Supreme Court New South Wales

• Medium Neutral Citation: Oakes v Oakes [2014] NSWSC 1312
• Hearing dates: 22, 23 September & 1 October 2014
• Decision date: 02 October 2014
• Jurisdiction: Equity Division
• Before: Pembroke J

Decision

See paragraph [50]

• Catchwords: SUCCESSION - family provision - claim by divorced former daughter-in-law of deceased - whether plaintiff an eligible person - relevant considerations; STATUTORY CONSTRUCTION - meaning of 'member of household' - section 57(1)(e) Succession Act
• Legislation Cited: Succession Act 2006
• Cases Cited: Churchill v Roach [2002] EWHC 3230; [2003] WTLR 779; Doshen v Pedisich [2013] NSWSC 1507; Hammond v JP Morgan Australia [2012] NSWCA 295; Legione v Hately [1983] HCA 11; (1983) 152 CLR 406; Morris v Morris (1982) 1 NSWLR 61; Petrohilos v Hunter (1991) 25 NSWLR 343; Thompson v MacDonald [2013] VSC 150; Thompson v Public Trustee of New South Wales [2010] NSWSC 1137; Wilcox v Wilcox [2012] NSWSC 1138
• Category: Principal judgment
• Parties: Narelle Oakes - plaintiff; James Edward Prosser-Fenn and Wayne Francis Oakes - first defendants; Wayne Francis Oakes - second defendant
• Representation: Counsel: M M Pringle - for the plaintiff; B Ralston - for the first and second defendants; Solicitors: Bale Boshev Lawyers - for the plaintiff; Baldock Stacy & Niven - for the first and second defendants
• File Number(s): 2012/396119

Judgment

Introduction

1 This is an unusual family provision claim brought by the divorced former daughter-in-law of the late Wallace Francis Oakes. It is unusual because someone in that category would probably not be considered ordinarily to be a natural object of the deceased's benevolence, and entitled to share in his estate. However, everything depends on the circumstances.

2 William Oakes (the deceased) died on 1 January 2012 leaving a will. By that will he left his substantial rural property known as Coolcappa at Coonabarabran to his only son Wayne Oakes (the second defendant) for life and after his life to the four children of the second defendant and the plaintiff. The deceased also gave legacies of $100,000 to each of Lynda Hoskins, Lorraine Pisansarakit and Lynette Smith. They are his daughter and stepdaughters from his first wife Ida and his second wife Gwen respectively. Probate of the will was granted on 30 May 2012. The estimated value of the assets of the deceased set out in the Inventory of Property is $3,655,968. The value of Coolcappa is approximately $2 million. It is currently leased at an annual rental of $108,395.00, to which Wayne Oakes as life tenant is entitled. The very substantial residue of the estate was left to Kathryn Adams, who is the only child of the deceased's marriage to Gwen.

Household - Legal Principle

3 One of the legal issues in the case is whether at any particular time the plaintiff was a member of the deceased's household. This is a threshold issue in relation to which the plaintiff's claim under the Succession Act 2006 depends. I am satisfied that the plaintiff was a member of the household of which the deceased was a member. This was not a state of affairs that continued indefinitely, but it did subsist at least in the period 1978 to 1979. The notion of a 'household' is not the same as the notion of a 'house'. The latter is a fixed and objective concept. The former is flexible, variable and to some extent immanent. Among other things, living in the same household connotes some element of frequency of contact, some element of mutual support and some element of community of resources. It is perfectly possible to have one household and two properties.

4 The plaintiff first met the deceased when she commenced employment for him and his wife Gwen at the Poplars Motel in Coonabarabran. They employed her in a general hospitality role. She was a young girl at the time and attended to such duties as waitressing, bar work, office administration and cleaning. The deceased's son Wayne from his first marriage was also employed at the Poplars Motel and performed a variety of duties there. The plaintiff and Wayne met in the family business in 1977 and rapidly became romantically involved in. Soon afterwards they commenced a relationship and began to live together. She was fifteen and he was about twenty years of age. Accommodation was provided for them by the deceased in a house that formed part of the motel complex. From 1978 the plaintiff and Wayne commenced living together in the house. They later married, but not until 1981. They were divorced on 9 May 2011.

