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Stojanovska v Stojanovski[2019] QDC 142

Stojanovska v Stojanovski[2019] QDC 142

 

DISTRICT COURT OF QUEENSLAND

 

CITATION:

Stojanovska v Stojanovski [2019] QDC 142

PARTIES:

HRISTINA STOJANOVSKA
(applicant)

v

LJUBE STOJANOVSKI
(respondent)

FILE NO/S:

2106/17

DIVISION:

Civil

PROCEEDING:

Application

ORIGINATING COURT:

District Court at Brisbane

DELIVERED ON:

21 August 2019

DELIVERED AT:

Brisbane

HEARING DATE:

20, 21 and 28 June 2019

JUDGE:

Barlow QC DCJ

ORDER:

The proceeding be adjourned for submissions on costs.

CATCHWORDS:

SUCCESSION – FAMILY PROVISION – REQUIREMENT FOR ADEQUATE AND PROPER MAINTENANCE – WHETHER APPLICANT LEFT WITH INSUFFICIENT PROVISION – CLAIMS BY CHILDREN – whether provision is adequate and proper having regard to the totality of the relationship between the applicant and the deceased – the applicant was the daughter of the deceased – the applicant had made a substantial monetary contribution to the value of the deceased’s estate and had cared for the deceased what provision should be made for the applicant

SUCCESSION – ADMINISTRATION OF ESTATE –– property of the estate jointly owned by applicant (10%) and deceased (90%) – Applicant had lived in property since deceased’s death – whether applicant liable to contribute an occupation rent to the estate

Legislation

Succession Act 1981 (Qld) ss 35, 36A, 41, sch 2 pt 1

Cases

Biviano v Natoli (1998) 43 NSWLR 695, applied

Bkassini v Sarkis [2017] NSWSC 1487, applied

Callow v Rupchev (2009) 14 BPR 27,533, applied

Coates v National Trustees Executors & Agency Co Ltd (1956) 95 CLR 494, applied

Collins v Mutton [2012] NSWSC 548, applied

Re Fulop (decd) (1987) 8 NSWLR 679, applied

Hughes v National Trustees, Executors & Agency Co. of Australasia Ltd (1978-1979) 143 CLR 134, applied

Laursen v Laursen [2009] 2 Qd R 148, considered

Perpetual Trustees Queensland Ltd v Mayne [1992] QCA 417, considered

Singer v Berghouse (1994) 181 CLR 201, applied

Re Sinnot [1948] VLR 279, applied

Vigolo v Bostin (2005) 221 CLR 191, applied

W v D (2012) 115 SASR 61, considered

COUNSEL:

MK Conrick for the applicant

AD Stobie for the respondent

GR Dickson for the administrator

SOLICITORS:

Spranklin McCartney Lawyers for the applicant

Burns Law for the respondent

Gleeson Lawyers for the administrator

Introduction

  1. [1]
    Velika Stojanovska (“Velika”) died intestate on 3 October 2015 at the age of 65. Until a few months before her death, she had been living with her only daughter, Hristina (“Tina”), in a house owned by them both in differing shares. Velika is survived by Tina, Tina’s brother Igor and their father Ljube (Velika’s husband). Velika and Ljube had been separated since late 2010.[1]
  1. [2]
    Tina is now applying for adequate provision to be made for her maintenance and support out of Velika’s estate.[2]  However, she seeks that Igor’s entitlement be exonerated from any incidence of an order in her favour.[3]
  1. [3]
    As Velika died intestate, the usual distribution of her estate is under part 3 of the Succession Act.  The operation of that part means that, absent any order made pursuant to this application, Ljube, Tina and Igor are entitled to take the following interests in the residuary estate: 
  1. (a)
    Ljube is entitled to $150,000 and the household chattels and one third of the residuary estate then remaining;[4]
  1. (b)
    each of Tina and Igor is entitled to take half of the remainder of the residuary estate after Ljube’s entitlements are satisfied.[5] 
  1. [4]
    It falls to me to determine whether the ordinary division of the estate makes adequate provision for Tina. I have concluded that it does not and that she should be entitled to half of the residuary estate. After Igor’s one third, that will leave one sixth for Ljube.

