Charlotte Brown (the plaintiff) is the executor of Betty Hunt’s (the deceased) estate. The deceased died on 22 June 2018 leaving a Will (“the Will”) dated 6 October 2014 naming her grandson Mathew Hunt (the defendant) as executor.
Before making the Will, the defendant had one child Nathaniel and told the deceased that he did not intend to have any more children. However, following the deceased’s death the defendant re-partnered and has since fathered a daughter, Matilda, with his new partner.
Clause 9 of the Will stated:
I give the sum of one million dollars ($1,000,000) to such biological child or children of my said grandson Matthew Alec Hunt (being my great-grandchild or great-grandchildren) as survive me and if more than one in equal shares upon attaining the age of thirty (30) years.
The defendant is:
(a) the residuary beneficiary in the deceased’s Will;
(b) the deceased’s only biological grandchild;
(c) the plaintiff’s son;
(d) Nathanial Hunt’s father. Nathanial Hunt was born on 12 November 2012 and is the eldest of the deceased’s great-grandchildren.
(e) Matilda Charlotte Hunt’s father. Matilda Hunt was born on 15 November 2020, and is the deceased’s second and only other living great-grandchild; and
(f) the only person who can produce the deceased’s biological great-grandchildren.
The defendant renounced his appointment as executor. Probate of the Will was granted to the plaintiff as substitute executor on 27 August 2018.
Following the distribution of bequests, transfer of real property and payment of expenses, the balance of the estate funds held in trust by the plaintiff’s solicitor as at 17 September 2021 was $1,086,736.15.
In interpreting clause 9 the Court must take into account the words of the clause, the Will as a whole, and the surrounding circumstances of its execution. Importantly the rigid application of a uniform meaning throughout the Will may risk distorting the testator’s intention in respect of some relationships.
Construction of the Will
The Court held that on its proper construction the class of beneficiary that cl 9 applies to includes all great-grandchildren of the deceased born before the first great-grandchild reaches the age of 30 years. That class of beneficiaries closes when the eldest great-grandchild reaches the age of 30 years. As a corollary the trust monies will be distributed to all great-grandchildren then alive at that time regardless of their age.
Amending the Trust
The plaintiff sought a variation to the trust established by by clause 9 of the Will to reduce
‘the age of the beneficiaries who are born at the time of this application’.
It was submitted that the deceased was concerned that the beneficiaries of her estate had gained a level of maturity before any distribution was made. The court held that by reducing the age to 25 balanced the deceased’s testamentary intentions and the beneficiaries. Critically, it will reduce the extent to which the funds are depleted through trust management fees.
The Court was obliged to consider all persons who cannot consent to the variation which includes Nathanial and Matilda and any unborn children of the defendant who may be born prior the eldest great-grandchild turning 30.
In considering the impact on any unborn great-grandchildren, the court considered the low likelihood of their coming into existence together with uncertainty of the defendant’s present intention about fathering further children.
Appointing a Professional Trustee
Under the current terms of the Will, the plaintiff (now 70 years’ old) is required to manage the estate for the benefit of the deceased’s great-grandchildren until the oldest turns 30. The Court accepted in the interests of the beneficiaries, the security, investment and management of the trust monies, and the efficient, sound and faithful exercise of trustees powers, it is appropriate that the plaintiff be discharged from her role as trustee, and replaced by a professional trustee under s 48 of the Trustee Act 1958 (Vic).
The Court accepted that due to the inadequate framing of the questions in the summons and general preparation of the case by the plaintiff unnecessary costs have been incurred by the defendant. Therefore the defendant should have his costs paid from the estate on an indemnity basis. The court accepted that as the plaintiff’s application was necessary and appropriate that her costs be paid from the estate on a standard basis.