New South Wales Supreme Court CITATION : Harris v Mills [2009] NSWSC 339 HEARING DATE(S) : 9 December 2008 JUDGMENT DATE : 30 April 2009 JUDGMENT OF : McLaughlin AsJ 1. I order that, in lieu of the benefits given to him by the will of the late Doreen Harris ("the Deceased"), the Plaintiff receive the entirety of the estate of the Deceased absolutely, apart from the gifts and legacies provided in clause 3 (a), (b), (d) and (e) of the said will. DECISION : 2. I order that the costs of the Plaintiff on the party and party basis, and the costs of the Defendant on the indemnity basis be paid out of the estate of the Deceased. 3. The exhibits may be returned. CATCHWORDS : SUCCESSION - family provision - claim by widower, aged 82 - marriage of 49 years - Plaintiff was given a conditional right of residence in matrimonial home - financial and material circumstances of Plaintiff - whether Plaintiff has been left without adequate provision for his proper maintenance - competing claims of other beneficiaries. LEGISLATION CITED : Family Provision Act 1982 CATEGORY : Principal judgment CASES CITED : Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201 Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 19 PARTIES : Frederick Alfred Harris (Plaintiff) William Mills (Defendant) FILE NUMBER(S) : SC 2055 of 2008 COUNSEL : Mr M. Gorrick and Mr T. Evers (Plaintiff) Mr R. Weaver (Defendant) SOLICITORS : Higgins & Dix (Plaintiff) Higgins & Higgins (Defendant) IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION ASSOCIATE JUSTICE McLAUGHLIN Thursday, 30 April 2009 2055 of 2008 FREDERICK ALFRED HARRIS –v- WILLIAM MILLS JUDGMENT 1 HIS HONOUR: These are proceedings under the Family Provision Act 1982. 2 By summons filed on 27 March 2008 Frederick Alfred Harris claims an order for provision for his maintenance and advancement in life out of the estate and/or notional estate of his late wife Doreen Harris (to whom I shall refer as "the Deceased"). 3 The Deceased died on 22 October 2007. She left a will dated 28 February 2003, probate whereof was on 2 January 2008 granted to William Mills, the executor named therein (who is the Defendant to the present proceedings). 4 The inventory of property discloses the following assets and the respective values attributed thereto, House property situate at and known as 37 Evans Lookout Road, Blackheath $350,000 Moneys in banks and financial institutions $274,557 5 At the hearing it was noted that the present agreed value of the Blackheath house property is $290,000. 6 The funds in the financial institutions have been realised. The Defendant has invested $251,863 with the ANZ Bank. The sum of $18,734 is held in the trust account of the Defendant's solicitors. 7 In calculating the value of the estate available for distribution, the costs of the present proceedings should be taken into account, since the Plaintiff, if successful in his claim, will normally be entitled to an order that he receive his costs from the estate of the Deceased, whilst the Defendant, irrespective of the outcome of the proceedings, will normally be entitled to an order that his costs be paid out of the estate of Deceased. It has been estimated on behalf of the Plaintiff that his costs will total about $19,000, whilst it has been estimated on behalf of the Defendant that his costs will total about $24,000. 8 It is appropriate therefore to proceed upon the basis that the value of the estate available for distribution will be in the order of about $518,000. 9 The Deceased and the Plaintiff had married in 1958, and remained married until the death of the Deceased forty-nine years later. They had two children (each of whom was adopted), being Yvonne Louise and Jacqueline Nicole (each of whom is now aged in her late 30s). 10 By her will the Deceased gave small gifts of chattels to each of her two daughters; she gave to the Plaintiff moneys standing in a specified bank account (which account appears to have been inaccurately identified, but is probably an account in which there was an amount of $333); she gave to Yvonne moneys standing in another bank account, being an amount of $5,361; she gave to the Defendant moneys standing in a credit union account, being an amount of $2,994. In respect to their matrimonial home at 37 Evans Lookout Road Blackheath ("the Blackheath property"), the Deceased gave to the Plaintiff a right of residence, such right of residence being determinable upon the remarriage of the Plaintiff and being subject to other conditions (including the payment by the Plaintiff of outgoings and maintenance). The interest in remainder in the Blackheath property, after the termination of the right of residence of the Plaintiff therein was given to Sharon Maree Franks. The Deceased gave the residue of her estate to the Sydney Legacy Appeal Fund. 11 The Plaintiff said that he was extremely surprised by the terms of the will. 12 The Plaintiff, who was born in 1926, is presently aged 82 years. The Plaintiff upon leaving school trained as a pastrycook and baker, and was continuously employed in that capacity until 1999, when at the age of 64 years he was made redundant. He was on unemployment benefits for about a year, until he became eligible to receive the age pension. He has been in receipt of that pension since that time. 13 The Plaintiff has also worked as a driving instructor, and at times he sold newspapers to assist with the family expenses. The Plaintiff said that after retirement he did some lawn mowing, in order to assist with the medical bills of the Deceased. 