Steinmetz v Shannon

1. [1]

   WHITE JA: This is an appeal from orders of the Equity Division (Pembroke J) dismissing the appellant’s application for a family provision order (Steinmetz v Shannon [2018] NSWSC 1090). The appellant is the deceased’s widow. The deceased died leaving a distributable estate of approximately $6.8 million.

2. [2]

   I have had the advantage of reading in draft the reasons for judgment of Brereton JA which address in detail the facts giving rise to the appeal. Partly because we are differing from the reasons of the primary judge, partly because my reasons differ in some respects from those of Brereton JA, and partly because I would make a different order for provision than proposed by Brereton JA and Simpson AJA, I state my own reasons for concluding that the appeal should be allowed and that the appellant is entitled to further provision from the deceased’s estate.

3. [3]

   The deceased made his last will on 19 September 2016. The will was signed in hospital shortly before the deceased was to undergo surgery which it was thought he might not survive. The will appointed the children of his first marriage as the executors and trustees of the will. He gave his wife all of his personal items and the contents of his house at Crescent Head Road, Crescent Head “and any other items that we may have obtained together”. Subject to this specific gift and to a pecuniary legacy to his godson, the deceased left the residue of his estate to his children in the following terms:

4. [4]

   Clause 8 of the will provided as follows:

5. [5]

   The will was drafted for the deceased by his son-in-law, Matthew Shannon, the husband of his daughter, Nicole Shannon. He is a solicitor.

6. [6]

   The appellant and the deceased were married on 30 December 2011. Prior to their marriage, they had been living in a de facto relationship since July 1988.

7. [7]

   The appellant and the deceased largely kept their assets separate. The primary judge found that they retained financial independence. The appellant also maintained a home in Crescent Head. The primary judge found that she moved between it and the deceased’s home in Crescent Head.

8. [8]

   The appellant estimated that the value of her assets at the time of hearing was $706,880. This included superannuation having an estimated value of $300,000 and her home unit in Walker Street, Crescent Head which she valued at $250,000. The primary judge thought that the appellant may have understated her assets, noting that the appellant stated that she derived income of $28,158 from her superannuation which would be a very high rate of return if the capital value of the fund was $300,000, and noting that an almost identical property to her unit (they both being part of a duplex) had recently sold for $310,000.

9. [9]

   The primary judge concluded that the appellant had not been left without adequate provision for her proper maintenance. He did not refer to the adequacy of provision for the appellant’s advancement in life, but this was not a ground of appeal and did not figure in the submissions before the primary judge.

10. [10]

    The primary judge observed that the annuity had a present value of $880,000.

11. [11]

    In concluding that the annuity was adequate provision for the appellant’s proper maintenance, the primary judge relied upon the following matters:

12. [12]

    The deceased’s 2016 will was prepared by Matthew Shannon at the deceased’s request following a telephone call from the deceased in which the deceased said, “Mate, I’ve really got to sort out my will. I want to do a new will. I am having a procedure done at 2.00pm and the doctor isn’t sure that I’m going to make it through the anaesthetic”. Matthew Shannon deposed that the deceased gave him instructions over the telephone. He prepared the will between 10.59 and 11.28am and then immediately drove to Port Macquarie Hospital. When he arrived the appellant was seated next to the bed. The deceased instructed him to make handwritten adjustments that were contained on the will that amended the annual annuity from $50,000 to $52,000 and deleted a condition that the annuity would lapse if the appellant married or entered into a de facto relationship.

13. [13]

    The instructions for and execution of the will were rushed. It was made when the deceased was in extremis. The appellant submitted that there was no evidence that any careful thought or consideration was given by the deceased as to what was appropriate for the appellant. I agree. That is manifest from the terms of clause 8 of the will that show that the deceased’s overriding consideration was to preserve his estate for his children and future generations rather than his considering what was proper provision for his wife.

14. [14]

    The primary judge’s finding that the appellant was not left with inadequate provision for her proper maintenance was an evaluative decision that can only be disturbed on appeal on the same principles as are applied to the appellate review of discretionary decisions as expounded in House v The King (1936) 55 CLR 499; [1936] HCA 40. In DJ Singh v DH Singh [2018] NSWCA 30, Gleeson JA said:

15. [15]

    The appellant challenged the primary judge’s findings of fact and his rejection of parts of the appellant’s evidence. It is unnecessary to determine the latter challenge. Independently of that challenge, there are four errors of principle or material findings of fact that warrant appellate intervention.

