New South Wales Supreme Court CITATION : Richardson v Rearden [2006] NSWSC 1252 HEARING DATE(S) : 17 November 2006 JUDGMENT DATE : 17 November 2006 JURISDICTION : Equity JUDGMENT OF : Campbell J EX TEMPORE JUDGMENT DATE : 11/17/2006 DECISION : Application dismissed. CATCHWORDS : SUCCESSION – EXECUTORS AND ADMINISTRATORS – administration – revocation of letters of administration – circumstances in which order for revocation of grant of letters of administration made – SUCCESSION – FAMILY PROVISION AND MAINTENANCE – principles upon which relief granted – extension of time – estate distributed - no property of persons to whom estate distributed identifiable - order for provision out of notional estate not able to be made LEGISLATION CITED : Family Provision Act 1982 Wills, Probate and Administration Act 1898 Caldar v Public Trustee [2003] NSWCA 187 CASES CITED : In re Diplock Estate; Diplock v Wintle [1948] Ch 465 Lewis v Lewis [2001] NSWSC 321 Neilson v Public Trustee - The Estate of Ellen Letitia Neilson (Powell J, 8 May 1992, unreported, BC9201888) PARTIES : Marilyn Jean Richardson - Plaintiff Alison Jane Rearden - Defendant FILE NUMBER(S) : SC 1504/05 COUNSEL : G P McNally - Plaintiff No Appearance - Defendant SOLICITORS : Matthews Dooley & Gibson - Plaintiff No Appearance - Defendant IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION EQUITY LIST CAMPBELL J FRIDAY 17 NOVEMBER 2006 1504/05 MARILYN JEAN RICHARDSON v ALISON JANE REARDEN JUDGMENT – Ex Tempore 1 HIS HONOUR: This is an application for revocation of letters of administration in the estate of the late Michael James Hart. Mr Hart died on 3 January 2000. He had married twice. Each of those marriages ended in divorce, with his second marriage ending in divorce in January 1993. The deceased had two children only, Alison and Brett. His mother also survived him. Alison has been granted letters of administration of the deceased's estate. 2 It seems to be common ground that the deceased left no valid will. The plaintiff, on the evidence before me, was the de facto wife of the deceased. Their relationship began in mid 1992, and continued until the deceased's death, that is, for about seven and a half years. The plaintiff at that time was living in accommodation at Doonside that she rented from the Housing Commission. The deceased at that time owned a house located at 62 Gasmata Crescent, Whalan. The deceased worked in two jobs, sometimes three, at a time. He had regular employment of an evening at the Building Workers' Club at Mt Druitt. His home at Whalan was very close to there. However, during the week, he usually lived with the plaintiff at the property she rented at Doonside. The plaintiff has four daughters and various of them also lived at the Doonside property at different times. 3 There were many of the usual indicia of a de facto relationship - some involvement of the couple with each other's extended family, shared social activities, shared holidays, sharing of common mundane tasks like shopping, attending together family functions like weddings, and a sexual relationship. 4 When the deceased died, the plaintiff went, within a matter of weeks, to see a solicitor, Mr Robert West. He advised her that, in the event that there was no will, she would receive the bulk of the estate, and the balance would be divided between the defendant and Brett. That advice, obviously given on the basis that the plaintiff was the de facto wife, was correct. The value of the house at Whalan at the time was of the order of $200,000. When letters of administration were granted the Whalan house was shown as having a value of $190,000. The only other asset of the deceased, according to the application for administration, was a little less than $200 in ready money. As well, he had a little over $26,500 in liabilities. Thus the net estate was around $163,500. The provisions of intestacy in section 61B of the Wills, Probate and Administration Act at the time provided for a de facto spouse to receive "the prescribed amount" - which was then $150,000 - and half the balance of the estate. 5 Mr West lodged three different caveats concerning the deceased's estate. They were each caveats requiring no grant or reseal in the estate to be made without prior notice to the plaintiff. Those caveats were lodged on 28 March 2000, 7 December 2001 and 18 September 2002. A caveat is in force for a period of six months. Thus, the first caveat that was lodged had lapsed for some months before the second caveat was filed. The second caveat also had lapsed for a couple of months before the third caveat was filed. The third caveat that was filed was the last one. It expired on 18 March 2003. On 1 April 2003 the defendant obtained a grant of letters of administration in respect of the deceased's estate. 6 I have examined the file relating to that grant. It contains an affidavit by the defendant in this case which says: "The deceased did not remarry after he was divorced from Michelle Yvonne Braddick in 1993, nor did he enter into a de facto relationship." 7 Pursuant to a requisition, an affidavit from a disinterested party was required to be filed as to the absence of any de facto relationship. The defendant obtained an affidavit from one Albert Kupper who deposed that he lived next door to the deceased, and that from his observation there was no other person living at the premises, apart from the deceased's mother, and that, to the best of his knowledge, the deceased never entered into another relationship with any other person. 8 The estate seems to have been realised fairly quickly after the grant was obtained. The Whalan property was conveyed, by a transfer dated 20 August 2003. 