Value of estate

  1. [5]
    In order to give some perspective to the various family members’ entitlements, it is important to estimate the value of Velika’s estate. At the time of her death, Velika and Tina, as tenants in common, owned a house in Holland Park, where they ordinarily lived. Velika’s share was 9/10ths and Tina’s share was 1/10th. Velika’s share of that house is by far the principal asset in her estate.
  1. [6]
    Subject to four items, there is no dispute as to the value of the assets and liabilities in Velika’s estate. They were deposed to by the administrator, Mr Gleeson. If one were to accept all the items in his list of assets and liabilities, then the net value of the estate (subject to any costs of this application to be deducted from it) is $247,433.[6] 
  1. [7]
    The four items in dispute are:
  1. (a)
    whether Tina is liable to contribute to the estate an occupation rent for the period since Velika’s death, which Mr Gleeson has valued (and the amount is not disputed) at $82,062;
  1. (b)
    whether Tina is entitled to claim 9/10ths of the amounts that she has paid, since Velika’s death, in reduction of a home loan in her and Velika’s names secured by a mortgage over the property, and for rates on the property and utilities utilised by Tina for the property;[7]
  1. (c)
    whether Tina is entitled to claim from the estate 9/10ths of payments that she has made, since Velika’s death, in respect of another loan taken out jointly by her and Velika in the original sum of $50,000, which is also secured by the mortgage;[8]and
  1. (d)
    the administrator’s legal costs of $79,839.[9]
  1. [8]
    If one excludes the sum of those items in dispute from the value of the estate as deposed to by Mr Gleeson, the estate has assets of $562,665 and liabilities of $244,344, resulting in a net value of $318,321.
  1. [9]
    The value of the estate is therefore not large. It concerns me considerably that, between them, the parties have incurred substantial legal costs in respect of such a comparatively small estate. I raised my concern with the parties shortly before the beginning of the trial and was informed that they had not been able to resolve their dispute, despite offers having been made. Accordingly, it falls to me to do so, but with the result that the amount available to the parties out of the estate will be substantially reduced. For example, if each party’s costs total about $80,000, if the estate were to bear all parties’ costs, the net value would be little more than $78,000.
  1. [10]
    It is also relevant to the question of whether adequate provision is made for the proper maintenance and support of Tina as a result of the intestacy, to determine how much she would be entitled to under that intestacy. Under the provisions referred to in paragraph [3] above, after Ljube’s entitlement to $150,000 and the furniture and household goods and to 1/3rd of the balance, based on a net value of $318,321, Ljube would be entitled to $206,107 (64.85% of the total value) and each of Tina and Igor would entitled to $56,107 (17.625% each).  Of course, those sums are dramatically reduced if all parties’ costs are first paid out of the estate. 

Principles for family provision

  1. [11]
    In considering an application under s 41 of the Act, the court is required to undertake a two stage process. 
  1. [12]
    First, the court must determine whether the disposition of the estate under the intestacy was not such as to make adequate provision for the proper maintenance and support of the applicant. This is, in effect, a jurisdictional question. It is to be determined at the date of the deceased’s death.[10] 
  1. [13]
    Secondly, if that question is answered affirmatively, then the court has a discretion to make such provision as it thinks fit for the proper maintenance and support of the applicant. In determining the exercise of its discretion, the court must take into account the relevant facts as they exist at the time of making the order.[11] 
  1. [14]
    In the first stage, the court ought ordinarily to consider the applicant’s financial position, the size and nature of the estate, the totality of the relationship between the applicant and the deceased and the relationship between the deceased and other persons who have legitimate claims upon the estate.[12]  This involves the exercise of value judgments, the words “adequate” and “proper” being relative.  There are no fixed standards and the court is left to form opinions upon the basis of its own general knowledge and experience of current social conditions and standards.  It is an objective question to be determined by the judge at the date of the hearing.[13] 
  1. [15]
    Adequacy of provision that has been made (if any) is not to be decided in a vacuum, nor by simply considering whether the applicant has enough on which to survive or to live comfortably. Adequacy or otherwise depends on all the relevant circumstances. The age, capacities, means and competing claims of all the potential beneficiaries must be taken into account and weighed with all the other relevant factors.[14]  The court may take into account such matters as: 
  1. (a)
    the nature and quality of the relationship between the applicant and the deceased;
  1. (b)
    the character and conduct of the applicant;
  1. (c)
    the nature and extent of the applicant’s present and reasonably anticipated future needs;
  1. (d)
    the size and nature of the estate of the deceased;
  1. (e)
    the nature and relevant strength of the claims to testamentary recognition by the deceased of those taking benefits under the intestacy; and
  1. (f)
    any contribution, financial or otherwise, direct or indirect, by the applicant to the property or welfare of the deceased.[15] 
  1. [16]
    “Proper maintenance” is not limited to the bare sustenance of the applicant. It requires consideration of the totality of the applicant’s position in life, including age, status, relationship with the deceased, financial circumstances, the environments to which he or she is accustomed and mobility.[16] 
  1. [17]
    On the question of financial need, the concept is a relative one. It is not necessary for an applicant to demonstrate that he or she is destitute.[17] 
  1. [18]
    In determining the second stage, should it arise, similar considerations are involved, although that stage involves an exercise of discretion rather than the determination of a jurisdictional fact. As it involves an exercise of discretion, the court can refuse to make an order even if it is satisfied of the fact in its consideration of the first stage. For example, the court might exercise that discretion against an applicant where there are no assets of the estate from which an order could reasonably be made at the time of the judgment.[18] 
  1. [19]
    No special principle is generally applied in the case of an application for provision by an adult child of the deceased. However, a court can normally assume that an adult child is able to “maintain and support” herself and some special need or some special claim must generally speaking be shown to justify intervention by the court.[19]  It has been recognised, however, that in some cases a special claim may be found to exist because the applicant has contributed to building up the deceased’s estate or has helped the deceased in other ways.[20]
  1. [20]
    An example of a case in which an award was made on the basis of the contribution which the applicant had made to building up the deceased’s estate is Perpetual Trustees Queensland Ltd v Mayne.[21]  The primary judge took into account the applicant’s contribution to his late father’s estate.  That basis for the award was upheld by the Court of Appeal, although the amount of the award was reduced.[22]
  1. [21]
    In another case,[23] the three adult sons of the deceased and of his widow failed in their applications for provision.  Perhaps most relevantly, Jones J said at [26]:

