Wednesday, 29 June 2011

Family Provision for your Lover /girlfriend / ???

A recent decision of the Victorian Supreme Court, subsequently affirmed on appeal, gives great pause for thought to those of us who would choose to maintain a relationship with a lover alongside their marriage or with a married person. 
Malcolm Forsyth died suddenly of a heart attack aged 63. He left his share of  the family home which he had inherited from his parents, to his Brother. He was a single man but had commenced an intimate relationship with a married woman in 1992. After Malcolm's death, his lover claimed that even though she was already married, she and Malcolm had made a "life long" commitment to each other and had decided to spend as much time together as they could and that they would get married when they could.
Malcolm was, of course dead by this time, so this evidence is always difficult to controvert.
The facts were that they never married (she in fact remained living with her Husband for most of the relationship), they maintained separate homes, were each financially independent and kept their relationship hidden from some family members.
Numerous offers of settlement were made to Malcolm's lover none of which were accepted.
His Honour Mr. Justice Harper decided to award half of Malcolm's estate to his lover on the basis that she was someone that Malcolm had an obligation to provide for from the proceeds of his estate. Whilst some concern was expressed by one of the Judges on appeal about the decision being "at the margin" the decision was upheld on appeal.
Thus the family home no doubt, together with several hundred thousand dollars in legal costs,  disappeared out of the fortunes of the Forsyth dynasty forever.
Rest in Peace Malcolm
For practitioners the appeal provides a most interesting examination of the admissibility and confidentiality of discussions at mediation, in the light of SS 24A of the Supreme Court Act and 131(1) of the evidence Act.
See - Forsyth -v- Sinclair [2010] VSCA  195

Sunday, 26 June 2011

Storage of wills, Lost Wills, Destruction of a will, Probating a copy of a will

Athena Yiossis made a will in 1995. She left everything to her three children but created a life interest enabling her autistic Son Rakesh to remain in her home until he died. Unfortunately no-one actually thought to take out probate of the will and when one of her Sons finally checked in 2006 they found the home still in the deceased's name alone. Everyone knew that a will had been made but unfortunately the original will and the title to the house had apparently both suffered the same fate. Both originals had been kept in the family home where the autistic boy, with a proclivity for disposing of paperwork he saw as useless, lived alone. Apparently "Rakesh"  had inadvertently  thrown the original title and will out in the rubbish some years after his Mother passed away. Fortunately the solicitor who made the will had retained a "marked up" copy which was presented to the probate office earlier this year. The probate office in South Australia was not prepared to grant probate of the copy and referred the matter instead to a judge in the Supreme Court in that State.

The applicable Probate Rules in South Australia are similar to those in Victoria and state that such a copy may be admitted to proof provided it is supported by affidavits as to:-
(a) The original will having been properly signed and witnessed.
(b) The existence of the will after the death of the testator or such evidence as will rebut the presumption that the will was revoked by having been destroyed AND;
(c) the accuracy of the copy will or other evidence of the contents of the will.

Complicating the Courts task in this case was the fact that the deceased was still married to her third Husband from whom she had separated in 1984. Evidence was led that satisfied the Court regarding the long separation of the parties and the fact that the third Husband was probably dead.
In the event the Court was satisfied that the copy was a complete and accurate copy of the will and that it had been duly executed and had not been revoked by the deceased before she died. The copy was admitted to probate and Rakesh was safe to stay living in mum's house until his death.

Saturday, 25 June 2011

Infants as beneficiaries. Selling property. Trustee Act 1958

A decision was handed down in an interesting case in the South Australian Supreme Court last week. A deceased person had left his estate to his Sons and an infant Grandchild. The Court was approached for permission to sell the property pursuant to Section 63 the South Australian Administration and Probate Act which contains similar  terms to the provisions in the Victorian Trustee Act. The Court is empowered to order that property in a deceased person's estate be sold in any case in which the Court considers that the sale would be for the benefit of  any infant entitled to the property. Most cases turn on whether the sale will actually be for the benefit of the infant concerned or not and it is up to the applicant to demonstrate that it will be for their benefit. Often, the difficulty in maintaining a low income generating property for many years, coupled with capital gains tax problems and the pressing financial needs of the infant will mitigate in favour of such an order being made.
In this case ( In the Estate of John Davi (Deceased) [2011] SASC 95 ) the Court found that the proposed sale of the real estate property in Kensington Park was for the benefit of the infant concerned and exercised its discretion to order the sale accordingly.
Selling and distributing  property prior an infant attaining the age of 18 years may be worth considering in certain limited circumstances where it can be clearly shown to be for the benefit of the infant concerned.