5 In Doshen v Pedisich [2013] NSWSC 1507 at [66], Hallen J cited with apparent approval the following passage from Churchill v Roach [2002] EWHC 3230; [2003] WTLR 779. I gratefully adopt and approve that passage:

It is, of course, dangerous to try and define what 'living in the same household' means. It seems to me to have elements of permanence, to involve a consideration of the frequency and intimacy of contract, to contain an element of mutual support, to require some consideration of the degree of voluntary restraint upon personal freedom which each party undertakes, and to involve an element of community of resources. None of these factors of itself is sufficient, but each may provide an indicator. ...It is perfectly possible to have one household and two properties.

6 A similar connotation is reflected in the statements set out in the succeeding paragraph of the judgment of Hallen J in Doshen v Pedisich at [67], which I also adopt:

In Re Dix deceased [2004] EWCA Civ 139; [2004] 1 WLR 1399, a claim was brought under the Inheritance (Provision for Family and Dependants) Act 1975 (UK). Ward LJ in the Court of Appeal (with whom Mummery and Rix JJ agreed) addressed the meaning of the word 'household'. At [23] and [24], his Lordship approved a definition of 'household' stated in Santos v Santos [1972] EWCA Civ 9; [1972] Fam 247 as meaning 'people held together by a particular kind of tie, even if temporarily separated', and said '[t]hus they will be in the same household if they are tied by their relationship. The tie of that relationship may be made manifest by various elements, not simply their living under the same roof, but the public and private acknowledgement of their mutual society, and the mutual protection and support that binds them together ... .

Household - The Facts

7 When the plaintiff and Wayne commenced living together at the Poplars Motel in 1977 they occupied a dwelling that was divided into two flats. The dwelling was free standing but situated directly adjacent to and within the grounds of the motel. The back door was a very short distance from the motel carport that accommodated cars belonging to the family members. The plaintiff and Wayne shared the same laundry facilities as the motel, including the clothes-line. Their flat did not have its own laundry. Nor did it have, for the first twelve months of their occupation, its own kitchen. Most of their meals took place in the motel eating area.

8 The deceased and his wife Gwen lived at the motel in accommodation above the reception area. Their bedroom faced the carport. It was effectively about ten metres from the dwelling where the plaintiff and Wayne lived. With some exceptions, they often had breakfast and dinner together with the plaintiff and Wayne. This depended on many factors including working hours and other commitments. Wayne was at that stage of his life not a frequent attender at breakfast in any event. He said he preferred coffee and cigarettes. After about twelve months the plaintiff and Wayne moved into the adjoining flat which did have a kitchenette where they made some meals, but they continued to have other meals with the deceased and his wife, Gwen.

9 Gwen worked long hours in the administration of the motel office. I accept the evidence of the plaintiff that from time to time she cleaned the residence where the deceased and Gwen lived. She did this in her personal time and out of respect for the assistance which they had given to her and Wayne.

10 Kathryn, the young daughter of the deceased and Gwen, was aged about four years when the plaintiff first met Wayne. I accept that the plaintiff behaved towards her as an older sister and from time to time assisted her and her mother by taking meals to her, bathing her or brushing her hair. Sometimes Kathryn would sleep in the flat with the plaintiff and Wayne. In my view, the four adults and Kathryn lived in a relationship of shared resources and common community.

11 All of these factors indicate to me that the requirement pursuant to Section 57(1)(e)(ii) of the Succession Act that the plaintiff be a member of the deceased's household, at some time, was satisfied in the period between 1978 and 1979. In fact there was another period when the evidence suggests that there was a further household relationship. This occurred at the rural property known as Westlynne. Several times a year the plaintiff and Wayne would go to the property known as Westlynne. These migrations occurred during the harvest season and also when it was necessary to plough and scarify the land or to sow seed. The practice of going to Westlynne for these activities commenced in about 1979 and continued until about 1985. The house on the property at Westlynne had three bedrooms. The family group stayed there and the plaintiff initially shared a room with Kathryn. Afterwards she and the second defendant shared a room. The deceased had his own room.

