Dr Mohammad Masoud Lodin died intestate in June 2014. Letters of administration of his intestate estate were granted to his daughter Rebecca the sole beneficiary under intestacy of his estate of more than $5 million. In June 2015, his former wife, and Rebecca’s mother Magdalena sought family provision out of Mohammad’s intestate estate.
Mohammad and Magdalena had separated more than 25 years previously after living together for about 18 months. A divorced former spouse of the deceased is considered an “eligible person” under state family provision legislation. The Court determined that Magdalena was in circumstances of need. The estate is ample to provide for her, without significant adverse effect on the position of the beneficiary Rebecca. The critical issue in this case is whether there are “factors which warrant” the making of the plaintiff’s application namely
(1) Where there has been a divorce but a spouse has died before the Family Court has resolved financial matters;
(2) Where the husband and wife have not finally settled all their property dealings at the time of the divorce;
(3) Where maintenance was being paid to the ex-spouse as at the date of the deceased’s death and the orders for maintenance were inadequate to provide for the ex-spouse after death of the paying spouse; and
(4) Where despite the divorce there was some dependency on the deceased as at the date of death, such as where some years after the divorce the present plaintiff fell grievously ill and because of a residue of affection the now deceased spouse provided moneys for medical treatment or living expenses.
Magdalena’s attitude to Mohammad since the end of their relationship was one of relentless hostility and persecution, and she carried into effect as best she could her stated aim of making his life a misery, pursuing him and his resources in every way she could – through reviews of child support, professional discipline with the Medical Association, and actions for damages.
It was reported that in 2008 or 2009 Magdalena wrote to Mohammad that unless he paid Rebecca’s university fees she would “personally make what is left of [his] wretched life not worth living”. She added that if he made her feel guilty for writing in this way he “WILL MOST CERTAINLY FEEL THE WRATH OF ALLAH”.
In April 1998, Mohammad’s solicitors instructed counsel to draft a will providing for the whole estate to go to Rebecca provided she attained the age of 30 or married. The draft Will also set out the reasons for not making any testamentary provision for Magdalena including her
“many and false allegations against me which were proved groundless and [she] made a false complaint against me to the Police alleging that I had sexually abused my daughter and these allegations have caused me great distress”.
Mohammad didn’t execute this Will despite reminders from his solicitors.
The Court conceded that deciding Magdalena’s claim was not easy however
“[T]here is something unbecoming about an arrangement under which the plaintiff is left in circumstances of considerable need, reliant on a social security pension, while the daughter whom she raised inherits in excess of $5 million,”.
The Court followed a two-stage approach to be met by those making an application for provision out of the estate of a deceased person
- Whether the applicant has been left with inadequate provision for his or her proper maintenance, education and advancement in life, and if so
- What provision ought to be made out of the estate for the applicant.
The determination of the two stage process calls for an assessment of whether the provision (if any) made was inadequate for the proper level of maintenance appropriate for the applicant having regard, amongst other things, to the applicant’s financial position, the size and nature of the deceased’s estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims upon the estate. The determination of the second stage, should it arise, involves similar considerations.
The Court took into account the unusual and enduring impact of the relationship and marriage with Mohammad on Magdalena, and its contribution to her current circumstances of need; the respective post-divorce deterioration in her circumstances, and great improvement in those of Mohammad; the impact of Magdalena’s care and responsibility for Rebecca for 15 years after the matrimonial property settlement, on her earning capacity, and her corresponding indirect contribution to Mohammad’s estate; and the size of the matrimonial estate at the time of the property settlement, compared to the size of the deceased estate now available; all in circumstances where the only other beneficiary will inherit a substantial amount after making proper provision for Magdalena; lead to the conclusion that Magdalena has been left with inadequate provision for her proper maintenance and advancement in life.
The Court decided that proper provision for Magdalena enabling her to buy a reasonably appropriate home (say $550,000, for which she already has accumulated savings of $250,000), provision for her reasonable living expenses for life ($400,000), and a small fund of $50,000 for contingencies. The resultant legacy of $750,000 represents less than 15% of the estate leaving in excess of $4,250,000 for Rebecca.
Regardless of whether there were other factors imposing a moral obligation on Mohammed to make testamentary provision for Magdalena, the size of Rebecca’s entitlement under the laws of intestacy was a factor for making an application for family provision. This assumes that a deceased person has a moral responsibility to make testamentary provision for a former spouse simply because the estate is large and the sole beneficiary of the estate under the will or on an intestacy is a member of the deceased’s family for whom the former spouse had some responsibility. The difficulty is exacerbated when the assumption is made in a case where the parties reached a final resolution of their financial claims after contested hearings many years prior to the Deceased’s death.
The decision caused some concern as the finality of financial property settlements following divorce are considered to be a financial ‘clean break’ between former spouses notwithstanding the legislative provision for a former spouse with compelling reasons to make a successful family provision claim.
Rebecca appealed this decision with the Court of Appeal assessing that a matrimonial financial settlement made by the Family Court in 1992 was “an important consideration counting against [Magdalena’s] claim”.
The marriage effectively ended a quarter of a century before the court heard the claim. Mohammad and Magdalena’s relationship lasted for less than six years and the marriage itself lasted only 19 months.
Magdalena had been responsible for raising their daughter Rebecca but Mohammad had “meticulously complied” with his obligations to provide financial support for his daughter while Magdalena “was not entirely honest in her claims for support”. The Court of Appeal also noted that Magdalena had refused Mohammad access to their daughter, which the original Judgement had dismissed as “not irrelevant” in determining Mohammad’s moral responsibility to leave money to Magdalena.
Similarly although Magdalena apologised for the “wrath of Allah” letter, the Court of Appeal held it didn’t minimise the years of her relentless persecution of Mohammad further as there was no evidence it was a result of psychiatric illness or caused by Mohammad’s conduct it should count against her entitlement.
Tellingly the Court of Appeal believed Magdalena’s financial needs were partly the result of legal action taken against her ex-husband, similarly Mohammad was not to blame for the injuries she had suffered in a series of motor vehicle accidents, which had impacted her ability to work.
“[Mohammad] cannot be said to have come under a moral duty to provide for the respondent because of injuries entirely unrelated to the parties’ relationship,”
The Court found that it was an irrelevant consideration to ascribe a moral responsibility to Mohammed to leave money to Magdalena simply because she was in struggling financially and the estate was large.
Importantly if Mohammed had executed the Will he had drafted in 1996 his estate would have been directed in the manner he wished – as this matter illustrates an intestate estate is never directed the way that you want it to and can compound an already difficult time for your loved ones.