WENTWORTH v WENTWORTH SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL SAMUELS AP, PRIESTLEY and HANDLEY JJA 9-10 December 1991, 16 December 1991, 3 March 1992 [1992] NSWCA 267 FAMILY PROVISION ACT — ("the Act") — application by daughter — contest at trial concerning relationship between daughter and testator — substantial provision made by testator for daughter during testator's lifetime — subsequent estrangement — reduction of daughter's assets in connection with litigation. NOTIONAL ESTATE — trial judge orders that shares in family company held by testator's son be designated as notional estate makes order for provision for maintenance but not advancement out of the designated notional property by annual payment of money on conditions akin to those of a protective trust — on appeal, and cross-appeal, chief points argued were: (i) was daughter entitled to order in the circumstances, (ii) if so, was she entitled to an order for advancement, (iii) did the shares in the family company fall within the notional estate provisions of the Act, (iv) should the protective trust type conditions have been imposed on the order, (v) should the provision made be increased or altered, (vi) the costs orders of the trial judge held, the trial judge should be upheld as to (i), (iii) and (vi), was in error as to (ii) and (iv), and in regard to (v) that a lump sum should be ordered. Samuels AP I agree with Priestley JA. Priestley JA Nature of Appeal This appeal is about the property of the late MrG.N. Wentworth and the claim by his daughter Ms Katherine Wentworth for provision from his estate for her maintenance and advancement in life. Ms Wentworth made this claim as plaintiff under the Family Provision Act 1982 ("the Act"). By s7 of the Act the court had the power to order that such provision be made out of the late Mr Wentworth's estate and notional estate as, in the court's opinion, ought, having regard to the circumstances at the time of the order, to be made for her maintenance and advancement in life. The plaintiff's father, whom I will call the testator, died on 7 July 1989, having made his last will on 25 October 1984 and a codicil on 17 May 1989, which were admitted to probate. The testator left nothing in his will to the plaintiff, or to her sister, the eldest of his three children, saying that he had made sufficient provision for them during his lifetime. His third and youngest child, Mr P Wentworth, was appointed sole executor of the will, under which he received the greater part of the testator's estate. The sister made no application under the Act. Mr P Wentworth was the defendant to the proceedings commenced by the plaintiff. Bryson J heard the proceedings: he made orders in favour of the plaintiff, but of an amount and on conditions which the plaintiff considered inadequate and inappropriate, so that she appealed against them. The defendant also appealed, on the ground that no orders should have been made in the plaintiff's favour at all. The testator: events bearing on his property life. Because the case is primarily concerned with the testator's property, I will begin by outlining the events in his life bearing on his holding of property. The outline will supply many of the facts important to following Bryson J's reasons. 2 UNREPORTED JUDGMENTS 1909-1971. The testator was born in 1909. He married in 1934. His father, Mr W C Wentworth, had substantial assets and in 1935 gave him money with which he bought a grazing property of 3,400 acres called "Kanoona", for 11,582 Pounds. A second principal part of the testator's property also came from his father. In 1936 his father established a trust, called the W C Wentworth Settlement, by which he transferred to his elder son (also called W C Wentworth) and to the testator certain property, mostly land near Warrawong, to be held by them upon trust. The deed by which this was done provided that the Settlement be treated as divided into forty equal shares, five of which were to be held on trust for the testator. The testator also acquired other assets, although, as Bryson J said, they were not well identified. They seem to have come through his father. "Kanoona'" and the interest in the W.C. Wentworth Settlement seem to have been his major assets. The testator lived as a grazier at "Kanoona". His elder daughter was born in 1938, the plaintiff in 1940 and the defendant in 1942. All three children helped their parents with the hard physical work involved in the running of "Kanoona'". The property was some distance from the nearest town and each of the children from about the age of ten was sent to boarding school, the daughters in Sydney and the defendant in Armidale. After boarding school, the sisters both became students at Sydney University where they lived at the Women's College. The elder graduated in Arts, the plaintiff in Science. The testator paid for his daughters' education and provided money and credit for their living expenses. The defendant did not go to university. He worked with his father on "Kanoona", to which considerable improvements were made as the years passed. The testator's other main activity besides the running of "Kanoona" was fulfilling his obligations as one of the two trustees of the W C Wentworth Settlement. This involved management and development of the Settlement's land at Warrawong. In 1950 this work required him to move his family to live at Wollongong for some time. In later years he continued to make the journey from "Kanoona" to Warrawong regularly. There were other occasional absences from "Kanoona" for holidays and the like. The defendant did everything necessary on the property in his father's absence. As time passed, the defendant gradually took over the management of "Kanoona'". The plaintiff married Mr G Rogers in 1960 and from that time lived mostly in Sydney. From 1967, perhaps earlier, until 1979, she did considerable managerial and administrative work in regard to the W C Wentworth Settlement properties and other properties in the same area which had belonged to her father's father and had become part of his deceased estate, of which her father and his elder brother were again trustees. She received a salary for this work, which relieved her father of a significant part of the more onerous detailed obligations he had as a trustee. At an early stage in the lives of his children, the testator made known to his family his opinion and intention that "Kanoona" should become the property of the defendant. His interest in the W C Wentworth Settlement, on the other hand, was to be divided equally between his children. In 1955 "Kanoona" was transferred to Fitzwilliam Pty Ltd The history of the shareholding in this company is a little obscure, but there is no need to try to clarify it, because it seems beyond doubt that the transfer was the first step in the method adopted by the testator of seeing to it that "Kanoona" should, in time, go to the defendant. The name Fitzwilliam was associated with the testator's family URJ WENTWORTH v WENTWORTH (Priestley JA) 3 and was the defendant's second given name. At all relevant times the only persons with any significant beneficial interest in the company were the testator, his wife, and the defendant. In 1961 the plaintiff gave birth to her first daughter. By 1964 matters had so fallen out in the W C Wentworth Settlement that the testator's original five one-fortieth shares had become five one-fourteenth shares in that Settlement. In that year he transferred one of his five shares in the Settlement to each of his three children, and the remaining two to a trust called the "G N Wentworth Grandchildren Trust". A valuation that was made of the testator's five fourteenths interest at the time of the transfers put that value at 300,000 Pounds. The children paid for the transfers with money simultaneously lent to them by the testator. In or about 1971 the testator released these loans. 1973-1979. In 1973 the testator and his wife retired to a house he bought at Terrigal. For some time previously the defendant had been doing the greater part of the work of running "Kanoona" and from this time on he was in charge, although he and his father remained in close touch, and the defendant seems always to have fallen in with his father's wishes. The testator made a will in February 1974 the effect of which, broadly speaking, was to leave his wife in control of Fitzwilliam Pty Ltd (and thus "Kanoona") until her death, after which those assets would become entirely the defendant's, to leave the matrimonial home of his wife and himself to his wife, (that presumably being the property at Terrigal) and to make some provision from the residue of his estate for his two daughters. He appointed the plaintiff and his brother-in-law as his executors. By a codicil to this will made in June 1975 he revoked the appointment of his brother-in-law as an executor and appointed the defendant in his place to be an executor with the plaintiff. He otherwise confirmed the will of February 1974. In January 1976 the Testator's wife was disabled by a stroke. In September 1977 the Protective Division of the Supreme Court, on the testator's application, found that his wife was incapable of managing her affairs because of mental infirmity arising from disease and appointed the testator manager of his wife's property under the order and direction of the court. The plaintiff first received a distribution of $1,800 from the W C Wentworth Settlement in 1965. It was an amount of capital. There was then no further distribution until 1972 when she received capital of $11,400. From then on there were capital distributions in each year, in 1973 $10,000, in 1974 $15,000, in 1975 $11,000, in 1976 $4,000, in 1977 $7,000, and in 1978 $15,000. Presumably no income tax was payable on these sums, which, to 18 December 1978, totalled $75,200. There do not appear ever to have been any distributions of income. The plaintiff's sister and the defendant each also received distributions of the same amounts. As one of the two trustees of the Settlement, the testator must have had direct knowledge of all these payments. By early 1979 the W C Wentworth Settlement trustees had decided to sell the Settlement assets and to distribute the proceeds among the beneficiaries. The plaintiff was strongly in favour of this. As late as the end of September 1979, it looked as if all assets would be sold without dissension. On 13 September 1979 the testator made a further will by which he again appointed the plaintiff and defendant as his executors and trustees; he left his shares in Fitzwilliam Pty Ltd to the defendant, and some provision for the plaintiff and her sister. 4 UNREPORTED JUDGMENTS November 1979-1984. At a meeting, at which the testator and his brother as trustees, and the plaintiff and her sister were present, on 30 November 1979, it became clear that the trustees did not intend to sell a particular property. This led to a dispute and there was some talk of litigation to which, Bryson J found, the testator's brother, Mr W C Wentworth responded, "If you proceed with litigation against us we will break you", at the same time indicating that any proceedings would be long and drawn out and would cost more than the plaintiff and her sister could pay. On the day of the meeting the plaintiff was dismissed from her employment by the Settlement trustees. On 13 December 1979 the testator made a codicil to his will of 13 September 1979 by which he appointed the defendant sole executor and trustee of that will which in other respects he confirmed. Not long afterwards, on a date not proved at the trial, but accepted as in early 1980, litigation against the trustees began. The litigation took the form of proceedings to have the trustees removed. From the second half of 1979, presumably as the result of the sale of some Settlement assets, further distributions were being made by the trustees of the W C Wentworth Settlement to the beneficiaries. In July 1979 the plaintiff received $15,000, in December $65,000. In 1980 at about the time when the proceedings to remove the trustees began, further amounts were distributed, $30,000 in February, $10,000 in March and $5,000 in May. In all, the plaintiff received capital contributions from the trust from June 1965 to May 1980 of $200,200: $1,800 in 1965, $73,400 from July 1972 to December 1978 and $125,000 from July 1979 to May 1980. (So did her sister and the defendant.) The $65,000 paid in December 1979 was paid in two sums, $60,000 on 11 December 1979 and $5,000 on 18 December 1979. In February 1980 Recato Pty Ltd ("Recato") was incorporated. On 18 August 1980, the defendant subscribed $480,480 and was allotted 14,560 B ordinary shares. On the same day the testator subscribed $355,410 and was allotted 10,770 A ordinary shares. On 30 October 1980 Recato became the registered holder of almost all shares in Fitzwilliam Pty Ltd There can be no doubt that, whatever the precise details of these transactions were, the testator was joining in further steps towards his longstanding intention that "Kanoona" should become, directly, or indirectly, the property of the defendant. Fitzwilliam Pty Ltd remained the owner of "Kanoona" and the testator remained governing director of Fitzwilliam Pty Ltd, thus retaining some powers to control the activities of that company. In May of 1981 the proceedings against the trustees of the W C Wentworth Settlement were settled as a result of which