New South Wales Supreme Court CITATION : Cleary v Young [1999] NSWSC 863 CURRENT JURISDICTION : Equity Division FILE NUMBER(S) : 2392/98 HEARING DATE(S) : 23 March 1999 JUDGMENT DATE : 27 August 1999 PARTIES : John Edward Cleary (P) Sandra Elizabeth Young (D) JUDGMENT OF : Master McLaughlin COUNSEL : Mr. John R. Wilson (P) Mr. Richard Legg (D) (Solicitor) SOLICITORS : L. Rundle & Co (P) Burridge & Legg (D) CATCHWORDS : Family provision; Claim by adult son; Plaintiff equally entitled with his sisters to the only substantial asset in the estate; Relationship between the plaintiff and the deceased and between the plaintiff and the other beneficiaries; Competing claims of the other beneficiaries; Plaintiff incurred liabilities in contested Probate proceedings; Extension of time. ACTS CITED : Family Provision Act 1982 CASES CITED : Singer v Berghouse (1994) 181 CLR 201 DECISION : 1. I order that the time for the making of this application be extended up to and including the date of the filing of the summons herein 2. I order that, in addition to the benefits given to him by the will of the late John Albert Cleary ("the deceased"), the plaintiff receive a legacy in the sum of $40,000, such legacy not to bear interest if paid on or before 27 November 1999 3. I order that the costs of the plaintiff on the party and party basis and the costs of the defendant on the indemnity basis be paid out of the estate of the deceased 4. The exhibits may be returned. SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION MASTER McLAUGHLIN Friday, 27 August 1999 2392/98 JOHN EDWARD CLEARY -v- SANDRA ELIZABETH YOUNG JUDGMENT 1 MASTER: These are proceedings under the Family Provision Act 1982. 2 By summons filed on 12 May 1998, the plaintiff, John Edward Cleary, claims an order for provision for his maintenance, education and advancement in life out of the estate of his late father, John Albert Cleary (to whom I shall refer as "the deceased"). 3 The deceased died on 14 October 1995, aged 89. He left a will dated 6 September 1991, Probate whereof was on 21 October 1997 granted to Sandra Elizabeth Young, the executor named in such will (who is the defendant to the present proceedings). 4 That Probate was granted in solemn form, as a result of contested proceedings brought by the present defendant against the present plaintiff. Those proceedings were heard by Mr Justice Simos in June 1997. His Honour's judgment, published on 21 October 1997, was admitted into evidence (as Exhibit A) at the hearing before me. 5 The deceased, who was a widower at the time of his death, was survived by his four children, being Janice Eileen (Mrs Coles), who was born in 1938 and who is presently aged 61; Deidre Ann (Mrs Hatton), who was born in 1940 and who is presently aged 59; John Edward (the present plaintiff), who was born on 2 November 1943 and who is presently aged 55; Sandra Elizabeth (Mrs Young), who was born in 1945 and who is presently aged 54. The deceased's wife died in 1991, aged 69. 6 The assets of the deceased at the time of his death consisted of a house property situate at and known as 62 Wyandra Avenue, Harbord (to which in the Inventory of Property a value of $180,000 was ascribed); a gold ring (having an estimated value of $1,500) and a Mitsubishi Sigma station wagon (having an estimated value of $3,000). The plaintiff disputes the value attributed to the gold ring (which is presently in the custody of his solicitor), and asserts that it is only of minimal value. 7 It would appear that the present value of the house property at Harbord is at least $300,000. An auction of the property was conducted in March 1999, but no bids for it were received. However, by the time of the hearing, the defendant had received an offer of $300,000, which she did not propose to accept, being of the view that the property was worth much more than that amount. It would appear that the value of that property is, essentially, the value of its land, and that the structure presently standing thereon will, in fact, be demolished by any purchaser. 8 By his will the deceased gave the contents of his house property to the defendant, and gave the balance of his estate to his four children equally. 9 It will be appreciated that the costs of the defendant of the present proceedings must be paid out of the estate of the deceased. It is estimated that those costs will total between $12,000 and $15,000. There is also an indebtedness to the defendant for funeral expenses ($1,941) and for Council rates ($3,952), which she has paid out of her own personal resources, and a possible liability for land tax in an amount of about $1,500. 10 Thus, upon the assumption that the property can be sold for no less than $300,000, then, after allowance is made for commission and legal expenses in respect of such sale, and for the payment of the foregoing liabilities of the estate (totalling between about $19,500 and $22,500), it is likely that the amount available for distribution would be about $270,000 or perhaps somewhat more. In that event, each of the four beneficiaries would, upon distribution, receive an amount of no less than $67,500. 