I have written before about the law concerning what is referred to as Testator’s Family Maintance or Family Provision claims against deceased estates pursuant to Part IV of the Administration and Probate Act (Vic.) 1958. This is the law that allows a Court to vary the distribution of a deceased person’s estate from what they had in their WIll, so as to make adequate provision for family that the Court decides the deceased had an obligation to provide for. As mentioned in my previous blog the law in Victoria was changed earlier this year so that, for deceased estates where the deceased dies after 1st January 2015, the categories of people who can make such a claim is limited to:
- A spouse or domestic partner of the deceased at the time of the deceased’s death;
- A former spouse or domestic partner in a situation where a property settlement was not reached following their separation;
- A child, step child, or adopted child of the deceased who at the time of death was under the age of 18 years, or a fulltime student between the ages of 18 and 25 or who is under a disability;
- A person who believed the deceased was their parent for a substantial period of their life and was treated by the deceased as their natural child an “assumed child”);
- A registered caring partner;
- A grandchild of the deceased who was wholly or partly financially dependant on the deceased ;
- A spouse or domestic partner of a child of the deceased if the child dies within 1 year of the deceased’s deathwho was wholly or partly financially dependant on the deceased ;
- A member of the household of the deceased, or a former member who would have resumed being a member of the household but for the deceased’s death, who was wholly or partly financially dependant on the deceased
- other family mewmbers such as parents, nices, nephews, siblings, cousins, unregistered non-partner carers etc. are only eligible to make a claim if they fall into one of the other above categories, i.e. household member or assumed child.
I have also mentioned before that there is a time limit within which Court proceedings for any such a claim must be commenced, i.e. within 6 months of Probate being granted. It is possible to ask the Court for leave (permission) to extend this time limit but whether or not the Court will do so is entirely in its’ discretion and depends on the facts of each case. What is very important to understand though is that the Court has no power to extend time once the estate has been finally distributed. Last week the Supreme Court of Victoria handed down a judgment, in the case of Robbins v Hume which highlights this, and the importance of commencing any proceedings for a claim against a deceased estate within the 6 month time limit.
The background to Robbins v Hume was that the deceased died on 7th June 2013, leaving behind 6 children – his son, the Defendant, Mr. Hume and 5 daughters, one of whom was the Plaintiff Ms. Robbins. In his Will the deceased made his son the Executor and left him his house in Vermont, worth about $600,000.00. The deceased left all the rest of his property, worth a total of $141,593.00, equally between his five daughters – in other words each of the daughters got only $28,228.20. Probate of the Will was granted to the Executor on 30th August 2013. On 21st January 2014 the Executor’s Solicitors wrote to each of the daughters to let them know what was in the Will, and how much each of them would get. In mid April 2014 the Executor sent out cheques to each of the daughters (his sisters) for their $28,228.20 share of the estate. In June 2014 the Executor settled the sale of the Vermont property that had been left to him, and recieved the proceeds of sale. Once all of the assets of the estate had been distributed amongst the benficiaries the administration of the estate was finished.
On 2nd March 2015 the Plaintiff made application to the Supreme Court for an injunction against her brother to try to stop him from disposing of any more of the money he had recieved from the sale of the Vermont property than he may already have done, and asking the Court to extend time for her to make a Family Provision claim against the estate.
The Plaintiff herself had suffered a stroke in April 2012 and was in hospital until September 2012. In April 2013 she went to live in a nursing home. In July 2014 the Plaintiff accidentally overdosed hereself on her prescription medication, so thereafter her medication had to be administered to her by the nusring home staff.
First, the Court made it very clear that it had no power to extend time for the Family Provision claim once the 6 months from the date of the grant of Probate had elapsed and the final distribution of the estate had occured. The only question that then remained was whether it should grant an injunction to freeze disposal of the Vermont sale proceeds in the hands of the Defendant, on the ground that he had breached his fiduciary duty as Executor to the Plaintiff and he continued to hold that money on constructive trust for her. After reviewing the relevant law the Court analysed and decided the Plaintiff’s claim as follows:
“61 The starting point for the administration of an estate is that an executor’s primary obligation is to carry out the wishes of the testator, as expressed in the will. All of the deceased’s children were beneficiaries under the deceased’s will and, in the case of the plaintiff, she received a copy of the will with an explanation of what she was to receive under it. As a beneficiary, the plaintiff was entitled to the share that she was left by the deceased. As a potential claimant for further provision from the estate, she has the right to make a claim, which could have been rejected or accepted by the executor. Generally, an executor has a duty both to uphold the will, as well as seeking a compromise where a proper claim is made against the estate, so as to minimise any legal costs. In Victoria, there is no duty on an executor to notify claimants in the category of the plaintiff. An executor is not under an obligation to bring the fact of the availability of a right to make a claim to the attention of a potential claimant. If there were, one would think that the Victorian Parliament would have provided for that, just as the New Zealand Parliament did when they included the special provisions for a person not of full age or mental capacity. Executors are entitled to distribute an estate if there is no notice of a claim within the statutory timeframe. Executors and beneficiaries are entitled to certainty of administration against a reasonable time limit for claimants to take proceedings against an estate. These provisions support the conclusion that the claims asserted by the plaintiff cannot be upheld.
62 The defendant has acted in accordance with long-established practice in his administration of the estate. He has not concealed what he was doing in the administration of the estate of the estate. I reject the plaintiff’s submission that the defendant failed to inform the plaintiff that he was about to make a final distribution of the estate or that he proceeded to appropriate the sale proceeds of the Vermont property to himself. Insofar as the plaintiff claimed the defendant ‘proceeded to appropriate’ the sale proceeds of the Vermont property, there is no basis to make such a claim. Inherent in the submission is that the defendant has taken the sale proceeds when he is not entitled to them and that is not the case.
63 It is also wrong to submit that the defendant failed to inform the plaintiff that he was about to make a final distribution of the estate. The defendant’s solicitors sent the letter dated 21 January 2014 to the plaintiff in which she was given a copy of the deceased’s will, told what she was entitled to receive under it, told that distribution could not be made until after 28 February 2104 and told that she could contact the solicitors if she wished to discuss any matters. The plaintiff did not contact the defendant’s solicitors with any queries. Subsequently, on or about 14 April 2014, the plaintiff received her distribution of the residue of the estate. The plaintiff deposed that she thought this amount ‘was an interim distribution and that I was entitled to more money from the estate’. After receipt of the distribution and bearing in mind her thought, the plaintiff still did not contact the defendant’s solicitors with any of ‘her thoughts’ regarding the dates of any further distributions to which she believed she might be entitled from the estate.
64 In any event, the defendant in his personal capacity has no duty to safeguard the plaintiff’s interests or a duty of even-handedness towards the plaintiff. He has received the net proceeds of sale of the Vermont property as a beneficiary of the deceased’s estate, as is his entitlement. There is no cause of action against the defendant in his personal capacity.
65 In respect of the defendant’s capacity as the executor of the estate of the deceased, as discussed, the defendant as executor does not have any duty to safeguard the plaintiff’s interests or a duty of even-handedness towards the plaintiff of the type submitted by the plaintiff. In any event, the defendant’s executorial duties have finished with the estate finally distributed in accordance with the deceased’s will. The plaintiff is not entitled to any injunctive relief claimed by her against the defendant.”
So unfortunately the Plaintiff was not successful. This case is a clear example of why it is so important to make any desrtied claim against a deceased estate within the 6 month time limit or, if for some genuine reason that has not been possible, then definitely before the distribution of the assets of the estate is completed.