16. [16]

    The first is the primary judge’s giving any weight, and it appears his Honour gave considerable weight, to the fact that (according to his Honour’s finding) the appellant concurred with the terms of the will.

17. [17]

    The primary judge found that the appellant did not contradict evidence given by Matthew Shannon that after the will was read the deceased asked the appellant whether she was happy with it, to which she replied with words to the effect, “Yes, but I keep telling you Geoff that I do not want anything from your estate.” The primary judge said that the appellant’s counsel did not challenge that evidence. This is correct.

18. [18]

    But the appellant gave different evidence. She deposed that she quickly read the will, but did not comprehend it because she was more concerned about her husband’s health than a last-minute will. She said she had a conversation with the deceased in which he asked whether she was happy with the will and she replied, “I will be happy with anything you would like to bequeath me.” She deposed that she replied in the way she did because she did not want to upset her husband in the extremely fragile and weakened state he was in.

19. [19]

    She was not challenged on that evidence.

20. [20]

    The appellant was cross-examined on her understanding of her husband’s estate as follows:

21. [21]

    The primary judge did not refer to this evidence. The will was made when the appellant’s husband was in hospital and about to undergo an operation he was not expected to survive. The appellant’s response, either as recorded by the primary judge or explained by her, was one focused on her concern for her husband and not for her own position.

22. [22]

    In any event, the appellant did not know the value of the deceased’s business or the extent of his assets. There was no opportunity for a considered and informed assessment. Her concurrence was not evidence that the deceased had made adequate provision for her proper maintenance or advancement in life.

23. [23]

    The second error is that the primary judge emphasised and purported to apply what I said in Slack v Rogan (2013) 85 NSWLR 253; [2013] NSWSC 522 (at [127]) and repeated in Sgro v Thompson [2017] NSWCA 326 (at [80]-[88]) that if the deceased were capable of giving due consideration to the question of what provision was required for the claimant’s proper maintenance and advancement in life and had done so, considerable weight should be given to the testator’s testamentary wishes in recognition of the advantages that the testator has over the court in knowing the details of the family’s relationships.

24. [24]

    The primary judge acknowledged (at [14]) that “there is no doubt that the plaintiff was caring, especially during the deceased’s later years when he suffered much ill health.” The appellant’s evidence was that for at least 15 years prior to the deceased’s death she was his full-time carer and that if she had not provided care he would have required a professional carer to attend to his daily care needs.

25. [25]

    At the conclusion of his judgment the primary judge said (at Judgment [43]) that he had not overlooked the fact that in an earlier will executed in 2013 the deceased left his home at Crescent Head Road to the appellant and made other more generous provisions for her. He did not otherwise address the question as to why after three more years of devoted care, the deceased, if giving due consideration to the appellant’s claim on his estate, should have thought it appropriate to reduce the provision made.

26. [26]

    There was evidence that the deceased made two wills in 2013. The former will made more generous provision for the appellant than did the latter, but the provision made in both wills was more generous than was made in the deceased’s last will.

27. [27]

    The deceased’s brother, Anthony, gave evidence that in about October 2013 the deceased indicated to him the terms he wanted in his will and asked him to prepare a will for him. Anthony Steinmetz prepared a draft will and advised the deceased to obtain his own independent professional legal advice. He was later told by the deceased that the deceased had signed the will and had added a legacy of $15,000 for his brother being the executor. The draft will prepared by Anthony on the deceased’s instructions left the deceased’s Crescent Head property to the appellant and gave her a life interest in his superannuation funds. It also provided for the residuary estate to be divided equally between the appellant and the respondents.

28. [28]

    The appellant gave evidence that in around 2013 the deceased told her that “I have made a will leaving you this house (meaning the deceased’s house in Crescent Head Road, Crescent Head) my superfunds and one third of the rest of my estate.” She had not seen the will and was not aware of its location.

29. [29]

    Matthew Shannon gave evidence that the deceased instructed him to prepare a will in October 2013 and that the deceased said to him words to the effect, “Tony has done a will for me. Can you make sure it does what I want to happen.” He deposed that he and the deceased then had a discussion about what was contained in the will prepared by Tony. Matthew then said, “This document does not do what you want it to do.” The deceased asked him to fix it and Matthew then prepared a will on the deceased’s instructions which was signed by the deceased at the Crescent Head Road property.

