Re Italiano; Application for Judicial Advice [2020] NSWSC 405

Supreme Court New South Wales

Medium Neutral Citation: Re Italiano; Application for Judicial Advice [2020] NSWSC 405 Hearing dates: 3 April 2020 Decision date: 03 April 2020 Jurisdiction: Equity Before: Ward CJ in Eq Decision: 1. Order that the executor be advised that the executor is justified in entering into a settlement of Norolim's claims for the sum of $90,000 inclusive of costs and entering into mutual releases. 2. Order that the executor's costs of the summons for judicial advice be borne out of the estate on an indemnity basis. Catchwords: SUCCESSION — Trusts and trustees — Judicial advice, Trustee Act 1925 (NSW), s 63 — Whether executor is justified in entering into a settlement of claims against the estate — Whether executor should be indemnified out of the estate Legislation Cited: Civil Procedure Act 2005 (NSW), ss 100, 101 Conveyancing Act 1919 (NSW), s 66G Trustee Act 1925 (NSW), s 63 Cases Cited: Macedonian Orthodox Community Church St Petka Incorporated v His Eminence Petar, the Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand (2008) 237 CLR 66; [2008] HCA 42 Re Estate Late Chow Cho-Poon; Application for judicial advice [2013] NSWSC 844 Category: Principal judgment Parties: Alfonso Italiano (Plaintiff) Representation: Counsel: W Tregenza (Plaintiff)

Solicitors: Watson Stafford Zipkis (Plaintiff) File Number(s): 2019/0040708 Publication restriction: Nil

Judgment 1. HER HONOUR: This is an application for judicial advice by summons filed on 6 February 2019 by Alfonso Italiano, the executor of the estate of the late Michele Italiano (the deceased), seeking judicial advice as to whether he would be justified in settling claims brought by Norolim Pty Limited (Norolim) against the estate for the sum of $90,000 (inclusive of costs) and entering into mutual releases. 2. The matter has quite some procedural history. The claim brought by Norolim against the estate is one that was commenced in the Common Law Division of this Court, transferred to the Equity Division, transferred back to the Common Law Division, and then transferred to the District Court of New South Wales. Norolim has sued Alfonso (in his capacity as executor) for the sum of $313,312 for payments allegedly made for the benefit of the deceased during the period up to his death and for payments made of $4,256.76 after his death (a total of $317,568.76), together with interest and costs. It is estimated that if the claim were to succeed in full then the interest up to 21 February 2020 at the rates prescribed by ss 100-101 of the Civil Procedure Act 2005 (NSW) would exceed $50,000. 3. Norolim filed an amended statement of claim on 15 November 2018. The executor has filed an amended defence on 18 February 2019 in which the executor does not admit the claimed debt, denies indebtedness to Norolim and claims a set-off (the set-off relating to claims provided for under a deed of settlement and release to which I refer below). 4. A settlement conference was held on 8 August 2019, directed by the Registrar of the District Court, pursuant to which settlement in principle was reached between the executor and Norolim by which the estate would pay to Norolim the sum of $100,000, inclusive of costs, and under which there would be mutual releases. Following that settlement in principle, additional evidence became available of a liability by Norolim to the estate of the deceased pursuant to cl 24 of the deed of settlement and release to which I have referred above. It would appear that the discovery of that amount led to the "in principle" agreement of $100,000 not proceeding. 5. Settlement in principle has now again been reached, this time for the claim of Norolim to be settled for $90,000 inclusive of costs and the entry into mutual releases. This application for judicial advice concerns whether the executor would be justified in entering into that settlement.