“None of them made any contribution to the testator’s assets whereas the contribution of the [widow] appears to have been a major source of his estate.  None of them provided any services beyond ordinary familial contact, whereas the [widow] was his carer virtually without respite over a 12 year period. … The obligation on the testator to make provision for her was extremely high.”

The history, relationships and contributions of the parties

  1. [22]
    Velika and Ljube married in their country of birth, Macedonia, in 1975. Tina and Igor were born in Macedonia: Tina in 1977 and Igor in 1979. Ljube migrated to New Zealand in the early 1990s and was joined by Velika and the children in 1995. Ljube then migrated to Australia in 1999 and was joined by Velika in 2000, while Tina and Igor remained in New Zealand.
  1. [23]
    In May 2011, Velika swore an affidavit in the Federal Magistrates Court (as it then was) in Brisbane in support of property settlement proceedings between her and Ljube arising from their separation in October 2010.[24]  In that affidavit Velika deposed that, during their relationship, Ljube had been very abusive to her, both emotionally and physically.  In particular, on 3 April 2002 Ljube physically assaulted her, resulting in a domestic violence order being made against him and police removing him from the matrimonial home.  Velika deposed that the order was later cancelled and they resumed living together.
  1. [24]
    Velika went on to depose that, after she and Ljube moved to Brisbane, Ljube continued to be abusive to her. She related two occasions in particular, one in 2003 and the other in October 2010, when Ljube attacked her. By the date of the latter occasion, Tina had immigrated to Australia and lived with Velika and Ljube in their matrimonial home. That home was the property that now comprises the major asset of Velika’s estate, which Ljube had acquired in his own name.
  1. [25]
    In October 2010, Ljube violently assaulted both Velika and Tina. By that stage, Velika had been diagnosed with cancer and was undergoing chemotherapy. Ljube left the marital home and did not return to live in it thereafter. In 2011, Ljube was sentenced to nine months’ imprisonment for his assault on Velika.
  1. [26]
    Velika and Tina continued to live in the former matrimonial home. In September 2011, however, Velika obtained family property settlement orders from the Federal Magistrates Court, under which the marital assets were to be divided in the proportions of 38 per cent to Ljube and 62 per cent to Velika. In order to give effect to that order, Ljube was required to transfer to Velika all of his interest in the former matrimonial home, with Velika to refinance the home loan in her own name.
  1. [27]
    When it came to refinancing the home loan, on the bank’s insistence it became necessary for Tina to become a party to the home loan and, for that purpose, to take an interest in the property. In March 2012 she acquired a 10% interest in the property as tenant-in-common, leaving 90% in Velika’s name. Between the date of refinancing and the date of Velika’s death, each of Velika and Tina paid 50% of the amounts due under that home loan, even though Tina only held a 10% interest in the property. They also shared equally all the other costs of maintaining the property. Since Velika’s death, Tina has made all of the mortgage repayments and has paid the other expenses associated with maintaining and holding the property.
  1. [28]
    In January 2013, Velika and Tina borrowed another $50,000, secured by the mortgage over the property. Tina’s evidence was that that sum was put into an account under Velika’s control and was used by Velika as and when she needed it. Tina said she did not know how Velika spent it. Notwithstanding that it was for Velika’s use only, Velika and Tina borrowed the sum jointly and shared the repayments equally until Velika’s death.[25]  I accept that evidence.  There is no dispute that Tina has been making all the repayments under that loan since Velika’s death.
  1. [29]
    Velika’s cancer and associated illnesses progressed between 2010 and her death in October 2015. Until about May 2015, she continued to live in the property with Tina. Tina worked fulltime, but states in her evidence that she also looked after her mother as her illness progressed.
  1. [30]
    Velika was hospitalised in about May 2015 and, in August 2015, she was transferred to the St Vincent’s Private Hospital, where she stayed until her death.
  1. [31]
