Supreme Court New South Wales Medium Neutral Citation: Thurlow v Thurlow [2015] NSWSC 1323 Hearing dates: 3 September 2015 Decision date: 03 September 2015 Jurisdiction: Equity Before: Hallen J Decision: (a) Grants leave to the Defendant/applicant to amend the notice of motion filed 10 June 2015 by substituting the reference to UCPR rule 13.1 with a reference to UCPR rule 13.4. (b) Orders the Plaintiff's proceedings be dismissed generally. (c) Orders that the Plaintiff pay the Defendant's costs of the proceedings, including the costs of the notice of motion filed 10 June 2015. (d) Directs that any notice of motion and affidavits in support of an application for a legal practitioner, or legal practitioners, to bear the costs of the proceedings or of the notice of motion filed 10 June 2015 be served by 4:00 p.m. on Thursday, 24 September 2015. (e) Directs that any evidence in reply by the legal practitioner or legal practitioners, be served by Thursday, 22 October 2015. (f) Stands the matter over to the list of the Family Provision List Judge on Friday, 19 February 2016. Catchwords: SUCCESSION – PRACTICE & PROCEDURE – Claim for family provision order by son of the deceased – No grant of Probate sought by Defendant the named executrix and sole beneficiary of the deceased's estate – Application for summary dismissal by Defendant – UCPR rule 13.4 – Whether there is any property that arguably could form part of the estate or notional estate of the deceased – If not, whether the proceedings are frivolous or vexatious – No assertion made by Plaintiff and supported by evidence that real property of which Defendant is, currently, and was for many decades, the registered proprietor, held by her in whole or in part on trust for the deceased – Other property held by company which was deregistered about two years prior to death of the deceased with negligible assets – Plaintiff unable to point to bases upon which any property held by the Defendant may be designated as the estate or notional estate of the deceased Legislation Cited: Civil Procedure Act 2005 (NSW) Succession Act 2006 (NSW) Uniform Civil Procedure Rules 2005 (NSW) Cases Cited: Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552 Hitchcock v Pratt [2010] NSWSC 1508 Ren v Jiang [2014] NSWCA 388 Yesilhat v Calokerinos [2015] NSWSC 1028 Texts Cited: LexisNexis Butterworths, Ritchie's Uniform Civil Procedure NSW, vol 1 (at 96) [13.4.15] Category: Procedural and other rulings Parties: William Lawrence Thurlow (Plaintiff) Lorraine Joyce Thurlow (Defendant) Representation: Counsel: Mr T Flaherty (Plaintiff/Respondent) Mr A M Gruzman (Defendant/Applicant) Solicitors: P.M.Lee & Co (Plaintiff/Respondent) Mark Evans Solicitors (Defendant/Applicant) File Number(s): 2015/142432 Judgment – EX TEMPORE (rEVISED) 1. HIS HONOUR: In this matter, the Plaintiff, William Lawrence Thurlow, who is the son of Harold William Thurlow ("the deceased") commenced proceedings, by Summons filed on 13 May 2015, for provision out of the estate or notional estate of the deceased. In addition he sought costs of the proceedings. 2. In the Plaintiff's affidavit in support of his Summons, which affidavit was sworn on 12 May 2015, the Plaintiff disclosed that he was born in May 1957 and that he is a child of the deceased. There does not appear to be any dispute about this fact. Accordingly, there is no dispute that the Plaintiff is an eligible person within the meaning of s 57(1)(c) of the Succession Act 2006 (NSW). 3. There is also no dispute that the proceedings were commenced within the time prescribed by the Act for the making of the application (that is within 12 months of the date of the deceased's death). 4. The Defendant named in the Plaintiff's Summons is Lorraine Joyce Thurlow, the widow of the deceased. She married the deceased in August 1960, and remained married to him at the date of his death in June 2014. She is the step-mother of the Plaintiff. 5. The deceased, at the date of his death, was aged 93 years. He left a duly executed Will dated 26 February 1992, in which he appointed the Defendant as the sole executrix, and gave to her, for her own use and benefit absolutely, all of his property, both real and personal, of whatsoever nature and kind and wheresoever situated. 6. The Defendant did not apply for Probate of the deceased's Will as she considered that there was no property of the deceased in New South Wales or at all. That administration has not been granted does not constitute an obstacle to the continuation of the Plaintiff's proceedings if there were otherwise a basis for those proceedings. 7. In the Summons, whilst there was a reference to the order for provision being made out of the estate, or notional estate, of the deceased, there was no suggestion that the actual estate was an interest in any real property, or part of any real property, of which the Defendant was the sole registered proprietor, which was held in trust by her for the deceased at the time of his death. Nor was there any specific property, real or otherwise, identified as property that the Plaintiff sought to be designated as the notional estate of the deceased. 