9 The plaintiff came to consult her present solicitors after she had a conference with Mr West in the first week of November 2004. In that meeting, he said to her words to the effect of: "It's too late. The estate is finalised. You will need to go to see another solicitor to bring a LawCover claim against me for negligence." 10 She thereupon went to see the firm of solicitors that she presently deals with with the first such consultation being on 4 November 2004. It took the plaintiff's present solicitors a little while to obtain the file but, on 9 February 2005, the plaintiff's present solicitors were in a position to advise her concerning the present proceedings. These proceedings were begun on 15 February 2005. 11 The orders which these present proceedings seek is an order for revocation of the grant of letters of administration, and an order for a grant of letters of administration to the plaintiff; alternatively a declaration that the plaintiff is an eligible person within the meaning of the Family Provision Act 1982, an order for provision under that Act, and an order extending the time for making application. 12 The time limit for applications under the Family Provision Act 1982 is eighteen months from the date of death. Thus, that time limit expired, in the present case, on 3 July 2001. That means that these proceedings, begun on 15 February 2005, are nearly four years out of time. As well, they are brought at a time when the estate has been distributed. 13 The defendant appeared in these proceedings fairly promptly after they were begun, but the solicitors who acted for her filed a Notice of Ceasing to Act on 31 August 2005. The court record shows that the defendant has not appeared at any of the mentions of the matter after 31 August 2005. The notice of ceasing to act filed by the defendant's former solicitor stated her last known address as being 15 Tarana Crescent, Dharruk, New South Wales. That is also an address that appears on some other documents that the defendant had filed in the proceedings. 14 There has been great difficulty in the proceedings in effecting service of any document on Brett. A citation was issued to Brett concerning these proceedings. There was evidence that there was no known address for him. An employee of the plaintiff's solicitors searched telephone books and obtained addresses or telephone numbers of various people who had the same initials and surname as Brett and contacted them, but none of the people contacted actually was Brett. There is evidence of a letter that Brett wrote to his father in September 1997 saying, in effect, that he did not expect to see him again. Eventually, an order for substituted service of the citation on Brett was made, so that it was adequately served if served at the defendant's house at 15 Tarana Crescent, Dharruk. The citation was in fact served at that address on 7 June 2006. 15 Since then, the defendant's house at 15 Tarana Crescent, Dharruk has been sold by a mortgagee exercising a power of sale. The plaintiff's solicitor has been in contact with the solicitor for the mortgagee. At first it appeared that there might be a surplus from the sale, but as things eventuated there was no surplus, and indeed there was insufficient to pay the first mortgagee. The present whereabouts of the defendant are unknown. The circumstances of the defendant and the other beneficiaries are such that it must be problematical whether any of them would have any assets against which any recovery action that the plaintiff might wish to bring concerning the assets of the deceased estate that were distributed to them. 16 A grant of letters of administration in common form is an interlocutory order. It is open to a court exercising probate jurisdiction to revoke that grant at any time upon a proper case being established: Caldar v Public Trustee [2003] NSWCA 187 at [5]. The sorts of situation that can count as a "proper case" are not rigidly confined. In Neilson v Public Trustee - The Estate of Ellen Letitia Neilson (8 May 1992, unreported, BC9201888) Powell J said, at 14-15: "That the Court possesses, and, when necessary and appropriate, will exercise, the power to revoke a grant which it has made - even after the death of the original grantee (see, Ayling, deceased January (1949) (UK) unreported, but noted Tristram and Coote's Probate Practice 24 Ed (1973) at 470) In re Gillard (1949) VLR 378) is undoubted, the classes of case in which the power has, in the past, been exercised being usually described as being: 1. where the grant is, in effect, a nullity; 2. where the surname or first Christian name, of the deceased in the grant is seriously incorrect; 3. where the grant has been obtained on a false, or incorrect, basis; 4. where, by reason of supervening events, the grant has become defective. (see, for example Tristram and Coote op cit at 426-433; Williams Mortimer and Sunnucks: Executors Administrators and Probate 16 Ed. (1982) at 335-339). It should, however, be noted that, although the power to revoke a grant undoubtedly exists, it is not exercised as of course, or even as a matter of right; rather, the question whether, in a particular case, the power ought to be exercised is one which lies in the discretion of the Court, having regard to all the circumstances of the case ( In the Will of Lamont (1881) 7 VLR (IP and M ) 86; In re Goode (1890) 11 NSWLR (Eq) 281; In re Gillard (supra)). Since that discretion is to be exercised after having regard to all the circumstances of the particular case, it is undesirable - and, in any event, probably impossible - to attempt to lay down, in advance, any general principles as to the way particular circumstances ought to affect the exercise of that discretion." 