12 The household was a shared community. The plaintiff's job was predominantly to look after the house, to wash, clean, cook and prepare all of the meals for the household while the men would tend to the farm work. There was no remuneration paid to her for this work. I accept that the family relationship at Westlynne during these seasonal visits was that of a household. The members of the family who were there had meals together whenever it was convenient to do so. They lived at Westlynne for the common purpose of conducting essential farming operations during those times of the year when it was necessary to do so.

Towards a Permanent Family Home

13 Before about 1992, the rural properties owned or controlled by the deceased consisted of three farms near Baradine. One was Westlynne, which I have mentioned. The other was Creswell and the third was Milroy. The evidence indicated that the Creswell property had been bought by the deceased and placed in Wayne's name. Indeed, it was later sold by the deceased without the intervention of Wayne, who received none of the proceeds of sale.

14 After the first year of their relationship, when the plaintiff and Wayne lived at the Poplars Motel in Coonabarabran, they spent a substantial time in the following year living on Westlynne. In 1980 they went on holiday to Queensland where they stayed for six months before returning to Coonabarabran. In 1981 they married. They then moved into a house on Creswell. Life on Creswell did not work out for the plaintiff and she and Wayne moved back to Coonabarabran where they lived for a while in a caravan supplied by the deceased. The caravan, although supplied by the deceased, was located on the plaintiff's parents' property. To this point in their relationship, the plaintiff and Wayne had always lived in accommodation provided by the deceased, except for their short time in Queensland.

15 In about 1983 the plaintiff received $20,000 as a gift from her parents. The money was used as a deposit on a home for the plaintiff and Wayne at Ann Street, Coonabarabran. The purchase price was $39,000. While living at Ann Street three of their four children were born. This appears to have been a stable period. However in 1991 the deceased approached the plaintiff and Wayne with a proposal to sell the three rural properties at Baradine and buy a larger property closer to Coonabarabran. The evidence of both the plaintiff and Wayne confirmed that the deceased had a general intention that this property would be their family home.

16 There are reasons to be cautious about the uncorroborated evidence of representations made long ago by a person who is now dead and unable to contradict what is attributed to him. I drew attention to certain well-known statements of guiding principle in Wilcox v Wilcox [2012] NSWSC 1138 at [9] and [10]. However the course of conduct from 1978 to 1991 supports the likelihood that that the deceased made a number of the statements of which the plaintiff gave evidence, or statements whose substance was similar. That is not to say that he intended the plaintiff and Wayne to have a beneficial interest in the property. But he did wish to set them up with a property which would be their family home on a permanent and ongoing basis. He was also by this stage getting old and no doubt wished to wind down his commitments. I accept that the deceased said words to the effect, 'The property will be in my name but it will be your family home'.

Purchase of Coolcappa

17 In March 1992 the deceased purchased the property known as Coolcappa. As soon as the sale was settled, the plaintiff and Wayne moved into the homestead and continued to occupy it together until their final separation in about 2009. Even after the separation and subsequent divorce, the plaintiff continued to live there, except for a short period of about three months. For twenty-two years, the plaintiff has been allowed to live at Coolcappa with her children, initially at the whim of the deceased, and after his death, with the consent of his trustees.

18 The property at Ann Street, Coonabarabran was retained for a while after the move to Coolcappa - until the deceased put another proposal. I accept that he said to the plaintiff words to the effect, 'It will be a show of good faith if you will agree to sell Ann Street and invest the money in Coolcappa. It will be an investment in your future'.

19 The decision to sell the Ann Street home was a difficult one for the plaintiff. And it upset her. But as had happened at every stage along the path of her adult life since 1978, she did as the deceased suggested. The Ann Street property was sold for approximately $74,000. After the mortgage was repaid, the net proceeds of sale amounted to about $40,000. The evidence was not crystal clear but I am reasonably satisfied as to the approximate amount. There was a dispute however as to what happened to the net proceeds of sale. I accept that it is more likely than not that the net proceeds of sale were made available for the benefit of the deceased in order to reduce the borrowings on Coolcappa. He told the plaintiff that he wanted some form of commitment or sign of good faith. This was it.

