Moylan v Rickard[2010] QSC 327

SUPREME COURT OF QUEENSLAND

1. By her will, Mrs Sybil Moylan (the deceased) made a disposition to her husband, the applicant, of a sum of money calculated by reference to her principal place of residence on the date of her death.  However, the respondents, who are her children from a previous marriage, had sold her house more than two years previously, acting under an Enduring Power of Attorney (EPA).  They then gifted part of the proceeds of sale to themselves.  Subsequent to the deceased’s death, they distributed her estate.  The applicant now seeks a declaration as to his entitlement under the will, and other relief under the Powers of Attorney Act 1998 (Qld) (PA Act), the Trusts Act 1973 (Qld), and the Succession Act 1981 (Qld).

Background

2. The applicant and the deceased commenced a relationship in 1973. They married in 1979. Although they remained married until the deceased’s death, the marriage experienced some difficulties, including on at least one occasion a separation of the parties.

3. On the commencement of the relationship, the applicant and the deceased lived in a house at 11 Prospect Street, Wilston (Wilston house).  The Wilston house was owned by the deceased.  It had previously belonged to her father. 

4. On 2 October 1996, the deceased executed her will. On the same date, she executed the EPA.

5. It about 1999, the deceased began to suffer the effects of Alzheimer’s disease. She was diagnosed as suffering from this disease by 2000. Her condition gradually deteriorated.

6. In late 2004 the applicant suffered a significant heart attack. Until then, he had been living with the deceased in the Wilston house. He was admitted to hospital, and remained in hospital for a period of appropriately six months.

7. Ms Rickard then arranged for the deceased to come and stay with her. However, she formed the view that, because of the deceased’s condition and her own family commitments, she could not continue to care for her. She arranged for the deceased to be admitted to Hill View House at Ashmore in January 2005. At that time the facilities at Hill View House were not adequate for the deceased, and Ms Rickard arranged that she be admitted to the RSL Aged Care Facility at Currumbin, in April 2005.

8. When the applicant was discharged from hospital, he was unable to care for himself, and stayed with his son Donald.

9. In the meantime, in early 2005, the respondents formed the view that they did not have sufficient funds available to enable them to maintain the Wilston house, and to pay for the deceased’s care. A decision was made to sell the home. It is common ground that at the time of this decision the deceased would not have been capable of understanding that the house was being sold.

10. The respondents then took steps to prepare the Wilston house for sale. This included painting the house, and carrying out repairs. Until this time, some of the applicant’s personal effects had remained at the house, but they were delivered to him. It appears that many of the deceased’s personal effects remained at the house until this time.

11. The house was placed on the market in October 2005. The respondents entered into a contract to sell the house dated 7 January 2006. The sale price was $885,000. The contract was completed on 8 March 2006. On settlement, the solicitors acting for the respondents received the sum of $845,116.94.

12. From the proceeds of sale, and some additional moneys of the deceased, a sum of $600,000 was invested to provide an income to meet the cost of the deceased’s care, and other expenses she might incur; $115,000 was given to Mr Allen as a gift; and $129,476.14 was paid to Ms Rickard, of which $115,000 was by way of gift.

13. The deceased died on 5 April 2008. On 8 October 2008, probate of the deceased’s will was granted to the respondents. On 5 November 2008, the sum of $220,224.32 was distributed to Ms Rickard. On 4 December 2008, a sum in the same amount was distributed to Mr Allen. A further sum of $35,067.16 was distributed to Mr Allen, and $28,340.21 was distributed to Ms Rickard. The dates of these distributions are not apparent, but would appear to have been after 30 October 2008. Of the amounts distributed, $442,681.03 represented the proceeds of the investment of $600,000, being part of the proceeds of sale of the house. A sum of $63,407.37 represented the balance in the deceased’s account with Suncorp. Income from the investment had been deposited to this account.

14. It appears to be common ground that around 20 August 2009 a request was made on behalf of the applicant, to the solicitors for the respondents, in relation to the deceased’s estate. The person who made the inquiry was Ms Janette McKillop, the partner of one of the applicant’s sons. She has deposed that she made a telephone call to the respondents’ solicitors to obtain a copy of the deceased’s will. She also deposed that on 26 August 2009 she again telephoned the respondent’s solicitors and spoke to a Mr David Brown. She asked why the applicant had not been contacted about the will. The reason that Mr Brown gave for this was that the house having been sold prior to the deceased’s death, the applicant was not entitled to receive anything from the estate.

15. The applicant deposes to other occasions on which requests were made for a copy of the will. These are in issue. The applicant obtained a copy of the deceased’s will from the Court Registry in August 2009.

16. These proceedings were commenced by application filed on 8 February 2010. The application initially came on for hearing on 11 March 2010, and was adjourned to 9 April 2010. It was further adjourned to the civil list, for hearing on 7 May 2010. No witness was cross-examined at the hearing. Supplementary submissions were received in May 2010, the applicant’s submissions in reply being received about 31 May 2010.

17. At the hearing, the applicants relied upon evidence of the movement in the price of houses in the Wilston area, between the date when the deceased’s house was sold in 2006, and the present time. The purpose of this evidence was to enable calculation of the value which the deceased’s house would have at the date of her death, by reference to the sale price and market movement.

18. After the Wilston house was sold, work was carried out to modify it. A valuation of it at the date of the deceased’s death, in the condition in which it then was, is quite unlikely to reflect the value it would have had, if it had not been sold in 2006. Evidence was given of the growth in the median house prices in Wilston between 2006 and 2008. The application of the growth rate to the price for which the Wilston house was sold in 2006 would result in a value, as at the date of the deceased’s death, of $1,194,730.

19. It is convenient at this point to make more detailed reference to the deceased’s will.

The will

20. The will revoked the deceased’s previous wills. It expressly modified what was s 32 of the Succession Act 1981, at the time when the deceased executed the will (dealing with the deemed lapsing of a disposition of property, where the beneficiary does not survive the testator for 30 days).^[1]  It appointed the respondents as the deceased’s executors and trustees.

