Hildebrandt v Williams[2015] QDC 301

DISTRICT COURT OF QUEENSLAND

1. [1]
   This is an application for declarations for the interpretation of clause 3(b) of a Will dated 12 January 1989.^[1]It is the Will of Percival Edward Williams (“the deceased”) who died on 1 July 1989.

2. [2]
   The Will is dated 12 January 1989.

3. [3]
   So far as seems relevant, the Will provides:

2. I APPOINT my son RONALD EDWARD WILLIAMS to be the sole Executor and Trustee of this my last Will and Testament.

3. I GIVE DEVISE AND BEQUEATH the whole of my estate both real and personal of whatsoever kind and wheresoever situate UNTO AND TO the use of my Trustee upon the following Trusts:-

1. (a)
   To pay all my just debts funeral and testamentary expenses.

2. (b)
   To hold the dwelling house situated at 89 Belmont Road, Tingalpa Brisbane aforesaid together with the furniture contained therein for the use of my daughter DOREEN MAY WILLIAMS for her life and after her death such dwelling house is to be transferred to my daughter-in-law JUNE WILLIAMS for her sole use and benefit absolutely the said JUNE WILLIAMS being responsible for the payment of all rates electricity and gas accounts and keeping the said dwelling house insured against loss and damage from fire storm and tempest in an amount and in an Insurance Office approved by my Trustees in the same state of repair as at the date of my death.

3. (c)
   As to my lawn mower, motor vehicle, trailer and mechanical tools to my son the said RONALD EDWARD WILLIAMS for his sole use and benefit absolutely.

4. (d)
   As to the rest and residue of my Estate to such of them my grandson STEPHEN EDWARD WILLIAMS, my grandson PAUL RONALD WILLIAMS and my grand-daughter VICKI WILLIAMS who shall survive me and attain the age of TWENTY-ONE (21) years and if more than one as tenants in common in equal shares.

4. IT IS MY EXPRESS WISH without creating any binding trust that my daughter the said DOREEN MAY WILLIAMS be cared for by the said RONALD EDWARD WILLIAMS and the said JUNE WILLIAMS if they are so willing.

4. [4]
   The applicant is the Trustee of the Trust created by clause 3(b) of the deceased’s Will. By her counsel, the applicant Trustee submits that the probable intention of the deceased as ascertained from the words of the Will was that Doreen May Williams (“Doreen”) should have a personal right of occupation, rather than an equitable interest and that on the termination of Doreen’s interest, June Williams (“June”) should have an absolute interest. The first respondent, Doreen by her litigation guardian, by its counsel submitted, in effect, that Doreen has an equitable life interest rather than a personal right of occupation and that on the termination of Doreen’s interest, June has an absolute interest in the property.

5. [5]
   The deceased was survived by his two children, Ronald Edward Williams (“Ronald”) and Doreen. Doreen has an intellectual disability and had such a disability at material times in 1989. The deceased is also survived by three grandchildren who are children of Ronald. Those grandchildren are: Vicki Christine Hildebrandt, the applicant, Stephen Edward Williams, the third respondent and Paul Ronald Williams (“Paul”). Paul died on 9 June 2014. Paul’s personal representative is the fifth respondent. Ronald, named as the sole Trustee in the Will, died on 9 December 2014.

6. [6]
   Doreen was born on 23 November 1943. Accordingly, she was 45 years of age at material times in 1989. She is 72 years of age now. She continues to suffer from an intellectual disability. She also suffers short term memory loss and mild cognitive impairment. In March 2014 Doreen moved from the property to Garden City Aged Care Service in Upper Mt Gravatt. She is presently living at Alzheimer’s Association of Qld in Upper Mt Gravatt, having entered that aged care facility on 5 May 2014. I accept that it is unlikely that Doreen will be able to return to live at the property.

7. [7]
   June is 77 years of age. She would have been about 41 years of age at material times in 1989.

8. [8]
   The property in respect of which the declarations are sought does not exceed $750,000 in value.

9. [9]
   Section 33C of the Succession Act 1981 (Qld) does not apply.

