate.

In February 2013 the Public Trustee of Queensland (PTQ) was appointed as Administrator of the deceased’s Queensland estate. In Queensland first cousins are recognised as next of kin under Part 3 of the Succession Act1981 (Qld). (“the Act”)

In January 2017, the PTQ applied to the Court under s 134 of the Public Trustee Act 1978 (Qld) seeking advice as to whether it should distribute the Queensland estate of KH’s first cousin.

The issue before the Court was whether KH’s movable property in Queensland vested in the Japanese Treasury, under the Japanese Laws of Succession. As KH had property in Queensland it is necessary to consider Queensland law in circumstances where a person has died without a will but has left moveable property within the State.

The applicable succession law for the moveable property of a deceased estate is the lex domicilii. (law of the deceased person’s domicile); immovable property of a deceased person is dealt with under lex situs (the succession law of the jurisdiction where the immovable property is located)

However, in August 2014, the Japanese Family Court following submissions made by the Japanese administrator granted permission to exclude the movable property from the estate.

The effect of the decision was that the Japanese administrator has no interest in the Queensland Estate. The Court was satisfied that the PTQ should be advised and directed that he can distribute the Queensland Estate of the deceased to the persons entitled under Part 3 of the Act.

Aboriginal Objects, Defective title, Security for costs

In New South Wales Aboriginal objects are the property of the Crown, under s 5(1) of the  National Parks and Wildlife Act 1974 (NSW), (”the Act”) an “Aboriginal object” includes Aboriginal remains which would also be the property of the Crown (s 83). The Act imposes offences on individuals who ‘harm’ (which includes moving) these objects. The penalties for harming an Aboriginal site are up to $275,000 and one year’s imprisonment for individuals and $1.1 million for corporations.

A review of potential Aboriginal heritage issues should form part of a ‘due diligence process’ to ensure that Aboriginal sites are not damaged. Similarly, a purchaser finding that the property contains an aboriginal object may give them certain rights against the vendor including the right to rescind a contract for the sale of land for a ‘defect in title’.

The Case

A recent case involved the sale of land and a business near Byron Bay for a purchase price of $3 million. Following the exchange of contracts, the purchaser became aware of the Aboriginal significance of the land the subject of the sale, being the burial site of two Aboriginal elders of the Bundjalung tribe, Harry and Clara Bray. The Arakwal people of the Bundjalung Nation, are the custodians of Byron Bay. Archeological evidence suggests that Indigenous Australians have been living on the north coast of NSW for over 20,000 years. Harry Bray, the son of “King Bobby” of the Bumberline Tribe and the direct descendant of the Arakwal people, was a prominent Indigenous leader.

The reputed existence of the burial site gave rise to a broader dispute as to whether there were Aboriginal objects in or on the land, and if so, whether their existence constituted a defect in title. The vendor did not accept that there was a defect in title. However, the purchaser terminated the contract by notice on 25 September 2015. On 6 October 2015, the vendors responded, alleging that the purchasers’ notice repudiated the contract. The property was subsequently resold by the vendor on 29 November 2015 for $2.525 million.

At first instance, the Court held that ownership of the objects was never vested in the vendor therefore the presence of aboriginal objects on the land did not amount to a ‘defect in title’ as they were never intended to be transferred to the purchaser. The vendor was able to transfer clear title of the land to the purchaser, therfore the purchaser’s termination was invalid, and the purchasers deposit was forfeited to the vendor.

The Appeal

In allowing the appeal the Court found that there were “Aboriginal objects” on the land (in particular, the remains of two Aboriginal elders, Harry and Clara Bray, known as the King and Queen of the Bundjalung tribe; and a memorial stone and plaque recording their burial near the location); and that the presence of those objects was capable of constituting a defect in title. In those circumstances, the refusal of the vendors to address the purchasers’ objections constituted repudiation.

Alternatively, the vendor’s insistence on completion based on an invalid notice to complete, coupled with an invalid claim for default interest, would have also constituted repudiation.

Security for Costs

This decision has been appealed. With the vendor ordered to provide security in the sum of $40,000 for the purcaser’s costs of the appeal either by payment of that amount into Court or in such other form as the parties agree.

Intestacy, Inertia & Distribution

In 2018, Pamela Frimont became administrator of the estate of her father Albert Bruce Case, (‘the estate’)who had died intestate in 1968. Albert was survived by a widow Joyce and three children, Kenneth, Robert and Pamela (another daughter Sylvia had died as a child in 1944). Kenneth Case obtained Letters of Administration of Albert’s estate on 18 June 1968, but by the time of his death on 1 October 2003 Albert’s estate remained unadministered, and it’s major asset – land at Blaxland’s Ridge (“the Land”) had not been transmitted into his name as administrator. A property on the Land has been occupied by Pamela’s nephew Donald Case (”the property “) for more than a decade.

Albert’s Intestacy

In 1968 s 50(a) of the Wills, Probate and Administration Act 1898(NSW), provided that Joyce was entitled to a one-third share of the intestate estate. Joyce died in 1986, leaving a will appointing her son Robert executor and sole beneficiary of her estate. A grant of probate of Joyce’s estate included her right to the due administration of Albert’s estate, resulting in her one third interest in the land being transmitted to Robert.

In September, 2010, Donald and his wife Peggy, agreed to give up their present accommodation and move into the property on the Land and provide domestic services to Robert. Donald paid some amounts of Council rates but has otherwise never paid rent.