    A substantial dispute in this proceeding between Tina and Ljube is about the extent of Ljube’s contact with Velika and the extent to which he contributed to her welfare and care during the period from 2011 to 2015. Tina contends that Ljube had very little contact, having been excluded from the house and living elsewhere, and that Tina was substantially responsible for caring for Velika as her illnesses worsened.
  1. [32]
    Ljube gave evidence that he frequently visited Velika in the house, he had keys to the house and to the garage, which he used to obtain access in Tina’s absence when she was at work or out in the evenings, and that Ljube kept a car in the garage, which he was restoring for some time. Ljube said that mostly he attended the house when Tina was not present, although Tina knew that he was occasionally present and they sometimes had dinner together with Velika at the house.
  1. [33]
    Igor married in New Zealand in 2012. Ljube and Velika travelled together to New Zealand for the wedding. While there, they stayed together in one bedroom in Igor’s house, as if they were husband and wife in a marital relationship. Igor also stated in an affidavit that Velika and Ljube travelled to New Zealand to visit him every year, acting as a couple and sleeping in the same room. He said that Velika told him that they were back together and that everything was fine between them, when they were there for his wedding. He says he often talked to Velika on the telephone and Ljube was mostly with her when he called. Sometimes they were at the house and sometimes they were at other places.
  1. [34]
    Notwithstanding Igor’s evidence in his affidavit that suggested that Velika and Ljube travelled together frequently, because he visited them and they visited him at least once a year, it appears from his cross-examination that that was not correct. They did visit him for his wedding in 2012 and they may have visited him when his son was born in 2011, but I am not satisfied that, from the date that Ljube and Velika separated, they visited Igor on any other occasions. When they did visit him, they acted as if they were an ordinary married couple in order to keep the peace and not to embarrass Igor or his wife.
  1. [35]
    It also appears that Igor did not visit Velika very frequently. At most, he was in Brisbane for two to four days in the years that he visited and such visits were not annual, as he had claimed in his affidavit. I agree with the submission on behalf of Tina that he simply did not have the opportunity to make any meaningful observations of how Velika and Tina shared their household and the cooking and other duties of maintaining that household, nor of the extent of the ongoing relationship between Velika and Ljube. In those circumstances, I did not find Igor’s evidence about those matters to be of any assistance.
  1. [36]
    Both Ljube and Igor gave evidence to the effect that Velika was scared of Tina and sought to hide from her the extent to which she saw Ljube. I accept that Velika did attempt to minimise the extent of Tina’s knowledge of the ongoing relationship between Velika and Ljube, but I do not accept that she was scared of Tina. Although Tina appears to me to have a forceful personality, I consider that she and Velika had a good mother and daughter relationship. But Velika knew that Tina intensely disliked Ljube and was not happy that he had an ongoing friendly relationship with Velika. It is not surprising that Velika and Ljube minimised Tina’s knowledge of their interactions, but that was not because of any fear of Tina herself.
  1. [37]
    A good deal of emphasis was placed by the parties on who visited Velika and how frequently, during the period she was in hospital, from about May to October 2015. Each of Tina and Ljube gave evidence that she or he (respectively) visited her daily. The hospital’s records of nurses’ notes were tendered and relied on by each of Tina and Ljube to demonstrate that she or he was (respectively) frequently in attendance and involved with Velika’s care.
  1. [38]
    There are certainly entries in the hospital records that demonstrate that on occasions Ljube attended. Otherwise, the records are mostly ambiguous, referring in most cases to “family” visiting, although on occasions they refer to “Tina” or “daughter” or to “husband”. Counsel for Tina has submitted that the records list Tina or daughter on 30 occasions but husband only on five and that those entries are indicative of the proportion of visits from each of them.
  1. [39]