8. However, in his affidavit in support of the Summons, the Plaintiff set out what he described as: "…[P]roperty [that] may form part of the estate or notional estate of the deceased [namely]: (a) the interest of the deceased in the property situated at xxx Lethbridge Road, Elizabeth Beach ... estimated value $1.6 million; (b) the interest of the deceased in the property situated at xxx Coomba Road, Pacific Palms NSW…; (c) the assets of Thurles Pty Ltd…; (d) the assets of Thurles Services Pty Ltd..." 1. Following receipt of the Summons and the Plaintiff's affidavit in support, the Defendant filed a notice of motion, on 10 June 2015, in which she sought an order that the Plaintiff's claim be dismissed. Although the notice of motion referred to Uniform Civil Procedure Rules 2005 (NSW) ("UCPR"), rule 13.1, in fact, at the hearing the Defendant sought to rely on UCPR rule 13.4. 2. (There was no dispute by the Plaintiff's counsel that I should proceed upon the basis that the order sought was pursuant to UCPR rule 13.4. In fact, the submissions of the Plaintiff identified the correct rule as being that rule. I shall make an order granting leave to amend the Summons accordingly.) 3. UCPR rule 13.4(1) provides that: "If in any proceedings it appears to the court that in relation to the proceedings generally or in relation to any claim for relief in the proceedings: (a) the proceedings are frivolous or vexatious, or (b) no reasonable cause of action is disclosed, or (c) the proceedings are an abuse of the process of the court, the court may order that the proceedings be dismissed generally or in relation to that claim." 1. Sub-rule (2) provides that: "The court may receive evidence on the hearing of an application for an order under subrule (1)." 1. A matter that is "frivolous" is one that is without substance, groundless or fanciful. A "vexatious" proceeding is one without foundation, which cannot succeed, or is brought for an ulterior and collateral purpose. The rule may be exercised where a plaintiff's case is so weak that it would be futile to permit the proceedings to go to trial: see Ritchie's Uniform Civil Procedure NSW, at [13.4.15]. 2. Any order under rule 13.4 involves the exercise of discretion. The high hurdle that the Defendant, the applicant on the notice of motion, must clear in order to have proceedings summarily dismissed was not in dispute between the parties. Indeed, counsel for the Defendant, in his written submissions, referred to Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552, at [57], Ren v Jiang [2014] NSWCA 388, at [49] and, in family provision proceedings, Yesilhat v Calokerinos [2015] NSWSC 1028, per White J, and Hitchcock v Pratt [2010] NSWSC 1508, per Brereton J. 3. Of course, in considering the evidence of the parties and the submissions made on her, and his, behalf, respectively have had regard to the principles referred to in these, and other, cases, and, in particular, to the need to proceed with caution when deciding whether to grant an application for summary dismissal. Importantly, I remember that the court should be slow to dismiss a proceeding depriving a party of opportunity to present his case at trial and that it must be very clear indeed that the action is so clearly untenable that it cannot succeed. In doing so, the Court will not look merely at the suggested weakness of the Plaintiff's case but also to the suggested strength of the Defendant's case. 4. In addition, I must bear in mind the overriding purpose of the Civil Procedure Act 2005 (NSW) and of rules of court, in their application to civil proceedings, to facilitate the just, quick and cheap resolution of the real issues in the proceedings and the court's duty to seek to give effect to the overriding purpose when it exercises any power given to it by the Civil Procedure Act or by rules of court. 5. In support of the notice of motion, the Defendant filed a number of affidavits that were read, without objection, and without the deponent being cross-examined. Relevantly, the evidence included an affidavit sworn by the Defendant in which she deposed that she was, and had been since about August 1972, the sole registered proprietor of the Elizabeth Beach property; that she was, and had been, since about May 1984, the sole registered proprietor of the Pacific Palms property. She deposed to the fact that she had paid the purchase price of each property ($1,500 and $70,000 respectively) and had spent other money (her own or borrowed by her) on the amenities that were constructed on each property. 6. The affidavit evidence also disclosed that Thurles Pty Ltd was registered on 28 September 1971 and that it was voluntarily deregistered on 16 May 2012, that is to say, some two years prior to the death of the deceased, by application lodged 9 March 2012. 