20 In 1996 the plaintiff's father died and she received approximately $11,000 from his estate, which she used to pay for the installation of ducted air-conditioning and vertical blinds for the residence on Coolcappa. The pattern of life on Coolcappa was dictated by the wishes of the deceased. He controlled the farming operations. The main sources of income were from beef, wheat and wool. He provided guidance and instruction to the plaintiff and Wayne about farming to the extent that they needed to learn more. He took them to bull sales and agricultural shows. From time to time, the plaintiff obtained casual work outside the farm, sometimes for the deceased at the motel and sometimes on other farms where she gained further farming knowledge and experience. Any income she received went into a joint account with her husband.

21 The deceased allowed the plaintiff and Wayne to sell some of the wool from the sheep and some of the cattle in their own names and to retain the income from those sales. Nonetheless, he would look over the accounts and generally control the operations, regularly making recommendations and giving advice. I accept that it was his intention that the plaintiff and Wayne would be able to treat the property as their own and that eventually they would become the owners of it after his death. From time to time he made statements such as 'This will all be yours some day'.

22 However, things change. In 1999 the plaintiff and Wayne began to experience marriage difficulties. As is often the case, there were many factors. One factor seems to have been that the plaintiff was becoming tired and frustrated as a result devoting so much of her life to a the farm that was owned and controlled by the deceased, without any legal recognition of the commitment to the property by her or her husband, or of the substantial time, effort and resources that they were investing in it. There was, I think, a degree of resentment at the full and complete control over Coolcappa that the deceased maintained. He apparently scrutinised every financial detail and occasionally criticised the expenditure of the plaintiff and Wayne. He even appears to have organised the preparation of tax returns for the plaintiff and Wayne by his accountant in Sydney.

Separation

23 From about 1999 the plaintiff and Wayne commenced to live separately, initially under the same roof and later in separate locations. The plaintiff moved into Coonabarabran with the four children. At one stage they went all the way towards obtaining a divorce but Wayne said words to the effect, 'You can't do this, you can't rip the farms apart'. The deceased was also understandably concerned and said words to the effect, 'It would be a pity for all of the assets and shares to be divided and lost due to divorce proceedings. If you call it off, we will sit down and work out a solution'. The clear premise on which both Wayne and the deceased expressed concern about the effect on the property of a possible marital break-up was an apprehension that the plaintiff had, or might have, some legal or proprietary right to an interest in Coolcappa.

24 The plaintiff was ambivalent about the divorce. And at this stage, so was the second defendant. They reversed their decision and proceeded poste haste to Newcastle where they obtained an order rescinding the divorce. The plaintiff, Wayne and the four children then returned to live at Coolcappa. The plaintiff made clear to the deceased that she intended in the future to obtain her own employment elsewhere and do her own taxes. In fact, nothing much changed. The farming operations continued as they had. The deceased allowed the plaintiff and Wayne to have some cattle and to receive the proceeds of sale to their own account, but every farming decision, every financial decision, was scrutinised by the deceased.

25 In October 2002 the deceased's second wife Gwen died. In 2003 the plaintiff commenced to suffer from depression and gained a substantial amount of weight. In 2008 the plaintiff and Wayne commenced a trial separation. In 2009 the deceased rented a small flat in Coonabarabran, and shortly afterwards was admitted to an aged care facility. The plaintiff then moved into the deceased's flat, which had a few months remaining on the lease, after which she returned to live at Coolcappa.

26 The relationship between the plaintiff and Wayne did not improve and eventually deteriorated. By 2009 it was clear that divorce was inevitable. Wayne moved away and commenced a new relationship with another person. In 2011 his marriage to the plaintiff was dissolved. The plaintiff's depression improved, she lost the weight which she had put on, but she was diagnosed with breast cancer, which is apparently now in remission. Given the closely interwoven lives of the family members, it is likely that these facts were known to the deceased when he made his will in 2009 and when he died in 2012.

