Zaklan v Stojanovic [2007] NSWSC 658

New South Wales Supreme Court

CITATION : Zaklan v Stojanovic [2007] NSWSC 658

HEARING DATE(S) : 25/06/07

JUDGMENT DATE : 25 June 2007

JURISDICTION : Equity Division

JUDGMENT OF : Associate Justice Macready at 1

EX TEMPORE JUDGMENT DATE : 25 June 2007

DECISION : Paragraph 24

CATCHWORDS : Family Provision. Application by widow who had separated from deceased prior to his death. Small estate. Order for legacy. No matter of principle.

PARTIES : Vera Zaklan v Steven Stojanovic (Estate of Petar Zaklan)

FILE NUMBER(S) : SC 2907 of 2006

COUNSEL : Mr A.L. Hill for plaintiff Mr G McGrath for defendant

SOLICITORS : G Faura, Villari & Co Stojanovic Solicitors

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

ASSOCIATE JUSTICE MACREADY

MONDAY 25 JUNE 2007

2907/06 - VERA ZAKLAN v STEVEN STOJANOVIC - ESTATE OF PETAR ZAKLAN

JUDGMENT 1 HIS HONOUR: This is an application under the Family Provision Act in respect of the estate of the late Petar Zaklan, who died on 8 September 2005. The deceased was survived by the plaintiff, his wife, and a sister, who is the deceased's only sibling. The deceased and the plaintiff had no children. The will of the deceased 2 The deceased made his last will on 30 March 2004. Under that we will he left the whole of his estate to his sister, Savka Zakula and appointed the defendant as his executor. The estate of the deceased 3 The deceased, when he died, owned his unit. That has been sold and the estate has been reduced to cash. The present distributable estate is the sum of $85,782. Costs will have to come out of that. In the event that the plaintiff is successful, her costs have been estimated at $15,000 and the defendant's costs have been estimated at $19,000. Having regard to the size of the estate it is plain that the legal practitioners have capped their costs and that is pleasing to see that that matter is attended to in that way and that responsibility is accepted. Normally small estates sometimes can be used up completely by costs. The background and the family history 4 The plaintiff was born in 1939 and in April 1971 after coming to Australia from Serbia she commenced work at the Crown Corning factory. She married the plaintiff on 27 January 1974 and they initially lived in a rented room in Bourke Street, Redfern. In 1978 the deceased and the plaintiff purchased a property at 5 Walker St Redfern for $26,600. They paid a deposit of $11,000 and the evidence is that the plaintiff contributed $8,000 of that and the deceased $3000. Thereafter the parties paid off the mortgage. Both were working and they managed to pay off the mortgage in about three years. 5 In 1984 the deceased left his employment with the Crown Corning factory and received a $20,000 payout. He travelled to Yugoslavia and took $15,000 of the $20,000 with him. A year later, at his request, the plaintiff went across and took the other $5,000 and gave it to the deceased. Apparently that was spent. The plaintiff says she only received her airfare but obviously she received something when they were both there. When they returned to Australia both the plaintiff and the deceased started receiving social security payments. In 1988 the deceased underwent a heart operation and received a disability pension. This meant that he could do less around the house to help the plaintiff. The plaintiff gave evidence, which was not contradicted, that the deceased started drinking from 1990 and became an alcoholic. There were some threats made to the plaintiff and the plaintiff was hospitalised one night during this period as a result of that conduct. She also gave evidence that the deceased would go on drinking binges and he would be away for some days at a time. She was obviously left in a situation where she had to support the household and this led her, at least for a period of six months from the end of 1992, to go back to work as a process worker. 6 In 1995 they sold the property at Redfern and purchased a property at Bourke Street, Canley Heights and they used part of the sale proceeds to do it up. In 1998 the plaintiff actually obtained an apprehended violence order against the deceased and eventually in May 1999 they separated. At that stage the property was sold for some $200,000, each receiving approximately $98,000. With her share the plaintiff bought a unit at 8/3-5 Church Street, Cabramatta for $72,000 and spent $16,000 on renovations. The deceased used only part of his for the purchase of a unit as he bought a unit at Lansdowne Road, Canley Heights for $68,000. This he changed in November 1999 when he purchased another unit at Cabramatta Road Cabramatta and sold his existing one. 7 The plaintiff gives evidence that from the time of separation, from about 1998 until 2002, she used to go and do shopping for the deceased and do cleaning and washing and ironing for him. I will come back to the detail of this because there is some contest on the evidence and particularly in regard to an alleged assault on the deceased by the plaintiff on 21 April 2001. 8 In March 2002 the plaintiff went to Serbia to nurse her brother who was dying of cancer and she returned a year later. The deceased sold his unit in Cabramatta and changed units again. After the plaintiff returned the deceased apparently was angry with her for going to Serbia and would not have her come to the unit unless he said she could. He made his will on 30 March 2004 and he died on 8 September 2005. Probate was granted and these proceedings were commenced within time. Eligibility 9 The plaintiff is an eligible person as she is still the widow of the deceased. They were never divorced and there was never any formal property settlement between them. In applications under the Family Provision Act the High Court in Singer v Berghouse(1994) 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".