21. The critical provisions of the will are contained in clause 4, which is as follows:

“4.I GIVE DEVISE AND BEQUEATH the whole of my estate both real and personal of whatsoever kind and nature and wheresoever situate UNTO and to the use of my trustees UPON TRUST to sell and convert (but with power to postpone the selling and conversion as my trustees see fit) into money so much thereof as my trustees shall from time to time in their absolute discretion consider necessary or desirable for the purpose of facilitating the administration of my estate and after payment of all probate succession estate death and other duties payable on or in respect of my estate or in respect of any succession arising on my death and of all my debts funeral (which is to include cremation, niche reservation and purchase, niche engravement fees and the like) and testamentary expenses TO HOLD the balance then remaining (hereinafter called ‘my residuary trust estate’) UPON TRUST as follows:-

(a)as to my piano, my clothing and wearing apparel and my jewellery and articles of personal use and adornment for the said Robyn Shirley Riekard absolutely;

(b)as to any motor vehicle that I may own at the date of my death and my go1d fob watch without chain, engraved with my father's initials and the year 1912, for the said Christopher William Allen absolutely;

(c)as to the land and improvements constituting my principal place of residence at the date of my death (‘house property’) but not including any of the contents, to be dealt with as follows:

(i)my trustees are to obtain a valuation of the market value of the house property as soon as practicable after the date of my death;

(ii)if the house property has neither been sold nor contracted to be sold within three (3) months of the date of my death, then my trustees are to pay a legacy equal to fifteen (15) per cent of the market value of the house property (from which market value, however, is to be deducted sales commission at the rate of five per cent on the first EIGHTEEN THOUSAND DOLLARS ($18,000.00) and two and half per cent on the balance, as if the house property had been sold) and to pay such legacy to my husband LESLIE PATRICK MOYLAN if he outlives me for thirty (30) days;

(iii)if the house property is sold within such three (3) month period, then my trustees are to pay to the said Leslie Patrick Moylan (if he outlives me for thirty (30) days) a legacy equal to fifteen (15) per cent of the proceeds of sale net of sales commission;

(iv)once the legacy for the said Leslie Patrick Moylan has been quantified pursuant to (ii) or (iii), no later event is to be the basis for any alteration in the amount of such legacy;

(v) the legacy for my said husband, whether it is payable pursuant to (ii) or (iii), is not payable to him any earlier than three (3) months from the date of my death;

(vi)as to the house property, or what remains of the proceeds of sale of same, to be distributed as part of my net residuary trust estate;

(d)as to my net residuary trust estate for such of the said Robyn Shirley Rickard absolutely and Christopher William Allan absolutely (and in both cases, in addition to other benefits derived hereunder) who outlive me and if both then equally as tenants in common but subject to what follows;

(e)if either of my two children predecease me leaving a child or children (‘grandchildren’) alive at my death who have then attained or thereafter attain the age of twenty-one (21) years then those grandchildren are to take and if more than one then equally as tenants in common the beneficial entitlement that his, her or their parent would have taken if he or she had outlived me.”

22. Clause 5 conferred certain powers upon the respondent. It included the power to mortgage the whole or any part of the estate; and the power to borrow money for the purpose of carrying out the administration of the estate.

Issues

23. At the hearing, the relief sought by the applicant was conveniently grouped into four categories or claims.

24. The relief sought in respect of the first claim may be summarised as follows:

(a)A declaration that the gift to the applicant pursuant to clause 4(c) of the will was not adeemed by the sale of the Wilston house;

(b)An order that the respondents account for moneys received from the sale of the Wilston house;                

(c)A declaration that the applicant is entitled to receive 15 per cent of the net sale proceeds of the Wilston house, together with interest;

(d)An order that the respondents pay that amount to the applicant, together with interest.

25. The respondents contended that the gift contained in clause 4(c) of the will was adeemed. The gift to the applicant was said to be “a specific legacy that could not be fulfilled”. It was also submitted that the gift was “conditional on the property being available at the date of the death”; and that the fund “only comes into existence if (the deceased) has an interest in her principal place of residence at the date of the death”. It was also orally submitted that the gift was “a gift of a sum of money arising from the sale proceeds” of the Wilston house; and that under the will there was no other possibility of a legacy. It was also submitted the gift was neither a general legacy nor a demonstrative legacy; and that caution should be exercised in construing the will, so that it was not given a construction which was not within the contemplation of the deceased.

26. The second claim sought relief under ss 106 and 107 of the PA Act.  The relief sought under s 106 was, in substance, restitution to the estate of the sum of $285,000 primarily by reference to the gifts which they distributed to themselves subsequent to the sale of the Wilston house.  The relief sought under s 107 of the PA Act was for compensation of the loss suffered by the applicant as a result of the sale of the Wilston house.  Extensions of time were sought for the making of the application for these forms of relief.

27. The respondents opposed an extension of time for relief under s 106. No submission was made about the extension of time under s 107. It was also submitted that the respondents should be relieved from liability under s 105 of the PA Act.

28. The respondents also relied on ss 88 and 89 of the PA Act.

29. The third claim sought relief based on an alleged breach of the obligation found in s 33Z of the Succession Act by reason of the failure of the respondents to provide to the applicant a copy of the will; declarations that the respondents are in breach of trust for that reason, and by reason of their distribution of the estate; an order that the respondents pay damages for breach of s 33Z of the Succession Act; and an order that the respondents hold sums distributed to them as trustees of a constructive trust, to the value of the gift to the applicant for which the will makes provision.

30. For the respondents, it is submitted that the claims based on s 33Z of the Succession Act are not sustainable.  It is also said that the applicant’s evidence about the requests for a copy of the will should not be accepted.  It is also submitted that the applicant suffered no loss as a result of the alleged breach of trust; and that in any event, the respondents ought be excused under s 76 of the Trusts Act.

31. For the respondents, it is submitted that s 33Z of the Succession Act does not create a statutory right to damages.  It is submitted there has been no breach by the respondents of their obligations as trustees, nor as executors. 

32. Finally, as an alternative claim, the applicant seeks an order for better provision out of the estate of the deceased under s 41 of the Succession Act, and a direction under s 41(8) that the application be heard and determined, notwithstanding it was not instituted within nine months of the death of the deceased.  The applicant has indicated that it does not wish this application determined in the present hearing.

33. The respondents submit that the application should not be determined, having been instituted more than nine months after the death of the deceased. They also submit they are entitled to the benefit of s 44(3) of the Succession Act, the deceased’s estate having been fully distributed.

Principles of construction of will

34. A number of principles of construction are potentially relevant. I make particular reference to the following:

(a)The first principle of construction is to give effect to the intention of a testator as expressed in the words of the will;^[2]

(b)The intention of the testator is collected from the whole will, with reference to such extrinsic evidence as the rules allow, and the meaning of the will and every part of it is determined according to that intention;^[3]

(c)Under the general law, statements of, or explanatory of, intention made by a testator are not admissible except in a case of latent ambiguity;^[4]

(c)If the will shows that the testator must necessarily have intended an interest to be given which there are no words in the will expressly to devise, the court is to supply the defect by implication; and thus to mould the language of the testator, so as to carry into effect, as far as possible, the intention which the court considers the testator has, on the whole will, sufficiently declared;^[5]

(d)An inference cannot be made that does not necessarily result from the whole of the will, taken together;^[6]

(e)The court should lean towards a construction of an instrument which preserves, rather than destroys its effect.  Where the question is not one of choosing between two rival constructions, but, on reading an instrument one may either take it verbally and literally, as it is, or with a somewhat larger and more liberal construction, and by supplying words in the way in which there is every reason to believe the maker of it intended that it should stand, and thus preserving the effect of the instrument, that approach is to be preferred;^[7]

(f)In determining whether, as a matter of construction, a legacy is a specific legacy or a general legacy, the court leans against finding the legacy to be a specific one;^[8]

(g)The question whether a gift has been adeemed depends upon the apparent intention of the testator;^[9]

(h)Legal technical terms in a will should be given their technical meaning unless the context of the will otherwise indicates;^[10]

(h)Nevertheless, the circumstances may be such that a will should not be construed in a strictly technical or legalistic sense, and its construction should be sensitive to the factual context of ordinary life and circumstances.^[11]

35. Reference was also made to s 33E of the Succession Act, which provides that a will takes effect, in relation to the property disposed of by the will, as if it had been executed immediately before the testator’s death, unless a contrary intention appears in the will; and to s 33C of that Act, dealing with extrinsic evidence, including evidence of the testator’s intention.  Fuller reference will be made to s 33C later in these reasons.  