the plaintiff was paid $238,876.50 and her sister a similar amount. The deed embodying the compromise of the proceedings recited, in part, that matters other than the removal of the trustees had been in issue. There had been a cross claim brought by the trustees against the plaintiff and claims made by the plaintiff arising from her employment by the trustees and/or companies associated with the trustees and other claims by the plaintiff and her sister of breaches of trust by the trustees. By CLS of the deed the plaintiff released the trustees from all causes of action referred to in the recital. On 8 May 1981, the day before the execution of the deed of compromise, the testator made a will in which he appointed the defendant his executor, failing him his brother-in-law the executor and failing him the defendant's wife as executrix. This will revoked the will of 13 September 1979 and the codicil of 13 December 1979 by which he had given property to his two daughters. In CL11 the testator URJ WENTWORTH v WENTWORTH (Priestley JA) 5 said he had made no further provision for his daughters by it because he considered he had made sufficient provision for them during his lifetime. Shortly after the compromise, payments, and releases of 9 May 1981, the plaintiff as next friend of her children and her sister as next friend of her children caused a statement of claim to be filed against the testator, his brother Mr W C Wentworth, and also against the trustee of the G N Wentworth Trust, this trustee being a company called "Greycliff' of which the testator was the governing director. (I will call this litigation the Greycliff proceedings). The G N Wentworth Trust still held two one fourteenth shares in the W C Wentworth Settlement on trust for the grandchildren of the testator. The statement of claim alleged that the testator and his brother were guilty of breaches of trust in administering the W C Wentworth Settlement and were not fit and proper persons to act as trustees of that Settlement. Orders were sought that the trustees be removed and that an account be taken of their dealings as trustees and that they restore to new trustees the amount found to be due upon the taking of the accounts. In 1982 the testator's wife died. By her will she appointed her three children as executors. Her daughters obtained probate and became her executrices; the defendant reserved leave to apply. In 1983 the executrices commenced proceedings against their father and his brother, Mr W C Wentworth, in respect of disputes concerning the testatrix's personal property, principally some valuable furniture in the Terrigal home. These proceedings and the Greycliff proceedings were compromised by deed made 19 April 1984. This compromise was effected by the buying out of the interests of the children of the plaintiff and her sister by the defendant and the release by the sisters of all claims in the proceedings. A matter agreed upon between the plaintiff and her sister in the course of their reaching agreement with the testator and his brother upon the terms of the compromise was that the plaintiff's sister would pay to her $85,000 in recognition of the time and effort she had put into the cases that had been brought against the testator and his brother. At about the end of 1983, Fitzwilliam Pty Ltd sold "Kanoona"; the funds from that sale were made available to Recato to complete the purchase of a property called "Southlands" on 20 January 1984 for $1,190,000. From then on the defendant carried on business on "Southlands". In about April 1984, the testator began to discuss how he should arrange his affairs and tidy up his estate. An immediate reason for his wish to do this appeared in what he said to Mr Woodley, his accountant, in about August 1984, that he wanted the accountant to come to a meeting with his solicitor, his son and himself "'to tidy up my estate and arrange my affairs so Katherine can't attack my estate". The arrangement of the testator's affairs was effected in October of 1984. By this time the property affairs of the testator and defendant had been intermingled for a considerable period. In a report later made by Ernst and Young which attempted to disentangle the various transactions in which Recato and Fitzwilliam Pty Ltd had been concerned since their incorporation, that firm remarked that "From a review of the records, the minutes and the flow of funds and share dealings, we conclude that the testator, G N Wentworth and his son, P F N Wentworth dealt with the entities detailed in this report as though they were 'one'. Credit balance loan accounts were established to provide notional funds against which funds could be drawn or expenses debited to meet living expenses and other personal outgoings." The defendant's wife had become part of this unit. She had played a part in the management and improvement of "Kanoona" and then, since early 1984, of "Southlands", and had contributed to the enhancement 6 UNREPORTED JUDGMENTS of the assets owned, directly and indirectly, by Recato. The testator, in retirement, was maintained, very comfortably, from these assets as were the defendant and his wife who were working and managing them. At the time when the arrangement of the testator's affairs was effected his principal asset was his shareholding in Recato. The main features of the rearrangement of the property affairs of the testator and the defendant were these. On 25 October 1984 the articles of Recato were changed in a number of ways. The 10,770 A ordinary shares became preference shares which were then transferred to the trustee for the defendant's family trust. A new class of B redeemable preference shares was created. One hundred of these were allotted to the testator, their value lay in the fact that they qualified the testator to remain governing director of Recato. This article was as follows: "GOVERNING DIRECTOR 81A. George Neville Wentworth is the governing director of the company and shall continue to hold that office until he resigns or dies or ceases to be a member of the company and whilst he retains such office he shall have authority to exercise all powers authorities and discretions by these articles expressed to be vested in the directors generally and all other directors shall be bound to conform to his directions with respect to the business of the company. The shares for the time being held by the governing director shall entitle him to cast as many votes on any motion put at a general meeting as constitutes twenty-six per centum (26%) of all votes case on the motion or such greater number of voted as the shares so held confer upon him as the holder thereof. The governing director by notice in writing under his hand to the company may from time to time remove any other director howsoever appointed and appoint additional or other directors." Relevant to the effect of this article was article A4.2, inserted at the same time: "(2)... shares in the company... are under the control of and may be issued by the directors either at par or at a premium to such persons at such times on such terms and conditions and with such... rights privileges conditions restrictions or limitations... as the directors may from time to time determine... (3)... (4) Notwithstanding any other provisions of the memorandum of association and these articles upon application made by George Neville Wentworth at any time or times during his lifetime the directors shall be at liberty to allot to him at par all or any of the unissued shares in the capital of the company and the holders of all of the shares in the capital of the company hereby consent to and shall be deemed to have consented to every such allotment." On the same day as the articles were amended the testator made his last will, CL8 of which was in substantially the same words as CL11 of his previous will, (see p 9 above). The rights available to the testator under article 81 A enabled him, if he chose to exercise them to the full, to cause the liquidation of Recato and to bring into his own hand about 78.6% of the surplus assets on winding up. The testator and the defendant were aware, at least to some degree, of the significance of the powers conferred on the testator by the various amendments to the articles of Recato associated with the new article 81A. Mr Woodley was one of those present at the offices of the solicitors for the testator and the defendant when they decided to make the changes. Mr Woodley later recalled that the testator had said that he did not want to be governing director of Recato, but that the defendant replied he should be governing director in case, for example, the defendant and his wife were killed in a car accident; the defendant URJ WENTWORTH v WENTWORTH (Priestley JA) 7 said he did not want the testator to "go cap in hand to my executors should you be in need of funds". The testator had then agreed. 1985-1989. The arrangements entered into by the testator in October 1984 remained substantially unchanged until his death. Any money he needed was supplied through Recato by means of loan accounts. He lived at Terrigal until about the end of 1987 when he bought an interest in the "Kenilworth Garden" retirement village at Bowral where he went to live and where he stayed until his death. He did not exercise any of the powers in regard to Recato which had become available to him in October 1984. In the May 1989 codicil to the will of October 1984 he made no major alterations to the will. He substituted his elder daughter for his brother-in-law as an alternate executor and widened the number of his grandchildren to whom he gave legacies to include one of the plaintiff's children. The assets in his estate consisted of the unit at Kenilworth Gardens, valued at approximately $115,000, money on deposit with banks in one form or another of approximately eighteen and a half thousand dollars, life policies of approximately seventeen and a half thousand dollars, AGC debenture stock to the value of approximately $68,000 and an amount due to him in his loan account with Recato of $50,692. The total value of the assets was of the order of $270,000. The liabilities totalled a little over $130,000, the main one being an amount owing to the defendant of $93,513. Proceedings under the Family Provision Act. The plaintiff filed her summons under the Act in August of 1989. Probate of the will and codicil was granted in September 1989. Filing of affidavits began in October 1989 and continued at a steady rate through 1990 and into 1991, until after the hearing of the substantive proceedings began before Bryson J on 15 April 1991. Seventy-five affidavits were filed in all. The affidavits went into great detail on many factual matters and also involved expert accountants analysing financial dealings and records extending over many years. Quite obviously, the preparation of the case must have been extremely expensive and the contestants must have realised that the litigation would be likely to use up most if not all of the testator's net actual estate. This must have become the more obvious as the hearing proceeded through about sixteen court days before Bryson J. The mass of evidence which mounted up from the energies of the contestants and their representatives was used by both the plaintiff and the defendant to support cases which could be stated in very few words. The plaintiff's case. The plaintiff's case was that although she and her father had had many conflicts over the years, particularly towards the end of his life, she was entitled, as one of his three children, to provision in his will proportionate to his wealth and her own financial position and need. Her position at the time of the hearing was that she was fifty-one years old, unemployed and single. The net balance of her assets over liabilities was approximately $230,000. Her prospects of being able to earn a living lay in her hope of completing the Barristers Admission Board courses and subsequently being admitted to practice at the Bar. On her case, she had not done anything warranting exclusion from a share in the testator's estate; in many ways she had been supportive both of him and his wife, in particular in their periods of illness in middle age and also what she had done in her management activities concerning the W C Wentworth Settlement had made the testator's fulfilment of his obligations as a trustee of that settlement less onerous than it would otherwise have been. Her case further was that there was notional estate of the testator within the meaning of the Act which the court 8 UNREPORTED JUDGMENTS should designate as such and in regard to which the court could and should make orders providing for her maintenance and advancement. There were further more complicated claims in regard to the testator's estate based upon the view that a number of transactions in which the testator, the defendant, Fitzwilliam Pty Ltd and Recato had participated were void, the result being that in law there remained property in his estate additional to what I have earlier listed, without need for any resort to the notional estate provisions of the Act. The defendant's case. The defendant's case was that the testator had made full and proper provision for the plaintiff during his lifetime, particularly but by no means entirely by the transfer to her in 1964 of her interest in the WC Wentworth Settlement; further, her conduct towards her father had been such as to justify him