27 Some indication of the moral obligation felt by the deceased towards the plaintiff is evident from his willingness to allow her to continue to reside on the property at Coolcappa. In 2009, after the plaintiff and Wayne finally separated, the deceased leased the Coolcappa property to a Mr and Mrs Doolan. But he excluded from the demise the lot on which the house is located where the plaintiff lives with her children, grandchildren and children's partners. His decision reflects some recognition that it was appropriate to provide for the plaintiff's accommodation and that of her children, notwithstanding the separation and the departure of her husband.

Credibility

28 I should make some general observations about the respective evidence of the plaintiff and Wayne. The plaintiff has had a difficult life and many tribulations, but she was an impressive witness whose evidence I feel able to accept in its essential respects. She was dignified. Her answers were direct and responsive. She was intelligent and she did not seek to overstate her case. I found her evidence to be credible in the main and helpful. She was not an advocate. She did her best to give an honest account of her recollections of past events. That is not to say that the evidence of Wayne was not also useful, but in a number of material respects he was prepared to make concessions or qualifications that tended to fortify my assessment of the facts, and which also tended to corroborate some of the aspects of the plaintiff's evidence on which I have relied. Admittedly, his evidence as to what happened to the net proceeds of sale of the property at Ann Street, Coonabarabran was different to that of the plaintiff, but I prefer her account. He was not convincing on this issue. And her evidence is more consistent with the probabilities, especially having regard to the statements about commitment and a show of faith which the deceased made.

Dependence

29 The plaintiff was effectively dependent on the deceased until he died. She is his divorced former daughter-in-law, who was married to his only son for thirty years and in a de facto relationship with him for thirty-three years. For at least twenty of those years, if not more, accommodation was provided to her by the deceased. The provision of accommodation alone may constitute dependency: Petrohilos v Hunter (1991) 25 NSWLR 343; Thompson v Public Trustee of New South Wales [2010] NSWSC 1137. In this case, the dependency was more broad-ranging. For approximately twenty of those years she worked the deceased's land with both the deceased and Wayne, although from time to time she sought and obtained employment away from the property. For the majority of her relationship with Wayne she was dependent on the deceased for her accommodation. That dependence continued after the breakdown of her marriage and included the provision of accommodation in a leased flat at Coonabarabran, as well as her continuing subsequent occupation of the residence on Coolcappa.

Factors Warranting Application

30 There are in my view factors warranting the making of an order pursuant to Section 59(1)(b) of the Succession Act. I have already recounted the plaintiff's essential circumstances. She has spent most of her adult life living and working in a tri-partite relationship with the deceased and Wayne. The deceased provided the farming property on which was situated the residence which was the family home of the plaintiff and her children for at least twenty years. This same property was central to the deceased's farming operations. To a limited extent he allowed the plaintiff and Wayne to share in those farming operations and to receive some of the revenue from them. It was a relationship of dependence and financial control, and to some extent, of not so subtle moral subjugation. The relationship no doubt lasted as long as it did because the plaintiff assumed (and hoped) that in the fullness of time, she and her husband would have the freedom and security of owning the property.

31 It is probable that at least until 2009 the deceased intended that he would leave Coolcappa to the plaintiff and Wayne on his death. He could not have failed to be aware that the plaintiff made substantial physical and financial contributions to the property, to the business, and to the prosperity of the farming operations. Wayne also made substantial physical contributions to the farming operation. Both of them, but especially the plaintiff, invested emotional capital in the property and assumed they would eventually acquire it, or at least a substantial part of it. They raised four of the deceased's grandchildren on the property.

32 However divorces happen and testators are entitled to change their mind. For that reason, it is not often that provision is made out of the estate of a deceased person in favour of his or her divorced former son or daughter-in-law. But there is no reason in principle why in any given case such a person may not be an eligible person entitled to make a family provision claim against the estate. Everything depends on the particular facts and circumstances of each case.

Financial Circumstances

33 In this case the plaintiff's financial circumstances are penurious. She lives in the residence on Coolcappa with three other adults and three children. The adults are her son, Daniel, her daughter Jessica, and Jessica's partner, Norbert. The children are the children of Jessica and Norbert. They are all under the age of 12. Another daughter and her partner lives in a separate cottage situated on the property. As at May 2013, none of the adults, including the plaintiff, were permanently employed.