30. [30]

    The will prepared by Matthew Shannon for the deceased gave the appellant a licence to occupy the Crescent Head Road property for as long as she might wish or until she married or entered into a de facto relationship. The rates, taxes and other outgoings and insurance premiums were to be paid out of the estate. The will included a provision for the appellant to be able to require the trustees of the will to sell the house to obtain another residence for the appellant’s occupation, including in a retirement village, to which the same provisions would apply. It provided for the licence to terminate if the appellant entered into a de facto relationship, or ceased to live permanently in the house or in any such new residence. The will again provided for the appellant to have a life estate in the deceased’s superannuation fund. It provided for the residue of the estate to be divided between the respondents only.

31. [31]

    Whether the deceased’s true wishes in 2013 were as explained to his brother (a solicitor) or to his son-in-law (also a solicitor), it is clear that he then intended that the appellant would be more generously provided for than she was provided for by his last will. But there is no explanation why, after more years of devoted care, his wife should have been afforded less provision, except the deceased’s statement in clause 8 of his will that he wished to keep his estate intact for his children and grandchildren and that his wife could live comfortably without having to dispose of his assets. That shows no proper consideration to his wife’s legitimate expectations.

32. [32]

    A third error in the primary judge’s approach was that his Honour wrongly equated what was adequate provision for the appellant’s proper maintenance with a need for provision of financial necessities (Judgment [19]-[21] referred to above at [11(j)]). The primary judge dismissed the appellant’s evidence that she wanted to be able to move from Crescent Head to Port Macquarie as expressing a preference rather than a need. But if the preference were soundly based then it would inform what the appellant’s “proper” maintenance required. (Sgro v Thompson at [74]).

33. [33]

    The appellant gave evidence in her first affidavit that she wished to move from Crescent Head to South West Rocks. She deposed:

34. [34]

    It is not clear whether the primary judge accepted or rejected the appellant’s evidence that if she stayed in Crescent Head she feared she would confine herself to her home. I infer that his Honour did not reject the evidence, but did not consider that that was sufficient to create a “genuine need”. The appellant’s evidence about difficulties in staying at Crescent Head was corroborated by the evidence of the first respondent who said, “I agree that Crescent Head is a small village, I too have had locals say to me words to the effect of ‘Gayle is going to take you for everything you’ve got. She doesn’t care how much it costs.’”

35. [35]

    In her third affidavit sworn shortly before the hearing, the appellant said that she was concerned that she needed to be closer to proper healthcare as she became older and that Port Macquarie provided a high level of healthcare. She suffered a fall in January 2018 and travelled to Port Macquarie to attend specialist appointments. She deposed that considering all her circumstances she preferred to live in Port Macquarie which was a large regional centre with hospitals and medical specialists close at hand and also had an airport to enable her to travel to Sydney if needed. The primary judge did not address the appellant’s evidence that she wished to move to Port Macquarie to be closer to healthcare services.

36. [36]

    Fourthly, I agree with Brereton JA that having regard to the size of the estate which is ample to meet all competing claims, the provision of an indexed annuity of $52,000 per annum was manifestly not adequate provision for the appellant’s maintenance, having regard to the appellant’s moral claims on the deceased’s estate when she had been his de facto partner or wife for some 28 years, including 15 years as his carer.

37. [37]

    With the following riders, that are in part by way of emphasis and in part by way of qualification, I agree with the reasons of Brereton JA in relation to guidelines for widows’ claims (at [98]-[109]). The matter of emphasis is that guidelines such as those expressed by Powell J in Luciano v Rosenblum (1985) 2 NSWLR 65 for claims by widows, or by Brereton JA (then Brereton J) in Taylor v Farrugia [2009] NSWSC 801 at [57]-[58] in relation to claims by adult children, or by Hallen J in Bowditch v NSW Trustee and Guardian [2012] NSWSC 275 at [113] in relation to claims by eligible applicants who are grandchildren, cannot be elevated to inflexible rules and are subject always to the consideration of the particular circumstances of each case, including the size of the estate, any competing claims, the applicant’s conduct and the applicant’s relationship with the deceased. Thus, in Golosky v Golosky [1993] NSWCA 111 Kirby P referred to Luciano v Rosenblum, but also said:

38. [38]

    In Bladwell v Davis [2004] NSWCA 170 Bryson JA said (at [18]):

39. [39]

    Ipp JA and Stein AJA agreed. Ipp JA’s additional remarks (at [2]) do not detract from the force of what Bryson JA said. (See also Chapple v Wilcox (2014) 87 NSWLR 646; [2014] NSWCA 392 at [18]-[20] and [66]-[67]; Burke v Burke [2015] NSWCA 195 at [84]-[85]; Yee v Yee [2017] NSWCA 305 at [172]; Verzar v Verzar [2012] NSWSC 1380 at [131] and Gargano v Coves [2018] NSWSC 985 at [160] at [175]-[178]).

40. [40]

    My qualification concerns recourse to community standards or community expectations. I acknowledge the weight of authority that endorses a judge’s bolstering his or her view as to whether an applicant has been left without adequate provision for proper maintenance or advancement in life and whether a testator or testatrix has failed in his or her moral duty to provide such adequate provision, by reference to what the community (or fair and reasonable members of the community) would expect (e.g. Chapple v Wilcox at [11], [12] and [102]; Andrew v Andrew (2012) 81 NSWLR 656; [2012] NSWCA 308 at [12] and [13]).

41. [41]

    My first difficulty is in understanding what is meant by community standards or community expectations. Does it refer to the community generally or to a more particular community of which the deceased and his family and the applicant form part informed by particular cultural, ethnic, religious or social values? I assume that the answer is the former, although I am not aware of any case in which the question has yet come up for decision. What would be the position if the expectation of a particular cultural, ethnic, social or religious community in which the deceased lived was that a child who married without his or her parents’ consent should be cut off without a penny? Would evidence of that expectation be an answer to an otherwise worthy claim? I would answer that question in the negative, but that is because I do not consider the references to community standards or community expectations are to an externally provable fact. In Goodman v Windeyer (1980) 144 CLR 490; [1980] HCA 31 Gibbs J said (at 502):

42. [42]

    In Kearns v Ellis (Court of Appeal (NSW), Glass, Mahoney and McHugh JJA, 5 December 1984, unreported) Mahoney JA said that the Court itself is the spokesman for the fair and reasonable man or woman in the community.

43. [43]

    It is the Court’s perception of what fair and reasonable members of the community would expect a testator to provide for the applicant, not something that is to be proved as a standard against which the Court’s judgment is to be made, that is relevant.

44. [44]

    But unlike the reasonable man on the Clapham omnibus or the Bondi tram, or the reasonable and fair-minded lay observer asked to consider the impartiality of a judge, there is no utility in invoking a community standard or expectation against which the adequacy of provision is to be judged. I agree with Brereton JA that if one is forced to use concepts of “moral duty” or “community standards”, the former is preferable. The indication of either expresses a conclusion about the judge’s own evaluative assessment as to whether the provision made for the applicant was adequate for his or her proper maintenance and advancement in life (and, where relevant, education).

45. [45]

    The advice of a solicitor that judges generally expect that a certain type of provision will be made for a spouse, adult child, or grandchild may carry more weight with a client than advice that judges have said that the community generally expects such provision to be made. A client could properly consider that he or she is in as good a position as a judge to assess what the community would expect.

46. [46]

    Community expectations or community standards are not one of the specifically identified matters in s 60(2) of the Succession Act that the Court might consider in determining whether to make a family provision order and the nature of any such order. Section 60(2)(p) has a catch-all that the Court may consider any other matter, additional to those listed in s 60(2)(a)-(o), which it considers to be relevant. But whereas the legislature picked up the notion of moral obligation in s 60(2)(b) (“the nature and extent of any obligations or responsibilities owed by the deceased person to the applicant” etc), it evidently did not consider that community standards or community expectations were a fact to be established that might be considered to be relevant in how the evaluative decision under s 59 should be made.

47. [47]

    I agree with the appellant’s submission that the primary judge asked the wrong question at paragraph [4] of his Honour’s reasons when his Honour said:

48. [48]

    In the absence of competing claims that could not be otherwise fully met out of the estate, and informed, but not directed, by the guide provided by Luciano v Rosenblum and Golosky v Golosky, the appropriate question was why should she be entitled to less? The primary judge did not expressly ask that question, but implicitly he answered it by saying that the deceased had freedom of testamentary disposition, he was in the best position to assess the appellant’s claim on his testamentary bounty, and he made a considered judgment as to what was appropriate provision. The primary judge said (at [31]):

49. [49]

    His Honour concluded that the deceased did not abuse his “right of freedom of testamentary disposition” (Judgment [41]).