in taking the view, particularly in light of the provision he had made for her during his life, that he had no moral obligation to make any further provision by his will. Reliance was placed on the estrangement which was said to have begun between the testator and the plaintiff towards the end of 1979, the litigation, beginning in 1980, in which the plaintiff made claims against the testator and his brother concerning many matters of family property, and some incidents occurring in the time not long before the testator's death including some letters written to him by the plaintiff in that time, which, it was submitted, demonstrated an attitude to the testator which discharged him from any moral obligation to provide for the plaintiff in his will. Bryson J's main findings. Bryson J made clear findings of fact on a number of matters important to his decision of the case. One concerned the interaction of the personalities of the plaintiff and the testator. Bryson J said: "There was strong strain of conflict in the relationship between the plaintiff and the testator from early in her life. In her childhood and youth there were, to an unusual degree in family life, angry and noisy confrontations and shouting matches and displays of rage between the plaintiff and her father, and also on occasions her mother was involved in these displays. There is some characteristic in the plaintiff's personality which has led to her involvement in conflicts with her father and with other people closely related to her. However he too participated in these conflicts." Bryson J then went on to say that the evidence showed the testator was, to many people outside his family circle both gentle and a gentleman, but he continued: "No doubt his behaviour varied with his circumstances, but I find that in the family circle and in dealings with the plaintiff and with Mrs T.M. Wentworth, and with other relatives, he was capable of great rage, obstinacy, noisy expression and violent language, that he was rather severe with the plaintiff in her childhood and that in some important decisions of her life he sought to dominate the plaintiff; and in view of her character and likely response, such an attempt could only be frustrating. Conflict with the plaintiff was a lifelong feature of their relationship and could well have reflected similarities in their characters." A little later, he continued: "The plaintiff made many complaints of grievances against her father, including much that seemed very unlikely, such as a complaint that she had married Gordon Rogers at her father's insistence and sooner than she wished; this cannot be a fair view of those distant events, as the plaintiff could not be compelled in such an important matter, if in any matter. URJ WENTWORTH v WENTWORTH (Priestley JA) 9 To the end of his days the plaintiff made complaints about his treatment of her in her childhood, asserting that he had poured anger and violence on her, and that he had beaten her with pieces of harness when she was a small child. The element of anger and confrontation in the relationship between the plaintiff and her father is not to be blamed on the plaintiff alone; her father participated. While it would be difficult to preach this sermon to a person involved in such a relationship, in my judgment a just and wise parent would recognise such a characteristic in his relationship with his child and would not resent or punish it; in a parental relationship there ought, eventually, to be acceptance and toleration of such an element in the relationship." Another important aspect of Bryson J's findings was that the circumstances of the plaintiff's upbringing had made her different from most Australians in her attitude to property; there was instilled in her family (and I assume his Honour meant also in the plaintiff) "the need to inherit and manage property" as a central economic need of life. The "expectations of and duties towards each other" of members of the Wentworth family, he said, "are formed or very significantly affected by the dominating reality that large assets are available, the need to manage assets presents itself continuously and the conditions of their lives depend on it". From these circumstances his Honour said "expectations and moral duties could properly be formed" leading to an obligation on the testator in the present case to make such provision for his children as at least "to free them of basic needs to provide for their own housing and maintenance, and enable them to pursue professions or other careers as exercises in self realisation untroubled by concerns of necessity". He further found that the testator was acting on a "dynastic ideal" in dealing with his property in accordance with his belief "that property went to sons and that daughters were looked after by their fathers while they were still in the care of their fathers and then they were looked after by their husbands". This observation was based on a statement made by the testator to his elder daughter. The facts of the case show that he did not act literally in accordance with such a simple minded view. A still oversimplified but more accurate short statement of what the testator did is that he saw to it that the land he had been given by his father went to his son and the bulk of the rest of his property, his interest in the W C Wentworth Settlement, valued at 300,000 Pounds in 1964, was divided equally between his two daughters, his son and his grandchildren. In regard to the relationship between the plaintiff and the testator in her early adult life, Bryson J found that she did assist both him and her mother in ways appropriate for an adult daughter, to a significant extent and over a number of years. This assistance included looking after her parents in periods of illness, and her work for the W C Wentworth Settlement for which, his Honour found, the salary received by the plaintiff although more than nominal was modest in relation to the extent and responsibility of the work she did. The estrangement from the end of 1979 onwards was, necessarily, the subject of considerable description and fact finding by Bryson J. There are two strands to it. One began in 1977 but did not have any effect on the relation between the testator and the plaintiff until some time afterwards. This concerned happenings between the plaintiff and her husband which became the subject of or cause for, many court proceedings, some still on foot, which I will call for short the Rogers litigation. The other strand was the litigation about property, earlier summarised, which the testator thought of as the plaintiff suing him and his brother. 10 UNREPORTED JUDGMENTS In regard to the Rogers litigation, the testator was in a position to give evidence which Bryson J characterised as "quite significant, but not of vital importance" which supported the plaintiff's account of a physical attack upon her by her husband. The testator in fact gave this evidence at a jury trial in the Rogers litigation, after the estrangement had begun. He was asked during his evidence about his relationship with the plaintiff, answering that in 1977 he and the plaintiff were not close, but were on amicable terms, adding that since that time, "Well, there has been a certain amount of distancing, then a complete distancing when she saw fit to sue me and my brother". Bryson J noted that the plaintiff accepted that this was accurate. It seems to me to be a sufficient summary of the position as it had developed to that time. However, further events relating to the Rogers litigation later affected the relations between the plaintiff and the defendant, and these and one other topic were dealt with by Bryson J in some detail. The other topic concerned the death and funeral of the testator's wife. These events happened (in 1982) when the plaintiff and her sister had proceedings on foot against the testator. The funeral took place in circumstances of great hostility between the testator and defendant on one side and the plaintiff on the other. Bryson J found that this came about, in part, because the testator and defendant thought the plaintiff was displaying an unworthy interest in the disposition of her mother's estate; he found this interpretation of her behaviour was quite wrong and not reasonable. There were different accounts of what actually happened on the day of the funeral; on one of them, which his Honour did not accept, the plaintiff had behaved in a way very likely to be extremely distressing to the testator. My understanding of Bryson J's final view of what happened on this occasion is that he thought that on any account of it, some very unpleasant things had taken place but that that was more due to the faulty understanding of the plaintiff's motivation by the testator and the defendant than to any fault of hers, and that in his overall weighing of her conduct towards the testator, he held nothing that happened on this occasion against her. I come now to Bryson J's finding on how events that grew out of the Rogers litigation affected the relation between the testator and the plaintiff. Since the time the plaintiff's estrangement from the testator began, she had spent much time and energy in court proceedings of various kinds related to that litigation. The jury trial at which the evidence was given by the testator which I earlier quoted resulted in judgment being given against the plaintiff. The Court of Appeal later set aside the trial result, and ordered a new trial. The plaintiff, in collecting evidence for use at the new trial sought to have the testator swear an affidavit giving an account of those matters about which he had testified at the trial. A draft affidavit was sent to him in May of 1986 which did little more than restate his evidence at the trial. He declined in a polite letter to swear the affidavit. In October 1988 the plaintiff visited the testator in his unit at Kenilworth Gardens. Bryson J found that the visit was on the whole a pleasant social one but became tense when the plaintiff asked the testator to swear an affidavit for use in the Rogers litigation. The testator was unwilling to do so. This refusal led to the plaintiff's sending a letter to her father dated 23 November 1988 in which she set out in detail why, in her opinion, he was refusing to swear the affidavit. Paraphrased, she said that the testator was under pressure from his brother, Mr W C Wentworth, and the defendant, to change the evidence he had previously given in order to protect lies told by Mr W C URJ WENTWORTH v WENTWORTH (Priestley JA) 11 Wentworth; he was being asked to join in a conspiracy to protect his brother, the criminality of Mr Rogers and of others who had "committed serious crimes in the presentation of" the Rogers litigation. Here I interrupt the summary of Bryson J's findings to say in my own words that towards the end of this letter, the language reached the highest pitch of recrimination and rebuke, and if the letter were considered in isolation, the conduct of its writer might be condemned as endurable only by a saint-like parent and forgivable only by a supernatural being. However, it seems to be common experience within families, whether they be wealthy or not, that sometimes the most shocking things imaginable can be said, and sometimes deeds done, which would lead rational people to sever relations forever, and yet, after an interval, the relationship goes on much as before. "I will never speak to you again", is a statement of intention sometimes acted on, sometimes not. In her evidence before Bryson J the plaintiff did not seek to justify the terms in which her letter had been written but explained the situation along the lines I have just mentioned. She said that when she had spoken to the testator by telephone soon after he got the letter, he had said "You know you don't need to write to me in those terms; I am your father; I gave true evidence at the Court; Iam not part of any conspiracy against you"; and, her evidence continued, they then had quite a long discussion about what had happened in the court proceedings and the plaintiff told him she was sorry she had written the letter. I infer that Bryson J accepted this account. In the light of this acceptance, the terms of the letter lose some of their damaging effect upon the plaintiff's case. However, from evidence before him which was not clear in detail, Bryson J found that at around this time the plaintiff made a complaint to the police either about a conspiracy among her family or subornation of the testator in respect of his evidence. This resulted in police officers calling on the testator in his unit at Kenilworth Gardens in January 1989 and questioning him about the evidence he had given at the jury trial. The judge found also that police officers again interviewed him on 8 May 1989 and on 7 June 1989 about this matter. On 29 May 1989 the plaintiff visited the testator with one of her daughters. Bryson J found this was in some ways a pleasant social occasion; the testator did not indicate the plaintiff was unwelcome, but the visit was overshadowed by his now being in hospital and by his illness and pain. On 2 June 1989 the testator's solicitors despatched a letter to the plaintiff saying the testator had asked that she not visit or attempt to contact him and that if she wished to do so she should first make a request in writing to the solicitors. The letter also told the plaintiff the staff at