James v James [2006] NSWSC 1151

New South Wales Supreme Court

CITATION : James v James [2006] NSWSC 1151

HEARING DATE(S) : 26/10/06

JUDGMENT DATE : 27 October 2006

JURISDICTION : Equity Division

JUDGMENT OF : Associate Justice Macready at 1

EX TEMPORE JUDGMENT DATE : 10/27/2006

DECISION : Paragraph 44

CATCHWORDS : Family Provision. Application by son when whole estate passed to second wife. Consideration of the circumstances of relationship between deceased and son. Order for a legacy.

PARTIES : Marcus Rhys James v Rosaleen Marie James

FILE NUMBER(S) : SC 2983 of 2005

COUNSEL : Mr G.A. Sirtes for plaintiff Mr R.D. Wilson for defendant

SOLICITORS : Turner Freeman for plaintiff Mullane & Lindsay for defendant

- 1 - THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

ASSOCIATE JUSTICE MACREADY

FRIDAY 27 OCTOBER 2006

2983/05 - MARCUS RHYS JAMES v ROSALEEN MARIE JAMES ESTATE OF HAROLD MARCUS RHYS JAMES

JUDGMENT

1 HIS HONOUR: This is an application under the Family Provision Act in respect of the estate of the late Harold Marcus Rhys James, who died on 17 November 2003 aged 77 years. The deceased was survived by his widow, who was his third wife, who is the defendant, his son, the plaintiff, and a daughter. The daughter and his first wife have been given notice and make no claim. His second wife and his other daughter, Bronwen, predeceased the testator. Last will of the deceased 2 The deceased made his last will on 8 May 1996 under which he appointed the defendant executrix and left her the whole of his estate. Assets of the deceased 3 The actual estate of the deceased was only $56,000. He owned jointly with the deceased his farming property "Airlie" at Singleton, cash, stock and shares. His half interest in these assets were, at the date of death, $1,199,000. They are now worth more and I will return to their value later. 4 Costs have been incurred. The plaintiff's estimate of costs for a two day hearing was $57,300 and the defendant's for a two day hearing was $54,000. In the event the matter only took less than a day and the costs should be less than that. Family history 5 The deceased was born in 1926 and the defendant on 12 March 1941. The deceased had a daughter of his first marriage and that was Shani Rhys James born in 1953. The children from the second marriage were his daughter, Bronwen, who was born on 12 January 1957 and the plaintiff, who was born on 5 February 1959. When the plaintiff was a month old the deceased and his second wife, Barbara, separated. She, the plaintiff and Bronwen moved to New Zealand where they lived for the next 10 to 11 years. 6 In 1967 the deceased, who had been a medical practitioner, qualified as an ophthalmic surgeon and went on to develop that specialty for the rest of his life. Also in 1967 he travelled to New Zealand and saw the plaintiff and the plaintiff's mother. The deceased and the defendant met in 1968 and in 1969 the defendant commenced to work as the deceased's secretary in his medical practice. They were married on 24 March 1972 and shortly prior to that they purchased the home they were living in at Strathfield. In 1972 they purchased a property at Woy Woy for $11,000 and sold it in 1973 for $23,000. They subsequently purchased a property in McMahons Point which they also subsequently sold with some capital profit from that sale. In November 1973 they sold the Strathfield property and purchased a waterfront property at Gladesville for $68,000. In 1976 they purchased a property at Kurrajong, which they held until 1980 before selling it. This is the start of the deceased's and the defendant's country interests. 7 The plaintiff, in 1977, travelled to Australia for a short time where he worked in Melbourne and then he and his then de facto wife travelled and lived in the United Kingdom. There they had a daughter, Alice, who was born on 28 December 1978. In 1980 the deceased and the defendant purchased the property "Airlie" near Singleton for $115,000 borrowing $103,000 to purchase it. That loan was repaid in about six years. 8 In 1981 the plaintiff, his de facto wife and his daughter returned to live in New Zealand. There the plaintiff had occupation as a musician. It was at this stage in his life that he first had his contact with drug use, which has been a problem to him for many years. The plaintiff returned to Sydney in 1987 and worked as a driver with the State Bank until 1991. In this period he was free of drugs. He then started studying for a degree, a Bachelor of Arts at the University of New South Wales. He finally achieved that degree in 1995. He then started an honours year but it was in that honours year that he succumbed to drugs and started using again. He also was diagnosed as suffering from hepatitis C. which he found out at that time. The effect of this was that he could not complete his honours degree. There was also at this stage a visit by the deceased to the plaintiff at his home in Glebe in that year. 9 The deceased made his will on 8 May 1996, as I have mentioned, and in that year he had open heart surgery. The following year, in February 1997, he retired from practice and obviously, of course, the defendant ceased work as his medical secretary. In November that year when the plaintiff was living at The Rocks the deceased also visited the defendant and saw him at that time. 10 In 1998 the deceased and the defendant sold their home at Gladesville for $875,000. This was a substantial capital gain when one compares it to its purchase price. Over the following few years after moving to the property at Singleton they sold off various small blocks from the main property for about $114,000. 11 The deceased, as I have mentioned, died on 17 November 2003 and the summons was filed within time. The plaintiff plainly, of course, is an eligible person. 12 In applications under the Family Provision Act the High Court in Singer v Berghouse (1984) 181 CLR 201 has set out the two stage approach that a Court must take. At page 209 it said the following:- "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' etc 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 etc 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 upon 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 we no assets from which an order could reasonably be made and making an order could disturb the testator's arrangements to pay creditors".