50. [50]

    Insofar as the primary judge claims support for the approach that he took from what I said in Slack v Rogan (at [127]) and repeated in Sgro v Thompson (at [80-[88]), his Honour erred. In Slack v Rogan, in a passage quoted by the primary judge (Judgment [11]), I said:

51. [51]

    I did not say that wherever it can be seen that the deceased was capable of giving due consideration as to the adequacy of the provision in the will for a claimant and did so, that that was determinative of a claim for provision.

52. [52]

    Section 59 of the Succession Act does interfere with the freedom of testamentary disposition, and if the provision made for an eligible applicant is less than adequate for his or her proper maintenance and advancement in life, provision must be made. I agree with Brereton JA (at [96]) that s 59 is to be applied according to its terms, and I agree that the application of the section is “... not confined by notions of reluctance to interfere with freedom of testation.” But although the application of the Act is not confined by such notions, they can be material to the application of the Act as Bergin CJ in Eq said in Ford v Simes [2009] NSWCA 351 (with the approval of Tobias JA and Handley AJA) (at [71]-[72]) and as I said in Sgro v Thompson (with the approval of McColl and Payne JJA) (at [86]).

53. [53]

    Like Brereton JA, I would endorse the observation of Young J (as his Honour then was) in Stewart v McDougall quoted by Brereton JA (at [96]).

54. [54]

    The issue is how freedom of testamentary disposition is to be factored into an assessment of whether the provision made by the testator is adequate for the proper maintenance, education or advancement in life of a claimant. The determination of the adequacy of the provision is a matter for the court and it is to be determined as at the time the court is considering the application rather than as at the time the testator made a will or at his or her death. This alone may provide a reason for interference.

55. [55]

    Independently of that, the court will interfere with the freedom of disposition if it concludes that adequate provision has not been made for the applicant’s proper maintenance, education or advancement in life. But in making that assessment the court has to take into account a wide range of matters that are not confined to the parties’ present financial circumstances, but can range over the relationships between the deceased and his or her family where the true facts can hardly be ascertained by a court years after the events. This may constrain the making of a family provision order under s 59.

56. [56]

    To say that a Court’s ability to interfere may be constrained by freedom of testamentary disposition is merely to say that such freedom is one of the matters factored into the assessment called for by s 59. It is factored in by a recognition that in appropriate cases, deference should be given to the testator’s better position in making an assessment as to what provision for proper maintenance and advancement in life is adequate.

57. [57]

    No issue arises in the present case as to whether the court should interfere where the testator has given proper consideration to the claim of the applicant on his estate. For the reasons previously given, the testator did not do so.

58. [58]

    I respectfully disagree with Brereton JA’s reasons that there should be a “cross-check” as to the adequacy of the provision provided for under the deceased’s will and, at least by inference, as to what order for provision should be made if the provision made by will or intestacy is inadequate, by reference to the hypothetical case of what would have happened had the appellant made a claim for a financial adjustment order under the Family Law Act 1975 (Cth), s 79 immediately before the deceased’s death.

59. [59]

    I agree with the reasons of Simpson AJA in this respect. I would add the following. It is well established that under the jurisdiction conferred by s 59 of the Succession Act, the court does not ask whether the will was fair and does not have the power to adjust entitlements under the will according to what it considers to be fair. Section 59 confers on the Court power to interfere with testamentary dispositions or entitlements on intestacy only to the extent that it considers that adequate provision has not been made for the proper maintenance, education or advancement in life of the applicant. By contrast, s 79 of the Family Law Act confers on the Family Court or the Federal Circuit Court power to adjust property interests according to what the court considers to be “just and equitable”. What is fair, and what is just and equitable, are synonymous. But they are not the same thing as what is or is not “adequate provision ... for the [applicant’s] proper maintenance, education or advancement in life”.