11 It will also be appreciated that, in the event that he be successful in the present proceedings, the plaintiff also will be entitled to have his costs paid out of the estate. Those costs are estimated to total about $24,000. If those costs also are to be met by the estate, the amount available for distribution would be reduced to about $246,000. 12 It must be recognised, and emphasised, that unless and until the Harbord property is sold, neither the plaintiff nor his sisters will receive any benefit from the estate of their father. 13 I have already recorded that the plaintiff is presently aged 55. He has never married, although he has a daughter, now aged 24, by a former de facto relationship. The plaintiff has had no contact with his daughter for many years. 14 The plaintiff in his affidavit evidence recounted the history of his schooling and his various occupations. It was the plaintiff's assertion that during his childhood years the deceased was a gambler and a heavy drinker and, in consequence, failed to fulfil his responsibilities as a husband and father. Thus, so it was asserted by the plaintiff, it was necessary for the plaintiff as the only other male in the family, to take over many responsibilities long before he reached adulthood (including, so he said, financial contributions towards the acquisition of the Harbord property in 1957, when the plaintiff was aged only fourteen, and towards the household expenses, as well as towards the reconstruction of that house after it had been partially destroyed by fire in about 1958 or 1959). Those assertions were denied by the defendant. According to the plaintiff he was always in employment from the time he left school with the intermediate certificate in 1960 until he was involved in a motor accident in 1969, in which he suffered a severe compound fracture to his left leg. In his affidavit of 28 April 1998, the plaintiff said that his life lost direction in the 1970s. He was off work for eighteen months, and still continues to suffer residuary physical disabilities as result of his injury. 15 Since his accident the plaintiff has not engaged in full-time employment (apart from some intermittent work, including 12 months with one employer, in the early 1970s). 16 In 1974 the plaintiff removed to Queensland with his sister Deidre and her son. For more than 20 years the plaintiff resided on portion of a rural property which Deidre purchased at Doonan in that State. A falling out between the plaintiff and Deidre concerning that land resulted in litigation in the Supreme Court of Queensland, which in September 1996 was decided adversely to the plaintiff. In consequence, the plaintiff has a liability to pay the costs of Deidre in respect to that litigation. He also has a liability for his own costs, which remain unpaid. 17 According to the plaintiff, he lived with and cared for the deceased from December 1994 until the death of the deceased some ten months later. The plaintiff said that it was at the request of the deceased that he came from Queensland, where he had been residing to that time, and entered into occupation with the deceased in the Harbord house; that they remained there until July 1995, when the plaintiff and the deceased travelled to Queensland, where they remained until the death of the deceased. The plaintiff subsequently returned to the Harbord property, where he continued to reside until 31 August 1998, when he vacated that property as a result of an order for possession obtained against him by the defendant. 18 The plaintiff did not pay anything by way of rent or occupation fee for his occupancy of the Harbord property, where he remained for almost three years from late 1995 until the end of August 1998. Despite an agreement by him to be responsible for municipal rates whilst he was residing in that property, it has been necessary for the defendant to pay those rates out of her own pocket. 19 I should here observe that there has been no adequate explanation by the plaintiff as to what happened to an amount of $6,000, being funds of the deceased, which were under the control of the plaintiff shortly before his father's death and which were the subject of an undertaking given by the plaintiff to Mr Justice Windeyer on 29 September 1995. 20 The plaintiff's only income is by way of a pension from the Department of Social Security. He has been receiving such a pension, which is now in an amount of $360 a fortnight, since about 1996. According to the plaintiff that amount is fully expended in maintaining a frugal lifestyle. 21 The plaintiff is presently residing in the Eversham Hotel at Manly. His outgoings include rent, $123 a week; food, $30 a week; garage rent, $25 a week. In his affidavit of 19 March 1999 the plaintiff said that he is frequently short of money, and that he obtains food vouchers from charities such as the St. Vincent de Paul Society. 