17 It seems to me on the present evidence that the grant has been obtained on a false or incorrect basis. 18 The problem, however, is whether there is any purpose to be achieved in making an order for revocation of the grant. The obligation of administrators under a grant of administration is to administer the estate and distribute any assets remaining after payment of debts, funeral and testamentary expenses to the persons lawfully entitled. If, as seems correct to me on the present evidence, the plaintiff is the person who was lawfully entitled to $150,000 in the estate, plus half of whatever the ultimate balance might have been, then the administrator will have distributed the estate to the wrong people. Ordinarily, if a legal person or representative distributes the estate to the wrong people, a personal action lies against the administrator for so doing, and (subject to discretionary defences) the person who should have received the assets has the opportunity to trace the estate assets into such of the assets of the people to whom the estate assets were paid as that person might be able to prove now represent the estate's assets: In re Diplock Estate; Diplock v Wintle [1948] Ch 465. The plaintiff's ability to bring that action would not be assisted by a revocation of the grant, because an order for revocation, made on an ex parte basis, while an effective order of the court, could itself be contested. It would not create any issue estoppel, and hence the plaintiff would need to prove again, in any such personal action against the administrator or tracing action, that she was the de facto wife of the deceased. 19 Sometimes there can be a point in revoking a grant that has been wrongly made when there are administrative duties known to be outstanding, or where there are circumstances from which there is a realistic possibility that administrative duties might arise in the future, such as if there is a prospect of assets, presently unknown, coming to light. Revocation of the grant in those circumstances enables future tasks of administration of the estate to be carried out by the person with the best title to be administrator. But in the present case there are no administrative tasks outstanding and no realistic possibility that administrative tasks might arise. 20 As well, it is not as though the defendant's application for administration was unknown to the plaintiff. The very circumstance that the caveats were put on shows that there was a concern on her part about who would obtain administration. There was a time, according to the plaintiff, when it appeared that there would be competing applications for a grant between the defendant and herself. There were also, it seems, letters between the defendant's solicitors and Mr West attempting to settle the dispute about the estate. 21 For the purpose of an application to revoke administration, knowledge and actions of the plaintiff's solicitor are her actions. It is as though it is she who lay by and did not continue to resist the possibility that the defendant would obtain a grant. The various circumstances that I have outlined all lead me to the view that this is not an appropriate case in which to revoke a grant, because there would be simply no point. 22 I turn to the application under the Family Provision Act 1982. That application is brought late, and at a time when the estate has been distributed. Because the estate has been distributed, the plaintiff can only succeed if the court makes an order designating certain property as notional estate - Lewis v Lewis [2001] NSWSC 321 at [57]. In cases like the present, where the deceased did not enter any prescribed transaction, the power of the court to designate notional estate relates to: "… such property as [the court] may specify, being property which is held by, or on trust for, the person or the object of the trust, whether or not that property is the property distributed." (Section 24 Family Provision Act 1982 ) 23 That provision means that if someone has received a benefit from a deceased estate, it is possible to designate as notional estate an asset of that person, even if that asset is not something into which it would be possible to trace any specific asset of the testator. That ordinarily gives the court a fairly wide power to do practical justice, and make sure that the assets of a deceased estate end up, so far as at least their value is concerned, in the hands that the court decides are the appropriate ones to enable the deceased to fulfil his or her obligations. However, in the present case, even that broad power will not be adequate to meet the present situation of the plaintiff. There is simply no asset that can be identified, of any person who received benefits from the estate of the deceased, which could be designated as notional property. Under these circumstances, the application under the Family Provision Act 1982 would inevitably fail, even if the extension of time were granted. 24 On the evidence before me, it seems that the plaintiff would have had, if the claim had been brought against the right person and at the right time, a case which justified an order. In circumstances where there may be other litigation about this, it is probably not appropriate for me to say anything more about the quantum of any such order. However, what I have said means that the Family Provision Act 1982 claim must also be dismissed. In the result the proceedings are dismissed. ********** 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. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.