Supreme Court New South Wales Medium Neutral Citation: Estate Webster [2016] NSWSC 580 Hearing dates: 8 and 22 February 2016, followed by written submissions Date of orders: 11 May 2016 Decision date: 11 May 2016 Jurisdiction: Equity - Probate List Before: Lindsay J Decision: In the interests of due administration of a deceased estate, ORDER that a grant of probate of a statutory will be revoked, and that administration of the unadministered estate of the deceased be granted to some only of the executors named in the will, in circumstances in which working relationships between the executors have broken down. Catchwords: SUCCESSION – Alteration and revocation of grants - Generally – Revocation and re-grant of administration – Breakdown of working relationships between executors - Removal of executor with no ongoing interest in due administration of the estate. Legislation Cited: Succession Act 2006 NSW Cases Cited: Baldwin and Neale v Greenland [2006] QCA 293 Bates v Messner (1967) 67 SR (NSW) 187 Conroy v Smith [2007) QSC 182 Estate Wight; Wight v Robinson [2013] NSWSC 1229. In the Estate of Helene Josephine Storch (deceased) [2013] SASC 129 In the Estate of Raymond Francis Stuart (deceased) [2009] SASR 399 In the Goods of Loveday [1900] P 154 Letterstedt v Broers (1884) 9 App Cas 371 Livingston v Commissioner of Stamp Duties (1960) 107 CLR 411 Mavrideros v Mack (1998) 45 NSWLR 80 Miller v Cameron (1936) 54 CLR 572 W v H [2014] NSWSC 1696 Texts Cited: - Category: Procedural and other rulings Parties: Plaintiff: Michael Peter Webster (Executor) First Defendant: Cara Beverley Higgins (Executrix) Second Defendant: Family Company of Plaintiff Third Defendant: NSW Trustee and Guardian Fourth Defendant: Daughter of First Defendant Fifth Defendant: Daniel David Webster (Executor) Sixth Defendant: David Michael Webster (Executor) Representation: Counsel: Plaintiff: TD Castle First Defendant: G Sirtes SC and NCT Bilinsky Second Defendant: - Third Defendant: - Fourth Defendant: - Fifth Defendant: R Bianchi Sixth Defendant: Self represented Solicitors: Plaintiff: Elliott Tuthill First Defendant: Broun Abrahams Burreket Second Defendant: - Third Defendant: - Fourth Defendant: - Fifth Defendant: Atwood Marshall Sixth Defendant: - File Number(s): 2014/001485792014/00357365 Judgment 1. The administration of a deceased estate by four executors appointed by a statutory will (made pursuant to sections 18-26 of the Succession Act 2006 NSW), admitted to probate by an order of this Court, has been afflicted by factionalism. The executors' working relationships have broken down. The Court's intervention is necessary to facilitate due administration of the estate, looking forward. 2. Before the Court are two notices of motion (one seeking an order for revocation of the grant of probate and a fresh grant, the other a competing application for a costs order) that arise out of chronic conflict between the executors. 3. Three of the executors (Michael, Daniel and David Webster) are adult sons of the deceased. The fourth executor (Cara Higgins) is, in substance, the widow of the deceased. Although she and the deceased never married, they had a long standing de facto relationship which subsisted at the time of the deceased's death. The statutory will made for the deceased, with the consent of all four executors, described her as the deceased's "spouse". 4. Albert Victor Webster ("the deceased") died on 18 November 2014. That was two days after orders were made by the Court authorising the making of a statutory will on his behalf: W v H [2014] NSWSC 1696. In the day intervening between the date of the Court's orders and the date of death, the deceased's statutory will was formally executed by the Registrar in accordance with the Succession Act 2006, section 23. 5. The deceased's sons are the children of a relationship which preceded that between himself and his de facto widow, Cara. 6. There were no children of the relationship between the deceased and Cara. She has an adult daughter by an earlier relationship. 7. The deceased's statutory will was made as an integral part of a family settlement predicated upon management of the estate of the deceased (under the NSW Trustee and Guardian Act 2009 NSW) as a person incapable of managing his own affairs. 8. In reaching that settlement all members of the family subordinated simmering tensions in the interests of making proper provision for the deceased's care, and (in the interests of family harmony and an orderly succession planning) accommodating the interests of family members with a reasonable expectation that they would, in time, benefit from his estate. 