7. Thurles Services Pty Ltd was registered on 17 June 1981 and was voluntarily deregistered on 22 July 2012, that is to say, slightly less than two years prior to the death of the deceased by application lodged 17 May 2012. 8. In addition, there is other evidence demonstrating that in each of the years ending 30 June 2009, 30 June 2010, and 30 June 2011, neither company earned any income nor traded. The Thurles Services Superannuation Fund Cash Management account bank statements showed that in the year prior to the date of the deceased's death, there was less than $200 held. 9. No evidence was filed by the Plaintiff in response to the evidence of the Defendant to which I have referred. Other evidence upon which he relied went, principally, to demonstrating that his financial resources and other circumstances made it apt for a family provision order to be made. The Plaintiff, too, was not cross-examined on this evidence and I shall take it at its highest. 10. At the hearing of the notice of motion, Mr A M Gruzman of counsel appeared for the Defendant/applicant and Mr T Flaherty of counsel appeared for the Plaintiff/respondent. 11. The primary submission of the Defendant/applicant, based upon the evidence set out above, and the other evidence that had been filed and served, was that there is no estate, or notional estate, out of which the Court could make a family provision order, with the result that there is no purpose in the matter proceeding to a hearing. (This assumes, of course, that the relevant matters that the Plaintiff needed to establish relating to inadequacy of provision could be established.) 12. The primary submission of the Plaintiff/respondent was that it was premature to dismiss the proceedings as further steps could be taken, including interrogatories, to establish whether there was property of the deceased that could form part of the estate, or notional estate, of the deceased. 13. Although written submissions by counsel for the Plaintiff ranged far and wide in relation to the property that could form part of the estate and notional estate of the deceased, including for example, the proceeds of a lottery win received in the 1960's, the proceeds of sale of an aircraft sold in about 1990, he was unable to answer to questions from the Bench, to demonstrate evidence to establish that the deceased had retained any part of that property at the date of his death, or that the Defendant had received or retained any part of that property. 14. More significantly, counsel was unable to state how the real property, specifically identified in the Plaintiff's affidavit, to which I have referred above, was held on trust for the deceased. He was unable to say, for example, whether it would be asserted that the Defendant held the whole of each parcel of real estate on trust for the deceased, or only a part of it, and if the latter, what part was so held. 15. It was submitted, without any apparent factual basis, that the trust to be asserted would be a resulting trust or a constructive trust. (There was no submission that it would be an express trust.) 16. When asked to identify the factual basis of each assertion, Mr Flaherty stated that the Court would be asked to draw an inference from the facts that the deceased had practised as a medical practitioner; that he had earned a substantial income as a medical practitioner; that he had won a lottery during the marriage; and that he had owned an aeroplane which had been sold. 17. The substance of the submission was that it seems implausible that a doctor with a dependent spouse and four children who had not long before won the Opera House Lottery would live in a one bedroom kit home for many years and not have any assets at the date of his death. 18. On a number of occasions during the submissions, the court pointed out to counsel for the Plaintiff that there was no assertion of any such trust in the Summons, or any facts asserted by the Plaintiff, in his affidavit, going to matters that could found the basis of the trust claims. 19. Counsel was also reminded of the requirement to plead a trust claim (UCPR rule 6.3(e)), and that without a statement of claim, neither the Defendant, nor the court, could know the precise nature of any such claim. 20. Counsel for the Plaintiff frankly conceded that currently, the Plaintiff had no evidence to dispute the uncontested evidence of the Defendant regarding her payment of the purchase price of each of the parcels of real estate, but he submitted that this did not mean the Plaintiff accepted, without cross-examination, her sworn evidence that she had done so. 21. Before proceeding to hear more of the submissions, having raised these matters, I enquired whether the Plaintiff wished to seek an adjournment of the Defendant's notice of motion to enable the preparation of a statement of claim in which the material facts alleging a trust could be pleaded, or to enable the Plaintiff to file further evidence going to the assertion of any such trust. 