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High Court of New Zealand Decisions |
Last Updated: 19 July 2018
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IN THE HIGH COURT OF NEW ZEALAND ROTORUA REGISTRY
I TE KŌTI MATUA O AOTEAROA
TE ROTORUA-NUI-A-KAHUMATAMOMOE ROHE
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CIV-2017-463-109
[2018] NZHC 1764 |
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UNDER
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the Law Reform (Testamentary Promises) Act 1949 and the Senior Courts Act
2016
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IN THE MATTER
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of an appeal against the decision of the Family Court at Rotorua
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BETWEEN
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HAROLD TERRANCE DWIGHT being the
sole executor of the Estate of MAUREEN ANN DWIGHT
Appellant
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AND
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SARAH ROSS
Respondent
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Hearing:
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13 March 2018
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Appearances:
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T Mounsey for the Appellant R Gregory for the Respondent
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Judgment:
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17 July 2018
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JUDGMENT OF WOODHOUSE J
This judgment was delivered by me on 17 July 2018 at 2:00 p.m. pursuant to r 11.5 of the High Court Rules 1985.
Registrar/Deputy Registrar
..........................................
Counsel / Solicitors:
Mr T Mounsey, Malcolm Mounsey Clarke, Solicitors, Taupo Ms R Gregory, Barrister, Auckland
DWIGHT v ROSS [2018] NZHC 1764 [17 July 2018]
[1] This is an appeal by the executor of an estate against a decision of Judge J F Munro in the Family Court allowing a claim under the Law Reform (Testamentary Promises) Act 1949 (the Act).1
Background
[2] The claim was brought by the respondent, Sarah Ross (Sarah), against the executor of the estate of Maureen Dwight (Maureen). The executor is the appellant, Harold Terrance Dwight (Terry).
[3] Maureen was in a 30 years long de facto relationship with Sarah’s father, Phillip New (Phillip). It began in the United Kingdom around 1975 and ended when Phillip died in New Zealand in 2004. Sarah lived with her father and Maureen, in the United Kingdom, from the outset of the relationship, when she was 9 years old.
[4] In about 1991 Sarah moved to New Zealand where she married and had two children. Maureen and Phillip remained in the United Kingdom, where both of them were working. In 2003, after they had retired, Maureen and Phillip moved to New Zealand to be closer to Sarah and her children. They bought a home in Taupo. Phillip died shortly after their arrival in New Zealand.
[5] By his will, Phillip left his entire estate to Maureen. Sarah did not contest her father’s will. This formed part of the basis for her claim under the Act. Sarah said that she did not contest her father’s will because of promises made by Maureen, both before and after Phillip died, that provision would be made for Sarah in Maureen’s will. Sarah said that her father had also given her assurances that Maureen would make provision for her in her will.
[6] Sarah’s claim was also founded on a further claim that Maureen had promised to make testamentary provision for Sarah in return for assistance she received from Sarah after Phillip died.2
1 Ross v Dwight [2017] NZFC 7160 (Family Court judgment).
2 The nature of some of this assistance is described below, at [41]-[42].
[7] In 2004, Sarah and her husband separated. Sarah moved back to the United Kingdom with her two children.
[8] Maureen remained in New Zealand after Phillip died, living in a home she and Phillip had bought in Taupo. Title to this property, which had been jointly owned by Phillip and Maureen, passed to Maureen by survivorship. In 2005 Maureen met Terry and in June 2006 they married. Maureen and Terry entered into an agreement under the Property (Relationships) Act 1976. By this agreement Maureen retained, as her separate property, her home in Taupo and other assets she already owned, including investments in the United Kingdom and in New Zealand. Terry retained as his separate property firearms, and shares in a company which owned a boat and motor vehicle.
[9] In November 2006, after her marriage to Terry, Maureen made a will leaving half of the residue of her New Zealand estate to Sarah. Particulars of this will, and other wills, are noted below.