9. A practical problem was that the deceased was asset rich, income poor. He and Cara needed financial assistance from Michael, and a family company of Michael, for the purpose of securing the deceased's residency in a nursing home and providing ongoing maintenance for Cara. 10. The family settlement, largely implemented through admission of the statutory will to probate, contemplated, in substance (and omitting comparatively minor gifts), a sale of the "matrimonial home" of the deceased and Cara at Vaucluse, followed by payment of capital sums to Cara and her daughter, leaving the residue of the deceased's estate to be divided between his sons. 11. Tensions emerged during the process of effecting a sale of the Vaucluse property. Michael and Cara clashed, in part because, contrary to positions taken by a Cara, Michael insisted on particular steps being taken, the effect of which (it must be said) enhanced returns to Cara as well as to the estate generally. 12. During that period, encouraged by Cara, Michael firmed in a personal predisposition to secure Cara's retirement from the office of an executor once she and her daughter had been paid what was due to them, respectively, under the deceased's will. 13. Cara, for her part, withdrew her earlier intimations of a preparedness to retire when she did not receive what she expected to receive as quickly as she expected to receive it. 14. This led to an appearance before me on 23 October 2015 when, on an application made by Cara, and no more than a passing protest by Michael, I made orders designed, summarily: (a) to ensure that Cara and her daughter received their due without further delay; and (b) to encourage the parties to resolve their differences, including differences as to the costs of and incidental to that application. I declined, in the meantime, to entertain an application by Michael for revocation of the grant of probate of the statutory will without a formal application. 15. My expectation that, consulting both their executorial duties and self-interest, the four executors, as current adversaries, would resolve their differences was too hopeful. 16. By a notice of motion filed on 20 November 2015 Michael sought, inter alia, an order that the existing grant of probate be revoked and that a fresh grant of administration be made to himself and his brothers, omitting Cara. 17. On the same date, Cara filed a notice of motion seeking, inter alia, that Michael pay the costs of and incidental to the appearance of 23 October 2015. On 1 December 2015 she filed an amended notice of motion, substantially to the same effect, which formally joined Daniel and David Webster as respondents to her motion. 18. Both motions came before me on 8 February 2016 and were adjourned, part heard, to 22 February 2016, with ancillary timetables for written submissions. 19. At my invitation, the parties' written submissions traversed, inter alia, the question (identified by reference to Livingston v Commissioner of Stamp Duties (1960) 107 CLR 411 and Estate Wight; Wight v Robinson [2013] NSWSC 1229) whether there were any executorial duties remaining to be performed or whether the executors could now be said to hold estate property on trust. 20. Attempts to move the parties towards a consensual outcome, if not reconciliation, appear generally to have foundered. In broad terms, the primary battlelines were drawn between Michael and Cara. David, resident in Britain, favoured Michael's position. Daniel, resident in Queensland, favoured Cara's. Both David and Daniel were, however, more on the sidelines than regularly in play. 21. One apparently positive outcome of the parties' litigious engagement appears to have been that, without admissions of any kind, the Webster brothers conceded, in favour of Cara, that she have the benefit of a boat and Sydney Harbour mooring which she had hoped to inherit but which, in terms of the deceased's statutory will, passed to the brothers as part of the deceased's residuary estate. The brothers' concession appears to have been made readily and ungrudgingly. 22. Although much has been done towards completion of executorial duties, and Cara and her daughter have been paid their dues, I proceed on the basis that the parties' executorial duties have not been fully completed, and that the jurisdiction to be exercised by the Court, on Michael's motion, remains that contemplated by the probate jurisdiction (involving an application for a revocation order and a fresh grant of administration) rather than that contemplated by the equity jurisdiction (an application for removal of a trustee): cf, Estate Wight; Wight v Robinson [2013] NSWSC 1229. 23. In the current proceedings there is not a great deal of difference between the respective approaches of the probate and equity jurisdictions, but such as there is might be thought to favour Cara. That is because, although the deceased's estate must be administered according to the terms of a statutory will, the Court's deliberate selection of Cara as one of four executors might reasonably be taken to reflect a personal judgement that would have been made by the deceased had he had testamentary capacity to make a will. 24. Upon an application for revocation of a grant of probate, the Court generally needs to take into account the fact that the deceased may have exercised deliberate, personal judgement in his or her selection of an executor: Mavrideros v Mack (1998) 45 NSWLR 80 at 107F-108C. The Court will not lightly interfere with a testator's personal selection of an executor: Baldwin and Neale v Greenland [2006] QCA 293 at [44]-[45]. 