Construction principles

10. [10]
    The Court construes the Will to give effect to the intention of the deceased. The deceased’s intention is to be gathered from the language of the Will read in the light of the circumstances in which the Will was made.^[2]  Where the language of a Will means that some clause is meaningless or uncertain or ambiguous, the Court may have regard to background circumstances of the will-maker. Two background circumstances which would be admissible for the interpretation of this Will if its meaning is uncertain or ambiguous are Doreen’s condition in 1989 and the fact that June had no legal obligation to care for Doreen.

11. [11]
    It is irrelevant to the proper construction of the Will, but it is the fact that June cared for Doreen after the death of the deceased for approximately 25 years in accordance with the wishes expressed in the Will until June and her husband Ronald, deceased, were unable to care for Doreen because of their own poor health and advanced age.

12. [12]
    The Will must be construed as a whole and not in a strictly technical or legalistic sense.^[3]

13. [13]
    The correct approach is to form an opinion about the particular Will and only then to go to other cases to see if the opinion requires any modification in light of previous decisions, rather than to import conclusions formed by courts interpreting other wills.^[4]The Court may not speculate or guess as to the intentions of a testator but must adopt what is the most probable meaning of the Will. That is not to say that the Court may not have regard to relevant matters known to the deceased in 1989.

The parties’ submissions

14. [14]
    The applicant submitted:

1. The fact that clause 3(b) imposes no obligation on Doreen to pay rates, utilities etc. could suggest it was intended to confer on Doreen an equitable estate;

2. the words “for the use of my daughter” tend to suggest a right of residence;

3. given Doreen’s intellectual disability it is more likely that the deceased intended Doreen to have a right to live at the property, rather than a life interest which would enable her to rent the property out;

4. the fact that Doreen’s interest is framed by reference to her “life” does not provide assistance as to the proper interpretation of her interest because it merely indicates the maximum duration of Doreen’s interest, not the nature of her interest;

5. As for June’s interest, the words “for her sole use and benefit absolutely” suggest that June is to take an absolute interest;

6. However, the words “the said JUNE WILLIAMS being responsible for the payment of all rates electricity and gas accounts and keeping the said dwelling house insured… in an Insurance Office approved by my Trustees in the same state of repair as at the date of my death” suggest that something less than an absolute interest may have been intended. The requirements that insurance arrangements be “approved” is inconsistent with an absolute interest;

7. But that reference to the trustees’ approval may be a drafting error. Indications of an error arise because the clause does not specify what is to happen if June fails to comply with the obligation to pay and because the Will does not contain any gift over on the termination of June’s interest.

15. [15]
    The submissions for Doreen are that:

1. Clause 3(b) gives the property to the trustee to be held on trust for Doreen to “use… for her life”. The ordinary meaning of “use”, defined in the Macquarie Dictionary (Revised 3^rd Edition) means “the enjoyment of property, as by employment, occupation or exercise of it. The benefit or profit of property (lands and tenements) in the possession of another who simply holds them for the beneficiary” (p 1330). Therefore the “use” means more than the right to live and is consistent with the right to take rents and profits and that suggests a proprietary interest and something more than mere personal enjoyment of the property.

2. The fact that the Will makes no provision for Doreen to pay rates and taxes is not determinative because a life tenant has the obligation to pay council water and sewage rates and taxes unless there is a contrary intention expressed in the Will.^[5]

3. The second part of clause 3(b) imposes the obligation to pay the outgoings and keep the property in the same state of repair on June (not Doreen). This is a contrary intention expressed in the Will.

4. The reason clause 3(b) requires June to pay the outgoings is consistent with a recognition of Doreen’s intellectual disability and limited financial means and because the clause gives June absolute ownership of the property on Doreen’s death. I infer that to mean that the unfairness of imposing such a financial burden on June is balanced by June’s obtaining absolute ownership upon Doreen’s death.