22 Apart from his interest in the estate of the deceased and some chattels and personal effects, the plaintiff has no assets. The plaintiff has the following liabilities: Deidre Hatton - $25,539, being the costs which the plaintiff is liable to pay in respect to the litigation in the Supreme Court of Queensland. Sandra Elizabeth Young - $19,500, being the costs which the plaintiff is liable to pay in respect to the probate proceedings in the Supreme Court of New South Wales. Sandra Elizabeth Young - $1,792, being the costs of the proceedings for possession of the Harbord property. Fosters, solicitors - $19,500, being the plaintiff's own costs in respect to the probate proceedings. 23 The plaintiff, as a son of the deceased, is an eligible person within paragraph (b) of the definition of that phrase contained in section 6(1) of the Family Provision Act. As such, he has the standing to bring the present proceedings. It will be appreciated that each of the defendant and the other beneficiaries, they also being children of the deceased, is an eligible person in relation to the deceased. 24 In the event that the plaintiff receives only the amount to which he is entitled under the will of the deceased (being an amount of about $67,500, or perhaps a little more), almost the entirety of that amount will be exhausted in the payment of the various liabilities of the plaintiff, which total about $66,000. Those calculations, it will be appreciated, do not make provision for the costs of the plaintiff of the present proceedings. In consequence, therefore, the plaintiff will, in the event that he be unsuccessful in the present proceedings, have nothing left over after receiving his entitlement from the estate of his late father, and, indeed, will be subject to a liability for his own costs in an amount of about $24,000, which it would appear that he has no real likelihood of being able to pay. 25 In carrying out the first stage of the two-stage process identified by the High Court of Australia in Singer v Berghouse (1994) 181 CLR 201 at 208 -210 per Mason CJ, Deane and McHugh JJ, the relationship between the plaintiff and the deceased and between the deceased and other persons who have a legitimate claim upon his bounty is of relevance. In the instant case the deceased obviously intended that each of his four children should benefit equally from his estate (apart from the gift to the defendant of the contents of the house property). 26 Evidence has been placed before the Court concerning the financial and material circumstances of each of the defendants. 27 Mrs Coles, who by her marriage has three adult children, divorced in the late 1980s. As a result of a property settlement in her divorce Mrs Coles received about $143,000, from which she was able to acquire a house property at Narrabeen. Whilst residing in that house property she suffered a fall, which has given rise to continuing problems of health, both physical and mental. Since her accident Mrs Coles has not been in employment. She no longer owns the Narrabeen property, and as a result of unsatisfactory financial advice she has lost about $100,000 of the moneys which she received in her property settlement. She currently has an amount of between $30,000 and $40,000 invested in bonds. 28 Mrs Coles receives an income of about $215 a week by way of a disability support pension ($180) together with a rent allowance ($35). She has been receiving that disability pension for about six years. She also receives some interest upon her investments. 29 For about the last eighteen months Mrs Coles has been a lodger in a home unit at Lismore Avenue Dee Why. She pays $85 a week and also contributes to the cost of electricity for accommodation which consisted originally one room, but now consists of two rooms in that home unit. She shares the bathroom and kitchen facilities. 30 It would appear that Mrs Coles owns two caravans, one located at Warriewood (which is used for storage purposes), and the other located on the property of her sister Deidre at Doonan in Queensland. She usually visits Deidre once a year, upon which occasions she resides with a friend in the caravan. The precise nature the relationship between Mrs Coles and that friend (who is the owner of the premises at Dee Why in which she resides) was somewhat unclear. What emerged with clarity from the evidence of Mrs Coles, however, was that on account of her problems with her physical, and especially her mental, health, the amount to which Mrs Coles is entitled under the terms of her father's will should not be significantly reduced as a result of the present claim made by the plaintiff. 31 Mrs Hatton (who resides in Queensland and who was not cross-examined at the hearing) currently resides in a caravan on the property at Doonan, which was the subject of the proceedings between Mrs Hatton and the plaintiff in the Supreme Court of Queensland. (A copy of the reasons for judgment of Mr Justice Moynihan, 6 September 1996, is annexed to the affidavit of Sandra Elizabeth Young, sworn 3 July 1998.) That property is owned by Mrs Hatton as to a one half share (the other half share being owned by Mrs Young); that half share has a current market value of $75,000. The accommodation upon that property appears to be of a primitive nature, there being no proper bathroom, and the water supply consisting of a well. 32 Mrs Hatton subsists on a widow's pension in an amount of $360 a fortnight. She has liabilities totalling almost $12,000 (including an amount for unpaid Council rates of $2,578, upon which interest is accruing). 