25. Once the character of a legal personal representative passes from that of an executor to that of a trustee, his or her obligations shift in focus from the deceased to his or her beneficiaries. Upon an application for removal of a trustee, subject to the terms of the trust, a (if not the) paramount consideration is the welfare of beneficiaries of the trust: Miller v Cameron (1936) 54 CLR 572 at 575, 579 and 580-581; Letterstedt v Broers (1884) 9 App Cas 371 at 386-387. 26. It is not necessary, in the current proceedings, to make any finding of misconduct or default on the part of any person. I deliberately refrain from doing so. It is sufficient that there has been a breakdown in the working relationship between the executors, frustrating the process of administration of the estate: Conroy v Smith [2007] QSC 182 at [19]-[24]; In the Estate of Raymond Francis Stuart (deceased) [2009] SASR 399 at [26]; In the Estate of Helene Josephine Storch (deceased) [2013] SASC 129 at [8]-[12]. 27. The jurisdiction to be exercised by the Court is governed by the purpose served by the jurisdiction. 28. In a passage in In the Goods of Loveday [1900] P 154 at 156 approved by the Court of Appeal in Bates v Messner (1967) 67 SR (NSW) 187 at 189, and in Mavrideris v Mack (1998) 45 NSWLR 80 at 101-102, Jeune P expressed the governing principle in the following terms: "After all, the real object which the court must always keep in view is the due and proper administration of the estate and the interests of the parties beneficially entitled thereto; and I can see no good reason why the court should not take fresh action in regard to an estate where it is made clear that its previous grant has turned out abortive or inefficient. If the court has in certain circumstances made a grant in the belief and hope that the person appointed will properly and fully administer the estate, and if it turns out that the person so appointed will not or cannot administer, I do not see why the court should not revoke an inoperative grant and make a fresh grant." 1. As a practical matter, Cara has no ongoing interest in due administration of the deceased's estate. She and her daughter have been paid their due from estate property. The persons with a primary interest in due administration of the estate, with, in due course, a beneficial interest in estate property, are the Webster brothers alone. Nor is there any hint of a possible discovery of fresh assets that could enliven, or extend, executorial duties beyond those necessary to be discharged in relation to presently identified estate property. 2. In my judgement, the due administration of the estate of the deceased, looking forward, would best be served by a direction, in effect, that Cara retire from the office of executor, leaving the Webster brothers to administer the estate on their own account. 3. Accordingly, I make orders to the following effect: 1. ORDER that the grant of probate made to Cara, Michael, Daniel and David on 19 February 2015 (in respect of the Will of the deceased, Albert Victor Webster, dated 17 November 2014) be revoked. 2. ORDER that administration of the unadministered estate of the deceased be granted to Michael, Daniel and David with the Will of the deceased dated 17 November 2014 annexed. 3. ORDER that the proceedings be referred to the Registrar to complete the grant. 4. ORDER that further compliance with requirements of the Probate Rules be dispensed with, with a view to the new grant of administration being made forthwith. 5. ORDER that Cara, Michael, Daniel and David, jointly and severally, cause the original grant of probate made to them to be delivered up to the Court. 1. In my opinion, taking into account the success of Cara in obtaining orders favourable to her on 23 October 2015; the success of Michael in persuading the Court that orders for a revocation and re-grant should be made; and the futility of endeavouring to unravel particular personal disputes about due administration of the deceased's estate in circumstances where working relationships have broken down, the appropriate orders for costs (which I make) are orders to the following effect: (6) ORDER that Cara pay or bear her own costs of and incidental to the oral application made on 23 October 2015; the notice of motion filed by Michael on 20 November 2015; and her own amended notice of motion filed 1 December 2015. (7) ORDER that the costs of Michael, Daniel and David of and incidental to the oral application made on 23 October 2015; the notice of motion filed by a Michael on 20 November 2015; and the amended notice of motion filed by Cara on 1 December 2015, be paid out of the residuary estate of the deceased on the indemnity basis. 1. These seven orders dispose of Michael's notice of motion and Cara's amended notice of motion without any need for further consequential orders. ********** 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: 11 May 2016