Preliminary observations on clause 4(c)

36. The following observations may be made about cl 4(c) of the will:

(a)It intended to provide for a gift to the applicant of a sum of money;

(b)The sum of money to be given to the applicant was to be calculated by reference to a property described as the deceased’s “principal place of residence at the date of my death”;

(c)A possible source of the money to be given to the applicant is the sale of the property, but only if the property were sold within three months of the date of the deceased’s death;

(d)If the property were sold in that period, the amount of money payable to the applicant is to be calculated by reference to the proceeds of the sale;

(e)If the property were not sold within that period, then the amount to be paid to applicant is to be calculated by reference to the market value of the property at about the date of the deceased’s death;

(f)Once the amount payable to the applicant has been determined by either of these two methods, the amount is fixed; subsequent events are not to alter the amount payable;

(g)The gift to the applicant is not payable until three months have elapsed after the date of the death of the deceased;  

(h)The property, or what remains of the proceeds of the sale of the property, is to fall into residue.

Doctrine of ademption does not apply

37. In Williams^[12] the following appears:

“A specific gift may be adeemed by the subject-matter of the gift, between the date of the will and that of the testator’s death, ceasing to be part of his estate or ceasing to be subject to his right of disposition or ceasing to conform to the description by which it is given.  This may result from the testator’s own disposition or change of investment or other events subsequent to the will and prior to the death of the testator.” (references omitted)

38. Although stating a similar principle, Theobald adds:^[13]

“Strictly speaking the doctrine of ademption is only applicable if the subject matter of the gift is to be ascertained at some time prior to the testator’s death.  If a specific gift speaks from the testator’s death it cannot fail under the doctrine of ademption, but it does nevertheless fail if at his death the testator has no assets which answer to the description in the will.”

39. It will be obvious that the principle applies where a gift in a will is a gift of specific property. The rationale for the principle is that the property not forming part of deceased’s estate, effect cannot be given to a gift of it.^[14]

40. The gift to the applicant in cl 4(c) of the will is not a gift of specific property. It is a gift of a sum of money. In my view, that gift cannot fail by reason of the doctrine of ademption.

41. Mr Peterson of Counsel, who appeared for the respondents, made reference to Re Culbertson.^[15]That case discussed the difference between general legacies, demonstrative legacies and specific legacies.  A specific legacy was identified as “a gift by will of a particular thing forming part of the testator’s estate or of a specified legal or equitable interest, such being described in a sufficiently explicit manner in the will as to enable it to be identified as separated from the mass of the testator’s estate inclusive of other things of the same kind, if any, and which is satisfied by the executor by delivery of the particular thing or by appropriate transfer of such interest to the legatee.”^[16]

42. A demonstrative legacy was described as “an unconditional gift of a specified amount accompanied by a reference to a particular fund or source for payment thereof”.^[17] A general legacy is a legacy which is neither specific nor demonstrative.^[18]

43. As I have indicated, the gift made to the applicant in cl 4(c) is not a specific legacy. It bears some analogy with a demonstrative legacy, for, if the property were sold within three months of the deceased’s death, then the sale price provides a measure for the amount of the gift; and it seems likely that it would constitute the source of funds for that gift. However, the gift is intended to take effect even if a sale of the property does not occur within three months of the death. In that case, the source of the funds is not specified in the will, whether directly or indirectly.

44. A demonstrative legacy is not adeemed by the total or partial failure at the testator’s death of the fund out of which it was to be paid.^[19]

45. The gift to the applicant found in cl 4(c) of the will is clearly not a specific gift or legacy. Indeed, its connexion to the property referred to in that clause as a source of funds for the gift is not as close as the connexion between a demonstrative legacy, and the property which provides the source of funds for such a legacy.

46. I am therefore of the view that the gift referred to in cl 4(c) the will is not adeemed, because it is not a gift of specific property; rather it is a gift of money, the amount of which is to be determined by reference to a property.

Construction of cl 4(c) under general law

47. While s 33C of the Succession Act may permit recourse to evidence, including evidence of the deceased’s intention, to construe this provision of her will, it seems appropriate initially to consider the construction of this clause, without reliance on its provisions.

48. I should first refer to a submission made on behalf of the respondents that the gift was a gift of a sum of money arising from the proceeds of sale of the property referred to in cl 4(c). In my view, it is clear that that submission is not correct. Clause 4(c) envisaged the payment of a sum of money to the applicant, whether or not the property referred to in the clause was sold.

49. Earlier in these reasons I have dealt with the submission that the gift was a specific legacy, which could not be fulfilled, and reached the conclusion that the gift was not a specific legacy.

50. I shall next deal with the submission that the gift provided for in cl 4(c) was conditional on the property being available at the date of the death of the deceased.

51. When the will refers to a “principal place of residence” it clearly contemplates real property owned by the deceased at the time of her death, and which might be sold by her executors, or as part of her estate. The language of the will does not contemplate the possibility that she would not own such a property at the time of her death. Nor does it purport to make the gift to the applicant conditional or contingent upon the deceased’s owning such a property at the date of her death. It therefore seems to me that it is not accurate to describe the gift to the applicant as contingent or conditional.

52. However, a difficulty becomes apparent when an attempt is made to determine the amount of the gift. Two methods of determining the amount were identified by the will. On a natural reading of the language of the will, it is not possible to give effect to either method, because, at the time of her death, the deceased did not own any land and improvements which could be described as her principal place of residence. On such a reading of the will, the gift is uncertain.

53. There are cases where a reference in a will to particular property has been held to be a reference to some other form of property into which the first-mentioned property has been converted.^[20]  However, that principle has not been applied where the testator did not possess and did not, at the date of the will, contemplate possessing the property which was later acquired.^[21]  This approach does not, therefore, make it possible to take the reference to the deceased’s principal place of residence at the date of her death, as a reference to the proceeds of sale of the place of residence last owned by her prior to her death.