the hospital had been asked not to let her have any contact with the testator. On 4 June 1989 the plaintiff visited the testator; she had not yet received the letter of 2 June. The testator asked her to leave. The plaintiff thereafter spoke to the testator by telephone from time to time until the last week or ten days of his life by when he could no longer use the telephone and was still unwilling to have her visit him. What was happening between the testator and the plaintiff during the last weeks of his life has something of the Grand Guignol about it; it is easy for a person outside the family circle to begin speaking in harsh black and white terms of condemnation about things that were said and done; but the facts of the case itself show that such an approach would be over simple and unfair to the persons concerned. Bryson J strove to maintain a balance when assessing the situation, and in my respectful view, he succeeded in doing so, when he summarised the position as follows: "Late in 1988 it was still possible for the plaintiff to make a 12 UNREPORTED JUDGMENTS visit to the testator at Kenilworth Gardens in circumstances which, while not completely relaxed, were reasonably pleasant, and communication continued in 1989 during the last months of the testator's life. However the testator felt great concern about the endeavours to get him to sign the affidavit, and about endeavours of police officers to get him to sign other notes. The communications with him by the police, though not under the detailed control of the plaintiff or indeed under any control at all of hers, were traceable to complaints which she had made and which required investigation. In the circumstances, in my view the plaintiff's conduct in continuing until November 1988 to press the testator to make an affidavit, and in initiating action which brought the police repeatedly to speak to him in his old age and indeed in June when he was in a nursing home suffering his final illness, was inappropriate and is open to criticism. It was a failure of filial duty for her to persist in these endeavours and impose the burdens of them on the testator. In the last weeks of his life the testator absolutely refused to see the plaintiff when she visited, authorised a solicitor's letter directing her not to visit and gave written instructions to the management of the nursing home that she was not to be allowed to see him. From the plaintiff's point of view this must have appeared to be very harsh conduct, particularly as he was approaching the end of his life and the plaintiff expressed what I regard as sincere wishes to be reconciled with him. However in endeavouring to understand the testator's point of view I notice that he received repeated visits from police officers, that the controversy with Mr Rogers and the related controversy about the circumstances in which the plaintiff had made her complaint to him by telephone about Mr Rogers did not go away and kept presenting themselves and claiming his attention over many years, that the wish to get him to sign papers kept presenting itself, that he was aged, incurably sick with cancer and I infer, very weary and in pain, and that his children formed two warring camps and, while it seems a very sad matter that he should not have been prepared to see the plaintiff and express some reconciliation in the last weeks of his life, I have no doubt that excluding the plaintiff was his own wish and not a decision imposed on him by anybody else, and in his circumstances he is not to be condemned for it. In her narration of the events of 1988 and 1989 in the witness box the plaintiff presented her communications with her father as if they had occurred in an atmosphere which, while not untroubled, was relatively calm and normal. I do not regard this as an accurate picture. In my finding there was some tension, and an atmosphere of threat and confrontation lurked around these communications, and they took place in circumstances where it was obvious that they could well be resisted. The terms of the plaintiff's letters, which are contemporaneous with the events, are a much better indication of.the atmosphere of those times than the narration which she gave to me." Bryson J then went on to deal with the letter of 23 November 1988 which I have already mentioned and another written later, on 15 June 1989, both of which, I think, must be read in the light of the passage I have just set out. All the comments I made in regard to the first letter apply to that of 15 June, which however conveys, along with what the testator can only have seen as insults and abuse, more sense of personal desperation on the plaintiff's part than the previous one. Bryson J's first comment on the June letter, with which I respectfully agree, was as follows: URJ WENTWORTH v WENTWORTH (Priestley JA) 13 "The plaintiff sent the testator this letter (Exhibit G) on 15 June 1989, about three weeks before his death, after he had absolutely refused to see her, although some telephone communication continued. In that letter she told him that she wished there to be peace between them before he died, but she then set out many firmly expressed reproofs and recriminations about matters, many of them in the distant past, which, whatever the justice of them, were quite beyond aid. In the letter she heaped many complaints on her father, although she accompanied these with expressions of her wish for peace and reconciliation. It would be hoped that a father receiving such a letter would find it possible to see his daughter, discuss the letter and seek reconciliation. However it could not be surprising, and it could not have been unexpected by the plaintiff that the recipient of a letter like this would decide that he did not wish to see his daughter. A sick man of four-score years with a few weeks to live and no real opportunity to redress the grievances of more than 40 years could not be blamed if he continued to refuse to see his daughter after receiving a letter like that." A little later Bryson J said that on any view it was "a terrible thing" for the plaintiff to have written the two letters to her father, that writing them was filial misconduct and that, speaking objectively there must be strong disapproval of the plaintiff for writing the letters. In his judgment they were an element strongly adverse to her in his considering whether there was a duty to make provision for her and what an appropriate order was. However, he said it would not be right to judge the testator or the plaintiff, or her claim, on the basis only of their conduct towards one another in the last months of the testator's life. The next group of matters with which Bryson J dealt involved considering the very detailed evidence that had been given about Fitzwilliam Pty Ltd and Recato and the various contentions made by the plaintiff concerning both notional estate and a number of allegedly void transactions. Bryson J found that none of the impugned transactions was void as contended for by the plaintiff, and these conclusions have not been the subject of appeal. Bryson J did find however that the testator, by not exercising any of his rights or powers under article 81A, and on his view of the other facts in the case, must be deemed to have entered into a prescribed transaction within the meaning of s22(1) of the Act. That provision says: "A person shall be deemed to enter into a prescribed transaction if (a) on or after the appointed day he does, directly or indirectly, or omits to do, any act, as a result of which (i) property becomes held by another person (whether or not as trustee); or (ii) property becomes subject to a trust, whether or not the property becomes in either case so held immediately; and (b) full valuable consideration in money or money's worth for the firstmentioned person's doing, or omitting to do, that act is not given." Bryson J's reasoning was that Recato's articles as they stood after 25 October 1984, conferred on the testator "an entrenched privilege... of obtaining the allotment to him by [Recato's] directors of any or as unissued shares, and of exercising the power of directors to do that", this power being separate from and additional to the general power of allotment of shares and notwithstanding that general power. By not exercising that privilege the testator had, in Bryson J's view, omitted within the meaning of s22(1)(a) to do an act as a result of which property had become held by the defendant, thus fulfilling the requirements of s22(1)(a)(i), and full valuable consideration within the meaning of s22(1)(b) had 14 UNREPORTED JUDGMENTS not been given for the testator's omitting to exercise that privilege. In considering whether the facts of the case brought the testator's non-exercise of privilege within s22(1), Bryson J was influenced by the way the word "property" in the subsection was defined in s6(1) of the Act. The word was there defined as including what appears to be intended to be all kinds of what is conventionally regarded as property, and further "any right with respect to property, and any valuable benefit;". This very broad definition was one of the indications in the Act leading Bryson J to find a purpose in it "that the notional property provisions should extend the powers of the court to the full range of benefits and advantages controlled by testators". S23 of the Act gives the court a power basic to the scheme of Pt2 Division 2 of the Act, which is headed Notional Estate, and contains s21-s31. $23 says: "On an application in relation to a deceased person made by or on behalf of an eligible person, if the Court is satisfied (a) that an order for provision ought to be made on the application; and (b) that, at any time before his death, the deceased person entered into a prescribed transaction (i) which took effect within the period of three years before his death [and thus not relevant in the circumstances] and was entered into with the intention, wholly or in part, of denying or limiting, wholly or in part, provision for the maintenance, education or advancement in life of that or any other eligible person out of his estate or otherwise; (ii) which took effect within the period of one year before his death, [likewise inapplicable] and was entered into at a time when the deceased person had a moral obligation to make adequate provision, by will or otherwise, for the proper maintenance, education and advancement in life of that or any other eligible person which was substantially greater than any moral obligation of the deceased person to enter into the prescribed transaction; or (iii) which took effect or is to take effect on or after the death of the deceased person, the Court may, subject to s26, s27 and s28, make an order designating as notional estate of the deceased person such property as it may specify, being property which is held by, or on trust for the disponee or, where there is more than one disponee, any of the disponees, whether or not that property was the subject of the prescribed transaction. " In light of his findings both to this point and as he more fully set out later, Bryson J concluded that an order ought to be made on the application (s23(a)) and that the testator had entered into a prescribed transaction which took effect on his death (s23(b)(iii)); he then designated the defendant's ordinary shares in Recato as notional estate of the testator. In doing so he considered the various safeguards inserted by s26, s27 and s28, designed to ensure that the radical step of making the property of some person other than the testator available to satisfy the testator's moral obligations could not be taken except in particular and very carefully considered circumstances. Having reached this point, Bryson J turned to consider whether he as the court representing the wise and just testator acting with full knowledge of all circumstances relevant to a testator's exercise of testamentary powers, ought to make an order for the plaintiff's maintenance and/or advancement in life. There is one passage in Bryson J's reasons on this aspect which I think it best to set out in his words. In it, after making the point that long periods of hostility or estrangement do not necessarily mean that an application under the Act must fail, and that it is always necessary to consider the URJ WENTWORTH v WENTWORTH (Priestley JA) 15 extent to which the parent has contributed to the estrangement, he went on: "It is necessary to draw deeply on reserves of toleration and patience before becoming prepared to make any provision at all for a daughter who wrote to her father, in the year before he died, "You destroyed my mother doing it, and you have destroyed me. You are a disgrace to the human race, utterly amoral, and totally corrupt. You always have been' and 'How about one moral, honest act in your life, in expurgation of a lifetime of corruption and lies' and other enormities. If the plaintiff had any real control over her conduct and her engagement in argument and conflict, this behaviour would have extinguished the testator's duty to make provision for her. But she cannot stop herself The plaintiff's propensity for involvement in conflict and litigation has elements of a disability, an incapacity for successfully grappling with life, and the plaintiff's claim is in the special class of claims by adult sons and daughters who are in some way disabled and in need of favourable parental