Blanchfield v Johnston [2007] NSWSC 143

New South Wales Supreme Court

CITATION : Blanchfield v Johnston [2007] NSWSC 143

HEARING DATE(S) : 26/02/07, 27/02/07

JUDGMENT DATE : 1 March 2007

JURISDICTION : Equity Division

JUDGMENT OF : Associate Justice Macready at 1

EX TEMPORE JUDGMENT DATE : 1 March 2007

DECISION : Paragraph 63

CATCHWORDS : Family Provision. Application under Family Provision Act by a daughter. Estate valued at $70,000. Costs incurred $74,000. Orders made capping plaintiff's costs.

PARTIES : Beryl Dawn Blanchfield v Eric George Johnston & anor

FILE NUMBER(S) : SC 1678/06

COUNSEL : Mr J Heazlewood for plaintiff Mr E. White for defendants

SOLICITORS : Griffiths Tierney for plaintiff Clark Rideaux Solicitors for defendants

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

ASSOCIATE JUSTICE MACREADY

THURSDAY 1 MARCH 2007

1678/06 - BERYL DAWN BLANCHFIELD v ERIC GEORGE JOHNSTON and ANOR

JUDGMENT 1 HIS HONOUR: This is an application under the Family Provision Act in respect of the estate of the late Jessie Eileen Johnston who died on 13 July 2005 aged 95 years. The deceased was survived by some of her children, one of whom is the plaintiff, and another is the first defendant. The last will of the deceased. 2 The deceased made her last will on 2 November 1979 under which she appointed the plaintiff and the first defendant as executors. The first defendant has taken out probate. Under the Will she left her estate to be shared between her children, of which there are four including the plaintiff Beryl and the defendant Eric. Assets in the estate. 3 The only assets in the estate consisted of a loan to the first defendant of $54,000 and an amount in the bank of $5,156.39, a total of $59,156.39. 4 The loan and its associated mortgage arose out of the sale by the deceased to the first defendant of her home at 25 Peden Street Bega in 2002. The sale was for $60,000 with a deposit of $6,000 and the balance was secured by mortgage over the property. The loan carried interest at 7% reducible at 4.5%. The interest was from 30 October 2002 to 27 July 2007, an amount of $16,131. This makes the estate, after the allowance of some expenses including the cash in the estate, in the sum of $70,331. 5 Costs have been incurred in the matter. The defendant's costs are estimated at $25,000; the plaintiffs at $49,000. This totals $74,000. If all these costs are allowed in full there will be no actual estate. 6 Under the arrangement for the sale of her house the deceased was entitled to live in the house until she died, which is what she did. The first defendant was obliged to pay rates and insurance on the property, the costs of the sale, and to carry out necessary repairs, which he did up until the date of death. Family history. 7 The plaintiff's father was born in 2001 and her mother, the deceased, was born in 1910. The son Gordon was born on 7 February 1930, the plaintiff on 27 November 1931, Norman on 30 March 1934 and the youngest, Eric, the first defendant, was born on 30 March 1938. 8 The plaintiff, after working on the property, moved in to the township of Bega in 1948 and she married in 1950. She had children, Barbara in 1952, Janelle in 1955 and her son, Ken in 1962. She and her husband purchased a house at 132 High St Bega in 1963. The plaintiff thereafter worked in Bega as a shop assistant. 9 The deceased's husband, George Leonard Johnson, died on 5 December, 1966. After that the deceased, after about five months, moved out of the family property in which she resided the most of her life. 10 Under the will of her husband the only thing she received was an annuity of $280 a quarter. This was charged on a loan due by Norman of $16,000 and that loan is still outstanding and was not repayable until after the deceased died. 11 As a consequence of having to move out the deceased purchased the property in Peden Street to which I have referred. I will come back to the debate about who paid for it, but it is plain that the plaintiff throughout this litigation has been under the misapprehension that the deceased herself paid for the property, whereas in fact the facts indicate that most of the purchase price was paid by the first defendant, her son Eric. 12 Eric and the deceased moved in and lived there for a while until Eric met his wife and married her in November 1969. It was on 2 November 1979 that deceased made her will, to which I have already referred. In 1980 the plaintiff and her husband sold their High Street home and purchased a home in Newtown Road, Bega where they still reside. 13 The plaintiff retired in 1993, as did her husband. He received $110,000 in superannuation at that stage. It was in the latter part of 2002 that the arrangements were made for the sale of the Peden Street property to the defendant. I will come back to the detail of that later. 14 The actual contract was dated 11 September 2002 and at that stage, according to the defendant, they paid a deposit of $6,000. The mortgage and the transfer were dated 30 October 2002 hand, and on 16 December 2002, the deceased's solicitor sent a cheque for $6,000 to the deceased. 15 There were some discussions in December 2002 between the plaintiff and the deceased which led to the rift between them. It also became apparent at that stage that the sale had gone through and the deceased mentioned it to the other children. 16 In early 2003, Norman, who had been paying the $280 per quarter amount to the deceased, started to make those payments into the deceased's account. There was another child, that was Lachlan, and he died in March 2003 and thus he did not share under the deceased's will. 17 The dispute with the plaintiff escalated in May 2003 when the deceased asked the plaintiff not to go to the house any more. She died on 13th of July 2005. Probate was granted and the proceedings were commenced within time. Eligibility. 18 The plaintiff is an eligible person. The High Court in Singer v Berhouse (1994) 181 CLR 201 has set out the two-stage approached the Court must take. At page 209 it said: "The final 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 Ltd. The determination of the first stage in the two-stage process calls for the 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 seas, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty.