In New South Wales, an applicant for a family provision order must first establish they are an “eligible person.” s57(d) of the Succession Act 2006 (NSW) provides that a “former spouse” is an eligible person and, in certain circumstances, may acquire a benefit from their ex-partner’s Estate.
A family provision claim is an application to the Supreme Court of NSW for a share or a larger share from the estate of a deceased person. For a former spouse to succeed in a family provision application, the former spouse must demonstrate that there are “factors” that warrant making the application.
Several important factors come into play when considering the relationship between the deceased and their former spouse. Firstly, it is essential to understand the nature and duration of their relationship, as this can significantly influence the dynamics of any obligations or responsibilities the deceased owed to their former spouse. Additionally, one must evaluate the former spouse’s financial resources and needs, which provide context for their current situation.
The presence of children from the marriage is another crucial aspect to consider, especially their ages and needs, as this can impact both the former spouse and the children involved. Moreover, the former spouse’s physical, intellectual, or mental capacity should be considered, as it can affect their ability to support themselves.
It is also essential to acknowledge any contributions the former spouse made to the deceased’s estate or their overall welfare throughout the relationship, including any benefits the former spouse might have received from the deceased’s estate during their lifetime. Lastly, any existing orders or agreements made during family law proceedings will also play a significant role in this complex assessment of the relationship between the former spouse and the deceased.
In the NSW decision of Lodin v Lodin, Estate of Dr Mohammad Masoud Lodin [2017] NSWSC 10, the Court considered a family provision application by a former wife.
Promissory Estoppel
The central principle of promissory estoppel is that a party can uphold a promise even without a formal contract or legal agreement. Promissory estoppel ensures that if a person makes a promise and another individual relies on it to their financial detriment, the promisee can enforce it under Australian law. This concept particularly applies to business, employment, and the construction sectors to promote fairness and justice.
Some promises can be enforced by law; for example, courts can mandate that an individual fulfils a promise outlined in a valid contract. However, when there is no legal contract to validate a promise, both parties typically believe there is no option for recourse if one person goes back on their word. In reality, the law will intervene when an individual fails to honour a promise under specific circumstances. Promissory estoppel offers a common law solution when a person goes back on their promise, causing harm to another party.
In Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387, the High Court of Australia examined a situation involving a builder who began work without a contract and suffered a loss when the client withdrew their commitment. Maher, the builder, was informed that the project was urgent and had already completed demolition and 40% of the new construction according to the client’s specifications when Waltons Stores opted not to proceed with leasing the property. The High Court determined that Maher was entitled to compensation from Waltons without a formal contract.
The Court concluded that Maher was justified in relying on the initial negotiations despite Waltons not formalising a contract. Ultimately, the Court decided that it would be inequitable to allow Walton Stores to backtrack on their promise to Maher. This case was significant as it broadened the application of promissory estoppel to include reliance on anticipated conduct.
Promissory estoppel requires a claimant to demonstrate five key elements that prompt judicial intervention.
Legal Relationship: There must be an existing or expected legal relationship between the parties involved in the dispute. Generally, this relationship is contractual, established through a legal agreement or during contract negotiations.
Promise: One party within this legal relationship must provide a promise, assurance, undertaking, or representation to the other party. Given the circumstances, the claimant must show that the promise was reasonable and credible.
Reliance: The claimant must demonstrate that they acted reasonably in reliance on the promise. It wouldn’t be appropriate to depend on every promise made, but if a reasonable person would have found the promise trustworthy, it is defensible for the claimant to act based on it.
Detriment: The claimant must show they experienced harm or loss because they relied on the promise. In other words, they must be in a worse position because they relied on the promise.
Unconscionability: The final element the claimant needs to prove is that if the party is not compelled to honour their promise, it will create an unequal situation that is unconscionable in the context.
Australian Courts need more consistency concerning the remedies available for promissory estoppel. Judges have the flexibility to determine the most suitable remedy to compensate a claimant’s losses. While courts generally grant monetary compensation, they may require the defendant to fulfil their promise.
Typically, courts decide that a claimant should receive an award equal to the promise’s value or an adequate amount to cover the financial harm suffered due to their reliance.
Alessandra Hart v Gerard John Basha [2024] NSWSC 1441
Alessandra Hart (the plaintiff) is the former wife of Anthony Siracusa (the deceased), who passed away on 29 January 2021. The plaintiff, now 82 years old, is pursuing legal claims against the deceased’s estate, administered by Gerard Basha, a solicitor appointed by the Court.
Background
The plaintiff and the deceased were married in December 1968 and had three children: Brendan, Louisa, and Mark. The couple separated in January 1992 and divorced later that year. No property settlement occurred following their divorce. The deceased subsequently entered into long-term relationships with Jessie Marion Boudville (until she died in 2012) and later Jane Grimm, which continued until his passing in 2021.
The deceased’s last Will, dated 27 January 2021—just two days before his death—allocated $65,000 and 5,000 Telstra shares to the plaintiff. It also distributed various personal items to his children, Brendan’s partner, and others. A trust held the estate’s residue for beneficiaries, including family members, Jane Grimm, and charitable organisations.
However, the $65,000 was a loan the deceased owed the plaintiff; similarly, the Telstra shares were the plaintiff’s property entrusted to the deceased for management. Thus, the Will left the plaintiff without any substantive provision.
Following the resolution of other claims, including a family provision order in favour of Jane Grimm, the estate’s net assets total approximately $2.7 million. The plaintiff submitted that the deceased made repeated promises from 1992 until his death, assuring her she would inherit the bulk of his estate if she refrained from seeking a property settlement.
The plaintiff submits that due to these assurances, she did not pursue her legal entitlements and suffered detrimental reliance under the doctrine of promissory estoppel. Alternatively, the plaintiff seeks a family provision order under the Succession Act 2006 (NSW), submitting the Will made inadequate provision for her maintenance and advancement in life.
The decision
The Court rejected the plaintiff’s promissory estoppel claim, noting that the doctrine cannot create obligations absent an existing legal relationship. Furthermore, the plaintiff’s evidence did not support most of the alleged promises or demonstrate detrimental reliance. However, the Court upheld her family provision claim, determining that the Will failed to make adequate provision for the plaintiff.
Accordingly, after considering the plaintiff’s significant financial and personal contributions during the marriage and present needs as an elderly widow with limited resources, the Court made an order under s59 of the Succession Act 2006 (NSW) for the provision of the plaintiff’s maintenance, education, and advancement in life from the deceased estate for $600,000 to be disbursed as a lump sum before any distribution to the residuary beneficiaries under clause 13 of the Deceased’s final Will (noting that Michael Brendan Siracusa and Jane Diana Grimm have waived their rights under that clause 13). The Amended Statement of Claim is otherwise dismissed, and all matters concerning costs are reserved.