54. As has been indicated, the parties conducted the litigation on the basis that the doctrine of ademption might be capable of applying to the gift to the applicant. In that context, I was referred to Re Viertel^[22] and a number of authorities which are to similar effect.^[23]  They are cases of specific gifts, where the testator or testatrix lost mental capacity subsequent to executing the will, and an agent disposed of the property the subject of the gift.  It was held that this did not adeem the gift.  The consequence appears to be that any fund replacing the property then becomes the subject of the gift.

55. In Re Viertel, reference was also made to Re Larking.^[24]  During his lifetime, a testator incurred two debts.  The will provided that an insurance policy on the testator’s life should be used to pay those debts, and the balance of the proceeds of the policy should be paid to his daughter.  During his lifetime, he repaid the first of the debts.  Subsequently, he was found to be lunatic, and a committee was appointed, which repaid the second debt.  A question arose as to whether the daughter should take the whole of the policy, or whether the amount of the second debt should be deducted from the proceeds of the policy, and included in the deceased’s personal estate.  The court held for the latter course.  Re Larking was relied on in Re Viertel, and referred to in Johnston v Maclarn.  The principle that an act taken during the testator’s incapacity does not affect a disposition of property is not, it would seem, limited to cases to which the doctrine of ademption applies.

56. This principle would support ignoring the sale of the Wilston house when the deceased lacked the capacity to make decisions for herself, in determining the effect of clause 4(c) of her will. That is not a large step to take. It is difficult to identify any reason in principle not to take it. Indeed, to do so would avoid uncertainty, an objective which courts of construction frequently go to some lengths to achieve.

57. A question then arises whether the Wilston house, had it not been sold, might be identified as the deceased’s principal place of residence at the date of her death. An answer in the affirmative is supported by a number of authorities.^[25]  The will plainly intended to refer to a residential property owned by the deceased at the date of her death.  The Wilston house satisfies that description.  It would appear from Ms Rickard’s evidence that much of the deceased’s personal property remained in this house at least until early 2005.  After her death, her estate included furniture which, it seems likely, remained in the house, probably with other property, until about the time it was sold.  The deceased’s absence from the house was not the result of a choice made by her to change her place of residence, but a consequence the fact that she was no longer capable of looking after herself, as she was by then significantly affected by Alzheimer’s disease, together with the fact that the applicant had, as a result of his heart attack, not been able to care for her at the house.  While the deceased remained capable of forming an intention, the evidence strongly suggests that she intended the Wilston house to be her residence.  It seems to me that, had it not been sold, the Wilston house was appropriately described as the deceased’s principal place of residence at the time of her death.

58. I therefore conclude that an analogy may be made with the approach taken in Re Viertel to avoid the failure of the gift intended by the deceased in favour of her husband.

59. Ordinarily, one might expect that this would have the result that the gift to the plaintiff is to be determined by reference to the fund retained by the deceased at the date of her death, resulting from the sale of the house. Counsel for the applicants submitted that if Re Viertel is applied, then the applicant was entitled to receive 15 per cent of the net sale proceeds of the Wilston property.  While counsel for the respondents contested the applicability of Re Viertel, he did not contest the applicant’s position about the consequences.  One might think that ordinarily the correct approach would be to identify the amount retained from the proceeds of sale of the Wilston house, at the time of the death of the deceased.  It may be that the position taken on behalf of the respondents reflects the fact that they made gifts to themselves out of the proceeds of sale of the Wilston house, shortly after that transaction was completed; and that this was likely to affect not only the amount of capital retained thereafter, but also the income generated from the investment, so that the deceased’s maintenance had in part to be met out of income when that may not have been necessary, but for the gifts which the respondents made to themselves.  In view of the way the case has been conducted, I am minded to accept the submission made on behalf of the applicant, in the particular circumstances of this case.  I am therefore prepared to make a declaration that, on the proper construction of the will, and in the events which have happened, under the will the applicant was entitled to receive fifteen percent of the net proceeds of sale of the Wilston house.

Evidence under s 33C

60. The language used in cl 4(c) of the will is not ambiguous. Nor, on the face of the will, is it without meaning. However, unless the analogy with Re Viertel is applied, the gift to the applicant is uncertain, and in my view the part of the will which makes provision for it is meaningless.  In case I am wrong to apply Re Viertel, I propose to consider the construction of the will by reference to evidence which would, in that case, be admissible under s 33C.

61. The respondents adduced evidence of the deceased’s prior will. It was dated 21 March 1991. It contained bequests to the applicant of any motor vehicle which the deceased might have owned at the date of her death, together with the sum of $10,000.

62. The solicitor who prepared the 1996 will has provided an affidavit, exhibiting his note of instructions given to him by the deceased on 23 September 1996, apparently for the purpose of drawing up the will. That note includes the following:

“15% of proven valuation figure if not sold in 3 months (to the applicant) or if contracted or actually sold in 3 months, 15% of sales net of commission & adjustments

- no come back after legacy is quantified.”

63. Against the background of deceased’s ownership of the Wilston house, this suggests that the will was intended to make a gift to the applicant measured against the Wilston house, or any residential property purchased by the deceased in substitution for it.

64. The solicitor also exhibits a note from the deceased dated 3 September 1996, intended to provide some background to her will. That note records that the deceased was born in the Wilston house, and that it passed to her on her father’s death. She referred to it as “our family house” and stated she had worked “long & hard to keep it in repair”. She noted some contributions by the applicant, both in relation to the house and in supporting and assisting her. She also noted a period of separation during the marriage.

65. In my view, this evidence demonstrates a clear intention by the deceased to provide a substantial pecuniary legacy in favour of the applicant. It also provides some support for the view that it was the deceased’s intention that the legacy to the applicant amount to 15 per cent of the value of the Wilston house at the date of her death, or the proceeds of sale if the house was sold within three months of her death. It also supports the view that, if the Wilston house were sold, then the gift to the applicant should be determined by reference to any residential property purchased in substitution for it. However, it seems to me that reference to this evidence does not otherwise assist in the construction of the language of the will. Without recourse to Re Viertel, it seems to me that the language of the will can only be construed as identifying the measure of the gift to the applicant by reference to the value of a residential property owned by the deceased at the date of her death.  To do more would require considerable adjustment, not to say violence, to the language of the will.  I therefore conclude that this evidence does not provide significant assistance in construing the will as resulting in a gift to the applicant.

Relief under s 106 of the PA Act

66. The EPA was made in 1996. Notwithstanding its later introduction, there was no submission that the provisions of the PA Act did not apply to it.^[26]  It authorised the respondents to do anything on the deceased’s behalf that she might lawfully authorise an attorney to do.  They were therefore attorneys for financial matters, as that expression is used in the PA Act.