34 The plaintiff receives a supplementary support benefit of about $200 per fortnight from Centrelink. She works on a casual basis at the Country Gardens Motel, Coonabarabran performing cleaning duties. For the financial year ended 2014 she received $11,000 in gross income. She owes $30,000 on her credit card and has no assets whatsoever, except for household effects of minimal value. She received nothing by way of property settlement on her divorce from Wayne and did not have the resources to pursue him. And in any event, although Wayne has the benefit of the rental income from his life interest in Coolcappa, he has few assets. He makes a living as one of the few taxi drivers in the country town of Mudgee. The plaintiff has emerged from a thirty year marriage with nothing, except the burden of children and grandchildren.

35 Because the facts of family provision cases are infinitely variable, it is not usually prudent to draw analogies with other cases, except at a general level. However an award in a case such as this is not without precedent. Thompson v MacDonald [2013] VSC 150 provides at least one example where the court was satisfied that a wise and just testator in the position of the testatrix would have made provision for her former daughter-in-law. Pagone J held at [52]:

I am satisfied that a wise and just testator in the position of the testatrix would have made provision for her former daughter-in-law. As at the date of death of the testatrix the facts concerning the position of her former daughter-in-law Lorraine, her circumstances, and her continuing obligations to her son Kenneth, were all known to the testatrix. She knew that William and Lorraine had divorced and had not maintained a supporting relationship towards each other. She knew that the full burden of caring for and supporting Kenneth had been assumed by Lorraine and that her son William was an alcoholic who depended upon his mother's continuing support. Lorraine had devoted the bulk of her married life as wife to the testatrix's son and as mother to their children. She had devoted herself as wife, mother and business partner to the maintenance and activities of East Glen for the better part of her working life until at the age of 60 she left her husband in large part to devote herself to the continued care and quality of life for her son Kenneth. A wise and just testatrix would not have excluded Lorraine from the Will and left Lorraine dependant upon her former husband for support.

Family Provision Order

36 I am satisfied in this case that a wise and just testator with the benefit of knowledge of the facts which I have explained, would have been prepared to make at least some modest provision out of his estate for the plaintiff, given her circumstances. In many ways the plaintiff's relationship with the deceased was more proximate, and her dependency more acute, than that which might normally be expected between father-in-law and daughter-in-law. And it extended over a lengthy time. I stress that in most cases, where a spouse has become divorced from the son or daughter of a testator, there is unlikely to be a sound basis for making a family provision order in favour of the former son or daughter-in-law. This is a special case but a generous award is not justified. I have reached the view that if the deceased had acted in a wise and just manner, it is unlikely that he would have been prepared to make a financial allowance for the plaintiff in any greater amount than the $100,000 that he gave to each of his stepdaughters and the daughter of his first marriage to Ida.

37 There is however another factor which requires consideration, bearing in mind the difficult accommodation situation facing the plaintiff and the number of dependents and other children who live with her. Having regard to the long history of the plaintiff's relationship with Coolcappa and the other matters that I have described at length, I think it is appropriate to make a further order that provision be made out of the estate of the deceased to allow her a limited continuing right of residence on Coolcappa solely to enable her to get her affairs in order and to find alternative accommodation. Counsel both submit that it would be appropriate to make such an order if I were otherwise satisfied that it was reasonable to do so.

38 The fact that the deceased himself recognised the plaintiff's right to remain on the Coolcappa property fortifies me in this regard. As I have earlier mentioned, when he leased the property to Mr and Mrs Doolan in 2009 he excluded the house block on which the plaintiff's residence is situated. The deceased made that decision at a time when the divorce between the plaintiff and the second defendant was inevitable. That arrangement has continued to this day. I propose that an appropriate period during which the plaintiff should be able to continue to reside on the Coolcappa property is eighteen months from the date on which these orders are made. After that date her entitlement to remain will cease.

Other Causes of Action

39 The plaintiff relied upon a number of additional causes of action including a resulting trust, a common intention trust, a constructive trust and an equitable estoppel. A foundation of these causes of action in one way or another was said to be the assurances given to her by the deceased from time to time about her future interest in the Coolcappa property, as well as contributions by the plaintiff to the purchase, upkeep and improvement of the property.