60. [60]

    There is also a policy consideration against the adoption of a “cross-check” against what a widow or widower might obtain had an application been made for a property adjustment order under s 79 of the Family Law Act immediately before death. One such aspect is adverted to in Brereton JA’s reasons at [149] that the evidence in the present case did not disclose the respective financial positions of each party when co-habitation commenced, and hence it was difficult to form an accurate view of how in proceedings under s 79 of the Family Law Act their respective entitlements would have been worked out on an application for a property adjustment. To require or expect parties to adduce such evidence and any other evidence that would be relevant to an hypothetical application under s 79 of the Family Law Act would be an incentive to increase costs for little or no benefit.

61. [61]

    Even if such evidence were adduced, the question would arise as to how, in proceedings in the Equity Division, it would be determined what would have been the outcome of proceedings in the Family Court or the Federal Circuit Court if an application for property adjustment orders had been made under s 79 before the deceased’s death.

62. [62]

    The generality of the discretion or evaluative judgment conferred on the Family Court and the Federal Circuit Court under s 79 of the Family Law Act is even less defined (“just and equitable”) than the jurisdiction to make a family provision order under s 59 (“adequate provision for proper maintenance, education and advancement in life”). Every decision under both provisions requires an evaluative judgment that is sensitive to the specific facts of each case. Even if there were a general jurisprudence under s 79 that in the case of a marriage or de facto relationship of a particular period, a spouse or de facto spouse should be entitled to a minimum proportion of a divisible pool of assets (and this Court was not referred to any authority that suggested that there was such a principle), the working out of such a principle in family provision proceedings would require in effect a separate trial by way of cross-check of what the applicant could expect to receive on an application under s 79 of the Family Law Act had an application under that section been made before death.

63. [63]

    The prospect of a collateral, but hypothetical, inquiry, perhaps involving competing expert evidence, as to what might be expected to be the outcome of a hypothetical application to the Family Court or to the Federal Circuit Court had an application been made under s 79 before the deceased’s death, is not one to be encouraged.

Conclusion

1. [64]

   I agree for the reasons given by Brereton JA, that proper provision requires provision of the sum of $1 million for accommodation in a two-bedroom apartment in Port Macquarie of a standard to that which the appellant enjoyed when living with the deceased. With that provision the appellant would have no need for her apartment in Crescent Head and it could be sold, to realise approximately $300,000 less the costs of sale. This would leave the appellant with a unit in Port Macquarie and her existing assets which when realised could be expected to have a value of approximately $740,000. This includes her superannuation fund which was yielding an income of $28,158 per annum. The primary judge doubted the appellant’s evidence as to the capital value of the superannuation fund, having regard to its rate of return, and his Honour’s finding in that respect has not been shown to be in error. The other assets after the sale of the Crescent Head unit amounting to approximately $440,000 would be expected to yield some income, although there was no specific evidence about that.

2. [65]

   Having regard to the size of the estate, I agree with Brereton JA that some additional provision is required over and above the amount of $1 million to provide for accommodation in Port Macquarie. The amount of that additional provision is a matter of intuitive assessment. Having regard to the appellant’s existing assets of approximately $740,000, I consider that provision in the order of $1.5 million, in lieu of the provision provided for under the will, would be appropriate. I accept that the difference between the award proposed by Brereton JA (with which Simpson AJA agrees) and the provision that I would be minded to order is within a range upon which reasonable minds can reasonably differ.

3. [66]

   I agree with Brereton JA that the payments of annuities made to date should be regarded as interim maintenance and should not have to be repaid or brought to account. For these reasons I propose the following orders:

   1. (1)

      Appeal allowed.

   2. (2)

      Set aside the orders of the primary judge of 16 July 2018.

   3. (3)

      In lieu thereof, order that in lieu of the provision made for the appellant by clause 7 of the will dated 19 September 2016 of Geoffrey Leslie Steinmetz, deceased, the appellant receive from the estate of the deceased a legacy of $1,500,000, such legacy not to bear interest if paid within 90 days, but otherwise to bear interest at the rate prescribed for unpaid legacies.

   4. (4)

      Order that the respondents pay the appellant’s costs of the appeal and of the proceedings at first instance.

4. [67]

   BRERETON JA: Geoffrey Leslie Steinmetz died on 4 October 2016 at the age of 68, leaving a will made only two weeks earlier on 19 September 2016, probate of which was granted on 20 September 2017 to the respondents his daughter Nicole Shannon (now aged 43) and his son James Steinmetz (now aged 38). By that will the deceased gave a legacy of $15,000 to his godson John Anthony Steinmetz, the contents of his residence at Crescent Head Road, Crescent Head to his widow the appellant Gayle Maria Warr Steinmetz, his second wife of some 28 years standing, and the rest and residue of his substantial estate of approximately $6.8 million to the respondents, who were the children of his first marriage, provided that they pay the appellant an indexed annuity of $52,000 for the remainder of her lifetime.