[10] Sarah remarried, in the United Kingdom, in 2011. Maureen and Terry travelled to the United Kingdom for Sarah’s wedding and, with others, accompanied Sarah and her husband on their honeymoon. On her return to New Zealand Maureen made a new will in which there was no provision for Sarah, and this continued with the final will made in 2015.
Maureen’s wills
[11] Six wills made by Maureen were put in evidence, including the final will of 26 November 2015.3
[12] A will made in November 2004, and two made in July 2006, made no provision for Sarah, but did provide that half of the residue would go to Maureen’s four step- grandchildren, two of whom were Sarah’s children, and the other two being children of Sarah’s brother. The other half of the residue went to Maureen’s sister, Jennifer.
3 These are detailed in the Family Court judgment at [13]-[20].
[13] The will made in November 2006, briefly noted above, disposed of Maureen’s estate other than assets held by her in the United Kingdom. Terry was left all moneys in Maureen’s bank accounts, any motor vehicle owned by her, and a life interest, so long as he remained Maureen’s widower, in the principal residence, household chattels, paintings and art works owned by Maureen at the date of her death. One-half of the residue, and therefore including the assets in which Terry had a life interest, was left to Sarah, and the other half, in equal shares, to the two children of Sarah and the two children of Sarah’s brother. In the November 2006 will, as in the earlier wills, there was a gift of $20,000 to Phillip’s brother, Stephen New (Stephen). Stephen was also executor and trustee of the earlier wills, and an executor and trustee, with Terry, of the November 2006 will.
[14] In March 2012 Maureen made a new will. This will made no provision for Sarah or for the children of Sarah and her brother. Stephen was also removed as a trustee, executor, and beneficiary. The provision for Terry was broadly similar to that in the earlier wills. The residue was left to Maureen’s sister Jennifer, with gifts over, if Maureen’s sister did not survive her, to cousins once removed of Maureen.
[15] The last will was the same as the 2012 will except that the gift over of the residue was to nieces of Maureen.
[16] The Judge made the following observations at the conclusion of her summary of the wills:
[21] There is no evidence of any written instructions that were given at the time of the making of these wills which would explain the changes in them. Clearly the will of July 2006 coincides with Maureen’s marriage to Terry. There is nothing to explain the exclusion of her sister Jennifer from her will in November 2006 and the reinstatement of her as a beneficiary in 2012. Neither is there any reason provided by the deceased as to why, despite Sarah or her children being a beneficiary in each will until 2012, she and all of her family members were entirely excluded. Evidence of the surrounding circumstances has been given by way of affidavit by the parties, Stephen and Ans New, and Jennifer Short. Because the hearing proceeded by way of submission only, the weight to be given to that evidence is a matter for the Court to consider. That evidence contains reference to a break down in the relationship between Maureen and Jennifer for a significant period of time, and the evidence of concerns held by Maureen in 2011, as previously referred to.
[17] The Judge referred to evidence of “a break-down in the relationship between Maureen and Jennifer ... and ... concerns held by Maureen in 2011”. The Judge had not previously referred to evidence of a break-down in the relationship “for a significant period of time”. This must have been a reference to an affidavit from Maureen’s sister, Jennifer, who said that Sarah and Maureen, living in different countries, “did not speak for a number of years”. To the extent that this has any relevance, and it is marginal, I am satisfied that that could only have referred to the period after Maureen returned to New Zealand following the wedding in 2011. This is based on evidence from Terry, to which I now refer, and which ties in with the making of the new will in 2012 disinheriting Sarah and all four of Maureen’s step- grandchildren. Terry said that when he and Maureen were travelling back from Sarah’s wedding Maureen told him that she was going to change her will. He said:
Maureen was annoyed that while we were staying Sarah had been continually asking whether she would be getting an inheritance.
I knew that Maureen was unhappy with what she called Sarah’s profligate lifestyle and was annoyed that Sarah had not been saving towards her retirement.
[18] There was no evidence from Terry of anything he had heard directly, or observed directly, in relation to interaction between Sarah and Maureen.