    I am not able to reach any conclusions as to how often either Tina or Ljube visited Velika while she was in hospital, although it is clear that both of them did visit her on some occasions and between them the visits were frequent. In many places, the records refer to family discussions, which suggests, and I infer, that more than one member of Velika’s family were present at the same time on at least some of the occasions. In that case, the multiple members of the family could only be Tina and Ljube.
  1. [40]
    As for the period before Velika’s hospitalisation, Ljube contends that he visited her frequently and often took her out for a cup of coffee or for a walk. Tina denies that. However, as counsel for Ljube pointed out, Tina was working fulltime during most, if not all, of that period and the period of Velika’s hospitalisation and therefore, while she was at work, she could not know what Velika was doing or whether Ljube was visiting her, either at the house or at the hospital.
  1. [41]
    Having seen both Ljube and Tina give evidence, it is my impression that Ljube exaggerated the extent of his visits and his relationship with Velika, but that Tina attempted to minimise that relationship by effectively denying the probability that Ljube visited Velika when Tina was not present at the house or in the hospital.
  1. [42]
    My conclusion is that, after about late 2011 or early 2012 (after Ljube’s release from prison), Ljube and Velika redeveloped a relationship of sorts, although not a marital relationship. I consider it likely that Ljube visited Velika relatively frequently when she was living in the house, mostly in the absence of Tina. I also consider that he probably visited her relatively frequently when she was in hospital, again mostly in the absence of Tina.
  1. [43]
    I also conclude that Igor maintained a good relationship with both Velika and Ljube, although principally from a distance, as he has lived in New Zealand throughout the relevant period (and continues to do so). He and Tina clearly do not have a close relationship.
  1. [44]
    It is clear to me that Tina hates Ljube, wishes to have nothing to do with him and would have preferred that Velika also had had nothing to do with him after the occasion of violence in 2010. However, Tina’s wishes in the latter regard were not fulfilled.
  1. [45]
    In summary, although Ljube and Velika did not have any form of marital relationship after 2010, they did develop a form of friendship and affection for each other and Ljube did attempt to care for Velika as best he could in the circumstances.
  1. [46]
    Tina, however, bore the brunt of caring for Velika throughout her illness and contributed substantially to Velika’s wellbeing and, of course, to the maintenance of the jointly shared house. I consider that Tina’s contributions to Velika’s wellbeing and to her property (which became the property of her estate) were considerable and far above those of Ljube.
  1. [47]
    The substantial asset of the estate is, of course, the house, which Ljube had formerly owned. It might be said that, by transferring the house to Velika, Ljube contributed substantially to her estate and that I should take that contribution into account. However, the transfer was pursuant to a court order that determined how the marital assets should be divided between the separated spouses. Such orders are made to recognise, among other things, the respective contributions of the parties to those assets over the period of their relationship. In that sense, the transfer of the house to Velika was simply attributing to her the contributions that she had made during their marriage. In my view, it is not properly considered as a contribution by Ljube to Velika’s assets during her lifetime and therefore to her estate.
  1. [48]
    Ljube complains that he was not paid sums that were due to him under the marital asset distribution order made in 2011. However, the order did not require Velika to pay any amounts to him. Rather, after transferring the house and a vehicle to Velika, he was declared to be entitled to all personal property in his ownership and possession or under his control at the date of the order, including a vehicle, his superannuation and money that he had withdrawn from a line of equity account secured by the mortgage and from his superannuation account in 2009 and 2010. He was not owed any money by Velika. Nor did he ever challenge the order. I do not accept any suggestion that Ljube has some claim to provision (nor to a debt) out of the estate as a consequence of the order.