22. After allowing counsel for the Plaintiff the opportunity, which he took, to obtain specific instructions, by telephone, from his instructing solicitors, he indicated that the Plaintiff would only seek an adjournment if no costs of the adjournment of the notice of motion were ordered to be paid by him. When the Court indicated that such an assurance could not be given, particularly bearing in mind the date on which a number of affidavits relied upon by the Defendant had been served, counsel for the Plaintiff stated that he did not wish to make any application for an adjournment. Accordingly, the hearing continued. 23. It is trite to say that in cases where a trust is asserted, one generally starts with the presumption that the equitable title to the property is at home with the legal title, but that this presumption, like all evidentiary presumptions, gives way to facts showing the contrary. 24. In my view, this trite proposition, when there are no facts showing the contrary, defeats the submission made on behalf of the Plaintiff that the search records do not reveal the source of the acquisition cost, or any equitable, or other beneficial, interest in the real property which was, and has been registered in the name of the Defendant for many decades and when, under oath, the Defendant maintains that she paid the acquisition costs of each property. 25. There is simply no evidence of any facts that could give rise to the assertion that the beneficial ownership of either the Elizabeth Beach property, or the Pacific Palms property, was held by the Defendant otherwise than in accordance with the legal title. The length of time during which the Defendant was the registered proprietor of each property, without any hint of a claim by the deceased, is also important. 26. That counsel for the Plaintiff was unable to identify the general nature of the trust, or what part of either property was said to be held on trust by the Defendant for the deceased is also important on this aspect. 27. Even if there were some evidence, or I could speculate that some evidence might be obtained to support the proposition that it was the deceased who paid the whole, or any part, of the acquisition costs of either, or both, of the Elizabeth Beach property, or the Pacific Palms property, the presumption of equity, that the beneficial interest in each property was to be held by the deceased and the Defendant upon a resulting trust in proportion to the respective contribution of each to the acquisition cost, would be rebutted by showing that there was a relationship between the parties, at the time of acquisition, giving rise to the presumption of advancement, so that the party who contributed less, or nothing, to the acquisition cost was nevertheless to have an interest in accordance with the legal title. 28. It will be remembered that, at the date of the purchase of each of the properties, the undisputed fact is that the deceased and the Defendant were married to each other. The presumption of advancement would therefore apply and it would be for the Plaintiff to demonstrate that it did not. 29. Bearing in mind the undisputed evidence of the Plaintiff that for many years he was estranged from the deceased, the likelihood of evidence being available to rebut the presumption of advancement, in my view, is highly doubtful. The Plaintiff simply has no direct, or even indirect, knowledge of the deceased's intentions at the time of the acquisition of either the Elizabeth Beach property or the Pacific Palms property. 30. The constructive trust in the remedial sense may be imposed upon a party as a remedy affecting her, or his, legal and beneficial ownership of particular property in a case where circumstances and the conduct of the parties are such as to make it unconscionable not to impose the trust. Then, the inquiry will not be to ascertain the actual or presumed agreement, or intention, of the parties. A constructive trust will not be imposed on the ground of mere fairness. It is only the latter ground upon which the Plaintiff appears to rely. There is no hint of any conduct by the Defendant that could lead to the view that a constructive trust could be established. 31. In my view, the Plaintiff does not have any, or any reasonable, prospects of success of establishing a resulting, or constructive, trust in favour of the estate of the deceased. It follows that neither the Elizabeth Beach property, nor the Pacific Palms property, can form part of the estate of the deceased. 32. On a number of occasions during the course of submissions, I sought from counsel for the Plaintiff, the bases upon which it could be submitted that either the Elizabeth Beach property or the Pacific Palms property formed part of the notional estate of the deceased. 33. Counsel was unable to direct me to any evidence, or to the parts of notional estate provisions of the Succession Act, that could satisfy me that the Plaintiff had any, or any reasonable, prospects of success in obtaining an order designating the whole, or a part, of either property as notional estate of the deceased. 