treatment." (Italics added) In later referring to the italicised sentences I will call them "the disability finding". Bryson J next considered the grievance felt by the testator because of the litigation against him from 1980 to 1984. The judge indicated he thought that the litigation should, from the plaintiff's point of view, be regarded as successful (and, I infer, justified) and that when the circumstances were looked at objectively, it was not reasonable for the testator to think of the events surrounding the litigation "as diminishing or ending his moral responsibility for the maintenance and advancement in life of the plaintiff'. When Bryson J came to summarise his reasons, he said: "There are clamant considerations against an order," but having recognised that, he thought other considerations outweighed them. He listed these: "(1) The mere fact that the testator was the plaintiff's father is a source of moral duty to provide for her maintenance. (2) The plaintiff was a good and dutiful daughter towards the testator in significant ways and for a long period. (3) The period of litigation and estrangement was caused by several factors and the plaintiff was not unmeritorious in all respects, although much of her behaviour had been undutiful. It was not reasonable for the testator to resent the plaintiff's acts which separated her property from his control. (4) There was and still is wealth available and it was used to establish the plaintiff's style of life and expectations. (5) Making proper provision for the plaintiff will leave the testator with the ability to make general provision for his son, and to go much further and deal bountifully with him. (6) There was hostility between the testator and the plaintiff and this was in part the result of elements in the testator's character and grievances which he felt. (7) The plaintiff's character led her into her misfortunes and into hostility, conflict and litigation with the testator and others and she does not have the capacity or the disposition of ordinary people to avoid these troubles. (8) The testator had had at least as much opportunity as anybody to contribute to elements in her character for better or worse. (9) The plaintiff had received a first endowment but this was no longer sufficient and there was little to show for it and although there were blameworthy aspects of the plaintiffs conduct which had contributed to this it was also contributed to by misfortune. 16 UNREPORTED JUDGMENTS (10) The plaintiff was truly in need of provision for her maintenance when the testator died and still is." Having reached the conclusion that he should make an order in the plaintiff's favour, Bryson J then considered what that order should be. The fact that the past provision by the testator for the plaintiff was, at the time of the hearing before Bryson J, inadequate for her proper maintenance and advancement was in his opinion due to the decline and loss of the plaintiff's fortunes attributable to a disastrous marriage and the loss of many years of her life by involvement in conflict and litigation; her earning capacity had not been used and was probably lost or greatly injured; this was not the defendant's fault but, and here his Honour stated two views of critical importance to his decision of the case, the first being: "The testator should not have disposed of all the family wealth in ways of his own choosing and left the family's economic casualty to relative penury or dependence on social agencies;" and the second: "After going through her first endowment she cannot expect to live like a patrician. Because she is seeking a second endowment, and because of unmeritorious aspects of her character and conduct, consideration of what provision ought in my opinion to be made for her leaves me to think that it ought to be, in Wentworth family terms, a modest provision, and that it ought to be carefully controlled so that it is and remains a provision for maintenance and does not come under the hazard of being used up in more conflict or litigation." Bryson J went on to explain that he thought unconditional provision for the plaintiff would probably be consumed in conflicts and litigation and that this was not the purpose for which the legislation authorised him to make orders in her favour or for which a parent would have a duty to make testamentary provision. After saying that he did not think an appropriate standard for the maintenance of the adult daughter of a wealthy grazier was the standard provided by social benefits, and after reminding himself once more that as a result of the testator's benefactions the defendant was a man of wealth, he concluded that maintenance should be ordered for her, subject to conditions, at the rate of $21,000 per annum; upon this, in Bryson J's opinion, after she paid tax and rearranged her capital resources to provide herself with modest housing free of debt she would be able to live at a better standard than many people supported by their own earnings and good endeavours. Bryson J's orders. In the upshot, the orders proposed by Bryson J when he published his reasons on 14 June 1991 were 1. that the defendant pay the plaintiff out of the testator's estate and notional estate a periodic sum for her maintenance in accordance with his further orders; 2. that until further order and subject to 0.3 the periodic sum be at the rate of $21,000 per year commencing on 1 July 1991; 3. that the periodic sum was to be varied every two years, first on 1 July 1993, by increasing it in accordance with a formula based on the All Groups Consumer Price Index; 4. that until further order the defendant was to pay the periodic sum to the plaintiff in equal quarterly instalments in advance on the first day of each July, October, January and April but subject to any deductions required by law relating to income tax or other taxation; 5. each of the following was a condition of the provision he ordered: (a) the periodic sum was to be available for expenditure for maintenance of the plaintiff but not for expenditure for any other purpose; (b) the plaintiff's entitlement was not to be assigned, anticipated or released except in accordance with the further order of the court; (c) the plaintiff's entitlement was not to be available for the benefit of any creditor or other person; URJ WENTWORTH v WENTWORTH (Priestley JA) 17 (d) no direction by the plaintiff for payment of all or any of the periodic sum to any person other than herself was to be effective; (e) except in the case that all of the periodic sum should be fully available subject to taxation for current and direct expenditure on the plaintiff's maintenance, the periodic sum was not to be payable but to be reduced to such sum as was available for such expenditure; 6. the defendant had liberty to apply by notice of motion for declarations and directions relating to the operation of the conditions; 7. that pursuant to s13 insofar as the burden of the provision ordered was borne by beneficial entitlements in the estate of the testator passing under his will, the beneficial entitlements which were to bear the burden of that provision were the entitlements of the defendant; and without prejudice to the general operation of the order pecuniary legacies and any interest payable thereon were to be paid out of the estate of the testator notwithstanding the order; 8. that pursuant to s23 of the Act the following property was to be designated as notional estate of the testator: all ordinary shares in Recato Ten Pty Ltd held by the defendant on 7 July 1989; 9. that each party have liberty to apply under s15 and generally; 10. that the plaintiff's costs be paid by the defendant out of the notional estate of the testator designated by O.7; and, 11 that the defendant's costs on the trustee basis be paid or retained by the defendant out of the notional estate. These were draft orders. On 28 June 1991 Bryson J made orders as in the draft, except that O.10 was changed to the effect that the plaintiff's costs were reserved. After considering written submissions, Bryson J made the following costs orders: 1. Defendant to pay plaintiff's costs of the proceedings. 2. Plaintiff pay the defendant's costs reserved on 10 December 1990 and 30 January 1991. 3. Plaintiff pay the defendant's costs of the hearing on 27 June 1991. The arguments in the appeal. The matters argued in the appeal fell under the following headings: (a) was the trial judge right in deciding to make an order; (b) in making an order was he right in deciding to provide for maintenance only and not advancement; (c) was he right in designating all shares in Recato as notional estate; (d) was the form of order appropriate, the arguments here going both to matters of amount and the conditions imposed; and (e) costs. (a) Should an order have been made? There was evidence before Bryson J that the costs of the litigation before him would use up as the moneys in the testator's actual estate; this point therefore is only worth considering on the assumption that there will be notional property from which an order can be satisfied and, for the moment, and as question (a) seems to me to be the most convenient starting place, I make that assumption. The first point made on behalf of the defendant concerned the trial judge's disability finding (pp 31-32 above). The defendant's argument was: (a) Bryson J said the plaintiff's behaviour would have extinguished the testator's duty to make provision for her but for her disability; (b) there was no basis for the finding of disability for three reasons, it was not part of the plaintiff's case, there was no evidence to support it, and the defendant had had no chance to address the court upon it, it not having been litigated; (c) therefore, since it was not possible for the judge to make the disability finding and since he said that but for her disability he would have made no order, no order should have been made. The plaintiff too complained that there was no basis for the disability finding and agreed with the defendant that it had been no part of her case. From this however it was submitted on her behalf different conclusions should be drawn; 18 UNREPORTED JUDGMENTS that is, that his Honour was right in deciding an order should be made, but that the disability finding led him to make a much too restrictive order. The plaintiff's argument concerning the disability finding therefore becomes part of question (d), rather than the present one. The defendant's reliance on the matter on the other hand squarely raises the question whether an order should have been made at all. The defendants submission seems to involve the idea that the disability spoken of by the trial judge was some kind of pathological disorder entitling the plaintiff to specially favourable treatment. I do not think he was stating any such opinion. The trial judge's view of the plaintiffs personality was stated in the course of reasoning to his summary of the considerations which supported the making of an order. The seventh of these items involves a conclusion about the plaintiff's character and disposition which, by analogy only, places her in the category to which the judge referred. It seems to me that Bryson J regarded the plaintiff as an aggressive woman, lacking in objectivity and tact, frequently insensitive and much inclined to belittle others and their views; these unfortunately abrasive traits of character naturally provoked a degree of resentment, conflict and hostility on the part of others, well beyond that encountered by people with an ordinary capacity to accommodate the normal frictions of society; her relationship with the testator, who shared her aggressive disposition, particularly during her earlier years, revealed these temperamental deficiencies of which the testator must have been aware; hence, as a wise and just parent, he should have allowed for these defects of character in his dealings with his daughter and in making final testamentary provision for her. Ido not think that his Honour intended to convey more than this; and it is plain from his reasons and the evidence of the principal witnesses that these aspects of the plaintiffs character and personality were all comprehensively covered. I do not think that either of the parties has any reasonable basis for surprise at the judge's assessment of this matter. One of his tasks was to determine whether the plaintiff's behaviour to the testator had extinguished the testator's duty to make provision for his daughter. Obviously the relationship between the two of them was of critical importance to this decision, and to that relationship they brought their own temperamental inadequacies. In particular the testator, to whom the law attributes a judgmental position, ought to have taken account of those temperamental deficiencies which he knew the plaintiff to possess; and these manifested themselves very largely in responses which from others could have been explicable only on the basis of deliberate malice and ill-will but which in her case were, in some degree at least, to be attributed to the temperamental defects which the learned judge identified. In my view, although the defendant's argument finds some support in the form of words which the trial judge used, it does not go to the substance of the case. As I have already said I do not consider that Bryson J determined the matter on the footing that the plaintiff was suffering from a pathological