The estate
[19] The net value of the estate, in round figures, is $636,000. $400,000 is represented by what is recorded as the “CV” of the home owned by Maureen, in which Terry has a life interest. The balance comes from investments, less estate debts of some $40,600. The principal asset, other than the home, is just under $274,000 held by Maureen in a United Kingdom superannuation fund. The statement of assets and liabilities, produced by Terry, contains no information about household chattels, paintings and art works.
The Family Court judgment
[20] Judge Munro was satisfied that Maureen did promise Sarah that she would make provision for Sarah in her will and that this promise was given because Sarah
did not contest her father’s will.4 The Judge held that Sarah’s not contesting the will
– forbearing to sue – was a “service”, citing Re Sellars,5 and that this was “on the basis that the forbearance has provided to the deceased the ability to live in comfort without the property being disturbed or in any way depleted through a claim against the estate”.6
[21] The Judge said that it was difficult to know the extent of any claim that could have succeeded against Phillip’s estate because the assets of his estate were not known. Probate had not been applied for and that indicated that the estate may have been modest with most of Phillip’s property passing by survivorship to Maureen. She then said:
[23] ... [H]owever, as one of the two children of Phillip, it can be assumed that there would be an arguable claim given that Sarah and her brother were excluded. It is clear that the exclusion was not out of a desire to effectively disinherit the children for some reason. That is because his will provided that one half of his estate would be shared between Sarah and her brother in the event that Maureen predeceased him.
[22] There was also Sarah’s claim that Maureen had also promised to make testamentary provision for her because of Sarah’s assistance to Maureen. It was not in issue that the assistance detailed in Sarah’s evidence had been provided. But the Judge held that this was no more than would be expected between family members.
[23] Sarah claimed one-half of the net value of the estate on the basis that one-half had been promised. The Judge said that “any payment must depend on the circumstances and particularly the size of the estate”, and that “it must also reflect the service provided”.7 The Judge referred to some further considerations, and determined that the promise as a consequence of Sarah’s forbearance to sue justified an award of 25 per cent of the net value of the estate. This was fixed at a sum, rounded down, of
$150,000.8
4 Family Court judgment at [28].
5 Re Sellars (dec’d) [1996] NZFLR 971 (DC) at 980.
6 Family Court judgment at [22].
7 Family Court judgment at [30].
8 Family Court judgment at [30]-[32].
The Act and relevant principles
[24] Claims under the Act are made under s 3. A claimant must prove the following:
[25] Sarah claims that she provided services. In consequence, the following outline of relevant statutory provisions and principles does not refer to the performance of work. The statutory provisions and principles of relevance concern services, the promise, the connection between the two, and assessment of quantum if provision has not been made. Each of these aspects is addressed in the following four paragraphs in summary form.
[26] Services:
(a) “Services” do not include “the natural incidents and consequences of life within a close family group”.9 Whether the services come within that broadly stated test will not always be readily apparent and, like every case, must turn on the particular facts. In Byrne v Bishop this was put on the basis that, to qualify as services, “what has been done for the deceased must have been beyond the normal expectations of family life or social interaction”.10
10 Byrne v Bishop [2001] NZCA 309; [2001] 3 NZLR 780 (CA) at [6].
(b) Forbearing to bring a claim against an estate, in which the person making the testamentary promise has an interest, may amount to a service to that person.11
(c) The fact that a service claimed to have been rendered to the deceased was intangible, and of a value incapable of precise monetary assessment, does not prevent it being a service.12
[27] The promise:
(a) “A promise includes any statement or representation of fact or intention.”13
(b) A promise may be expressed or implied.14
(c) A broad view is to be taken of the meaning of the word “promise”. “The term ‘promise’ under the Act covers declarations which might not fall within a dictionary definition of that word and certainly goes beyond any contractual context.”15
(d) This, and related matters, was discussed by the Court of Appeal in
Jones v Public Trustee as follows:16
In our opinion the word “promise” now being a defined term, does include unilateral declarations by a deceased person of his intention to reward others for services or work performed by them by the making of a testamentary provision in their favour, and that it is not necessary that the “promise” should amount to a contractual undertaking to be within the section.
