New South Wales Supreme Court CITATION : McCallum v Dennis [2000] NSWSC 501 CURRENT JURISDICTION: Equity Division FILE NUMBER(S) : SC 2060/99 HEARING DATE(S) : 25 May 2000 JUDGMENT DATE : 25 May 2000 PARTIES : PATRICIAL ANNE McCALLUM v BRUCE VERNON DENNIS - ESTATE OF THE LATE DENNIS HENRY McCALLUM JUDGMENT OF : Master Macready at 1 COUNSEL : Mr C.M. McCallum for plaintiff Mr B. Slowgrove for defendant SOLICITORS : Symonds & Company for plaintiffs Dennis & Company for defendant CATCHWORDS : Family Provision. Application by children under Family Provision Act. No matter of principle. Orders made DECISION : Paragraph 25 - 1- THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION MASTER MACREADY THURSDAY 25 MAY 2000 2060/99 - PATRICIA ANNE McCALLUM v BRUCE VERNON DENNIS IN THE ESTATE OF THE LATE DENIS HENRY McCALLUM JUDGMENT 1 MASTER: This is an application under the Family Provision Act in respect of the estate of the late Denis Henry McCallum who died between 18 January 1999 and 1 February 1999 aged sixty-three years. He was survived by his two children, the plaintiffs, and his former wife. She has been notified of the proceedings and makes no claim on the estate. There was a property settlement between the deceased and his former wife. 2 The last will of the deceased was made on 15 December 1998 and under that he appointed the defendant as the executor and left the whole of his estate to Stephen James Lawson. The assets in the estate are as follows: ASSETS i Strata unit 3/290 Falcon Street, North Sydney (estimated net value assuming current value of $225,000 and commission on sale of $5500 and legal fees of $1500) $218,000 ii Advance Bank account 1,862 iii Medals 10,000 $229,862 LIABILITIES a) Simplicity Funerals 3,781 b) Dennis & Company outstanding motor vehicle accident account 3,400 c) Dennis & Company costs re administration of estate (estimate) 3,000 d) Costs of all parties re Family Provision matter (estimated parties costs of proceedings) 36,000 e) Outstanding strata fees (approx) 1,500 47,681 Total 182,181 Accrued rental of $210 gross per week since 11 January 2000 needs to be added to this sum. 3 I will first deal with some of the history in the matter. The deceased was born in Scotland on 21 October 1936. He moved to Australia in 1961. On 7 December 1963 he married Pamela Betty McCallum. They had two children, who are the plaintiffs, Gordon Charles Andrew McCallum, born 2 June 1964, and Patricia Anne McCallum, born 30 September 1967. 4 The deceased was apparently a seaman and he would spend time away at sea and also spend lengthy times at home. In 1980 he suffered a stroke and he had medication for that condition. Apparently that medication did not go with alcohol and it is apparent that at times he was affected by excessive alcohol consumption. 5 In 1984 there was a substantial dispute with his wife and daughter as a result of which he and his wife separated, the children moving out to live with their mother. The marriage was dissolved in February 1988. 6 On 30 May 1989 the deceased made a will in which he left the majority of his estate to North Shore Hospital. He subsequently changed that and made his later will on 15 December, to which I have referred. The deceased died at the time I have indicated he, apparently, having been discharged from hospital a few days before 18 January 1999. 7 Probate ultimately of the later will was granted and these proceedings were commenced in time. 8 In applications under the Family Provision Act the High Court has, in Singer v Berghouse (1994) 181 CLR 201, set out the two-stage approach the Court must take: "The first question is, was the provision (if any) made for the applicant inadequate for (his or her) proper maintenance, education and advancement in life?" The difference between "adequate" and "proper" and the interrelationship which exists between "adequate provision" and "proper maintenance" et cetera were explained in Bosch v Perpetual Trustee Co Limited : "The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate or what, in all the circumstances, was the proper level of maintenance et cetera appropriate for the applicant, having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased and the relationship between the deceased and other persons who have legitimate claims on his or her bounty. The determination of the second stage, should it arise, involves similar considerations. Indeed, in the first stage of the process, the Court may need to arrive at an assessment of what is the proper level of maintenance and what is adequate provision, in which event, if it becomes necessary to embark upon the second stage of the process, that assessment will largely determine the order which should be made in favour of the applicant. In saying that, we are mindful that there may be some circumstances in which a court could refuse to make an order notwithstanding that the applicant is found to have been left without adequate provision for proper maintenance. Take, for example, a case like Ellis v Leeder where there were no assets from which an order could reasonably be made and making an order could disturb the testator's arrangements to pay creditors." 9 As required by the High Court, I turn to consider the situation of the plaintiffs. I firstly deal with the situation of the plaintiff Patricia. She is married and aged thirty-two years. She has a child, Francesca, who is a little over one year of age. Her husband has a business in which he does decorative painting. She herself is not working at the moment of necessity, being at home looking after the child. To the year ended 30 June 1999 her husband's income was $42,000. The plaintiff would like to have some employment but it would only be home employment. She has qualifications as a graphic artist and can do book design, provided she has the appropriate equipment. However, she does not at this stage. Their expenditure generally exceeds their income so obviously they have to defer some items. She is apparently in good health. They have no significant assets, apart from two cars worth in the order of $10,000 and $4000. 