34. In my view, the Plaintiff does not have any, or any reasonable, prospects of success of establishing that either the Elizabeth Beach property or the Pacific Palms property, in whole or in part, could form part of the estate, or notional estate, of the deceased. It follows that neither of the Elizabeth Beach property, nor the Pacific Palms property, can form part of the notional estate of the deceased. 35. In relation to each of the two companies referred to as property that could form part of the estate, or notional estate, of the deceased, the undisputed evidence discloses that each company was deregistered, without any assets of substance, about two years, or so, prior to the death of the deceased. 36. It was not suggested that either company had any assets at the date of deregistration. Once again, speculating that there were any assets still in existence of either company, counsel for the Plaintiff could not direct me to any evidence, or to the parts of notional estate provisions of the Succession Act, that could satisfy me that the Plaintiff had any, or any reasonable, prospects of success in obtaining an order designating such assets as notional estate of the deceased. 37. It follows that, in my view, the Plaintiff does not have any, or any reasonable, prospects of establishing that there are any assets of either company that, in whole or in part, could form part of the estate, or notional estate, of the deceased. 38. In all the circumstances of this case, I am satisfied that the continuation of the proceedings would be frivolous or vexatious in the sense that the Plaintiff's case is without substance. In my view, it cannot possibly succeed. 39. Accordingly it follows that the Plaintiff's Summons should be dismissed generally. ********** 1. Following the giving of reasons set out above, the question of costs was argued, counsel for the Defendant, initially, making the submission that the Defendant's costs of the proceedings, including the Notice of Motion, should be paid by the Plaintiff on the indemnity basis. 2. I expressed the view that even though some of the evidence had been served shortly after service of the notice of motion, some evidence had been served shortly prior to the hearing of the notice of motion. Mr Gruzman responded that the evidence contained in the most recent affidavit merely confirmed the evidence previously provided by the Defendant. Having read the affidavit, I consider that there was some additional material to be relied upon contained in it. Had there not been, it would have been unnecessary to serve the affidavit prior to, or read it at, the hearing. 3. Accordingly, whilst I was prepared to order the Plaintiff to pay the Defendant's costs, in accordance with the usual rule relied upon by the Defendant I was not prepared to order that those costs be assessed on the indemnity basis. 4. Having made that order, Mr Gruzman then stated that the Defendant wished to make an application under s 99 of the Civil Procedure Act. The section permits the court, where it appears, among other things, that costs have been incurred without reasonable cause in circumstances where a legal practitioner is responsible, to make an order that the legal practitioners instructed by the Plaintiff pay to the Plaintiff, for payment to the Defendant, the whole of the costs that the Plaintiff has been ordered to pay. 5. As the section requires the court to give the legal practitioner(s) a reasonable opportunity to be heard, I consider that I should list any such application, separately, for hearing, with reasonable notice to be given to the legal practitioner(s) against whom such an order is to be sought. I shall list the matter for a pre-trial directions hearing at a convenient time to the parties and to the court. 6. There was no suggestion that any such claim against the legal practitioner(s) should not be by way of notice of motion with affidavits in support. 7. The Court: (a) Grants leave to the Defendant/applicant to amend the notice of motion filed 10 June 2015 by substituting UCPR rule 13.1 with UCPR rule 13.4. (b) Orders the Plaintiff's proceedings be dismissed generally. (c) Orders that the Plaintiff pay the Defendant's costs of the proceedings, including the costs of the notice of motion filed 10 June 2015. (d) Directs that any notice of motion and affidavits in support of any application for a legal practitioner to bear the costs of the proceedings or of the notice of motion filed 10 June 2015 be served by 4:00 p.m. on Thursday, 24 September 2015. (e) Directs that any evidence in reply by the Plaintiff's legal practitioner(s) be served by Thursday, 22 October 2015. (f) Stands the matter over to the list of the Family Provision List Judge on Friday, 19 February 2016. ********** Amendments 16 September 2015 - Return date changed from 20 February 2016 to 19 February 2016 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. Decision last updated: 16 September 2015