Was adequate provision made for Tina?

  1. [49]
    As I have said, Tina bore the brunt of looking after Velika and contributed substantially, in financial terms, to Velika’s estate. At the date of Velika’s death, the effect of the disposition of the estate under the intestacy rules was not, in my view, such as to make adequate provision for Tina’s proper maintenance and support. As she had contributed, both materially and emotionally, to Velika and to both loans secured by the mortgage over the property, it is reasonable to expect that Velika would have looked to assist Tina in maintaining her living standard and the home in which she had lived for quite some time and, particularly, during the period of Velika’s illness.
  1. [50]
    In determining whether adequate and proper provision has been made for Tina, I need to take into account the competing claims of Tina, Igor and Ljube. Principally, in this case, I need to consider the positions of Tina and Ljube.
  1. [51]
    Tina was, during the relevant period, and remains employed as a dental nurse. She is now about 42 years old and in good health. At the time she swore her affidavit in 2017 she had a gross income of approximately $54,000 per annum and a superannuation balance of about $40,000. Her evidence was that her current salary is about $2,990 per fortnight, or about $60,000 per annum.[26]  I note, however, that $2,990 per fortnight would equate to an annual salary of about $77,740, so it is not clear what her income currently is.
  1. [52]
    Counsel for Ljube criticised Tina for not providing accurate details of her current income and superannuation balance. Clearly both of those sums are higher than they were in 2017. On the other hand, in my view Tina cannot be said to have a large income and she is unlikely to have a superannuation balance much (if any) in excess of about $60,000.[27]
  1. [53]
    Additionally, Tina owns a car which she estimated to be worth approximately $9,000 in 2017.
  1. [54]
    Tina’s liabilities are principally her share of the amounts owed and secured by the home.
  1. [55]
    Igor appears to be comparatively well off, having stable employment, a good income and assets, although there was no direct evidence about his financial position.
  1. [56]
    Ljube, on the other hand, is 64 years of age. He relies on government benefits and is in chronic poor health. He appears to have no assets to speak of.
  1. [57]
    Having regard to all these matters, I consider that adequate provision has not been made for Tina’s proper maintenance and support. She cannot be said to be wealthy, although she does appear to be in good health and has a normal earning capacity for the remainder of her working life, which is likely to be at least another 20 years. But she contributed substantially, both to Velika’s wellbeing and to the value of the estate, by living with and caring for Velika and by contributing half of the amounts needed to maintain the repayments on both loans secured by the home and half of the expenses of running the home and keeping the property. Ljube is substantially worse off, both financially and in his health. However, having separated from Velika in 2010 and having divided their assets by court order in 2011, notwithstanding that he and Velika reinstituted a friendly relationship between 2011 and 2015, I consider that he has no moral call on Velika to provide any support to him.
  1. [58]
    An order such as that made by the Federal Magistrates Court in 2011 is intended, as far as practicable, to determine finally the financial relationships between the parties to the marriage.[28]  That will not automatically preclude a former spouse being entitled to claim provision from the deceased spouse’s estate, but in most cases such an order is likely to terminate any obligation on the deceased to make testamentary provision for his or her former spouse.[29]  In considering any claim by the surviving spouse (or in considering another relative’s claim, such as that by Tina in this case), the court must be careful not to allow the application to become a forum for litigating questions of matrimonial fault long since removed from family law.[30]
  1. [59]
    On the other hand, the fact that the former spouse has unmet financial needs at the date of the deceased’s death or of the hearing is not, of itself, a basis for finding that there are factors warranting the making of family provision for the surviving former spouse.[31]
  1. [60]
    If Velika and Ljube had divorced, then Ljube would not really have any claim upon the estate, particularly given that the property settlement had divided the marital assets and Ljube has never challenged that settlement. If they had been divorced, then the intestate estate would have been divided equally between Tina and Igor (absent any application such as this). However, as Ljube and Velika did not get divorced, but they maintained a form of relationship, I must take that into account in determining what provision should be made for Tina.
  1. [61]
    Having concluded that proper provision has not been made for Tina, I must determine what provision should be made for her in all the circumstances. In doing so, I must take into account similar considerations to those which I considered in determining whether adequate provision had been made.
  1. [62]
    Clearly, Tina is not destitute. In comparison with Ljube, in particular, she is reasonably well off and certainly able to maintain herself, whereas Ljube is in a poor financial position, with no real prospects of improving it.
  1. [63]
    In my opinion, although she is an adult, Tina has a special claim on the estate because of her contributions to helping Velika, caring for her while they were living together and assisting and supervising her care while she was in hospital. She also contributed substantially to building up Velika’s estate, by contributing 50% to the loan repayments and other expenses of holding and maintaining the property for about the last five years of Velika’s life. In contrast, neither Ljube nor Igor made any substantial monetary contribution to the value of that estate and, although they maintained a relationship with Velika, Igor’s was no more than might be expected of a son living in another country and Ljube’s was, for all practical purposes, limited to that of a close friend who did not live with her.
  1. [64]
    In all these circumstances, it seems to me that Velika had a moral duty to provide substantially for Tina’s maintenance and support out of Velika’s estate. In my opinion, it is appropriate that Tina receive the majority of the estate. What exact proportion she should obtain will depend substantially on the true value of the estate, a subject to which I shall now turn.