10 It is necessary, of course, to consider the relationship between the plaintiff and the deceased. 11 On the affidavit evidence it seems that it was not an easy childhood for both of the children. There was little help from the father in their upbringing, or at least that is what the children's recollections are. Obviously he was away from home for long periods when he was at sea and, so far as the plaintiff Patricia is concerned, some time not long before 1984 she had a disagreement with her father he, according to her, wrongly accusing her of stealing some money and the relationship between them was not good thereafter. There was then the incident in 1984 where, according to Patricia and her mother, the deceased threatened both of them with a knife. They ran out of the house and left home. Whatever the rights and wrongs of the incident it certainly precipitated the break-up of the marriage. 12 The deceased, at some later stage, thought it might have been caused as a result of him having medication and alcohol at the same time but he himself really, in some of these discussions with friends later and with psychiatrists, recognised that the incident was his fault. The result was that, at least as far as Patricia was concerned and also the brother, there was no contact from probably some time prior to 1988 up to the date of death. 13 In one sense with Patricia it was quite surprising because when she became pregnant she did not tell her father of this fact. One would have thought this would have been a natural thing to do. Evidence was given by the mother of the children that she discouraged the children from making contact with their father. The other thing about it is that there was no evidence before me that the father himself ever tried to contact the children again or make a rapprochement. Perhaps it is understandable he did not want to contact his wife but one would have thought with his age and maturity he might have tried to make contact with the children. 14 Although the matter is at a somewhat different level, the following comments of Justice Holland in Kleinig v Neal (1981) 2 NSWLR 532 at 540 are apposite: "If it is a case of parent and child, another circumstance is that the parent was responsible for bringing the child into the world and having done so assumed a duty to be concerned with the child's welfare. A wise parent will recognise that perfect harmony between parent and child is, in the nature of things, not to be looked for and that, coming to adulthood, a child will want to make his own life just as the parent had done before him. Differences of outlook between different generations is not exceptional, it is the general rule, so some friction between parent and child or disappointment in a parent's hopes and expectations concerning his child will be accepted by the wise parent as almost inevitable. If it occurs, the parent who is just as well as wise will not allow such disharmony or disappointment to blind him to the needs of his child for maintenance, education or advancement in life. The duty of a parent towards his child to provide for those needs on his death, if he can, continues in spite of such disharmony or disappointment and the statute obliges the Court to consider whether it has been performed. The Court must take in the whole scene and make the judgment that it considers that a wise and just parent would have made in the circumstances. Of course, as the statute provides, if the Court considers that the character or conduct of the child has been such as to disentitle the child to any or any further benefit from the parent, it may refuse the child's claim." 15 In this case neither made an attempt at a rapprochement. Both the child and the father were probably mature enough. However, there is the evidence given by the mother that she actually discouraged contact with the deceased. Given that and the fact that the period prior to separation was unpleasant for the children, I do not think, in these circumstances, their failure to contact their father is such that it would reduce their claim on his bounty. 16 I turn to the situation of Gordon. He is married, aged thirty-five and does not have any children. He is planning a family and, when that happens, his wife will have to give up work. So far as assets are concerned, they have an old 1982 car worth about $2500 which will have to be replaced. They have savings of some $18,000, furniture and personal effects. Gordon is an accountant and he receives a wage of some $1379 per week with his wife having a wage of $740. That is a combined income of $2119. Their expenses are $1700 per week and they have been, as their savings history demonstrates, able to save. They recently spent some of their savings on a trip to Canada but there were good reasons for that and it was obviously quite appropriate. Apart from breaking his arm on the trip, the plaintiff Gordon appears to be in good health. So far as his relationship with his father, it is similar to that of his sister. He himself was not actually threatened in the incident in 1984 but he found life unhappy prior to then. He has had no contact since. I think the same considerations apply to him as in the case of Patricia. 