40 I do not think that anything said by the deceased reflected a sufficiently clear or strong intention to create a legal or beneficial interest in the property in favour of the plaintiff. His intention was, in my view, more loosely formed. He expected that the plaintiff and Wayne would be able to continue to reside on the property. And, at least until their separation in 2009, I suspect that he intended to leave it to them on his death. But I do not think that the evidence is sufficient to enable me to hold that he clearly represented that they would have a legal or beneficial interest or that there was a common intention that they would do so.

41 Nor was there a 'joint venture' for the purpose of enhancing the wealth of the deceased, the plaintiff and Wayne in any legal sense. Certainly not in a sense that would make it unconscionable to deny that the plaintiff holds a beneficial interest in Coolcappa. The representations, as I have made clear, were not sufficiently clear, unambiguous or certain to make it reasonable that the plaintiff should have assumed that she would receive a legal or beneficial interest in the property: Legione v Hately [1983] HCA 11; (1983) 152 CLR 406 at 435-437; Hammond v JP Morgan Australia [2012] NSWCA 295.

42 However, the plaintiff should have an equitable charge to secure the moneys that she has directly contributed to the property. This is a charge based on the principle explained in Morris v Morris (1982) 1 NSWLR 61. The evidence is clear enough that she applied approximately $11,000 to the property. And I accept the evidence that the net proceeds of sale of the Ann Street property were, on the balance of probabilities, paid to the deceased. Her share of those net proceeds of sale was approximately $20,000. That makes up $31,000.

43 There is force in the argument that the benefit of those contributions has amortised over the period since they were paid. But they were concrete contributions, which have enured for the benefit of the legal owner of the property and continue to do so. It would not be appropriate to ignore the plaintiff's claim to have a charge to secure the repayment to her of those moneys. In the circumstances, there is no reasonable basis for allowing interest. Although there was evidence of labour and other work which the plaintiff contributed to the property, it was nebulous. I do not regard any such intangible contributions as being sufficient to justify an equitable charge in this case. The two discrete amounts of $20,000 and $11,000 are in a different category. The orders should include a declaration that the plaintiff is entitled to an equitable charge over the land known as Coolcappa to secure the payment to her of the sum of $31,000. This is separate and distinct from her entitlement to a family provision order and is additional to it. I reject the various claims based on resulting trust, common intention trust, constructive trust and equitable estoppel.

Parties & Orders

44 It is necessary to say something about the parties to these proceedings and the orders that are necessary to give effect to my reasons. When the original summons was filed on 21 December 2012, it did not name any legally recognisable person or entity as a defendant, merely nominating the 'Estate of the late Wallace Francis Oakes'. Obviously, the executors of the estate should have been joined. Nothing was done about this irregularity until 27 February 2014, when a statement of claim was filed. Surprisingly, it named as defendants certain persons who were not the executors, namely James Edward Prosser-Fenn and Wayne Francis Oakes.

45 On 28 March 2014, at a directions hearing before Hallen J , the plaintiff's then counsel announced that it was also proposed to join the executors (Kathryn Annette Adams and Richard John Niven) as defendants. Hallen J was reluctant to allow their joinder and any consequential adjournment but apparently indicated that an undertaking from the executors to submit to and comply with any order of the court would be sufficient. That undertaking was given.

46 This medley of apparent confusion occurred partly as a result of a deed that was entered into on 26 August 2013. By that stage, each of the legacies of $100,000 had been distributed and $1.25 million had been paid to Kathryn Adams as the residuary beneficiary. The only material remaining undistributed asset was the real estate consisting of the property known as Coolcappa, which was subject to a life interest in favour of Wayne Oakes. The only substantial contingent liability was the plaintiff's claim.

47 The executors did not wish to continue to have the burden of the responsibility which the will imposed on them. They entered into a deed with Mr Prosser-Fenn and Wayne Oakes containing the following recitals:

A. Wallace Francis Oakes late of 'Wontama' 27 Summer Street, Orange in the State of New South Wales made his Will on 15 April, 2009 appointing Kathryn Annette Adams and Richard John Niven as Executors and Trustees thereof.