or medical condition. Rather, he used that expression as a means of indicating the nature of the plaintiff's temperament and personality and the extent to which these features should properly be taken to mitigate what other features of her conduct towards the testator might otherwise convey. Hence, I do not think that this submission of the defendant is sound. URJ WENTWORTH v WENTWORTH (Priestley JA) 19 For the defendant, the argument that no order should have been made in favour of the plaintiff at all was supported by two principal arguments in addition to that based on the judge's disability finding. One was that ample provision had been made for the plaintiff by the testator during his lifetime, and the other was that the plaintiff's conduct towards him discharged him from any residual obligation he may have had. As to the first of these submissions, there is no doubt, in my opinion, that the plaintiff had received provision in 1964 which, had its equivalent or some substantial part of its equivalent been in her hands at the time of the testator's death, would have been quite sufficient to justify the submission that there was no moral obligation to provide further for her. However, the position seems to be as I earlier set out (see p 15) and as stated in more general form in considerations (9) and (10) in Bryson J's list (see p 33). Further, on the materials before him, I do not see how it can be said that Bryson J made any error in the findings involved in considerations (9) and (10) and I do not think they are open to successful attack in this court. As to the plaintiff's conduct towards the testator, I do not think that the defendant has shown that Bryson J made any error in concluding that that conduct, bad as it sometimes was, did not put an end to the testator's moral obligation to her. The decision whether or not to make an order in a case like the present one where there are circumstances shouting loudly (to change Bryson J's word into rougher language) against the making of an order and also many others in favour of it, is difficult, and what is the best thing to do can strike different reasonable minds differently; in a word, the decision is discretionary and so long as the person obliged by office to make it gives proper consideration to all relevant matters to the exclusion of the irrelevant and arrives at a conclusion within reasonable bounds, an appellate court is not in a position to say the decision is wrong. It is only if the reasoning to the conclusion shows material mistakes in understanding the facts or the law (these include the failure to take into account relevant considerations or the taking into account of the irrelevant) or if the result is unacceptably far away from what the appellate court considers reasonable, that that court will consider changing the first instance decision. In my opinion the considerations (1) to (10) in Bryson J's summary list are all soundly based on the factual materials before him; his conclusion, after balancing the considerations for and against an order, that an order should be made, seems to me to be a sound exercise of discretion. One very material matter on which Bryson J relied and which I have not reproduced much detail of was the financial position of the defendant at the time of the hearing; he had by then become a man of very considerable property. An indication of its size is that his Honour found that the "valuable benefit" which passed to the defendant on the testator's death was worth about $700,000, and that the defendant's shareholding in Recato was worth about $2,000,000 more than the shareholders' equity of $865,646. Another indication is the evidence given by the defendant that since the settlement in 1981 of the Wentworth Settlement litigation, he had received about $700,000 from it. (This included some moneys from the G N Wentworth Grandchildren Trust, presumably for his children.) Question (b): should the order have provided for advancement as well as maintenance? Bryson J found there was no need for an advancement in life. He stated his reasons very briefly, and with respect, they seem to me a little 20 UNREPORTED JUDGMENTS inconsistent with the basis of his view that an order should be made. What he said about it was: "The plaintiff owns housing to which she attributes the value of $700,000 and she could sell it, pay her debts and marshall her assets and have available enough to provide her with modest and sufficient housing. There is no need which it should be regarded as the duty of her father to meet to provide her with a home unit worth $700,000 or to redeem mortgages on a home unit such as she has." This view of the plaintiff's asset position seems to be in some conflict with considerations (9) and (10) in Bryson J's summary. The fact was, as matters stood before him, that the plaintiff's surplus of assets over liabilities was in the region of $200,000. Further, the question of the plaintiff's home unit does not seem to have as much to do with the claim for advancement as the fact that at the time of the hearing the plaintiff had nearly completed her academic qualifications for admission to the Bar and was hoping to earn a living as a barrister. For the defendant it was pointed out that very little evidence was given of what money would be needed in order to commence practice at the Bar. I do not think however that it is necessary for a court to have evidence before it can act on the basis that it is highly desirable for a person seeking to practice at the Bar or on that person's own account as a sole practitioner as a solicitor to have some funds in hand to deal with all the costs, capital and revenue, involved in starting professional life as a lawyer. It has in the past been possible, and it may be that it still is, to get a start as a lawyer with little backing in the way of money, but for people with only their earnings to support them such a beginning means a hard, hand to mouth existence for some time; it is not a luxury but a very real benefit to have some reserve funds when starting. What I have been saying goes to the question whether a case had been shown for the making of an order providing for both maintenance and advancement. I think there had. The skimpy evidence in the plaintiff's case dealing with the amount that should be attributed to advancement is not a bar to the making of provision for it, although it may result in the court, through sheer lack of evidence, having to make an order where the provision for advancement would be on a very limited basis. But that is not the present question; I am at the moment saying only that the considerations relied upon by Bryson J for the making of an order should have led him to conclude that the order should provide for both maintenance and advancement. Question (c): should an order have been made designating the Recato shares as notional estate? S22 of the Act (see p 28 above) sets out the things which if done or omitted by a person will cause that person to be deemed to have entered into a prescribed transaction. Unless a person can be deemed to have entered into a prescribed transaction, Pt2 Division 2 of the Act cannot apply to that person. For the defendant, it was submitted that there were two reasons why what the testator had omitted to do did not fall within the deeming provisions of s22. The first was that there was in consequence of the death of the testator no valuable benefit which became held by the defendant. The second was that it had not been shown that full valuable consideration in money or money's worth for the omission to exercise the testator's special article 81A rights had not been given. As I have earlier mentioned, Bryson J found against the defendant on both of these points, the result being, as his Honour saw it, that the testator had entered into a prescribed transaction (s22(1)) which took effect on his death (s23(b)(iii)). His Honour reached his overall conclusion about the operation of s22(1) upon a liberal reading of its language, something I think he was entitled to do in view URJ WENTWORTH v WENTWORTH (Priestley JA) 21 of the obvious intention of Division 2 of the Act (Notional estate) in which s22 appears. Quite clearly, the Act sets out to cut down the ways in which a person may, before death, in order to avoid the court's exercise of jurisdiction in favour of a worthy applicant under the Act, transfer assets which might ordinarily be expected to be dealt with by will. In arguing the first of the points, counsel for the defendant did not dispute the trial judge's view that the increase in value of the defendant's shares on the death of the testator was a valuable benefit within the extended definition of property in s6(1) of the Act and thus property held by the defendant within the meaning of s22(1)(a)(i), the contention was rather that nothing changed on the death of the testator. The submission was that the shares always carried with them the possibility their value would increase. To use counsel's words: "There was always the possibility that the shares would increase in value by virtue of that fact which was part of the shares themselves, part of the rights inherent in the shares themselves. True it is that the possibility became actuality and the value of the shares increased because their voting power could not longer potentially be diminished but the possibility was always there." I do not agree with this submission. It seems to me that there was in fact a difference in the value of the defendant's Recato shares before and after the testator's death. The death did not affect the holder's rights flowing from the shares but to the defendant the death meant that the possibility that those shares might become a minority shareholding in the company, with the result that their unchanged rights would be of less effect than before, no longer existed. The valuable benefit that became held by the defendant on the death of the testator resulting from his omission to exercise his article 81A rights was the increase in value of shares which could not now be displaced as giving control of Recato to the defendant. In coming to the second point, to what I said about the clear object of Division 2 I need to add that the Division, in striking at attempts to avoid the operation of the Act, has been carefully drawn so that the transactions aimed at as objectionable and intended to fall into the net of the "prescribed transaction" provisions are restricted to those which in substance are, at least, in the nature of gifts or sham transfers or for less than true value. I derive this view both from the words of s22(1)(b) itself and the more general precautionary provisions in s26 and s27. S27(1) for example, says the court shall not make an order designating property as notional estate unless it has considered, amongst other things, the importance of not interfering with reasonable expectations in relation to property. If someone is in possession of property, otherwise than by gift, after having given up something of equivalent value in order to obtain that property, it would be entirely reasonable for that person to expect to remain in possession of it. On this approach to the meaning and effect of Division 2, the defendant's valuable consideration argument comes part of the way to success. If the sequence of events is looked at, commencing with article 81A and associated articles becoming effective on 25 October 1984, then the death of the testator without his having exercised the powers they gave him, and then the consequence of that, the result, subject to one qualification, seems to me to be far from the kind of transaction s22 describes. What happened on 25 October 1984 was that the testator who until then had 10,770 capital A ordinary shares in Recato which, although they left him as a minority shareholder in the company, were on any view of considerable value, took part in bringing about the new situation under which those shares 22 UNREPORTED JUDGMENTS immediately lost by much the greater part of their value, and became the holder of other shares which gave him rights to possess himself during his lifetime, if he chose, of more than three quarters of the surplus of Recato's assets over liabilities in a winding up. An equally radical change took place in the defendant's position on that day. The legal effect of what then happened was that in return for the probability that the testator would not exercise his new powers under article 81A, with the result that on the testator's death the defendant would have a much greater beneficial interest in Recato's shareholders' funds than if the changes to Recato's articles were not made, a power was created in the testator to reduce the defendant's beneficial interest in shareholders' funds from something well over a half to something less than a quarter. What happened was that not only was there a very large transfer of value at the testator's death but there had earlier been a very large transfer of value when the articles were altered on 25 October 1984. The defendant gave up that value for the period between 25 October 1984 and the testator's death, which strikes me as being for full money's worth, in return for the expectation that the testator would omit to exercise any of those rights. This argument was vigorously pressed upon the court in the appeal. It has considerable attraction but because of the qualification earlier mentioned I