Disputed items in the estate

  1. [65]
    The principal items in dispute are:
  1. (a)
    whether Tina should be liable to the estate for an occupation rent for the period since Velika’s death, as she has been the sole occupant of the property, in which she only has a 1/10th interest;
  1. (b)
    whether Tina is entitled to make a claim against the estate for 9/10ths of the contributions that she has made to that estate (in terms of loan repayments and payments relating to holding the property, such as rates and utilities) since Velika’s death.
  1. [66]
    Ordinarily, a co-owner who has not excluded the other co-owner from occupying the co-owned premises is entitled to full use and occupation of the property owned in common, as if he or she were the only owner. But if only one co-owner occupies the property and the occupying co-owner seeks compensation from the other owner for a proportionate share of the costs of improvement or enhancement of the value of the property (including a proportionate share of mortgage repayments), then the non-occupying co-owner may be entitled to offset against that liability what is known as an occupation rent: that is, a fair amount that the resident co-owner ought pay for the use of the property, recognising the benefit to that owner of the continued occupancy of the property. However, the occupation rent may only be claimed up to a limit of the amount of contribution claimed by the resident co-owner.[32]
  1. [67]
    In the case of the breakdown in a domestic relationship, where it is no longer practicable for both co-owners to occupy the premises, the owner who remains in possession is generally taken to do so to the exclusion of the other and therefore to be liable to pay an occupation rent to the non-resident co-owner.[33] 
  1. [68]
    However, it has recently been held that, where the interest of a co-owner passes by devolution to a party outside the pre-existing domestic relationship between the coowners (such as an executor or administrator of the estate of a co-owner, or someone who has acquired an interest in the property as a beneficiary of the estate), the usual expectation pending the sale of the property would be that it would continue as the home of the remaining co-owner and would not become the home of the new coowner.  In such a circumstance, usually the non-resident owner would not be entitled to claim an occupation rent from the resident owner.[34]  This is so at least if the resident co-owner does not actively exclude the non-resident and deny the latter’s rights or his or her ability to sell the property. 
  1. [69]
    In this case, Tina shared residency of the property with Velika during Velika’s life, after her separation with Ljube. Since Velika’s death, the administrator of Velika’s estate has become the co-owner with Tina. Obviously the administrator would not expect to occupy the home. Tina has not prevented the administrator from taking steps to have the property sold. Rather, the administrator, sensibly, appears to have decided not to take any such steps pending the outcome of this proceeding. In those circumstances, it seems to me that the administrator is not entitled to claim any occupation rent from Tina.
  1. [70]
    On the other hand, since Velika’s death, Tina has maintained the property and made payments on the loans secured by the property and rates in respect of the property, at her entire expense notwithstanding that she has only a 1/10th interest in it. In my view, she is entitled to claim from the estate 9/10ths of those expenses. These amounts are the repayments of the home loan (the estate’s share is $53,339), the repayments of the small loan (estate’s share $10,319) and payment of the rates (estate’s share $5,908). I do not consider, however, that Tina is entitled to claim 9/10ths of the cost of utilities for which she has paid since Velika’s death, as those utilities have essentially been used solely for her benefit as the occupant of the premises.

Determination of valuation of estate before costs

  1. [71]
    The result of my consideration above is that the estate comprises the following (having regard to the figures deposed to by the administrator, but not including costs not already ordered to be paid):

Assets and Liabilities

Value

Assets

 

ANZ Cheque Account

$165

9/10ths share of Property

$562,500

Total assets

$562,665

 

Liabilities

 

9/10ths share of home loan ($213,101)

$191,791

9/10ths share of small loan ($43,536)

$39,183

9/10ths share of home loan payments since date of death ($59,266)

$53,339

9/10ths share of small loan payments since date of death ($11,466)

$10,319

9/10ths share of rates payments since date of death ($6,564)

$5,908

Applicant’s legal costs under order made on 5 June 2017

$10,069

Mediator’s costs

$3,300

Total Liabilities

$313,909

Net value of estate (pre-costs)

$248,756

Conclusion

  1. [72]
    Having regard to all of the factors which I have discussed above, including the respective relationships between Velika on the one hand and Tina and Ljube on the other hand, the contributions which Tina has made to the value of the estate, the contributions which both Tina and, to a lesser extent, Ljube made to the emotional and physical support of Velika during her illness and the exoneration of Igor’s share of the estate from Tina’s claim, I consider that the appropriate provision that ought be made for Tina is one half of the residual value of the estate.
  1. [73]
    The result is that Tina will be entitled to half, Igor will be entitled to 1/3rd and Ljube will be entitled to 1/6th of the residual value of the estate.

Costs

  1. [74]
    Submissions were made to me, during the trial, about how the parties’ costs should be dealt with. I have already mentioned the likely extent of their costs and their possible effect on the amount of the estate that will be available for distribution.
  1. [75]
    Given my conclusions on the application, I consider it appropriate to receive further submissions before determining how each party’s costs should be dealt with. I will say, however, that no party should assume that I will order that some or all of that or any other party’s costs be paid out of the estate.