67. The relief sought under s 106 is dependent upon a failure by the respondents to comply with the PA Act in the exercise of a power conferred by the EPA.  The acts primarily relied upon are the gifts or distributions which they made to themselves from the proceeds of the sale of the Wilston house in early 2006, in each case in an amount of $115,000.  The provisions relied upon by the applicant are ss 66, 76, 85 and 86 of the PA Act.  There has been no submission that the applicant does not have standing to make an application for an order under s 106.^[27]

68. Section 66(1) requires an attorney to exercise the power conferred by the principal “honestly and with reasonable diligence to protect the principal’s interests”. I note that the copy of the EPA signed by the respondents included a summary of the obligations of an attorney, one being the obligation to exercise the power “honestly and with reasonable diligence to protect the interests of the donor (of the power of attorney)”. Counsel for the respondent could not advance any submission to demonstrate that the payments were made in the interests of the deceased. They plainly had the effect of diminishing the assets ultimately available for her care. No interest of the deceased’s has been identified for which it might be said the payments provided some protection. On that basis I would be prepared to conclude that the payments were made in breach of s 66.

69. Although not referred to in the submissions for the respondents, the affidavit of Ms Rickard suggests that at the time consideration was being given to the sale of the Wilston house, she was concerned about the effect of that on the deceased’s eligibility for a pension, and associated medical benefits. Exhibited to her affidavit is a document entitled “Questions for Solicitor – 13/05/05”. Her affidavit records that the solicitor suggested that Centrelink would be able to answer some of the questions. No evidence is given of any consultation with Centrelink.

70. It is clear that the deceased was elderly at the time when the respondents distributed the money to themselves. A handwritten letter from her dated 30 September 1996 suggest that she was six years older than the applicant; indicating she was approximately 82 years of age at that time. She was also suffering from dementia, and confined to a secure ward at about the time of the distribution.

71. Ms Rickard deposes that in early 2006 she asked the solicitor she had consulted in May 2005 whether it was permissible for part of the proceeds of sale to be gifted to the respondents, in recognition of the efforts they had made in selling the Wilston house and in caring for the deceased, and in reimbursement of expenses they had incurred. She deposes that a reason for asking this question was a desire to preserve a part pension for the deceased. No evidence is proffered to demonstrate that was achieved. Nor is there evidence to show the worth of any benefit being obtained for the deceased, as against the amount of the distribution.

72. I note that, with reference to her meeting with the solicitor in May 2005, Ms Rickard associated eligibility for a pension, with eligibility for unspecified medical benefits. The evidence does not indicate whether the deceased would have remained eligible for these benefits, if she was eligible for a partial pension; and in any event Ms Rickard’s evidence indicates that by about mid 2005, she had arranged private health cover for the deceased.

73. There is no suggestion that the respondents carried out any comparison between the amount which they distributed to themselves, and the benefits the deceased was likely to receive if she were able to retain her eligibility for a pension, bearing in mind her age and the condition of her health. Indeed, the evidence does not demonstrate whether the distribution made any difference to her eligibility. A handwritten note on the document dated 13 May 2005 containing questions for a solicitor would suggest otherwise. With reference to the “moving” of some of the proceeds of sale to respondents, it records, “OK to do (indecipherable) still treated as asset and deemed income”.

74. In the result, the evidence shows that the distributions diminished the assets of the deceased by the sum of $230,000. It does not positively demonstrate any benefit to the deceased resulting from these distributions. If there was any, in view of the age of the deceased and her state of health, it is unlikely to be much less. The respondents have not sought actively to prove that the distributions protected an interest of the deceased. In those circumstances, I find that the distributions were an exercise of the respondents’ powers as attorneys for the deceased, for a purpose other than the protection of her interests.

75. Submissions made on behalf of the applicant were directed to showing that the respondents did not act honestly in making these distributions. They deal with the evidence of Ms Rickard to which I have referred, suggesting a relationship between the distributions and some benefit to the deceased. Although no submissions were made on behalf of the respondents on the basis of this evidence, I propose to comment on it. I also propose to consider the evidence that Ms Rickard obtained legal advice prior to the making of the distributions.

76. Ms Rickard deposes that in 2006 the solicitor advised that it was appropriate for part of the proceeds of sale to be gifted to the respondents, provided sufficient was retained to meet the costs of caring for the deceased, and any claims there might be in relation to her estate on her death. I find this evidence quite surprising. It betrays no consideration by the solicitor said to have given the advice of the provisions of the PA Act.  I have already mentioned s 66.  However, there are a number of other sections to which reference should be made.  They include s 73 (which requires an attorney for a financial matter not to enter into a conflict transaction unless authorised to do so by the principal); and s 88 (limiting the occasions on which gifts might be made, discussed later in these reasons).  I note that with respect to the meeting in May 2005, Ms Rickard was able to produce her typewritten questions prepared for that meeting.  She also produced her own notes of questions and answers from an earlier meeting.  It seems likely that she has had full access to the file of the solicitor, as she has produced his handwritten notes of her meeting with him in February 2005, as well as of the meeting in May of that year.  However, there is no note, whether by Ms Rickard or the solicitor, of the advice said to have been given in early 2006.  The circumstances suggest that, if the solicitor made any comment about the proposed distribution to the respondents, that occurred in the context of some rather general discussion which did not identify the proposed amount of the gift, and the extent of the benefits to the deceased which might result from it.  Nor is there any reason to think that any real consideration was given to the question by the solicitor.

77. In Ede v Ede^[28] Muir J (as his Honour then was) had to consider whether the conduct of an attorney was honest for the purposes of s 105 of the PA Act.  His Honour noted the reference to honesty in s 66 of the PA Act.^[29]  His Honour considered that acting in conscious disregard of the interests of a person to whom fiduciary duties were owed would normally constitute dishonesty; but also stated that consciousness of wrongdoing was not a necessary prerequisite to a finding of dishonesty.^[30]

78. For the applicant, it was submitted that Ms Rickard’s evidence demonstrates a lack of honesty towards Centrelink. In my view, the honesty which is relevant to s 66 of the PA Act, is honesty in the exercise of the power (in relation to the obligations owed by the attorney to the principal).  Some ulterior dishonest purpose is not, in my view, relevant.  In any event, there has been no suggestion that the respondents did not intend the distributions which they made to themselves to be fully effective.

79. In my view, the distributions made by the respondents to themselves were made in disregard of the interests of their mother and accordingly were not an honest exercise of the power conferred on them by the EPA. There is no suggestion that there was any genuine consideration of any potential benefit to the deceased which might result from these distributions, against the amounts distributed. Given the age and state of health of the deceased, and the limited benefit which might be said to result from the distribution, when compared to the amounts distributed, it is difficult to see that the distributions could honestly be regarded as being made in her interests. The evidence that the solicitor said that some distribution was appropriate does not support a conclusion that the distributions could honestly be regarded as being in the interests of the deceased. I should add that the evidence does not suggest any material difference between the positions of Ms Rickard and Mr Allen in this respect. I am satisfied that the respondents could not have honestly considered the distributions to have been in the interests of the deceased.

