Daughter Successful in Notional Estate Claim

Carusi-Lees v Carusi [2017] NSWSC 590 The family provision list judge in the Supreme Court of NSW has recently heard and determined a family provision claim brought by a biological daughter of the deceased who died in December 2014. The deceased made a will in 2013 which left the whole of his estate to his second wife and made no provision for his surviving children. The deceased had been married to his second wife for about 39 years. The plaintiff daughter named her step-mother as the defendant in the proceedings even though there was very little in the actual estate. The majority of the deceased’s assets passed to the step-mother by way of survivorship as the assets were held jointly prior to his death. This meant there was no need for any person to apply for a grant of probate or letters of administration in the estate as the defendant was a party to the litigation. In order to be successful in making her family provision claim, the daughter needed to prove that she was an eligible person and that she had been inadequately provided for by the estate. It was noted by the Court that when the daughter’s mother (the deceased’s first wife) died in about May 2005, she received about $700,000.00 from her estate. In circumstances where there is no actual estate sufficient to make an order for provision for a family provision applicant, the Court may make a notional estate order. A notional estate order can identify certain property to bear the burden of any order for provision for the applicant. The deceased’s jointly held interests that could be designated as notional estate were estimated to be worth around $4.5 million dollars. To satisfy the Court a notional estate order should be made, the plaintiff must address the criteria listed in section 87 of the Succession Act, which provides: 87 General matters that must be considered by Court The Court must not make a notional estate order unless it has considered the following:

the importance of not interfering with reasonable expectations in relation to property,
the substantial justice and merits involved in making or refusing to make the order,
any other matter it considers relevant in the circumstances.

The assets which form the potential notional estate must ordinarily also be found to be the subject of a relevant property transaction that either occurred within 12 months prior to the deceased’s date of death, or within 3 years prior to the date of death with the intention to defeat a family provision claim. A relevant property transaction occurs where there is an act or omission that results in property being held by another person where full consideration (or full and proper value) was not passed when the interest was acquired. In this matter, the deceased held interests jointly with his wife for many years, but as a result of not severing the joint tenancy prior to his death, this was an omission on his behalf that resulted in his interests not forming part of his deceased estate. The deceased had made prior wills in which he had made provision for his daughter and other children, although in his wills the amounts he left to his daughter decreased over time. He made a statutory declaration in 2004 that set out details of gifts he had made to his daughter previously, which totalled around $500,000.00. On the day the deceased made his last will in 2013, he wrote a note that indicated he had given over $1 million dollars to his daughter during his lifetime, and that he did not want her to receive anything further from his estate. The Court examined this issue but the figure of ‘over $1 million’ was ultimately found to be inaccurate. The Court reviewed the evidence and material put forward by both the plaintiff and the defendant, and some witnesses were cross-examined. The relationship between the daughter and her father was examined and the judge noted, ‘the deceased does not attribute, as a cause for omitting the Plaintiff as a beneficiary in his last Will, a strained relationship as parent and child’. The judge found that the deceased was a caring, loving and generous father to his daughter, and that they enjoyed a good relationship with each other. He did state, however, ‘it is clear, from all of the evidence, that as the years passed, the deceased grew weary of the Plaintiff’s requests for money’. When delivering his reasons for his judgment, the judge commented that, ‘the fact that the Plaintiff does not receive any provision under the Will of the deceased, of itself, does not bespeak inadequacy. That fact is not all that the Court is required to consider. The totality of the relationship of the Plaintiff and the deceased, the age and capacity of the Defendant, as the deceased’s widow of a very long marriage, the claim of each on the bounty of the deceased, and the size of the estate and notional estate, are very relevant factors in determining the answer to the question whether the Court is satisfied, for the purposes of s 59(1)(c) of the Act, that the deceased did not make adequate provision for the proper maintenance, education or advancement of the Plaintiff’. Despite there not being any significant assets in the estate, the judge determined that the step-mother should pay to the daughter of the deceased the amount of $400,000.00 plus her legal costs on an ordinary basis from the notional estate of the deceased. Understanding your rights and options as a testator, beneficiary or claimant can be confronting and difficult. Please contact us on 13 43 63 for a free, no-obligation discussion if you need assistance.

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