Keep it in the Family: First case to consider new family provision laws
The Victorian Supreme Court decision in Brimelow v Alampi  VSC 135 (Brimelow) marks the first case to consider recent law reforms regarding disputed estates.
The Justice Legislation Amendment (Succession and Surrogacy) Act 2014 (Amending Act) made significant changes to Part IV of the Administration and Probate Act 1958 (Vic) (Act). Although the final amendments to the Act are not as far-reaching as initially proposed, the amendments have significantly restricted the classes of plaintiffs who can apply for a family provision order (previously known as a maintenance order) to be made in respect of the estate of a deceased person.
Before considering the decision in Brimelow it is instructive to restate the key changes introduced by the Amending Act.
The Amending Act only applies to estates where the deceased died on or after 1 January 2015.
Prior to the amendments, any person could apply to the courts for a family provision order. Under the Amending Act only an ‘eligible person’ may apply. There are effectively two tiers of claimants:
Tier One – spouses and children
The following people can make a claim:
- the spouse or domestic partner
- a child, stepchild, or person who believed they were a child
- a former spouse or domestic partner who would have been able to commence proceedings under the Family Law Act 1975 (Cth).
Tier Two – other eligible persons
The following people can make a claim if they can also show they were wholly or partly dependent on the deceased for their proper maintenance and support:
- a grandchild
- a registered caring partner
- a spouse or domestic partner of a child of the deceased
- a member of the deceased’s household.
Significantly, for adult children over 25 years of age, a Court, when making a family provision order under the Amending Act, must take into account the degree to which the adult child is not reasonably capable of adequately providing for their own proper maintenance and support. This amendment is intended to limit claims made by adult children who are capable of providing for their own proper maintenance.
Another significant amendment under the Amending Act is that, when making a family provision order, the Court must have regard to what is stated in the deceased’s Will, any evidence of the deceased’s reasons for making the dispositions in the Will and any other evidence of the deceased’s intentions to provide for a claimant. This amendment was introduced to ensure that due regard was had by the Court to a deceased’s testamentary Will.
Notwithstanding the amendments, a claimant must still establish that the deceased had a moral duty to provide for his/her proper maintenance and support and failed to do this in the Will.
How did the Victorian Supreme Court interpret the amendments in Brimelow?
Rita Alampi, (Deceased) died on 10 January 2015 and was survived by her three adult children, including the Plaintiff (daughter) and the Defendant (son). Her husband pre-deceased her.
Under her Will, the Deceased appointed the Defendant as the sole beneficiary of her estate, to the exclusion of her other two children. Significantly, the Deceased included an express clause in her Will stating that she had made no provision for her other children as she had ‘no meaningful relationship’ with either of them.
Both of the excluded children issued proceedings against the Deceased’s estate seeking provision pursuant to the Amending Act. The Plaintiff continued to trial, while the other child settled prior to trial at mediation.
As the Plaintiff was the daughter of the Deceased, she fell squarely within the scope of eligible people permitted to make a family maintenance claim under the Act. Accordingly, the Court was not required to consider in any detail whether the Plaintiff was an eligible person.
Given that the Defendant conceded that the Deceased had a moral duty to provide for the proper maintenance and support of the Plaintiff and had failed to do this in the Will, the remaining issue to be determined at trial was the amount of money to award to the Plaintiff from the Deceased’s estate.
Decision of the Supreme Court of Victoria
The Court held that provision be made for the Plaintiff out of the estate in the amount of $170,000 and her costs (on a standard basis) were to be paid out of the estate.
The Court, as is required under the Amending Act, considered the express language of the Will, which excluded the Plaintiff from any entitlement. However, the Court held that although it must have regard to any reasons expressed in a Will to exclude a claimant, this is but one consideration for the Court in determining whether the deceased has a moral duty to provide for the proper maintenance and support of the claimant.
In this regard, the Court noted that the Plaintiff was a 50 year old adult with limited assets and earning capacity, two dependent children and a limited household income shared between herself and her husband. The Court found that the Plaintiff was not capable by reasonable means of providing adequately for her proper maintenance and support.
The Court emphasised that its role is not to ensure a fair distribution of the estate or to achieve equality; rather it is merely to ensure that adequate provision has been made for the proper maintenance and support of a claimant that is an eligible person.
- Under the Amending Act, the class of persons who may make a family provision claim under a Will has been limited. For example claims cannot be made by nephews, nieces, friends and non-related neighbours of the testator.
- It remains unclear how Victorian Courts will interpret the requirement under the Amending Act that a Tier Two eligible person be wholly or partly dependent on the deceased.Corresponding legislation in NSW, the Succession Act 2006 (NSW), adopts the requirement of ‘dependency’ in relation to certain classes of claims. This has been interpreted to mean that a claimant must have a “financial, economic or material dependency, not a mere emotional dependency” on the deceased. It remains to be seen whether Victorian courts will adopt the same approach to the term as the NSW courts have done.
- Although the Court is required under the Amending Act to consider the terms of the Will in assessing a claim for further provision, it will not deny a claim made by an eligible person merely because he/she is specifically excluded from the Will. Ultimately, in determining a claim, a Court will consider whether the deceased had a moral obligation to provide for the claimant’s proper maintenance and support.
You might be also interested in...
Banking & Finance | 7 Sep 2016
The Code of Banking Practice (Code) establishes standards of good practice when banks deal with small businesses and individuals. In recent years, a growing number of customers and guarantors have sought to rely on the Code in litigation with banks.
Litigation & Dispute Resolution | 23 Jun 2016
The convenience of executing legal documentation with electronic signatures must be carefully weighed against issues of enforceability and security.