... In short, the intention of the Legislature, as expressed in the present Act is that in such circumstances, the deceased person is required to keep his word where that word may be
11 Tucker v Guardian Trust and Executors Co of New Zealand Ltd [1961] NZLR 773 (SC) (disclaimer of an interest in property); Sparks v Pyne Gould Guinness Ltd HC Christchurch A379/85, 11 July 1989; Re Le Prou (1990) 8 FRNZ 72 (HC); Re Sellars (dec’d), above n 5; Re Estate of Webb HC Tauranga CIV-2010-470-264, 14 October 2011.
13 Section 2 of the Act.
14 Section 3(1) of the Act.
15 Byrne v Bishop, above n 10, at [8] citing Jones v Public Trustee [1962] NZLR 363 (CA).
16 Jones v Public Trustee, above n 15, at 374.
taken to relate expressly or by implication to services given or to be given.
(e) Because the term “promise” goes beyond any contractual context, a promise sufficient to establish a claim under the Act may be vague or uncertain.17
(f) There is no rule that a claimant’s allegation of a promise must be corroborated. However, because it is an allegation of a statement or representation made by a deceased person, the Court is bound to assess the evidence with care, as it does with any allegation of a statement, representation, or act, of a dead person, when the allegation is central to a claim.
[28] The connection between the services and the promise:
(a) On a claim under s 3(1), it does not matter whether the services were provided before or after the promise was made.18 It necessarily follows that the sequence of the services and the promise is irrelevant and that proof of each may come from a sequence of promises and services.
(b) There must be some nexus or linkage between the services and the promise, in whatever sequence each occurs.19 This is not a technical requirement. As the Court of Appeal explained in Byrne v Bishop, it simply comes from the wording of s 3(1), which refers to the rendering of services to the deceased and a promise by the deceased to reward the services by making a testamentary provision.20
17 McCormack v Foley [1983] NZLR 57 (CA) at 61, per Cooke P, explaining one of the primary reasons for the introduction of the Act: the inability to enforce promises which were too vague to establish an enforceable contract at common law. See, generally, Bill Patterson Law of Family Protection and Testamentary Promises, above n 9, at [13.13].
18 Section 3(2)(a) of the Act.
19 Byrne v Bishop, above n 10, at [9].
20 At [9].
[29] Quantum:
(a) If the claimant establishes relevant services and a testamentary promise then, to the extent that testamentary provision or other remuneration is not made, the claim is enforceable against the estate for “such amount as may be reasonable, having regard to all the circumstances of the case”.21
(b) Section 3(1) provides that circumstances include, “in particular”: (1) the circumstances in which the promise was made; (2) the circumstances in which the services were rendered; (3) the value of the services; (4) the value of the testamentary provision promised; (5) the amount of the estate; and (6) the nature and amounts of the claims of other persons on the estate.
(c) In determining quantum regard must be had to “other remuneration” as well as any testamentary provision. In consequence, “[benefits] conferred by the deceased directly on the claimant or ... on the claimant’s family may have to be ‘netted off’ against the value of the services or work performed for the deceased.”22
Evaluation
[30] There were six grounds of appeal. To an extent these were expanded, or modified, in Mr Mounsey’s submissions in support of the appeal. The evaluation of the appeal which follows is made under six headings directed to each of the grounds of appeal and submissions.
[31] Some of Mr Mounsey’s submissions, on points of law or principle, have already been addressed in my summary of relevant statutory provisions and principles. It is unnecessary to further address these points.
21 Section 3(1) of the Act.
22 Byrne v Bishop, above n 10, at [11].
[32] On this appeal, on questions of fact, or value judgment, I am bound to come to my own conclusion.23 Because all of the evidence was contained in affidavits, with none of the deponents being cross-examined, and from the wills, the relationship property agreement, and the statement of estate assets and liabilities, I am in as good a position as the Judge to assess questions of fact and make any value judgments.