5. A trust to “use” the property “for her life” is unambiguous and should not be read down to a mere “right to reside”.

Analysis

16. [16]
    Clause 3(b) of the Will is ambiguous, both as to the deceased’s intention with respect to Doreen and his intention with respect to June. In interpreting the Will to determine the deceased’s intention, I may have regard to the fact that at material times in 1989 the deceased knew that Doreen had an intellectual disability, that she needed to be cared for by persons such as Ronald and June and that Ronald and June had no legal obligation to care for Doreen. The deceased would have known also that Doreen, by reason of her intellectual disability, had financial need.

17. [17]
    I find that the words “for her life” assist in determining the deceased’s intention. A trust of the dwelling house “for the use of (Doreen) for her life” is inconsistent with an intention that she have a mere right of occupation. A right of occupation is lost upon moving from the residence. From clause 4 and clause 3(b) of the Will it is evident that the deceased had an intention that Doreen have for life the security of a roof over her head and persons to care for her. It is more consistent with that intention that she have a life interest which could not be defeated by her moving from the premises as opposed to a license to occupy which could be defeated by moving. There is force in the submission that a trust to “use” the property “for her life” is unambiguous and should not be read down to a mere “right to reside”.

18. [18]
    As for the submission for the applicant that the fact that Doreen suffers an intellectual disability suggests that the deceased did not intend for her to have rents and profits, I do not accept it. The fact that a life interest in the property means Doreen could vacate it and be entitled to the rent from it does not seem to lessen the likelihood of the testator intending Doreen to have a life interest. The trustee’s receipt of rent for Doreen would mean it could be applied to her cost of alternative accommodation. A life interest is consistent with an intent that Doreen have accommodation for life. A licence to occupy, is consistent with the testator being content for Doreen to lose the security of a dwelling or its rents.

19. [19]
    I am satisfied that the meaning of clause 3(b) is that the trustee holds the property on trust for Doreen for life with the intention that Doreen has an equitable life interest in the property. With respect to June’s interest, I accept the possibility that the obligation imposed upon her to pay all rates etc. may be a drafting error as is submitted by counsel for the applicant. But, I reject that submission.

20. [20]
    The words of obligation imposed upon June in clause 3(b) are problematic. They make no sense if they are intended to apply after Doreen’s death and if June is to take the property absolutely. It makes no sense for the property to have a trustee after June takes the benefit absolutely. However, those words of obligation can be read sensibly in the clause. They are sensible if the obligation is intended to apply only during the term of Doreen’s life interest, but not afterwards. An intent that June pay rates and insurance as directed during Doreen’s life is consistent with the words of clause 3(b). An intention that after Doreen’s death June be the legal owner is consistent with the words of clause 3 (b). An intention that the obligation to take direction from a trustee should last only until June becomes legal owner is owner is consistent with the words of clause 3 (b).

21. [21]
    It is unnecessary to explain the obligation on June to take instruction from a trustee by reference to a drafting error. The obligation is explicable as intended to be imposed upon June. The only drafting idiosyncrasy is a failure to specify the reasonably obvious inference that the obligation lasts only until June becomes absolutely entitled to the property on Doreen’s death.

22. [22]
    That is a plausible explanation for the deceased’s inclusion of the obligation upon June to meet those expenses. The deceased recognised that because of Doreen’s intellectual disability and financial circumstances, Doreen was not in a position to meet the expenses of the property. The responsibility for payment which clause 3(b) expressed to be June’s responsibility was not expressed to commence upon Doreen’s death. It was intended to be an obligation during Doreen’s life. The wording is consistent with the testator’s hope that June would care for Doreen, by providing that June be responsible for payment of all rates etc. until June received the absolute interest in the property.

23. [23]
    That construction allows the apparent absolute gift to June to be read sensibly with the otherwise inconsistent requirement that June be responsible for payments and be obliged to seek approval from trustees. The intent was that June be subject to the trustee’s approval during Doreen’s life when June had no interest in the property but that June thereafter have an absolute interest without being subject to a trustee’s approval.

24. [24]
    I am satisfied that the intention of clause 3(b), so far as June is concerned, is to confer upon June, upon the termination of Doreen’s equitable estate, an absolute interest in the property.