80. Counsel for the respondents has relied upon s 88 as justification for distributions. Section 88 deals specifically with gifts. It provides that, absent a contrary intention in the EPA, an attorney for financial matters for an individual may give away the principal’s property only if certain conditions are satisfied. For present purposes, those conditions are:

(a)The gift is to a relation of the principal;

(b)The gift is of a seasonal nature, or because of a special event; and

(c)The gift’s value is not more than what is reasonable having regard to all the                             circumstances and, in particular, the principal’s financial circumstances.

81. In my view, the second and the third of these conditions were not satisfied. There was no suggestion that the distributions were gifts “of a seasonal nature”, or because of a special event (the examples given in s 88 are a birth, or marriage). Nor is there any relationship between the amount of the distribution in each case, and what is reasonable having regard to the circumstances, including the deceased’s financial circumstances.

82. Although relied upon in the context of s 107, in my view s 88 identifies another basis on which the respondents have failed to comply with the PA Act in the exercise of the power conferred on them, providing a proper basis for making an order under s 107.

83. The respondents also relied on s 89 of the PA Act.  It permits an attorney for financial matters for an individual to provide from the principal’s estate for the needs of a dependant of the principal.  Again, what is provided must be not more than what is reasonable having regard to all the circumstances, and in particular, the principal’s financial circumstances.

84. It is clear that neither respondent was a dependant of the principal. Accordingly, this section does not authorise the distributions.

85. Section 76 of the PA Act requires an attorney to comply with the principles set out in schedule 1 to that Act.  Section 7(4) of schedule 1 requires the application of the principle of substituted judgment.  This in turn makes it necessary, to the extent reasonably practicable, to work out, from the principal’s previous actions, what the principal’s view and wishes would be, and take those into account in the exercise of a power.  Counsel for the applicant relies upon this provision to assert that the Wilston house should not have been sold.  In my view, that submission should not be accepted.  It is by no means improbable that, unless the Wilston house was sold, the expenses of the deceased’s care, together with expenses related to the house, could not be met from the deceased’s assets.  The material does not establish that, from the deceased’s previous actions, it is reasonably practicable to work out what her views and wishes would have been in the circumstances; or at least, that she would, in those circumstances, have wished that the house not be sold. 

86. The applicant relies upon s 85 of the PA Act.  That section requires an attorney to keep and preserve accurate records and accounts of all dealings and transactions made under the power.  Counsel for the applicant submits that the respondents failed to keep records of moneys expended by them for which they claim reimbursement.  It may be doubted whether this failure is a failure to keep and preserve records of dealings or transactions made under the EPA, as it is by no means clear that the moneys were expended under the EPA.  In any event, it is difficult to see that this failure has given rise to any loss for which an order for compensation could be made under s 106. 

87. Section 86 requires an attorney for a financial matter to keep the attorney’s property separate from the principal’s property. It is submitted that the respondents failed to do this, by making the distributions from the proceeds of sale of the Wilston house. In my view, the complaint is not truly about a failure to keep property separate; rather it is that the respondents transferred moneys of the deceased to themselves, with the result that it became theirs. The respondents’ conduct is not properly characterised as a breach of s 86.

88. I am therefore satisfied that the deceased suffered a loss by reason of the gifts which the respondents made to themselves while acting under the EPA; and that in making those gifts, they failed to comply with the PA Act in the exercise of the power conferred by the EPA.  However, the availability of relief depends upon whether an order should be made in favour of the respondents under s 105; and on whether time should be extended under s 106(5) of the PA Act.

Relief to respondents under s 105?

89. Section 105(1) of the PA Act is as follows:

“105Relief from personal liability

(1)If the court considers—

(a)an attorney is, or may be, personally liable for a breach of this Act; and

(b) the attorney has acted honestly and reasonably and ought fairly to be excused for the breach; the court may relieve the attorney from all or part of the attorney’s personal liability for the breach.”                              

90. It will be apparent that I am satisfied that the respondents, purporting to act under the EPA, acted in breach of the PA Act, in making gifts to themselves out of the proceeds of the sale of the Wilston house.  It is then necessary to consider the conditions for the granting of relief under s 105(1).

91. I have expressed the view, in relation to s 66, that the respondents did not exercise the power conferred by the EPA honestly, when the gifts were made out of the proceeds of the sale of the Wilston house.

92. Counsel for the respondents submitted that the distributions were reasonable, because of the advice from the solicitor given early in 2006. It seems to me that this submission confuses the concept of reasonableness, and the question whether the respondents were acting lawfully. No material has been identified which might demonstrate that the distributions were made reasonably. I am therefore not satisfied that the respondents have acted reasonably, in making those distributions.

93. In Ede, Muir J, having found that the conduct of the attorney was both honest and reasonable, went on to consider whether the conduct ought fairly to be excused.  The conduct was a sale of the principal’s property to the daughter of the attorney, at less than market value.  There was no suggestion that the attorney intended to make good the loss.  His Honour said:^[31]

“A matter of obvious relevance to the exercise of the discretion is whether the attorney (or relative, friend or associate) has benefited from the breach and whether the attorney has accounted for any such benefit to his principal.^[32]  A consequence of acceding to the defendant’s application would be to excuse his breach and also, in effect, avoid application of the ‘strict equitable principle’ that a fiduciary being in breach of his fiduciary duty must account to the person to whom the duty is owed for the profit made in consequence of the breach.  In my view, a court would not readily exercise its discretion to bring about such a result.” 

94. In the present case, the respondents have themselves obtained the benefit which results from the distributions. In Ede, a case where it was found that the attorney had acted both honestly and reasonably, and in accordance with legal advice, it was nevertheless held that his conduct should not fairly be excused.  In that case, the attorney had not himself benefited from his breach of the obligation he owed to his principal. 

95. The respondents in the present case seek to advance a case of hardship. That may in some cases be relevant to the question whether an attorney ought to be fairly excused for the breach. However, I do not consider that hardship would usually carry much weight in a case where the attorney has personally benefited from the breach, as has happened here.

96. Mr Allen has $265,000 invested in term deposits. His income is modest, and less than the expenses to which he deposes. He also gives evidence of the personal difficulties which he is experiencing.

97. Ms Rickard works part-time. Her husband has casual employment, and has a limited income. They have two children who will soon be in high school. One of her children suffers from a number of disabilities. Money received from the deceased’s assets (including the distribution from the estate) was used to pay out the loan owing on their home, and Mr Rickard’s credit card debt; as well as to improve their house, and other personal and living expenses. Approximately $40,000 remains.