Orders

  1. [76]
    As it has been necessary to determine what are the assets and liabilities of the estate, it would be open to the Court to make declarations reflecting my determinations on those issues. However, unless it becomes necessary in order to resolve any further dispute between the parties about the effect of my orders, I do not propose to make any such declarations. Rather, the assets and liabilities of the estate should be determined by the administrator in accordance with my findings set out in these reasons.
  1. [77]
    I propose to make the following orders:
  1. That provision be made for the proper maintenance and support of the applicant, Hristina Stojanovska, out of the estate of the late Velika Stojanovska, by the applicant being paid one half of the residual estate, after payment of all due and proper debts of the estate.
  1. One third of that residual estate, comprising that part to which Igor Stojanovski would be entitled under the deceased’s intestacy, be exonerated from the incidence of order 1.
  1. Declare that, as a consequence of orders 1 and 2, Igor Stojanovski will be entitled to one third of the residual estate and Ljube Stojanovski will be entitled to one sixth of the residual estate.
  1. [78]
    However, I shall not make final orders until I determine the question of costs.
  1. [79]
    I shall adjourn the proceeding to receive submissions from the parties on costs.

Footnotes

[1]  As the dispute is between members of the same family, I propose to refer to them by their given names, without meaning disrespect to any of them. 

[2]  Pursuant to the Succession Act 1991 (Qld), s 41(1).

[3]  In the application, Igor’s entitlement is referred to as being pursuant to sch 2, pt 1, item 2(1)(b)(ii) of the Act, whereas his entitlement is not pursuant to that paragraph but item 3 and s 36A. 

[4]  Section 35(1); sch 2, pt 1, item 2(1)(a) and (b)(ii). 

[5]  Schedule 2, pt 1, item 3; s 36A(2) and (4). 

[6]  In these reasons, I shall ignore any cents and round down to the nearest whole dollar. 

[7]  Respectively, Tina’s claimed amounts for these items were $53,339 for the home loan, $5,908 for rates and $3,543 for utilities. 

[8]  Tina’s claim in respect of these amounts totals $10,319.  This loan was referred to by the parties as the small loan.

[9]  I do not understand Tina and Ljube to dispute that the administrator is entitled to his reasonable legal costs, but the amount of what is reasonable is disputed by Tina. 

[10] Coates v National Trustees Executors & Agency Co Ltd (1956) 95 CLR 494, at 508 (Dixon CJ), 516 (Webb J), 528 (Kitto J). 

[11] Coates, at 509 (Dixon CJ), 515 (Webb J agreeing with Dixon CJ), 528 (Kitto J). 

[12] Singer v Berghouse (1994) 181 CLR 201, at 209-210. 

[13] Singer at 211. 

[14] Vigolo v Bostin (2005) 221 CLR 191, at [122] (Callinan and Heydon JJ).

[15] Re Fulop (decd) (1987) 8 NSWLR 679, at 680. 

[16] Collins v Mutton [2012] NSWSC 548, at [59]. 

[17] Collins at [94]. 

[18] Singer at [138]. 

[19] Re Sinnot [1948] VLR 279, at [280] (Fullagar J).

[20] Hughes v National Trustees, Executors & Agency Co. of Australasia Ltd (1979) 143 CLR 134, at 147 (Gibbs J).

[21]  [1992] QCA 417.

[22]  This appears in particular from the primary judge’s reasons quoted and approved by Fitzgerald P and de Jersey J in their reasons at 13; see also the reasons of Pincus JA at 7-8.

[23] Laursen v Laursen [2009] 2 Qd R 148.

[24]  Exhibit “HS3” to the affidavit of Tina, Exhibit 1 in the trial.  No objection was taken to that part of Exhibit 1.

[25]  T1-43:4 to T1-44:9.

[26]  T1-64: 6-14.

[27]  On a salary of about $70,000, there would have been up to approximately $7,000 per annum added to it her superannuation account since her affidavit was sworn in July 2016, adding about $20,000 to the balance to which she deposed at that stage.  If her current salary is only around $60,000, the current balance of her superannuation would obviously be less.

[28] Family Law Act 1975 (Cth), s 81.

[29] Lodin v Lodin [2017] NSWCA 327, at [128].

[30] Lodin at [129].  Counsel for Tina did, in some respects, emphasise aspects of matrimonial fault by Ljube, referring frequently to his abusive relationship to Velika.  I do not consider it relevant, except marginally in determining whether they had an ongoing relationship.

[31] Lodin at [123].

[32]  These rules have developed over time.  For a reasonably recent review and exposition of them, see W v D (2012) 115 SASR 61, at [70] – [79].

[33] Biviano v Natoli (1998) 43 NSWLR 695, particularly at 700; Callow v Rupchev (2009) 14 BPR 27,533, at [59] – [60].

[34] Bkassini v Sarkis [2017] NSWSC 1487, at [139], [142], [159] and [192] – [194].

Close

Editorial Notes

  • Published Case Name:

    Stojanovska v Stojanovski

  • Shortened Case Name:

    Stojanovska v Stojanovski

  • MNC:

    [2019] QDC 142

  • Court:

    QDC

  • Judge(s):

    Barlow DCJ

  • Date:

    21 Aug 2019

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

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