14 After their marriage on 13 September 1958, the Plaintiff and the Deceased acquired a house property at Enfield. They then purchased land in Croydon Park, where they built a residence. They sold that residence in about 1973, and purchased land in Leichhardt Street, Blackheath, where they again constructed a residence. Each of those house properties was owned conjointly by the Plaintiff and the Deceased. 15 In about 2002, the Deceased came into an inheritance from her brother. The Plaintiff and the Deceased then sold their house property in Leichhardt Street, Blackheath, and the Deceased acquired, in her own name alone, the house property in Evans Lookout Road, Blackheath. The proceeds of sale of the Leichhardt Street house property were divided equally between the Plaintiff and the Deceased, each receiving about $99,000. 16 The Plaintiff and the Deceased contributed to the household expenses of the Blackheath property in equal shares. In each of their homes the Plaintiff did all the landscaping and designing of the yards and gardens and the exterior of each residence. He also attended to maintenance inside the Blackheath property, installing shelves, bookcases, curtains, picture frames. According to the Plaintiff, he spent about $12,500 on establishing the gardens in the Blackheath property. 17 After the adoption of their first child, in about 1972, the Deceased was not in employment throughout her marriage to the Plaintiff. From that time the Plaintiff was the sole breadwinner of the family. However, he left the management of the family finances to the Deceased. 18 In 2001 the Deceased was diagnosed with ovarian cancer, and subsequently she developed a brain tumour. Until her death some six years later the Plaintiff was her principal carer, driving her to medical appointments, attending to her at home, and visiting her daily during her many periods in hospital. 19 The Plaintiff is in reasonable health for a man aged 82. He has in recent times undergone knee replacement surgery upon each of his knees. However, he is still able to drive his motor vehicle. 20 The Plaintiff is at present physically able to maintain the Blackheath property, and wishes to remain there as long as he can. Although he has no present intentions of marrying again, the Plaintiff expressed the view that he did not wish to be deterred from again entering into matrimony by being thereby deprived of his right of residence in his home. 21 The Plaintiff's assets consist of a motor vehicle (to which an estimated value of $18,000 was ascribed), furniture and effects (to which an estimated value of $5,000 was ascribed), moneys in banks and financial institutions (presently totalling about $7,000), and a term deposit in an amount of $60,000. One of those bank accounts, in which there presently stands about $3,600, is maintained by the Plaintiff for the purpose of meeting his funeral expenses 22 The Plaintiff's only liability is his costs of the present proceedings. 23 The Plaintiff gave evidence of his outgoings, in a total amount of about $331 a week. 24 The Plaintiff's income consists of the age pension, in an amount of $568 a fortnight, and interest upon his term deposit, in an amount of about $126 a fortnight. Thus he has a weekly income of about $346. He said that, financially, "I just survive". 25 The claim of the Plaintiff must be approached in the light of any competing claims upon the testamentary bounty of the Deceased and of the persons who were the objects of the testamentary beneficence of the Deceased. The only such competing claims are those of two daughters of the Deceased and Sharon Maree Franks, who under the will is entitled to the Blackheath property upon the termination of the interest therein of the Plaintiff. (I observe, in passing, that the will refers to that interest as a "life estate". However, since it is determinable upon the remarriage of the Plaintiff and upon his failure to pay certain outgoings, or to keep the property in an appropriate state of repair, it cannot accurately be said to be a life estate.) 26 Ms Franks is the daughter of a first cousin of the Deceased. She provided an affidavit on behalf of the Defendant. That affidavit set forth details of her relationship and her contact with the Deceased. 27 Ms Franks in her affidavit provided details of the financial and material circumstances of herself and her husband. They conjointly own two pieces of real estate, being their residence at Blakehurst (to which a value of $1,100,000 was ascribed) and a residential unit at Auburn (to which a value of $300,000 was ascribed), which is rented. In addition, Ms Franks alone owns a vacant block of land at Wentworth Falls (to which a value of $250,000 was ascribed). To their other assets (consisting of furniture, appliances, jewellery, clothes and personal items) a total value of about $20,500 was ascribed. 