Family provision, addiction and the deceased’s grandson

Melville William Gooley (“the deceased”) died on 23 December 2017 aged 92 years, leaving a will dated 1 February 2010 probate of which was granted to the defendant, his son and the father of the plaintiff, on 13 May 2021.

The defendant remains engaged in legal proceedings with his sisters who had managed the deceased’s financial affairs; no distributions had been made from the estate. The estate has an estimated value of about $28 million, with the residuary estate having a value of approximately $16.98 million.

Sean Gooley (“the plaintiff”) is an adult grandson of the deceased and the only child of the defendant’s first marriage. In Estate Gooley, Deceased [2022] NSWSC 734 the plaintiff made an application for family provision under Chapter 3 of the Succession Act 2006.

The Court held the plaintiff’s long-term drug addiction and the breakdown of his parent’s marriage left him dependent upon the deceased for emotional, if not also financial, support.

Time limit

Although a family provision claim must be filed with the court within 12 months of the deceased’s date of death, the Court didn’t consider it a significant problem that the plaintiff had not applied to extend that time limit under s58(2) of the Succession Act.

The Court held that s90 of the Civil Procedure Act 2005 and rule 36.1 of the Uniform Civil Procedure Rules 2005 each empower the Court, in any event, to make such orders as the nature of a case might require. UCPR rule 36.1 provides the Court with the power to make such orders

“whether or not a claim for relief extending to that … order is included in any originating process or notice of motion.

[2022] NSWSC 734 at 65

The Courts discretion

The Court has broad discretion to determine the strength of the applicant’s claim. However, the onus lies on the applicant to establish sufficient cause. It will be for the court to determine the strength of the applicant’s claim. What constitutes “sufficient cause” depends on all the circumstances of the particular case, unconstrained by any rigid formulae.

The principles governing the exercise of discretion include:

  • the reason(s) for the lateness of the claim
  • whether beneficiaries under the Will would be unacceptably prejudiced if time were to be extended;
  • whether there has been any unconscionable conduct by either side; and,
  • what is the strength of the claim made by the party seeking an extension of time.

Uncertainty in the administration of the deceased’s estate, the estate’s size and the ongoing court action has led to a lack of its distribution which heavily favours granting an extension of time.

Additionally, no party to the proceedings has engaged in any form of unconscionable conduct, and there is sufficient strength in the plaintiff’s case for the family provision order offered by the defendant

The background

The plaintiff must establish factors that warrant the making of his application for a family provision order under s 59(1)(b) of the Succession Act 2006 that once proven will give the applicant the status of

“a person who would generally be regarded as a natural object of testamentary recognition by the deceased

Re Fulop Deceased (1987) 8 NSWLR 679 at 681.

The Court accepted that the relationship between the plaintiff and the deceased was stronger than the ordinary relationship between a grandparent and a grandchild. The plaintiff looked to the deceased as a surrogate father and remained in contact with him as an adult. The plaintiff was the only grandchild of the deceased who spoke at the deceased’s funeral.

Similarly, the court accepted that any misgivings the deceased had about the plaintiff’s drug addiction, did not completely absolve the deceased from a moral duty to make provision for the plaintiff in his will.

The Court held it was inadequate that the deceased made no testamentary provision for the plaintiff even though he continued to recognise him as his grandchild. The “factors which warrant the making” of the plaintiff’s application for a family provision order under s59(1)(b) are his relationship with the deceased, coupled with his poverty and the need for special assistance due to his long-term drug addiction.

The decision

The Supreme Court has a discretion to make an order that a person’s estate be subject to management if it is satisfied that the person is incapable of managing their affairs under s 41(1) of the NSW Trustee and Guardian Act 2009 (NSW).

The Court held that the plaintiff is a person incapable of managing his affairs within the meaning of section 41 of the NSW Trustee and Guardian Act 2009: CJ v AKJ[2015] NSWSC 498 at [27][42]. He is barely employable; dependent upon a disability pension; living in public housing and without substantial prospects. The plaintiff has few substantive assets.

Additionally, the plaintiff is unaccustomed to dealing with large sums of money; and likely, if funded, liable to be exploited and the defendant fears, buy drugs exposing himself to the risk of an overdose.

The defendant has made a series of offers that the estate would pay the costs of an inpatient rehabilitation programme, nominated by the defendant for up to six months. The plaintiff believes that such offers of rehabilitation assistance are impractical because they have not been accompanied by financial support, or somewhere to live, following the completion of a rehabilitation programme.

The Court held that the plaintiff’s belief that he should receive a legacy sufficient to acquire a residence of his own, with financial support beyond that was utterly unrealistic and, reflected his drug-fuelled envy of the material success of the defendant’s second family.

Acting on the defendant’s proposal that the plaintiff undertakes a rehabilitation programme the Court ordered provision be made for the plaintiff out of the estate of $250,000; $130,000 be set aside for the plaintiff’s participation in a process of rehabilitation, independent of the defendant, with other $120,000 available to provide for the plaintiff’s general maintenance, education or advancement in life.

If the plaintiff establishes his sobriety, he can apply for a declaration that he is capable of managing his affairs and seek an order that the management orders affecting him be discharged under s 86 of the NSW Trustee and Guardian Act 2009 NSW.

The Court allowed the plaintiff an opportunity to obtain independent legal advice concerning the orders and the implications for his public housing and disability pension before pronouncing the orders.

 

 

 

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