[33] The Judge’s decision on quantum required exercise of a reasonably broad discretion. This Court on appeal cannot interfere with exercise of that discretion unless there was an error of principle, or the Judge failed to take account of relevant matters, or took account of irrelevant matters, or was plainly wrong.24
Was there a promise and relevant services?
[34] Mr Mounsey submitted that Sarah failed to prove that there was a testamentary promise and that she provided a service to Maureen by not contesting her father’s will. I am satisfied that there was no error by the Judge in either respect. I am also satisfied, contrary to the Judge’s conclusion, that some of the other services provided by Sarah were services contemplated by s 3.
[35] The argument in relation to forbearing to sue was that there was no evidence that Sarah had sought advice in respect of a claim against her father’s estate and no evidence that Maureen was aware of the possibility of a claim. The absence of evidence on the first point is not material. Evidence from a lawyer that Sarah had sought advice on claims she might bring after her father died would corroborate her evidence, but it is not necessary if her evidence is accepted. The Judge accepted her evidence, as do I. This is discussed further below. On the second point – whether Maureen was aware of the possibility of a claim – an inference to that effect may properly be drawn from the evidence. This also is discussed further below.
[36] Sarah’s evidence, which was not challenged by any other evidence, establishes her contentions. Her evidence, both on the services and the promises, is as follows:
24 May v May (1982) 1 NZFLR 165 (CA).
[37] Mr Mounsey placed emphasis on an observation of the Judge which he recorded as being that there was no corroboration of the testamentary promises Sarah claimed had been made by Maureen. The notice of appeal in fact contained a contention that the Judge’s conclusion that there had been promises from Maureen “ignored case law which suggests there is a requirement for corroborating evidence”. That is wrong, as earlier noted.25 The contention was modified in the subsequent submissions. Assuming there was no corroboration, there was no error by the Judge in accepting Sarah’s clear evidence. In any event, the Judge did not say there was no corroboration of a promise. What she said was that there was “no corroborative evidence as to the extent of the promise”.26 This is discussed in the following paragraphs.
[38] The first source of corroboration is the joint affidavit evidence of Stephen and Ans New, Phillip’s brother and sister-in-law. They said:
25 See [27](f) above.
26 Family Court judgment at [28] (emphasis added).
[39] In my judgment, this evidence adds material weight to Sarah’s own evidence, both in relation to the two types of services she claims she provided and in relation to the claimed testamentary promises of Maureen because of those services. Some weight should be attached to this evidence. The statement of Stephen and Ans that they were both very close to Phillip and Maureen is borne out, and in particular the relationship between Maureen and Stephen, by Maureen making Stephen an executor and trustee of all the wills made in 2004 and 2006 and the gifts to him of $20,000 in each of those wills.
[40] The other form of corroboration is the November 2006 will. The relative weight of this is not materially diminished by the fact that three earlier wills, in 2004 and 2006, made no provision for Sarah, or by the fact that Sarah was excluded from the wills made in 2012 and 2015. The purpose of the Act is to provide a remedy when people do not keep their promise to make a testamentary provision. With due respect to the Judge, I also consider that the November 2006 will also provides important corroboration, directly from Maureen, as to the extent of her promise – one-half of the residue of her New Zealand estate as recorded earlier. What that meant in practical terms was that Sarah was to receive one-half of the value of the property in Taupo in
which Terry had a life interest, but which had been derived from the joint assets of Sarah’s father and of Maureen.
[41] As earlier noted, I am satisfied, contrary to the Judge’s conclusion, that some of the assistance provided by Sarah to Maureen qualifies as “services”. These were services “beyond the normal expectations of family life or social interaction”,27 with the normal expectations determined by reference to the circumstances of this case. It is unnecessary to catalogue the various forms of assistance which I consider went beyond normal expectations because, in the end, it makes no difference to the result of this appeal. But this is relevant because it supports a conclusion, to which I will come, that the Judge’s award of $150,000 was reasonable. I will simply illustrate my assessment by reference to two things done by Sarah. After Sarah’s father died, when she was assisting Maureen to wind-up her father’s affairs, Sarah left her daughters, aged 3 and 6 years old, in New Zealand, with their father, to travel to the United Kingdom for three weeks with Maureen to settle affairs in the United Kingdom. This followed another period of three weeks Sarah had spent with Maureen in Maureen’s home in Taupo to support her.