28 There is a housing loan secured by mortgage in respect to each of the foregoing pieces of real property, in amounts totalling $1,289,000. In addition, Ms Franks and her husband have a liability, by way of what was described as a portfolio loan, in an amount of $30,000. They have superannuation entitlements totalling in excess of $212,000. 29 From their business Ms Franks and her husband receive total net salaries of $114,400 a year. They receive a rental income from the Auburn home unit in an amount of $23,400 a year. Thus their total annual income is $137,800. 30 Ms Franks provided details of their family expenses and outgoings, which (apart from expenses relating to the various pieces of real property) total $80,646 a year. 31 No evidence was placed before the Court to indicate any connection or relationship between the Deceased and the residuary beneficiary, the Sydney Legacy Appeal Fund. 32 In his affidavit evidence the Plaintiff frankly conceded that his married life with the Deceased, which he said had been quite harmonious during its early years, was later sometimes stressful. He was critical of his wife's attitude towards and conduct regarding their two daughters, especially during the teenage years of those daughters. For about the last twenty years of their marriage the Plaintiff and the Deceased occupied separate bedchambers. Nevertheless, the Plaintiff said that they regularly went on outings together, that they shared household chores and activities, and they shared expenses. 33 After the Deceased had been diagnosed with ovarian cancer in 2001, and later with a tumour on the brain, her health deteriorated. In the five years preceding her death, she was admitted to hospital on eight separate occasions. The Plaintiff drove her to all medical appoints, and visited her daily when the Deceased was in hospital. He was her full-time carer. 34 According to the Plaintiff (and that evidence does not appear to be disputed by Ms Franks), the contact between the Deceased and Ms Franks was almost exclusively by telephone. To the Plaintiff's knowledge the Deceased had met Ms Franks on only one occasion, and that was when the Deceased was a patient in hospital in the last few years of her life. 35 It is in the light of the foregoing facts and circumstances that the Court must proceed to a consideration of the claim of the Plaintiff. 36 I have had the benefit of receiving a written outline of submissions and a chronology from Counsel for the Plaintiff. Those documents will be retained in the Court file. 37 The Plaintiff as the husband of the Deceased is an eligible person within paragraph (a) of the definition of that phrase contained in section 6 (1) of the Family Provision Act. As such he has the standing to bring the present proceedings. 38 The only other eligible persons in relation to the Deceased are her two daughters, each of whom is an eligible person within paragraph (b) of the foregoing definition. Neither of those daughters (although served with an notice of claim) has sought an order for provision out of the estate of her mother. 39 Neither Ms Franks nor the Defendant (who is not in any way related to the Deceased and who appears to have been no more than a friend or a acquaintance) is an eligible person in relation to the Deceased. 40 In carrying out the first stage in the two-stage process identified by the High Court of Australia in Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201 at 208 – 210 (the correctness of which test was affirmed by the High Court in Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191) the Court must determine whether in consequence of the provisions of the will of a testator the applicant has been left without adequate provision for his or her proper maintenance. 41 The High Court in Singer v Berghouse (at 209–210) said that the determination of the first stage calls for an assessment of whether the provision (if any) made was inadequate for 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. 42 The provisions of the will of the Deceased do not allow for any flexibility in the accommodation of the Plaintiff. They permit the Plaintiff to have a right of residence, subject to certain conditions, in the former matrimonial home of the Plaintiff and the Deceased. They do not make any allowance for changes in the Plaintiff's circumstances or situation (such as deterioration in health, or ultimate inability to drive a motor vehicle), which might result in the Blackheath property becoming unsuitable for the needs of the Plaintiff. Similarly, the requirements that the Plaintiff not merely maintain insurance of the property, and pay all outgoings, but that he maintain the house property in no less a state of repair than that in which it was at the time of death of the Deceased, do not take into account the limited (and probably diminishing) income of the Plaintiff. 