17 It is also, of course, necessary to have regard to others having a claim on the bounty of the deceased. IN this case the other person who has that claim is Stephen Lawson. He is a divorced man now aged sixty-eight and he has grown up children who live in Norway. He lives on an aged pension of $366 per fortnight. His expenses consume the whole of his pension and he obviously lives a very frugal existence. He has no assets except some minimal furniture worth about $500 and lives in rented accommodation which is not fully furnished. His medical situation is very difficult. In May 1998 he had a malignant tumour of the bowel removed and he also suffers from a degenerative condition of the spine, partially caused by a laminectomy operation in 1978. He has chronic obstructive airways disease which he has to control with a strict drug regimen. He has inoperable colorectal cancer and undergoes chemotherapy on an ongoing basis for that condition. His chemotherapy has to be balanced from time to time by his oncologist. For him it is important that he be able to have close contact with his hospital, which is North Shore Hospital. At the moment he lives in a Housing Commission flat at Milson's Point and can get there by train. He does not have, for instance, a car which might make it that much easier and more comfortable for him. 18 He got to know the deceased in 1985 and he and the deceased had a number of things in common. They both had interests in the sea, Scottish ancestry and both of them were separated from their children, the deceased by the events which I have mentioned and Mr Lawson as a result of his children living overseas with his former wife. It is apparent that their friendship extended to meeting each other on occasions at clubs of which they were both members but also went a little beyond that and there was assistance given by one to the other in times of medical difficulty and other similar matters. It was in fact the knowledge of the deceased of Mr Lawson's family situation that led him to make the bequest to Mr Lawson. He wanted him to be in a situation where at least he could make contact and be with his children in his later years. Accordingly, it seems Mr Lawson was a close friend of the deceased for many years after the deceased lost his family for the reasons that I have dealt with. 19 It is, of course, only appropriate for the Court to make provision for the plaintiffs if they can demonstrate to the Court they have been left without inadequate and proper provision for their maintenance, education and advancement in life. In this respect they have both advanced some matters to the Court. 20 Patricia has suggested she needs in the order of $20,000 in order to buy the appropriate computer and printing equipment so that she carry on business at home. This is obviously, I would have thought, a very sensible approach to helping the somewhat frugal existence that they have at the moment. The type of equipment which has been put forward seems to me to be standard for that type of work and I would accept this as an appropriate need. The other area that she advances is the fact that she and her husband would like to buy a unit if they could ever get enough money together to have a deposit or some start to purchase such a unit. They have in mind a unit in the price range of $280,000 - $300,000. The other need that is apparent is, particularly with young children, she does not have, or her husband does not have, a large income and some assistance there would be appropriate. 21 So far as Gordon is concerned, there are likewise similar areas. He advanced a need for $25,000 for a car and, if he is going to have a family, this would be an appropriate provision. He does have savings of $18,000, which could go to help toward such a purchase. He also does have a desire to buy a unit of a similar type in a similar price bracket to that of his sister. So far as his living expenses are concerned, clearly, although at the moment he can manage quite well and can save, he will not be able to save once his wife commences a family. 22 One of the things about the present situation of both the children is that they are both at one of the times in life when assistance by a testator can make all the difference and allow a child to get ahead and hopefully acquire a home in the future. At other stages in their life assistance can be towards education, also a stepping stone to a successful life later. At this stage, however, they do need some capital by way of advancement in life to enable them perhaps to start to acquire assets. Fortunately, they have many years ahead of them in order to do that. 23 One has to balance these needs against the testator's chosen object of his bounty. Mr Lawson does not have to justify his own needs in this Court. He is the one the testator has decided to benefit. He certainly is in a very difficult situation. He has no car, minimal furniture and absolutely no assets behind him whatsoever. His credit in the bank was shown as $2 and he only had a few dollars in his wallet at the time he swore his affidavit. He cannot have his children visit him, which I would have thought would have been somewhat dear to his heart in his present medical condition. He lives on a pension and simply scrapes by on that. Above all he has also the worry of his own medical condition as well as the worry of living such a frugal existence. Clearly he should receive a substantial part of the estate. 24 When one looks at these needs one also, of course, has to recognise that the plaintiffs are children of the deceased and would normally stand in a somewhat higher position than a stranger who is merely as friend, even if a good friend at that. The balancing of these considerations also must take account of the different situation between Patricia and Gordon. Patricia's needs, I think, are greater. Gordon's are potential needs but, all the same, still real. 25 Balancing these matters as best I can the orders I make are as follows: In lieu of the bequest of the estate to Stephen James Lawson, I order that the estate be held as to: (a) 4/12ths to Sidney James Lawson. (b) 5/12ths to Patricia Anne McCallum. (c) 3/12ths to Gordon Charles Andrew McCallum. The plaintiffs' costs on a party and party basis and the defendant's costs on an indemnity basis can be paid or retained out of the estate. I order that the exhibits be returned. oOo Last Modified: 09/26/2000 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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