[42] There is evidence, independent of Sarah’s own evidence, that Maureen herself considered that the help she got from Sarah after Phillip died went beyond “the normal expectations of family life”. The evidence of Stephen and Ans, quoted above, includes the evidence that Maureen continued to assure them that there would be testamentary provision for Sarah “throughout the period that Sarah assisted [Maureen] with her residency and beyond”. If the assistance Sarah provided to Maureen was no more than would have been expected as part of the family relationship, it would not appear to be a matter that would have prompted Maureen to repeat to Stephen and Ans what Maureen had already told them at the time of Phillip’s death. The advice at that time was prompted by the fact that all of Phillip’s estate went to Maureen.
[43] For these reasons I am satisfied that the services outlined were provided by Sarah to Maureen during Maureen’s lifetime and that Maureen made promises to Sarah that Sarah would receive, through Maureen’s will, what she would otherwise have
27 Byrne v Bishop, above n 10, at [6].
received from Phillip’s estate, together with remuneration for the further services after Phillip died.
Was there a nexus between the promises and the services?
[44] The second ground of appeal was that, if there was a testamentary promise, and if Sarah provided a service by not contesting her father’s will, there was no nexus between the two.
[45] The evidence already traversed establishes one side of the nexus: Sarah did not contest her father’s will, and also refrained from taking steps independently to provide some financial security for herself, because of the assurances she got from Maureen.
[46] The other side of the nexus is the reason or reasons for the promises repeatedly made by Maureen. The fact that there were repeated promises, and that these were made before as well as after Sarah’s father died, in my judgment sufficiently establishes, through reasonable inference in the factual context, that the successive promises were made to Sarah, and to Stephen and Ans, to forestall a claim by Sarah, and positively to assure her that there was no need to consider making a claim, in her father’s estate, and then in recognition of the fact that no claim was made. This inference may be drawn not only from Sarah’s evidence, supported by the evidence of Stephen and Ans. It may also be drawn from Terry’s evidence that Maureen had been put out by Sarah’s asking Maureen on the honeymoon in 2011 about the provision that had been made for her in Maureen’s will. This evidence does not assist in a defence to the claim but, if any weight is to be given to it, it supports a conclusion that Sarah expressed concern, over an extended period from before her father’s death, about securing an inheritance. That would provide abundant notice to Maureen there was need to make testamentary promises to Sarah to seek to avoid the possibility of litigation.
[47] I am also satisfied, for reasons already noted, that there were further promises from Maureen to Sarah, after Phillip died, and after Sarah had provided all of the assistance to Maureen in sorting out Phillip’s affairs, in recognition that at least some of those services went substantially beyond what both Maureen and Sarah would have expected to receive and give as a normal part of their relationship. I am also satisfied
that Maureen recognised this assistance went beyond what might be called the natural response from Sarah – the “setting off” – for assistance that in the past had been, and in the future might be, provided by Maureen to Sarah. There was such assistance from Maureen to Sarah, including financial assistance.
[48] There was a relevant link between the services and the promises.
Was there value in Sarah’s not contesting her father’s will?
[49] The third ground of appeal was that the Judge erred in concluding that Sarah would have succeeded in a claim under the Family Protection Act 1980. The point of the argument, although not quite put this way, was that there was no service provided by Sarah, in forbearing to sue; and no incentive for Maureen to make a promise, because a family protection claim by Sarah would not have succeeded or, at best, would have barely diminished Maureen’s assets. In other words: on one side, Sarah would not have contemplated contesting her father’s will because there would have been no value in a claim; on the other, Maureen would have known that there was no material risk to her if Sarah had made a family protection claim and therefore there was no need to make a testamentary promise to Sarah to forestall such a claim.
