New South Wales Supreme Court CITATION : Sikorski v Michalowski [2008] NSWSC 404 HEARING DATE(S) : 29 April 2008 JUDGMENT OF : Gzell J EX TEMPORE JUDGMENT DATE : 29 April 2008 DECISION : Probate revoked, defendants to lodge probate in Registry, substitute executor appointed. CATCHWORDS : SUCCESSION - Wills, Probate and Administration - Probate and Letters of Administration - Whether grant of probate should be revoked - Plaintiff awarded a legacy of $100,000 in proceedings under the Family Provision Act 1982 - Defendant executors - Defendants' house designated as notional estate - Demands to pay legacy ignored LEGISLATION CITED : Wills, Probate and Administration Act 1898 Uniform Civil Procedure Rules 2005 Re: Anderson (1953) 53 SR (NSW) 520 Upton v Downie [2007] NSWSC 1095 CASES CITED : Bates v Messner (1967) 67 SR (NSW) 187 In the Goods of Loveday [1900] P 154 Mavrideros v Mack (Supreme Court of New South Wales, Young J, 16 June 1997, unreported) Mavrideros v Mack (1998) 45 NSWLR 80 Paul Sikorski (Plaintiff) PARTIES : Richard John Michalowski (First Defendant) Maria Dolores Michalowski (Second Defendant) FILE NUMBER(S) : SC 1890/08 COUNSEL : Mr P O'Loughlin (Plaintiff) SOLICITORS : Hancock Alldis & Roskov, Solicitors (Plaintiff) IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION GZELL J TUESDAY 29 APRIL 2008 1890/08 PAUL SIKORSKI v RICHARD JOHN MICHALOWSKI & ANOR EX TEMPORE JUDGMENT 1 The plaintiff was awarded a legacy from the estate of the late Joseph Sikorski, deceased, of $100,000 payable from the notional estate. The notional estate is the house owned by the defendants in Cringila in New South Wales formally identified in the order made by McLaughlin AsJ on 20 February 2007. The defendants are the executors. The deceased gave the entirety of the estate to the first defendant. 2 The orders of the Associate Judge were served on the defendants but they have failed to pay the legacy. On 7 November 2007 the solicitors for the plaintiff put the defendants on notice that if the legacy was not paid within 14 days, proceedings would be commenced to recover the legacy without further notice. The defendants were informed that those proceedings might include an application to remove them as executors of the estate. That letter was also served on the defendants. The summons was served on the defendants. They have not appeared and the application has proceeded ex parte. 3 The plaintiff seeks relief on alternative bases. First, an order pursuant to the Wills, Probate and Administration Act 1898, s 84 is sought ordering the defendant to pay the plaintiff the legacy and to pay the plaintiff's costs as ordered on 16 July 2007. 4 Secondly, the Uniform Civil Procedure Rules 2005, r 54.3 is invoked as the basis for an order that the defendants pay the legacy and the costs they were ordered to pay. 5 Thirdly, an order is sought that the grant of probate be revoked, the defendants deposit the probate in the registry and the plaintiff be appointed as executor of the estate. 6 Fourthly, an order is sought that the administration of the estate be conducted under direction of the Court. 7 It being considered inappropriate that the plaintiff be appointed executor in place of the defendants, I allowed an amendment to the summons to substitute Roderick George Thyer, who has lodged a consent to the appointment, in place of the plaintiff. 8 So far as is material, the Wills, Probate and Administration Act, s 84 provides that if an executor, after request in writing, neglects or refuses to pay to the person entitled any legacy, the court may, on the application of such person, make such order in the matter as it may think fit. 9 That provision should not be used as an alternative to an administration suit. It should be used only where the applicant is clearly entitled to the interest claimed and there is no need for the court to exercise any of its powers under an administration suit. 10 Those conditions are met in this case. It has been held, however, that in the case of an application for the payment of a legacy, there should be evidence that there are liquid funds available for the payment of it (Re: Anderson (1953) 53 SR (NSW) 520 at 522). No such evidence is advanced in this case because the plaintiff is unaware of the financial state of the estate or the financial state of the notional property. 11 I am not inclined to grant relief under that provision. 12 The Uniform Civil Procedure Rules, r 54.3 provides that proceedings may be brought for any relief that could be granted in administration proceedings. Clearly, an order could be made under that provision in this case that the defendants pay the plaintiff the legacy and his costs. 