98. The applicant seeks an order under s 106 so that there will be a fund available to him for relief under s 107. In the circumstances, considerations relating to hardship to the respondents are not of such significance as to warrant granting the respondents’ relief under s 105, if the other conditions specified in that section had been met.

99. I should add that, if relief were granted under s 105, there would be hardship to the applicant. He is an elderly man, of quite limited means.

Relief to applicant under s 107?

100. Section 107 of the PA Act applies if a person’s benefit in a principal’s estate under the principal’s will is lost because of a sale or other dealing with the principal’s property by an attorney of the principal.  In those circumstances, an order may be made that the person be compensated out of the principal’s estate, to the extent that the court considers appropriate.  Limitations are placed on the availability of the remedy, drawn from ss 41 and 44 of the Succession Act 1991.  I propose to consider these limitations separately.

101. If the respondents had not sold the Wilston house, the gift made in favour of the applicant in cl 4(c) of the deceased’s will would have been effective. By reason of the sale, it is not possible to determine the amount of the gift, absent reliance on Re Viertel.  The evidence shows that the value of houses in Wilston has increased quite markedly between the date of the sale in 2006, and the death of the deceased.  On the approach I have taken to the will, the amount thus available to the applicant may well be less than the amount which would have been available to him had the Wilston house been retained by the deceased until her death.  It therefore seems appropriate to consider whether relief should be granted under s 107.

102. The evidence shows that the value of houses in Wilston has increased markedly since the sale of the Wilston house in 2006. Because of the changes made to that house since it was sold, there are particular difficulties in attempting to determine what value it would have had, if it had not been sold, at the date when the deceased died. Some guidance to its change in value is provided by the evidence of the movement in median house prices over this time. No better evidence is available. No ground was identified for suggesting that the value of the Wilston house might have changed in a way significantly different to the change in median house prices in Wilston. I am therefore prepared to accept its value would have increased comparably with that change.

103. By reason of the sale of the Wilston house, the applicant is to receive less from the estate of the deceased than would otherwise have been the case. In my view, he is entitled to an order for compensation, subject to the restrictions found in ss 41 and 44 of the Succession Act.

104. Section 44 protects an executor in respect of the distribution of the estate of the deceased, so far as is relevant, where the distribution was properly made not earlier than six months after the deceased’s death (or if notice were given under s 41 or s 42, not earlier than nine months after the deceased’s death, absent notice that an application had been commenced). It is implicit in the submissions for the applicant that this section is effective to protect the respondents, in respect of distributions made after the death of the deceased. However, there has been no suggestion it would be effective to prevent the applicant from recovering compensation out of moneys ordered to be paid to the estate under s 106 of the PA Act.  Accordingly, it requires no further consideration.

105. Section 41 of the Succession Act, like s 106 of the PA Act, contains time limits for applying for relief, with the power of extension.  It is convenient to consider the limitations and extensions together.

Extensions of time

106. An application that an attorney compensate the principal’s estate under s 106 is required to be brought, in a case like the present case, within six months of the principal’s death.^[33]  However, there is a power to extend that period.^[34]

107. As has been mentioned, for relief under s 107, the provisions of s 41 of the Succession Act have been made applicable, as if the application were an application under Part 4 of that Act.  Under s 41(8), no application under Part 4 of that Act is to be heard unless the proceeding is instituted within nine months after the death of the deceased, unless the court otherwise directs.

108. In each case, there is a broad discretion to extend time for granting the relief. The effect of the legislation is that, without an extension of time or exercise of discretion, the application under s 106 of the PA Act was required to be commenced by 6 October 2008; and the application under s 107 by 6 January 2009.  These proceedings were in fact instituted on 8 February 2010.

109. I was referred to two decisions where an extension of time under s 106 of the PA Act was considered.^[35]  Neither contains any substantial statement of principle in relation to the granting of such an extension, although in one case it was pointed out that the Act presumes that an application should be made promptly.^[36]

110. The discretion to extend time is conferred on the Court in unconfined terms. As such, it is confined only by the subject matter, scope and purpose of the legislation.^[37]  In a case where a discretion was conferred to extend the time for bringing proceedings under the Workers’ Compensation Act 1926 (NSW) if the Court were “satisfied that sufficient cause has been shown”, it was said:^[38]

“The applicant has got to show that there is a reason, within the expression which I have read, for extending the time, and it is a positive burden on the applicant, not of any great severity perhaps, but it is a positive burden which the applicant must discharge as he must discharge any other matter in which the burden of proof lies on him.”

111. The PA Act does not include an objects clause.  However, regard may be had to its long title to identify its purpose.^[39]  One of the matters mentioned in the long title is the consolidation and reform of the law relating to enduring powers of attorney.  It is apparent from provisions referred to earlier that that extends to the articulation of obligations imposed on attorneys, and the provision of remedies in relation to their actions, whether in breach of those obligations or otherwise. There is nothing in the general purpose and scope of the PA Act which would introduce any relevant restriction on the general discretion to extend time under s 106.

112. There is no suggestion that the respondents informed the applicant of their actions when they made a gift to themselves of a part of the proceeds of sale of the Wilston house. The applicant’s subsequent dealings with Ms Rickard provided little basis for concern about the manner in which the respondents dealt with the proceeds of sale.

113. The applicant deposes to asking Ms Rickard, shortly after the death of the deceased, for a copy of the deceased’s will. This is denied by Ms Rickard. As stated earlier, neither deponent was cross-examined. I prefer the evidence of the applicant on this question. It is inherently likely that a person in his position would be interested in knowing about the will of his deceased wife. The applicant identifies an event which he says caused him to ask for a copy of the will. His account of this event appears to me to be reasonably likely to have occurred. It is clear that at a later stage, in August 2009, the applicant was taking steps to get a copy of the will. That conduct is consistent with his having taken similar steps on earlier occasions.

114. It is apparent from Ms Rickard’s file note of 10 March 2005 that she was at that time concerned that the applicant might assert some entitlement in relation to the house. Against this background, and in view of the provisions of clause 4(c) of the will, and of the fact that the respondents were responsible for the sale of the house before the deceased died, there is some reason to think that Ms Rickard was reluctant to make the will available to the applicant.

115. The applicant did not obtain a copy of the will until August 2009. Shortly afterwards, he sought legal advice. He also made an application for access to documents held by Centrelink under the Freedom of Information Act 1992 (Cth). That resulted in the provision to him, under cover of a letter of 25 September 2009, of a copy of Centrelink records. One entry, relating to the sale of what was described as the “former home”, by reference to the record for the deceased, stated “part of proceeds gifted to children”. The amount of the gifts was not identified. This appears to be the first occasion on which the applicant had available to him any information about the gifts made by the respondents to themselves, from the proceeds of sale of the Wilston house. The application was made about four and a half months later. It is likely that some further consideration of the information, and the available remedies, had to be undertaken before proceedings could be commenced. Moreover, it is very common for delays to occur in the Christmas vacation period. In my view, the applicant has not been guilty of undue delay in making enquiries and ultimately in instituting proceedings for relief under s 106.