[50] Determining whether there has been a testamentary promise, to reward services, may require assessment of the value of the services considered from the perspective of both the claimant and the deceased. In this case, however, analysis along those lines is not necessary because the fact of the promise linked to the services is well established by other evidence. And such analysis is also inappropriate because I am satisfied that neither Sarah nor Maureen would have assessed prospects as Mr Mounsey did.
[51] I am satisfied there is no merit in this ground of appeal.
Quantum: Did the Judge apply the wrong statutory test?
[52] The fourth ground of appeal was that the Judge misdirected herself in holding that the paramount consideration in determining the quantum of an award to the
claimant is the size of the estate. This ground is founded on the Judge’s statement that quantum “must depend on the circumstances and particularly the size of the estate”.28
[53] There is nothing in this point. The Judge did not say or imply that the size of the estate was the paramount consideration. In assessing the award to Sarah the Judge expressly took into account other relevant considerations, in addition to expressly stating that quantum depends on the circumstances. In addition, throughout her judgment, the Judge referred to and discussed other circumstances which are relevant to quantum and which it may be assumed were taken into account for the quantum assessment without being referred to for a second time.
[54] In support of this ground of appeal there was a submission that an important circumstance the Judge failed to take into account was the minimal value of any family protection claim that might have been brought by Sarah. This point is different from the point under ground three because ground four is directed to quantum. This aspect is considered under the next heading.
Quantum: Was the value of a family protection claim determinative?
[55] The fifth ground of appeal was that any award to Sarah should have been limited to the value of an award to her under the Family Protection Act. The argument from this was that the maximum award under the Act could not be more than $15,000 because Phillip’s estate could not have been worth more than $15,000. The assumed value of Phillip’s estate was based on the apparent fact that it had been unnecessary to apply for probate of Phillip’s will, and probate is not required if the estate consists only of financial assets worth no more than $15,000.
[56] The legal foundation for this ground of appeal, and the related argument on the fourth ground of appeal, was statements in two cases.
[57] In Re Welch, Sir Robin Cooke said:29
28 Family Court judgment at [30]. In this judgment, see above at [23].
29 Re Welch, above n 9, at 8.
It is of the essence of the jurisdiction under the Law Reform (Testamentary Promises) Act 1949 that an award must be not more than reasonable recompense for services or work for the deceased.
[58] In Re Le Prou, Anderson J said:30
The value of the services rendered must be approached on the basis of what type of award might have been obtained by [the claimants] if they had challenged the will.
[59] The specific argument under the fifth ground, to the effect that the award could not have exceeded $15,000, impermissibly conflates what was said in those two cases.
[60] The statement in Re Welch paraphrases the broad jurisdiction of the court under s 3(1) of the Act to make an award “of such amount as may be reasonable, having regard to all the circumstances of the case”. The statement in Re Le Prou is directed to one only of the six particular circumstances specified in s 3(1) to be taken into account in assessing quantum. Even if it had been established – and it was not – that Sarah would not have recovered more than $15,000 if she had made a claim under the Family Protection Act, that would have been only one consideration, and the Judge did expressly refer to the likelihood that the value of Phillip’s estate was small.
[61] The considerations to be taken into account go well beyond that very narrow point. Simply considered in relation to the possible value to Sarah of a claim against Phillip’s estate, regard would have to be had not only to the value of assets remaining in Phillip’s estate, but also to potential value arising from a claim by Phillip’s estate against Maureen under the Property (Relationships) Act 1976.31 In addition, and importantly, assessment of value arising from Sarah’s not brining proceedings against or through Phillip’s estate must go beyond possible value to Sarah and also take account of the value to Maureen of a claim not being made. This would have to include
