Netter v Watts [2008] NSWSC 1102

New South Wales Supreme Court

CITATION : Netter v Watts [2008] NSWSC 1102

HEARING DATE(S) : 20/10/07

JUDGMENT DATE : 24 October 2008

JURISDICTION : Equity Division

JUDGMENT OF : Macready AsJ at 1

DECISION : Paragraph 33

CATCHWORDS : Family Provision. Application by the two children of the deceased. No provision made for one child. Small estate. Order for provision. No matter of principle.

001724/07 GERHARD NETTER v FIONA WATTS 001972/07 SABINA NETTER v FIONA WATTS

001724/07 GERHARD NETTER v FIONA WATTS 001972/07 SABINA NETTER v FIONA WATTS PARTIES : 001724/07 GERHARD NETTER v FIONA WATTS 001972/07 SABINA NETTER v FIONA WATTS GERHARD NETTER v FIONA WATTS SABINA NETTER v FIONA WATTS

FILE NUMBER(S) : SC 1724/07; 1972/07

COUNSEL : Mr R Tregenza for Gerhard Netter Mr A McSpedden for defendant

SOLICITORS : Michael Parasyn for Gerhard Netter Watson Stafford for defendant

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

ASSOCIATE JUSTICE MACREADY

Friday 24 October 2008

001724/07 GERHARD NETTER v FIONA WATTS 001972/07 SABINA NETTER v FIONA WATTS

1 HIS HONOUR: This is the hearing of two applications under the Family Provision Act 1982 in respect of the estate of the late Gertrude Kate Else Netter who died on 14 August 2006. The deceased's husband had predeceased her and she is survived by the two plaintiffs in these proceedings the deceased's son, Gerhard Netter and her daughter, Sabina Netter. I have ordered that the two proceedings be heard together with the evidence in one matter evidence in the other. The last will of the deceased 2 The deceased made her last will on 22 June 2006 under which she appointed her granddaughter, Fiona Sands, (the defendant) as executor and trustee. She gave her property at Dublin Street, Smithfield to her trustee to permit her daughter, Sabina Netter, one of the plaintiffs in the proceedings to reside therein during her lifetime. On Sabina Netter's death the property was to pass to the defendant. The deceased gave the residue of her estate to her daughter, Sabina Netter, but there was no residue. She made no provision for her son, Gerhard Netter. 3 The deceased made a statement dated 22 June 2006 in which she made the following comments: "I am of the opinion that my son is a drug addict and criminal. For five months I supported my son and kept him in food and clothing without any means of support from him. He stole monies from me." The estate of the deceased 4 The only substantial asset in the estate is the property at Dublin Street, Smithfield which on the evidence before me is valued at $260,000. There was money in the bank of $49.18 and there were liabilities including funeral expenses of $2,078.06. 5 Costs have been incurred in these proceedings. The plaintiff, Gerhard Netter's costs are $58,000 and the defendant's costs are $48,600 a total of $106,600. Plainly the only property which is the house at Dublin Street will have to be sold in order to meet the defendant's costs. After selling expenses of $7,000 and if the Court makes an award in favour of Gerhard Netter the distributable estate will be $146,400. Family history 6 The deceased's husband died on 20 June 1976. The deceased and her husband had two children, her daughter, Sabina Netter, born in July 1949 and her son, Gerhard Netter, born in May 1957. 7 In 1965 Sabina Netter left high school aged 16 years and she first worked at the Commonwealth Bank. She married in 1971 and had two children. She later divorced her husband. One of her children, Fiona Watts, is the defendant in the proceedings. 8 After the breakdown of Sabina Netter's marriage 1994 or 1995 she lived with her mother until the time of her death. When she moved in to Dublin Street her two children moved in with her although soon after left to make their own way in life. 9 Gerhard Netter left school aged 16 and he eventually joined the army some five years later where he stayed until 1983. In 1982 he had a son but the relationship with his son's mother ended in 2000. In 2001 Gerhard Netter was convicted of possessing marijuana on three separate occasions. 10 In February 2006 the deceased asked Gerhard Netter to come to Sydney to look after her as her daughter, Sabina Netter, was not coping. At that stage Gerhard Netter was living in Townsville and he took leave from his employment and went to Sydney to be with his mother. He stayed there for some months before returning to Townsville. 11 For four years before her death the deceased suffered from pancreatic cancer and she died on 14 August 2006. She had earlier made her will on 22 June that year. Apart from the help given by Gerhard Netter to his mother the deceased was looked after by Sabina Netter. Eligibility 12 The plaintiffs are both eligible parties. 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 were no assets from which an order could reasonably be made and making an order could disturb the testator's arrangements to pay creditors." 13 I now consider the situation of the two plaintiffs. Situation of Sabina Netter 14 Sabina Netter is 59 years of age and she is divorced from her husband. She has two children who are not dependent upon her. She is living in the estate property and her former husband is also living in the property although it is clear they have not resumed their relationship. He contributes to expenses. 15 Sabina Netter's assets consist of jewellery, clothing and personal effects which are of little value. Her income is a disability pension of $265.45 a week which is consumed by her expenses. 16 Since 1980 Sabina Netter has suffered from a bipolar disorder. She suffered depression after the birth of her daughter. She tendered a medical report from Dr Stephen Allnutt, psychiatrist, who detailed her history. Dr Allnutt discussed whether she was suffering from a mental illness in these terms: "In my opinion, your client does not currently manifest significant symptoms of a major mental illness although she does manifest a degree of flight of ideas likely secondary to an underlying bipolar affective disorder. Notwithstanding this, the flight of ideas does not cause a significant functional impairment at this stage as she is easily re-directable and brought back to the topic without any loss of quality in her communication. She provides a history of multiple episodes of depression and mania dating back to the 1970s with frequent admissions to psychiatric hospitals and ongoing psychiatric follow up. Her presentation and the history she provided is consistent with a diagnosis of bipolar affective disorder with her last depressive episode occurring in about 2005. She has since then remained relatively stable." 17 Sabina Netter is currently receiving treatment and medication in order to control her disorder. So far as on going treatment was concerned Dr Allnutt said the following: "She would require ongoing psychiatric follow up. The cost of medication would be in the region of approximately $100 to $200 a month. Should she see a private psychiatrist those costs would be in the region of approximately $250 an hour at a frequency and for a duration to be negotiated with her psychiatrist based on her clinical need. She would also, in my view, benefit from some psychological counselling and support which she could obtain from a psychiatrist or from a psychologist at a cost of about $150 to $200 an hour at a frequency and duration to be negotiated with her psychologist depending on her need.