116. I also consider the following factors to be relevant:

1. The PA Act is plainly concerned to ensure that attorneys comply with their duties to their principal;

2. The PA Act seeks to create remedies where attorneys fail to comply with those duties;

3. The applicant has established a right to relief under s 106, subject to an extension of the time for making the application;

4. The respondents themselves were the beneficiaries of their failure to comply with the duties imposed on them as attorneys;

5. As was pointed out in Ede, a court should not readily exercise its discretion to enable a fiduciary who is in breach of his fiduciary duty, to avoid accounting for that breach to the fiduciary’s principal.  It seems to me that similar considerations would apply to the avoidance of an order under s 106.

117. The grounds relied upon by Counsel for the respondents for submitting that the evidence of Ms Rickard should be preferred to that of the applicant is that the applicant did not, in his affidavit in reply, repeat the evidence he gave in his primary affidavit. In my view, this creates no basis for rejecting his evidence.

118. On behalf of the respondent, it is submitted that it will be futile to extend time for an application for relief under s 106 of the PA Act, because any moneys which went to the estate would be refunded to the respondents as residuary beneficiaries under the will.  That ignores any right the applicant may have under s 107.  If the applicant were entitled to succeed under that section, than the orders under s 106 would not be futile.

119. It is submitted that the granting of the extension of time would be prejudicial to the respondents. That is because they distributed the estate of the deceased, more than six months after the deceased’s death, with no indication of an intended claim. It is said that they have subsequently changed their positions in good faith, in the belief that the estate had been properly distributed; and that they would suffer financial hardship if required to compensate the estate.

120. It is apparent that the respondents had possession of the deceased’s will as early as 2005. They provided a copy to their solicitor in February 2005, at about the time when Ms Rickard was concerned that the applicant might assert some rights in respect of the Wilston house. At this time the applicant was in hospital as a result of the heart attack which he suffered in late 2004. At some point, possibly in May 2005, Ms Rickard told one of the applicant’s sons that a decision had been made to sell the house. There is no suggestion that at that time the contents of the will were made known to him or anyone associated with him, nor was he told about the distributions made to the respondents from the proceeds of sale. It is also clear that the respondents took no step to inform the applicant of the contents of the will. Rather, they remained silent about it until more than six months had elapsed after the deceased’s death, and the estate was distributed. It seems likely that they were advised of the risks associated with an earlier distribution of the estate. There is no suggestion that any person other than the applicant might have had a potential claim in respect of the estate.

121. It is against that background that I give little weight to the submissions made on behalf of the respondents that they distributed the estate in good faith and that they changed their positions in good faith, in the belief that the estate had been distributed properly. Whatever may have been the legal advice on which they acted, they appear to have been careful to ensure that the applicant had no information which might enable him to get his own legal advice, which may have been different to the advice given to the respondents. There is no suggestion that the respondents had any reason to think that, prior to the time when they distributed the deceased’s estate to themselves, the applicant had available to him the information necessary to consider whether he should institute proceedings under s 106.

122. In this context, Counsel for the respondents also relies upon the hardship which it is said would be experienced by the respondents if they were required to compensate the estate. I have already considered this question in relation to s 105. Again, I do not consider that any hardship which would be experienced by the respondents is such as to warrant a refusal of an extension of time under s 106(5).

123. Accordingly, I am prepared to extend the time for making an application for relief under s 106 up to and including 8 February 2010.

124. The application for a direction permitting a claim under s 107 to proceed, notwithstanding the time that had elapsed since the deceased’s death, was not the subject of specific submissions on behalf of the respondents. While the effect of s 107(4) is to introduce the broad power to make a direction for the extension of time found in s 41(8) of the Succession Act, the objects of the statute which might potentially limit the scope of the discretion, in my view, are those relevant to the PA Act and not those relevant to the Succession Act. That consideration may have a bearing on the applicability of tests for the extension of time under s 41(8) of the Succession Act, for the making of an application under Part 4 of that Act. Nevertheless, I will refer to them.

125. In Enoch v Public Trustee of Queensland,^[40] Margaret Wilson J identified four factors which can be relevant to the exercise of the discretion to extend time for the making of a claim under Part 4 of the Succession Act.^[41] They are:

1. whether there is an adequate explanation for the delay;

2. whether there would be any prejudice to the beneficiaries;

3. whether there has been any unconscionable conduct by the applicant; and

4. the strength of the applicant’s case.

126. In the present case, the respondents are the relevant beneficiaries. I have already considered the question of prejudice to them, if relief were to be granted. There is no suggestion of unconscionable conduct by the applicant. I have already considered explanation for the delay by the applicant in seeking relief under s 106. In my view, the history of the matter demonstrates an adequate explanation by the applicant for not seeking relief earlier under s 107. He had made earlier attempts to obtain a copy of the will. Until he did so in August 2009, he had no basis for a claim under s 107. However, by then, time had run, and the estate had been distributed. The claim itself is unusual; and the factual circumstances raised complexities which needed investigation and consideration. I have already expressed the view that, subject to granting an extension of time, the applicant should succeed on his case.

127. In the circumstances, therefore, I am prepared to grant an extension of time to the applicant to commence relief under s 107 of the PA Act up to and including 8 February 2010.

Other claims

128. At the commencement of the hearing, Counsel for the applicant asked that I not deal with the fourth claim, made under Part 4 of the Succession Act.  At the end of the hearing, Counsel for the respondents submitted that if I found in favour of the applicant on the first claim, I should not deal with the balance of the claims.  I have, in fact, proceeded to deal with the second claim, in view of the relatively unusual basis on which I have found for the applicant on the first claim; and because, in any event, the second claim would provide the applicant with an additional sum of money.  In view of the attitude of the parties, and the conclusions which I have reached, I do not propose to deal with the third and fourth claims at this stage.  I shall, however, invite submissions from the parties about the future conduct of these claims.

Conclusion

129. On the view to which I have come the applicant is entitled to the benefit of a gift under clause 4(c) being 15 per cent of the net sale proceeds of the Wilston house, together with interest. That is likely to be less than the true benefit the applicant would have received under the will, had the respondents not sold the house property under the PA Act.

130. Accordingly, I am prepared to extend time for the making of applications for relief under s 106 and s 107 of the PA Act up to and including 8 February 2010. I am prepared to order that the respondents pay to the estate the amounts the subject of the gifts, which they made to themselves from the proceeds of the sale of the Wilston house, and that the applicant be compensated to the extent of the difference between the gift to which he is now entitled under clause 4(c), and the value which the house would have had, at the date of the testator’s death.  I propose to hear submissions as to the proposed orders, interest, costs, and the remaining issues in the application.