Re Kelly (deceased)

In this significant case, Williams J considered whether the Court had the power to make a grant of letters of administration “ad colligenda bona” to allow the proposed administrators to continue the deceased’s business affairs to prevent losses to the estate. Her Honour helpfully set out some key considerations for when such a grant would be made.

Williams J

6 April 2022 (delivered ex tempore)

At the time of his death in March 2022, the deceased was in the midst of an unresolved dispute regarding the restructuring of a business which he part-owned. [3]. However, due to the circumstances of his death, there was a delay in obtaining a death certificate, and further delays in obtaining probate were expected. [1]. Accordingly, the applicants applied for a grant of letters of administration ad colligenda bona (literally, “to collect the goods”) to allow them to conduct business dealings on behalf of the deceased’s estate, including resolving the dispute with the business’s co-owners. [1]–[4].

The starting point for Williams J’s consideration was s 6(3) Succession Act 1981, which provides that a grant of probate “may be made to such person and subject to such provisions, including conditions or limitations, as the court may think fit.” [5]. Her Honour noted that there were no relevant Queensland cases where a grant ad colligenda bona was sought, but that there was academic support for the proposition that such a grant could be made, including under s 6(3) Succession Act 1981. [5]–[10].

As to this, Williams J observed that the original intention underlying grants of letters of administration ad colligenda bona was so that perishable or precarious goods could be collected on behalf of the deceased’s estate before a formal grant of probate could be made. [10]. However, this has recently been expanded to cover other circumstances where a grant is necessary to protect the assets of the estate, including to safeguard and protect a deceased’s business as an asset of their estate. [11]–[12]. However, a grant ought not be made “to a person who has merely neglected to take out a proper grant within a reasonable time”. [8].

Against this background, Williams J was willing to make a grant ad colligenda bona in circumstances where:

a) the form of order sought by the applicants was expressly “limited to preserving, operating and negotiating the restructure and sale of the deceased’s corporate and business interests”. [14];

b) the proposed order was “pending a grant of probate of the will or further order of this Court”. [14];

c) the circumstances of the deceased’s business were “such that it is likely that losses could result to the business and to the estate if steps are not promptly taken to deal with the ongoing operation of the business” and its restructuring. [15]; and

d) it was likely that there would be further delays in obtaining probate due to circumstances outside the applicants’ control. [1], [8].

In the event, Williams J made orders in the form sought by the applicants, as slightly amended.

M Paterson