33 Mrs Hatton suffers from attention deficiency hyperactive disorder. She also suffers from various physical ailments, including severe arthritis, migraine, chronic fatigue, heart murmur, and chronic bronchitis. She currently pays more than $200 a fortnight for medication, special food and dietary supplements. 34 Mrs Young married in 1964, and had two children (one of whom was killed in a motor accident in November 1977). Mrs Young and her husband divorced in 1989. She married for a second time in 1994. Mrs Young's current husband bought out the half share of her former husband in their matrimonial home at Davidson. Although that house property is currently registered in the name of Mrs Young alone, she expressed the intention of transferring to her present husband a one half share therein, so that she and her husband will then own the house property as joint tenants. 35 In addition, Mrs Young is co-owner, with her sister Deidre, of the property at Doonan in Queensland. She is also the sole owner of land at Spencer in New South Wales, which was originally owned jointly by her mother and herself, and which, upon the death of her mother in 1991, devolved upon Mrs Young by survivorship. She has estimated that the present value of the property at Spencer (upon which stands a small residence, described as a weekender) as being $50,000. Apparently there was a mortgage on the property when it was originally acquired at the instance of Mrs Young's mother, and that mortgage was paid out by Mrs Young from funds provided to her by her husband. 36 Mrs Young's husband conducts a business as a fencing and railing contractor. However, in September 1998 he strained his neck at work, and since then has been unable to perform his usual activities, although he wishes to return to work. 37 Mrs Young does not own a motor car, although she owns a motorcycle. In her affidavit evidence she expressed a desire to effect some renovations to the house at Davidson, which is more than thirty years old; and also to purchase a motor vehicle for her own use. She wishes also to assist her adult daughter, who has a daughter of own. 38 It is within the context of the foregoing factual circumstances that the Court must proceed to a consideration of the claim of the plaintiff. 39 I will be appreciated that the financial and material circumstances of the plaintiff are far from satisfactory. He has no security of accommodation. His lifestyle appears to be frugal in the extreme, and he often has little or no money to purchase food, and is dependent upon the assistance of charity in this regard. 40 I recognise that none of the other beneficiaries are in affluent financial circumstances. Mrs Young is probably in better circumstances than Mrs Coles or Mrs Hatton. 41 Whilst Mrs Hatton and Mrs Young each has security of accommodation, that of Mrs Hatton appears to be primitive in the extreme. 42 Were it not for the liabilities of the defendant, arising out of his various pieces of litigation with his sisters, Mrs Hatton and Mrs Young, the plaintiff, if the testamentary provisions of the deceased remained unchanged, would have had the benefit of about $67,500 from the estate of his father. In the context of the financial and material circumstances of at least two of his sisters (Mrs Coles and Mrs Hatton) the plaintiff could not have any legitimate complaint against his father's testamentary dispositions which gave to him, and to each of his sisters, such a benefit. That sum would not have been sufficient to enable him to have purchased a residence of his own. But in no possible way could the plaintiff have justified a claim to receive an amount from his father's estate entitling him to purchase such a residence. If, however, he were now able to discharge his liabilities, then he would have from the estate a modest capital amount which invested would provide him with some additional income, which, taken together with the amount of his pension, would enable him to acquire rented accommodation. 43 The practical problem is, however, that any additional benefit given to the plaintiff must, of necessity, reduce the benefits given to the other beneficiaries. 44 I would not be disposed to reduce significantly the amount which either Mrs Coles or Mrs Hatton is entitled to receive out of the estate of the deceased. 45 It seems to me that it would be totally unfair to Mrs Young if the benefit to which she is entitled under the will of the deceased were required to bear the major part of any order for provision which might be made in favour of the plaintiff, in circumstances where it was Mrs Young, as executor of the 1991 will, who sought and obtained probate in solemn form of that will after contested proceedings. (In those proceedings the plaintiff sought to establish that that will had been revoked by the deceased, and that, in consequence of the transfer of the Harbord property to himself and the deceased as joint tenants (such transfer having been executed by the plaintiff as attorney under power), the plaintiff had by survivorship become the owner of the entirety of the Harbord property.) For Mrs Young (or either of her sisters) by the present proceedings to be deprived of the benefit which she received as a result of her success in the probate proceedings would result in those earlier proceedings now to be seen as having been largely an exercise in futility. 