B. The said Wallace Francis Oakes died on 1 January, 2012.

C. Probate No. 2012/160861 was granted in the Supreme Court of New South Wales on 30 May, 2012 to the said Kathryn Annette Adams and Richard John Niven. A copy of the Probate is attached hereto.

D. The Original Trustees wish to retire and appoint the New Trustees in their place.

E. The New Trustees have consented to act as trustees of the Trust.

F. The Original Trustees wishes to acknowledge that it has notice of its removal as trustees of the Trust and of the appointment of the New Trustees in their place.

G. The only assets unadministered in the Estate are the real estate comprised in Certificates of Title Folio Identifier 1/330342, 2/753405, 3/753405, 5/753405, 6753405, 7/753405, 8/753405, 9/665040 and 101/831607 which real estate will be held by the Trustees in accordance with the terms of the Will during the lifetime of the said Wayne Francis Oakes.

48 The deed is ambiguous but I was told that it was intended to deal solely with the trust established in relation to the life interest in Coolcappa of Wayne Oakes. It does not explicitly operate to remove the executors from their role as executors of the deceased's will, only as 'trustees' of the specified real estate pending administration. The operative clauses state that the 'Original Trustees appoints (sic) the New Trustees in their place and resign as the Original Trustees'; that 'the New Trustees accept appointment as trustees of the Trust'; and that 'the New Trustees release and discharge the Original Trustees from all claims and demands arising out of the administration of the Trust'.

49 Paradoxically, at the date of hearing, the executors, but not the new trustees, were still the registered proprietors of Coolcappa. This should be rectified, at least to enable my orders to be effective and to ensure that the new trustees are in a position to discharge their responsibilities in respect of the land. Counsel for the defendants informed me that he was instructed by Kathryn Adams and that she consented to the orders that I propose. He also informed me that I could proceed on the same basis with regard to Mr Niven.

50 With that lengthy preamble, I make by consent the following declarations and orders to give effect to these reasons and to perfect the irregularities and infelicities that I have explained:

(1) Declare that, pursuant to Section 79 of the Succession Act 2006, so much of the distributed residuary estate of Wallace Francis Oakes as may be necessary to satisfy orders 2, 5, 7, 8 and 11 below, be designated as notional estate.

(2) Order that, pursuant to Section 59 of the Succession Act 2006, provision be made for the plaintiff out of the said notional estate in the sum of $100,000.

(3) Order that, pursuant to Section 59 Succession Act 2006, the plaintiff receive a right to reside, for a period of 18 calendar months from the date of these orders, on the 'Coolcappa Homestead block" comprising the existing homestead and surrounding 60 hectares, not otherwise leased to third parties, being part of the property contained in folio identifier 101/831607'.

(4) Declare that the plaintiff be entitled to an equitable charge over the property known as 'Coolcappa', comprising folio identifiers 1/330343, 2/753405, 3/753405, 5/753405, 6/753405, 7/753405, 8/753405, 9/665040 and 101/831607 to secure the payment to her of the sum of $31,000.

(5) Order that interest be not payable on the amount in Order 2 above if it is paid within 28 days of the date of these orders. If interest becomes payable on the amount it is to accrue at the rate provided by Section 84A Probate & Administration Act 1898.

(6) Order that the balance of the plaintiff's Statement of Claim filed on 27 February 2014 be otherwise dismissed.

(7) Order that the plaintiff's costs be paid from the said notional estate on the ordinary basis as agreed or assessed.

(8) Order that the defendants' costs be paid from the said notional estate on the indemnity basis.

(9) Order that Kathryn Annette Adams and Richard John Niven be joined in these proceedings as additional defendants.

(10) Order that Kathryn Annette Adams and Richard John Niven transfer to the first defendants the whole of their right, title and interest in the property known as Coolcappa more fully described in Order 4 above.

(11) Order that the costs of and incidental to the transfer of Coolcappa be paid from the said notional estate.

Decision last updated: 02 October 2014