have reached the opinion that it does not quite escape the words of s22(1). The short answer to it, I think, is that although it is right to say that what happened on 25 October 1984 did not then result in the kind of transaction the subsection was aiming at and that there was full valuable consideration in money's worth for what happened on that day, nevertheless the testator did not promise on that day that he would omit to exercise his new powers. The result is that the full consideration in money's worth that was even for the alteration and diminution of the defendant's rights in Recato was not even for the testator's omitting to exercise his new powers; rather it was given in consideration of the expectation that except in certain circumstances he would omit to exercise them. This seems to me to be a substantial rather than a hair splitting distinction. The actual fact appears to be that the defendant himself envisaged certain circumstances in which the testator would be entitled to exercise the rights flowing from article 81A (see p 13). That is, assuming in the defendant's favour that it is appropriate to talk in terms of consideration at all, the advantage even to the testator on 25 October 1984 was the power to exercise or refrain from exercising his article 81A rights. It follows that the consideration that passed from him to the testator on 25 October 1984 cannot accurately or substantially be described as consideration for the testator omitting to exercise those rights during his lifetime. The defendant in addition to submitting that the testator should not have been deemed to enter into a prescribed transaction for the purposes of s22 also submitted, that even if wrong in those submissions, the order designating the shares as notional estate should not have been made for the discretionary reasons appearing in s27(1) of the Act. That subsection says: "On an application in relation to a deceased person, the Court shall not make an order designating property as notional estate of the deceased person unless it has considered (a) the importance of not interfering with reasonable expectations in relation to property; (b) the substantial justice and merits involved in making or refusing to make the order; and (c) any other matter which it considers relevant in the circumstances." URJ WENTWORTH v WENTWORTH (Priestley JA) 23 The considerations made relevant by s27, and also equitable considerations of a more general kind, raise what to me are very serious questions in the appeal. In coming to deal with these matters I will first add a little to what I have already said about the purpose of the notional estate provisions in Division 2. I have already indicated that one purpose is clearly to enable the court to disregard steps deliberately taken to put property out of reach of an application under the Act after the person's death. However the Act does not go on the footing that every time a person takes such steps they are necessarily bad. That is, a person may sometimes take such steps and be perfectly justified in doing so. On other occasions the motivation may be unworthy or unfair to a greater or less degree. What the notional estate provisions do is enable the court to disregard those steps and then do what the person ought to have done in regard to the property the subject of those steps had that person acted as a wise and just testator. Sometimes that will be to make a different disposition, sometimes not. That leads to the question in the present case, was there anything unworthy or unfair in what the testator and the defendant did in 1984? From their point of view the position as from April 1984 was that the plaintiff had brought proceedings concerning the W C Wentworth Settlement, which she was entitled to do, and which had ended in her, in 1981, coming into possession of $238,876. Within the two years before receiving that sum, she had received $125,000 from the Settlement, and during the seven years before that $75,200. She had caused proceedings to be taken in regard to the G N Wentworth Grandchildren Trust which had resulted in $278,294 being paid by the defendant to her sister and her in April 1984 as trustees for their children. (Also in 1984 the plaintiff had received $85,000 from her sister and others in consideration of what she had done in obtaining the settlements of proceedings in regard to the two trusts, but I do not think the evidence shows whether the testator or the defendant knew that, either in 1984 or before the testator died.) At that time therefore it could be argued that the testator and the defendant had good grounds for thinking that the plaintiff was in comfortable circumstances. The compromises of the legal proceedings had put substantial capital into the plaintiff's hands in her own right and for her children. In that situation the testator and the defendant made the arrangements culminating in the insertion of article 81A and associated articles in the articles of Recato and the defendant put himself at the mercy of the testator for the remainder of the testator's lifetime on two understandings: the first was that with the coming to an end of the testator's special powers on his death the defendant would become unconditionally the beneficial owner (virtually) of the whole of the shareholding in Recato and the other was that the testator would only exercise the special powers given to him by the new articles, in certain circumstances. Although these arrangements were made to prevent any possibility of a successful application by the plaintiff against the testator's estate, the question arises was there anything unfair or unworthy in those arrangements being made. If, at the time they were made, the testator and the defendant had reasonable grounds for thinking the plaintiff was not in need, one reason being the very substantial provision made for her in 1964, as a result of which she had come into in possession of the funds I have referred to, I can see a strong argument for saying that neither of them should be criticised for what was then done. On reflection, I do not think that these considerations should prevent the designation of the Recato shares as notional estate. There is no doubt that the arrangements of October 1984 were carried out for the specific purpose of 24 UNREPORTED JUDGMENTS ensuring that.he plaintiff could not dispute her father's property dispositions and testamentary arrangements. The testator said as much to Mr Woodley, the defendant agreed in his evidence that he knew that was the position and there is no other explanation, on the evidence, for what was done. Granted that for the reasons I have mentioned the attitude taken up by the testator as at October 1984 could be regarded as reasonable, nevertheless, what his thinking did not take into account was the possibility that between the time of making the arrangements and the testator's death, the plaintiffs circumstances might change in a way making it necessary, by objective standards, for the testator to make some provision for her in his will. Although failure to take this possibility into account may not require the testator's motivation at the time to be described as unfair or unworthy, it is a circumstance which, taken together with the plaintiff's situation at the time of her father's death, tells against exonerating the shares from designation as notional estate. The facts I have just discussed, taken together with the activities of the defendant and his wife in regard to their assets, from 1984 until the testator's death raise further matters requiring serious consideration. They bear upon what the testator, acting in accordance with the principles the cases established under the Testators Family Act, particularly as stated in Bosch's case, and the reflection of those rules by use of the word "ought" in s7 of the Act, should have done in the will that he left at his death. In view of the arrangements made in 1984 it would in my opinion have been wrong of the testator, so long as his son lived and continued to act in the loyal way that he had done all his life, and in the absence of some compelling reason to do so, to exercise the special powers given to him by the article 81A. If for example the testator had done something which the facts show he did not, but which an elderly single parent sometimes does, that is married again, and in his new circumstances sought to exercise to the full the powers given by the new articles, notwithstanding that the son was complying with all reasonable expectations of the testator, then it seems quite possible to me that on the facts shown in this case a court of equity would have restrained the use of the powers as unconscionable or as fraudulent in the equitable sense. Even if that is not right, the expectations of the defendant, reasonably flowing from the 1984 arrangements would have to be given very substantial weight under para(a) and para(b) of s27(1). The facts before the court show that the defendant, from 1984 until his father's death, continued to behave towards him as he had always done. He remained on good terms with him, carried on the family business, continuing to treat all the assets, as Ernst and Young had said, as one, everything the father needed being available without question from those assets. Over this period, as before, those assets and their values were substantially enlarged through the efforts of the defendant and his wife. Ail this met with the father's approval. Accordingly, no occasion of the kind envisaged when the 1984 arrangements were made ever arose for use of the special powers by the testator. In the absence of some such occasion, it seems to me it would have been morally wrong, as between the testator and the defendant, for the testator to have used those powers in his lifetime. The only types of situation in which it would have been acceptable for the testator to use the powers would have been of the following kinds: if his son and his wife died before the testator, as the son had mentioned in the October 1984 URJ WENTWORTH v WENTWORTH (Priestley JA) 25 conference; or, if, and I stress that this is an illustration by way of example only, having no relation to the possibilities in the present case, there were to be an argument between father and son resulting in the son cutting off all supplies to the father; and possibly, if the testator became aware of some disaster overtaking the plaintiff which made it vitally necessary that she be supplied with money. In the last example the testator might properly request his son to make funds available through the assets of or controlled by Recato, and if agreement could not be reached, use his article 81A powers to bring about that result; however, in such circumstances he would in my opinion only be entitled to use those powers to the extent necessary to supply the urgent need of the daughter and should not otherwise interfere with the settled expectations of the son and his wife. The fact that it is necessary to think about such possibilities is an illustration of the great change in testamentary and property law made by Division 2. One of the consequences of this change may be that a fiction that was introduced by the Testators Family Maintenance Act 1916 and which has been continued by the present Act has additionally been very much enlarged. Under the 1916 Act, the court in cases when an order was to be made, put itself in the place of the testator and then did what the testator should have done had the testator known all the relevant facts and been irreproachably wise and just. Under the present Act, s7 requires the court to put itself in the testator's position at the time the order is made, sometimes long after the testator's death. Further, it seems that Division 2 may require the court to put itself in the testator's position also some time before death. This is because, as this case shows, the reach of the Act can now extend back before the death of the testator for any number of years and it seems that any person whose family includes eligible persons under the Act must, when entering into property transactions other than for full valuable consideration in money or money's worth consider the effect they might have, years later, on that person's capacity to provide for his or her dependants. Considerations of this kind raise the following question in the circumstances of the present case. If the testator, at some stage between October 1984 and his death had decided that, after all, he wished to make some provision for the plaintiff in his will, he would have had to decide what property he could use for that purpose. When, after his death, the court is looking at that question retrospectively, on his behalf as it were, should the court consider the question by reference to all the facts known to the court, or by reference to those actually known to the testator, or by those which the testator knew or reasonably ought to have known, this last category not necessarily being at all the same as all the relevant facts. It may be that in some future case the court will have to decide this question, but, as it happens, in the present case the court is not much wiser than the testator would have been had he turned his mind to the question whether he should make some further provision for his daughter. In this case all the court can do is simply ask, on the basis of what the court knows about the plaintiff's position