46 I recognise that the penurious circumstances in which the plaintiff presently finds himself (and in which he will remain, even after he receives a distribution from the proceeds of sale of the Harbord property) are to a large extent the result of his liability for costs (both of those of himself and those of the defendant) in the probate proceedings. That fact does not of itself deprive the plaintiff of an order for further provision from the estate of the deceased. 47 I am satisfied that, on account of his present penurious circumstances, the plaintiff has established an entitlement to some further provision from the estate of the deceased, in addition to that to which he is entitled under the terms of the will. 48 However, the size of the distributable estate and the competing claims of the other beneficiaries (especially Mrs Coles and Mrs Hatton) are such that the amount of any additional benefit from the estate of the deceased to which I conclude the plaintiff has established an entitlement is no more than $40,000. An additional legacy in that amount would provide the plaintiff (after discharging his liabilities) with a fund of about $40,000 to assist him in obtaining rental accommodation and in somewhat improving his very modest lifestyle. 49 I have already recorded that the summons was filed on 12 May 1998. That was some thirteen months after the expiry of the limitation period of eighteen months from the death of the deceased provided by section 16 (1) of the Family Provision Act. Accordingly, the plaintiff was out of time in instituting the present proceedings. However, the plaintiff seeks by his summons an order that the time for the making of the application be extended up to and including the date of the filing of the summons. 50 In order to explain his failure to commence the proceedings within the prescribed period, and thus to enliven the discretion vested in the Court by section 16(2) to extend the period for the institution of the proceedings, the plaintiff relied upon two matters. 51 Firstly, he relied upon the probate proceedings, and the fact that a decision in those proceedings was not given until 21 October 1997. Up to the time of the delivery of the judgment of Mr Justice Simos, it was the assertion of the plaintiff that the document relied upon him in those proceedings gave to him the Harbord property, and it was not until those proceedings were concluded that the ultimate distribution of the estate of the deceased was known. The plaintiff further relied upon his assertion that it was not until March 1998 that he became aware of his entitlement to make a claim under the Family Provision Act. The present proceedings were instituted very shortly thereafter, in May 1998. 52 It was suggested on behalf of the defendant that it was unlikely that the plaintiff, who had had legal representation in the probate proceedings, would have been unaware of an entitlement to make a claim under the Family Provision Act. Nevertheless, although cross-examined on this point, the plaintiff remained unshaken in his evidence. 53 But, in any event, in the light of the manner in which the probate proceedings were conducted, it seems to me that the plaintiff was entitled to obtain a decision in those proceedings, in order to ascertain how the estate of the deceased would be distributed, before embarking upon what might be described as an inconsistent proceeding in the Equity Division, seeking an order for provision under the Family Provision Act. 54 In those circumstances, therefore, it seems to me appropriate, since I have expressed the view that the plaintiff has otherwise established an entitlement to further provision out of the estate in addition to that which he will receive under the terms of the will, for the Court to extend the time for the making of the present application. 55 Accordingly, I make the following orders: 1. I order that the time for the making of this application be extended up to and including the date of the filing of the summons herein. 2. I order that, in addition to the benefits given to him by the will of the late John Albert Cleary ("the deceased"), the plaintiff receive a legacy in the sum of $40,000, such legacy not to bear interest if paid on or before 27 November 1999. 3. I order that the costs of the plaintiff on the party and party basis and the costs of the defendant on the indemnity basis be paid out of the estate of the deceased. 4. The exhibits may be returned. ********** Last Modified: 08/27/1999 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. 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