13 But if there is a failure to comply with such an order and the plaintiff brings contempt proceedings, it may be a sufficient answer that the defendants are, for financial reasons, unable to pay the legacy. 14 In light of the Uniform Civil Procedure Rules, r 54.3 the fourth alternative of an administration suit is unnecessary in the circumstances of this case. 15 That leaves the question whether probate should be revoked. This is the plaintiff's preferred option as it would enable a new executor to explore the position of the estate and the notional property to ascertain whether the legacy can be paid in whole or in part. 16 I discussed the principles involved in Upton v Downie [2007] NSWSC 1095, [44]-[51]. 17 In Bates v Messner (1967) 67 SR (NSW) 187 at 191-192, Asprey JA said of what Jeune P had said in In the Goods of Loveday [1900] P 154 at 156: "I am of the opinion that the essential basis of the exercise of the court's inherent jurisdiction to revoke a grant of probate is that emphasised by Jeune P, namely, that the real object which the court must always keep in view is the due and proper administration of the estate in the interests of the parties beneficially entitled thereto on the part of the person to whom and by whose oath as to the faithful performance of his duties the court has been induced to entrust the office of executor. The terms used in some of the previously decided cases with relation to the circumstances which have given rise to the exercise of the jurisdiction of revocation, such as "aborted", "inefficient", "useless" or "ineffectual", are simply descriptive of a situation in which the court has been persuaded to the view that its grant, which was predicated on the oath of the executor named in the will that "he will pay all the just debts and legacies of the said deceased so far as the estate of the said deceased will extend and the law shall bind him, and that he will otherwise well and faithfully administer the said estate according to law; and that he will render a just and true account of his administration" has been circumvented by a breach of that oath which is in effect an undertaking to the court making the grant. I shall make no attempt to define all circumstances which may attract the exercise of the court's jurisdiction, but where circumstances clearly appear to have arisen after a grant of probate which impel the court to the firm conclusion that the due and proper administration of an estate has either been put in jeopardy or has been prevented either by reasons of acts or omissions on the part of the executor or by virtue of matters personal to him, for example, mental infirmity, ill health, or by virtue of the proof of other matters which establish that the executor is not a fit and proper person to carry out the duties which he has sworn to the court that he will perform, the court may exercise its inherent jurisdiction to revoke the grant." 18 In Mavrideros v Mack (Supreme Court of New South Wales, Young J, 16 June 1997, unreported) the judge at first instance adopted the approach that the inherent jurisdiction should not be exercised unless one was getting close to the position of the grant being useless. The Court of Appeal in Mavrideros v Mack (1998) 45 NSWLR 80 stated this to be too narrow an approach. At 108, Sheller JA, with whom the other members of the Court of Appeal agreed, said: "For present purposes this interpretation of Bates v Messner was too narrow. The question was, to adapt the language of Asprey JA (at 192), whether the due and proper administration of an estate had either been put in jeopardy or had been prevented either by reasons of acts or omissions on the part of the executor or by virtue of matters personal to him, for example, mental infirmity, ill health, or by virtue of the proof of other matters which established that the executor was not a fit and proper person to carry out the duties he had sworn to perform. His Honour applied a far too rigid test by saying that one had to get close to the position of the grant being useless." 19 In my view, the circumstances of this case establish that the defendants are not fit and proper persons to continue to conduct the administration of the estate. Having been advised of a court order that a legacy of $100,000 was payable to the plaintiff, the defendants have ignored the demands for that payment. In those circumstances it seems to me to be appropriate to order that the probate be revoked and that the probate be deposited in the registry within seven days. I make orders in terms of paragraphs 5 and 7 of the summons. 20 The consent of Roderick George Thyer, having been filed, I order that he be appointed as the executor of the estate. I stand the matter over before the probate registrar at 9.30 on Monday, 12 May 2008. ********** 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.