between 1984 and 1989 (which I think on the basis of what I have seen in the appeal papers may be inferred with reasonable safety to be pretty much the same as the likely knowledge of the testator during that time) what provision he should reasonably have thought he should make for the plaintiff and from what property. First, for the reasons generally, mentioned earlier, supporting the conclusion that an order should be made in the plaintiffs favour, I think the testator should have decided that he should make some provision for her. In light of the October 1984 arrangement, the expectations that arrangement must have encouraged in 26 UNREPORTED JUDGMENTS the defendant, the effect on Recato's assets both before October 1984 and to an increasing extent after that date of the personal efforts of the defendant and his wife, the intermingling of their property in Recato's affairs and the absence of any special circumstances which would have justified the testator exercising his article 81A rights, I cannot think that it would have been right for him to consider activating those powers in order to get into his hands property to be transferred to the plaintiff either during his lifetime or by his will. But I also think the Act would impose on him the duty of knowing, or impute to him knowledge of the plaintiff's weakened financial position which should have led him to think it right to consider making further provision for the plaintiff by his will out of his actual estate. But also, I think the court with its greater advantages in the way of knowledge both at the time of trial before Bryson J and the time of decision in this court would not think that a wise and just testator in this testators place had any greater obligation. The court now knows that none of that actual estate is available for satisfaction of any order the court might make. A variant has thus come about of the situation I mentioned above (see p 51-52), a possibility not foreseen by the testator in October 1984 when he entered into the arrangement from which later came the prescribed transaction taking effect on his death which removed from his actual estate value which, as events have turned out, is required in part to be available for the purposes of satisfying the order the court thinks ought to be made in favour of the plaintiff. Thus it seems fair to me, and within the words and intent of Division 2, that an order be made designating the defendant's Recato shares as notional estate of the testator. The fact that those shares were not precisely the property the subject of the prescribed transaction (see p 45 above) is no bar to the designating order in view of the concluding words of s23. In view of s28(2) the order designating the Recato shares as the testator's notional estate should only go to the length necessary to allow the making of the provision that is finally ordered by the court. Subject to that qualification, which will be discussed in the answer to the following question, the answer to the present question in my opinion is yes. Question (d); was Bryson J's form of order appropriate, as to amount and the conditions imposed? In regard to the conditions part of this question, for once the plaintiff and defendant were more or less in agreement, for more or less the same reasons. Stated shortly, those reasons were that the conditions imposed upon the provision ordered by the judge caused many practical difficulties, both in compliance and in supervision. I agree with this general criticism, although it does not seem to me altogether fair to direct it at the judge, who seems to have been well aware of the possible difficulties in the working out of the orders he proposed; when he published his reasons he emphasised that the orders he suggested were draft orders and no doubt he was expecting that some reasonable response by the parties to his judgment would much such alterations to his draft as would make the eventual orders workable. The parties however, for their separate reasons wanted to appeal rather than engage in discussions about the final form of the orders. However, having said this much, I should make it clear that, with respect to the trial judge, I disagree with the approach taken by his orders in two ways that would not have been curable, even with cooperation by the parties. One is that it seems to me that the evidence in this case discloses that no set of orders and conditions enforcing on the plaintiff and defendant continual, indeed lifelong, contact between them concerning moneys to be paid by the defendant to the URJ WENTWORTH v WENTWORTH (Priestley JA) 27 plaintiff from the defendant's legal assets with the plaintiff being obliged as recipient of the payments to comply with complicated conditions concerning them, is likely to work in practice. It seems to me highly probable that the orders made would produce further litigation between the parties. The other reason for my view is that explained in dealing with Question (c); I do not think that the provision to be made should go further than what the court thinks the testator should reasonably have done by way of provision for the plaintiff from his actual estate upon his death. The net value of that estate was of the order of $160,000. The view I have arrived at is that the testator, acting wisely and justly, and being entitled, as Bryson J found, to regard the plaintiffs conduct during the last year of his life in particular as undutiful and hurtful to an extent bearing heavily on the amount of the provision he should make and bearing in mind also that he had previously made provision which, with good management, should have needed no supplement, but bearing in mind also that neither of his other two children was in need of any further provision, should have left to the plaintiff by his will a legacy of $100,000. Further, I do not think that this legacy should be subject to any conditions. Although there were many references in the evidence before Bryson J to the litigation with which the plaintiff had been concerned more or less continually in the eleven years prior to the hearing before him, the parties, exhibiting some sense, did not embark on the herculean task of examining the various parts of that litigation in the detail required to form a valid judgment about the wisdom of the plaintiff's being involved in them. The one judge who has ever undertaken even part of that task, Roden J, in AG v Wentworth, partially reported in (1988) 14 NSWLR 481, emerged with conclusions partly critical of, but also partly favourable to the plaintiff, something which appears more clearly from the whole of his reasons than in the part reported. As to anything in the nature of a protective trust being needed in regard to the plaintiff, the materials before Bryson J went no further, in my opinion, than, as he said in consideration (7) in his summary (see above p 33) that her character led her into misfortunes and hostility, conflict and litigation with the testator and others and that she did not have the capacity or the disposition of ordinary people to avoid such troubles. Particularly when the fact is that the litigation in which she has been concerned has not been examined to the degree necessary to form a judgment on the extent to which it was defect of character which led the plaintiff into it, I do not think the behaviour and character described can properly be the ground for making provision under the Act subject to conditions of the kind imposed by the judge. In place therefore of Bryson J's O.1 to O.9 and to take effect as at the same time as those replaced, it is my opinion that the following orders should be made: 1. That the defendant pay the plaintiff out of the testator's estate and notional estate a sum of $100,000, such sum to carry interest at legacy rates from 2 February 1990 until payment. 2. That pursuant to s13 of the Act insofar as the burden of O.1 is borne by beneficial entitlements in the estate of the testator passing under his will, the beneficial entitlements which are to bear the burden of that provision are the entitlements of the defendant; and without prejudice to the general operation of the order, pecuniary legacies and any interest payable thereon are to be paid out of the estate of the testator notwithstanding the order. 3. That pursuant to s23 of the Act all ordinary shares in Recato 10 Pty Ltd held by the defendant on 7 July 1989 are designated notional estate of the testator, charged with the burden of the sums provided for in O.1. 28 UNREPORTED JUDGMENTS 4. That each party have liberty to apply to the Equity Division for orders under s15. The remaining orders to be made concern costs and will be dealt with under the next heading. Question (e); costs. The parties took up polar positions on this matter. The plaintiff said she should have been awarded costs on either an indemnity or common fund basis: see Supreme Court Rules Pt52 R28A and following; and the defendant said the plaintiff should pay his costs of the proceedings on an indemnity basis. The judge's reasons seemed to me to take into account all proper considerations and I am not persuaded that this court should interfere with his exercise of discretion. I would dismiss both parties' costs appeals. The trial judge's costs O.1, O.2 and O.3 should therefore be added to the four orders I have already proposed, as 0.5, O.6 and O.7. Costs in the appeal Looked at overall, the plaintiff has had some success in her appeal. She has won on the advancement issue, although that has not, in the circumstances, had much bearing on the size of the order; and she has succeeded in her attack on the form of the order. She has failed to obtain provision on the very substantial scale she claimed. The defendant has substantially lost his cross appeal. He mainly sought that the plaintiff have no provision at all, that there be no designation of notional estate, and, failing those results, that there be a form of order different from that made by Bryson J, and that the size of any provision be kept down. In the circumstances I consider that the costs of the appeal and cross appeal (including the appeals against costs orders) should be consolidated as one set of costs, and that the defendant should be ordered to pay half of the plaintiff's such costs. (at page 62) Formal Orders. In plaintiff's appeal: Appeal upheld; orders below set aside, and in their place order, 1. That the defendant pay the plaintiff out of the testator's estate and notional estate a sum of $100,000, such sum to carry interest at legacy rates from 2 February 1990. 2. That pursuant to s13 of the Act insofar as the burden of O.1 is borne by beneficial entitlements in the estate of the testator passing under his will, the beneficial entitlements which are to bear the burden of that provision are the entitlements of the defendant; and without prejudice to the general operation of the order, pecuniary legacies and any interest payable thereon are to be paid out of the estate of the testator notwithstanding the order. 3. That pursuant to s23 of the Act all ordinary shares in Recato 10 Pty Ltd held by the defendant on 7 July 1989 are designated notional estate of the testator, charged with the burden of the sums provided for in O.1. 4. That each party have liberty to apply to the Equity Division for orders under s15. 5. Defendant to pay plaintiffs costs of the proceedings. 6. Plaintiff to pay the defendant's costs reserved on 10 December 1990 and 30 January 1991. 7. Plaintiff to pay the defendant's costs of the hearing on 27 June 1991. In defendant's cross appeal: Appeal dismissed. In plaintiff's appeal and defendant's cross appeal: Costs to be consolidated as one set of costs: defendant to pay half plaintiff's costs. Handley JA I agree with Priestley JA. URJ WENTWORTH v WENTWORTH (Handley JA) 29 ORDERS In plaintiff's appeal: Appeal upheld; orders below set aside, and in their place order, 1. That the defendant pay the plaintiff out of the testator's estate and notional estate a sum of $100,000, such sum to carry interest at legacy rates from 2 February 1990. That pursuant to s13 of the Act insofar as the burden of O.1 is borne by beneficial entitlements in the estate of the testator passing under his will, the beneficial entitlements which are to bear the burden of that provision are the entitlements of the defendant; and without prejudice to the general operation of the order, pecuniary legacies and any interest payable thereon are to be paid out of the estate of the testator notwithstanding the order. That pursuant to s23 of the Act all ordinary shares in Recato 10 Pty Ltd held by the defendant on 7 July 1989 are designated notional estate of the testator, charged with the burden of the sums provided for in O.1. That each party have liberty to apply to the Equity Division for orders under s15. Defendant to pay plaintiff's costs of the proceedings. 6. Plaintiff to pay the defendant's costs reserved on 10 December 1990 and 30 January 1991. 7. Plaintiff to pay the defendant's costs of the hearing on 27 June 1991. In defendant's cross appeal: Appeal dismissed. In plaintiffs appeal and defendant's cross appeal: Costs to be consolidated as one set of costs: defendant to pay half plaintiff's costs. Counsel for the Appellant: Miss C Simpson Solicitor for the Appellant: H D Kelly Counsel for the Respondent: D Jackson QC and G Lindsay and R Angyal Solicitor for the Respondent: Dunhill Madden Butler