The Land must be sold as since Albert’s death, a number of beneficiaries of his intestate estate have died, and there are now six people – including Pamela and Robert – entitled to share in Albert’s estate.

In November 2018, Pamela’s solicitor wrote to Donald advising that she had decided to sell the land in order to finalise the estate. Subsequently, she has agreed to sell the land for $1.27 million, with vacant possession. Pamela then arranged for two written notices to be given to Donald to vacate, the first in November 2018 and the second in May 2019.

Donald’s Action

Donald submitted that s 119 of the Residential Tenancies Act provides the Supreme Court has no jurisdiction to obtain recovery of possession of residential premises subject to a residential tenancy agreement. In the alternative, Donald submitted that he occupies the premises from year to year, that such a tenancy is terminable on one month’s notice under s 127 of the Conveyancing Act 1919 (NSW), and that no such notice has been given.

The principal issue between the parties was whether or not Donald was entitled to possession of the land by virtue of a residential tenancy agreement (RTA) between the estate and himself. Section 13 of the Residential Tenancies Act 2010 (NSW) defines a tenancy agreement as

“an agreement under which a person grants to another person for value a right of occupation.”

Donald submitted there were three occasions when a RTA came into effect;

1. when he arranged with Robert to move in to the property in 2010.

2. when Robert died in 2011.

3. when the Pamela became the Administrator in 2018.

Estoppel

Donald submitted that by seeking possession Pamela had acted unconscionably and as Administrator, had encouraged him to believe an RTA was in force by accepting that he pay half the rates. There was no evidence to support this claim for estoppel.

In holding that Pamela had a right of possession the Court stated 

“when the present proceedings were commenced there was no residential tenancy agreement in place. The defendant has no right to remain on the land.”

The primary judge concluded that there could be no residential tenancy agreement with the administrator based merely upon Donald’s continuing occupation of the premises and payment of a fraction of the rates and charges of which the administrator was unaware.

Donald appealed the decision submitting the primary judge erred in failing to find that he had residential tenancy agreement.

The Appeal

In dismissing the appeal the NSW Court of Appeals held that

“under s 13, a residential tenancy agreement may be implied, the only matters relied upon here are the defendant’s occupation of the premises, and the fact that he paid amounts off the rates from time to time.”

Similarly If the payment of half the rates was part of an agreement in return for which he was given a right of occupation, Donald’s failure to pay amounts totalling half would mean only that he was in breach of that agreement. It would not, of itself, mean that there was no agreement or that he had not partly carried out any such obligation.

Sibling Co-Executors, Family Squabbles & Indemnity Costs

Giuseppina Condo died on 16 May 2020 survived by her five adult children. Although the relationship between the children was strained Giuseppina named two of her children, Maria (the plaintiff) and John (the defendant) executors of her estate in a Will dated 10 November 2016.

Around the same time, as the WIll was made Giuseppina appointed the plaintiff as her attorney, (including her medical attorney) with the defendant appointed as her alternate attorney. However, the defendant claimed he was only advised of this in 2019 further exacerbating the tensions between the plaintiff, the defendant and their siblings.

The defendant and the other children were unhappy with the plaintiff’s lack of transparency and communication regarding their mother’s care needs and medical condition. As a result, in January 2020, the defendant made an application to the Victorian Civil and Administrative Tribunal that had not been heard at the time of Giuseppina’s death

The Funeral

In Australia, a person’s wishes with respect to the disposal of their body are not legally binding. Provided it is not unlawful,wholly unreasonable or exercised in a way that prevents family and friends from reasonably and appropriately expressing affection for the deceased, the executor may dispose of the body in any manner they wish.

The defendant submitted that Giuseppina was a devout Catholic who wished for a traditional Italian service. However, he and two of his siblings were excluded from discussions at the aged care facility concerning the funeral arrangements which resulted in a substantial dispute between the siblings regarding Giuseppina’s funeral.

Notwithstanding this, on 23 June 2020, the plaintiff’s solicitors proposed that a joint funeral service take place. On 14 July 2020, the defendant’s solicitors extended this offer to include the dressing of the deceased as well as the selection of the casket and flower arrangements.

However, the plaintiff appears to have subsequently objected to that proposal; as a consequence, the deceased remained uninterred for more than two months after her death. The plaintiff commenced the proceeding.

Plaintiff’s application

In July 2020, the plaintiff sought orders giving her the right and responsibility to dispose of the body of the deceased in her sole discretion. In addition, the plaintiff asked the court to order that:

she directs how the funeral and burial be conducted and provide necessary instructions, to the exclusion of the defendant;

the funeral and burial service of the body be conducted as soon as practicable; and

the defendant pays the plaintiff’s costs on an indemnity basis.

The defendant sought orders that the dressing and viewing of the deceased be conducted by the plaintiffs funeral director and the funeral and burial be conducted by a funeral director chosen by the defendant.

Consideration

The court held that although the parties are the executors of a deceased estate, it is simply a dispute between siblings over the funeral and burial arrangements for the deceased. The plaintiff’s refusal to consult with her co-executor and at least two of her siblings on the funeral and burial arrangements and her refusal to accept what were fair compromises was unreasonable. 

The court found the defendant was amenable to the idea of a joint funeral and his offers remained open when the plaintiff’s solicitors asked the defendant’s solicitors to confirm whether he had instructions to accept service.

The Court ordered indemnity costs against the plaintiff as a result of the plaintiff’s unreasonable conduct in commencing such adversarial litigation when reasonable offers remained on the table, putting the estate at risk for costs of the proceeding.