30 Re Le Prou, above n 11, at 79.
31 The facts and claims in Re Welch, above n 9, are of some relevance on this appeal. There were two claims brought by a step-son against the estate of his step-father. The first was a claim under the Matrimonial Property Act 1963 brought by the step-son as executor of his mother’s will. On that claim the step-son was awarded 50 per cent of the former matrimonial home and 50 per cent of another substantial asset. The administrator of the step-father’s estate appealed against that award, as well as against the award under the Act pursuant to which the step-son got the remaining 50 per cent of the former matrimonial home and the other asset. The award under the Matrimonial Property Act 1963 was upheld on appeal to the Court of Appeal. In the Court of Appeal the award under the Act, valued at $133,000, was reduced to $20,000. The Privy Council dismissed the step- son’s appeal.
an estimate of the intangible value to Maureen of not having to face a claim, whatever its merit, reasonably late in her life and soon after the death of her partner for 30 years. This would also have to be assessed as the value of peace-of-mind for Maureen for the remainder of her life. It is a factor, still focussing only on the value of the fact that Sarah did not bring a claim, warranting substantial weight in the overall assessment of the award in exercise of the broad discretion available to the Judge.
[62] Those considerations, confined to one circumstance only, assessed in relation to the value of the estate, justify the award that was made to Sarah. But analysis on those terms would be confined within narrow limits not justified by s 3 of the Act and the principles developed in the cases.
[63] Another circumstance specified in s 3(1) is the value of the testamentary provision promised. In Re Welch, the Privy Council said:32
So it is plain, considering s 3(1) as a whole, that whenever a claim to relief is made out under it the criterion as to the relief to be granted is reasonableness. That is always the result at which the court is to aim, no matter whether the award is of money or of specific property. If the deceased promised a certain sum or a certain property, that is a relevant consideration but not necessarily decisive.
What Maureen promised Sarah, assessing that in light of the 2006 will, was half the value of her home and its contents, including paintings and art works. The award in this case is well short of that value.
[64] The combination of submissions in support of grounds four and five do not, in my judgment, point to any error by the Judge in her assessment of quantum. Given my conclusion that there were additional services provided by Sarah, the award of
$150,000 is well within range. As the Privy Council also said in Re Welch, “a liberal approach to the question [of an award] is fitting ...”.33
32 Re Welch, above n 9, at 6 (emphasis added).
33 Re Welch, above n 9, at 8.
Was there appealable error in failing to “net off” benefits Sarah received from Maureen?
[65] Mr Mounsey submitted that the Judge failed to consider “the degree of mutual support and benefits” provided by Maureen to Sarah during Maureen’s lifetime. This was said to include: moral support; Maureen’s emigrating to New Zealand to support Sarah and her young family; travelling to England to give Sarah away at her second wedding; funding travel for Sarah during her lifetime; and making a loan to Sarah that was never fully repaid.
[66] I am not persuaded that there was any error by the Judge in the exercise of her discretion. The Judge, expressly or implicitly, noted all of the matters referred to in the course of her judgment. There is no reasonable basis to conclude that these were simply ignored in her assessment of quantum at the end of the judgment.
[67] In addition, if I were required to reassess the award, my conclusion would be that the different forms of support from Maureen to Sarah were fully reciprocated by Sarah, in different ways, through services not taken into account as services justifying an award under the Act.
Conclusion
[68] For the foregoing reasons, I am satisfied that Sarah’s claim is established, the award did not involve any error by the Judge in the exercise of her discretion, and the sum awarded is clearly reasonable. In consequence, the appeal will be dismissed.
Costs
[69] Having succeeded on this appeal, Sarah is entitled to costs.
[70] In the Family Court, the Judge ordered that all costs were to be paid from the estate.34 I am satisfied that a similar order should be made in respect of Sarah’s costs on this appeal.
34 Family Court judgment at [33].
Result
[71] The appeal is dismissed.
[72] There is an order that the actual and reasonable costs of the respondent of and incidental to this appeal be paid out of the estate of Maureen Ann Dwight.
Woodhouse J
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URL: http://www.nzlii.org/nz/cases/NZHC/2018/1764.html