43 After a marriage of almost 50 years, during almost the entirety whereof he was the sole breadwinner and in circumstances where for the last five years of the Deceased's life he was her full-time carer, the Plaintiff, now aged in his ninth decade, is by the will of the Deceased left with no security of accommodation and may find himself deprived of residence in his matrimonial home. 44 Further, the Court should not overlook the fact that part of the assets of the estate represent the Deceased's half share (about $99,000) in the proceeds of sale of the Leichhardt Street property. That property, although held in the joint names of the Plaintiff and the Deceased, was acquired and paid for while the Plaintiff was the sole breadwinner of the family. 45 It is abundantly obvious that, by the terms of the will of the Deceased, the Plaintiff has been left without adequate provision for his proper maintenance. 46 The needs of the Plaintiff regarding accommodation require that he have both security and flexibility. So far as the house property is concerned, those needs can be adequately met only by giving to him the house property absolutely. 47 In addition, the Plaintiff requires a fund which will assist him in increasing his present modest income, will enable him to pay for the maintenance of the Blackheath property, as well as provide for those future contingencies which will inevitably confront the Plaintiff in his advancing years, and enhance his present modest lifestyle (by, for example, enabling him to maintain regular personal contact with his daughters, one of whom, with her family, resides in Western Australia). 48 I have already referred to the fact that the claim of the Plaintiff must be approached in the light of the competing claims of the persons who may have a claim upon the testamentary bounty of the Deceased, or who otherwise are the objects of the testamentary beneficence of the Deceased. The only persons who have a claim upon the Deceased's testamentary bounty are the Plaintiff and their two daughters. Neither of those daughters seeks to compete with the claim of her father. 49 Ms Franks, the major beneficiary under the will of the Deceased, has asked the Court to take into account her financial and material circumstances. However, it will be appreciated that her present financial and material circumstances are largely irrelevant, since neither the Court nor Ms Franks knows the time at which she will become entitled to receive her interest in the house property, or what her circumstances will be at that time. 50 The residuary beneficiary has placed no evidence before the Court, and has not expressed active opposition to the claim of the Plaintiff. 51 I am in agreement with the submission by Counsel for the Plaintiff that the terms of the will are contrary, capricious, and most peculiar in their treatment of the Plaintiff and the daughters of the Deceased. The will totally disregards the interests of those persons to whom the Deceased owed a duty, or who had claim upon her bounty, being her husband and her two daughters. 52 The beneficiary, Ms Franks, who under the will is entitled to the Blackheath property when the Plaintiff's right of residence comes to an end, receives a windfall under the will. The Deceased (as was apparent from the affidavit of another cousin, Pamela Sally Ann Hunt) at the time when she was proposing to make her will was not even aware of Ms Franks' name or address, knowing her only as "Sharon". Apart from being named the major beneficiary under the will, Ms Franks has no claim (grounded upon close blood relationship, dependency, membership of the same household, or the like) upon the testamentary bounty of the Deceased. I have already referred to the absence of any contact or relationship between the Deceased and the residuary beneficiary. 53 Whilst recognising the importance of freedom of testation and the fact that the Family Provision Act constitutes a qualification upon that freedom, I do not consider that any competing claim of Ms Franks or of the Sydney Legacy Appeal Fund should have the effect of reducing, let alone extinguishing, any order for provision an entitlement to which the Plaintiff has otherwise established. 54 I consider that, in addition to receiving the house property absolutely, the Plaintiff should receive the entirety of the estate of the Deceased, apart from the gifts of chattels and the pecuniary legacies referred to in clause 3 (a), (b), (d) and (e) of the will of the Deceased. 55 I make the following orders: 1. I order that, in lieu of the benefits given to him by the will of the late Doreen Harris ("the Deceased"), the Plaintiff receive the entirety of the estate of the Deceased absolutely, apart from the gifts and legacies provided in clause 3 (a), (b), (d) and (e) of the said will. 2. I order that the costs of the Plaintiff on the party and party basis, and the costs of the Defendant on the indemnity basis be paid out of the estate of the Deceased. 3. The exhibits may be returned. ********** 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.