5. [68]

   On 16 July 2018, Pembroke J dismissed the appellant’s family provision claim, holding that the annuity provided by the will was, in the circumstances, adequate provision for her proper maintenance and advancement in life. From that decision, the appellant appeals to this Court. While the notice of appeal complains of numerous alleged errors of fact in the judgment, the real issue is whether in the circumstances the annuity was adequate provision for the appellant’s proper maintenance and advancement in life.

The estate

1. [69]

   At the time of the hearing before the primary judge, the estate amounted to $5,250,000, comprising:

2. [70]

   In addition, the deceased was the sole beneficiary of the Steinmetz Superannuation Fund, for which there was no binding death nomination; in those circumstances it was an estate asset, worth $1.4 million, of which $450,000 had been distributed to the respondents. Accordingly, the total distributable estate (disregarding that distribution) was in the order of $6,650,000 net.

The relationship

1. [71]

   The appellant, who was born on 19 January 1953, met the deceased and commenced living with him in a de facto relationship in 1988, following the breakdown of the deceased’s first marriage. In 1991 – on the advice of the deceased, who was a real estate agent at Crescent Head – she purchased, from her own resources, two adjoining duplex properties in Crescent Head. She sold one in 1998, but not the other (Unit 2), of which she retained possession, maintained it and paid the outgoings from her own resources.

2. [72]

   The appellant deposed that “at all times during my relationship with the deceased, I lived with deceased at his home at … Crescent Head Road, Crescent Head”. His Honour “rejected” this evidence as “only party true”, but observed that “it may possibly have been the case after they eventually married in 2011 although I doubt that it is entirely accurate even then”. The appellant’s evidence was that before she purchased the units she rented a flat in View Street, Crescent Head, and that the deceased stayed there with her a few days a week, and she stayed at his house a few days a week; that after she purchased the units the same arrangement applied, with him staying at her unit a few days a week and she at his home similarly; and that after they were married in 2011, she spent much more time at his place than at hers. She acknowledged that she sometimes stayed alone in her unit, usually if she had to get up early the following day for work, and also when the deceased was in hospital, as she was frightened of being alone in the big house. However, she said:

3. [73]

   In cross-examination, she said of the period before they were married in 2011:

4. [74]

   The evidence of the first respondent tends to confirm that, at least after they were married, the appellant lived full time with the deceased. She deposed:

5. [75]

   It is also noteworthy, as his Honour accepted, that the appellant became the deceased’s full-time carer, especially during his later years when he suffered much ill-health; she could not have done this if she was not living, at least primarily, in his home. The appellant’s connection with Crescent Head Road property was acknowledged by the deceased in a will made in 2013, which gave her, if not the property absolutely, then at least a life-time right of residence in it. [1] Even in his last will, it was reflected in the gift of the contents of the property to the appellant.

6. [76]

   Taken together, the evidence supports the conclusion that at least after 2011, the appellant’s primary place of residence was the deceased’s home at Crescent Head Road. As I have noted, the primary judge allowed that this “may possibly have been the case”.

7. [77]

   The appellant and the deceased were married on 30 December 2011. They had no children together.

8. [78]

   The evidence does not disclose their respective financial positions when cohabitation commenced, or when they were married. The appellant and the deceased did not comingle their property, each retaining their own separate real properties and investments.

9. [79]

   During their relationship, the appellant did the washing and cooked the meals for both. The deceased paid for all household expenses, food and entertainment, holidays and spending money on holidays, and provided the appellant with a credit card to pay for fuel in the car she drove.

10. [80]

    As has been mentioned, the deceased suffered from ill-health for at least 15 years prior to his death, and the appellant became his carer; in time this became a full-time commitment. The deceased’s illness was such that, without her care, he would have required a professional carer, and otherwise would not have been able to remain at home but would have had to relocate to some form of care accommodation.

The appellant

1. [81]

   The appellant has assets amounting to approximately $727,380, as follows:

2. [82]

   Her gross annual income of $81,146 comprises the annuity under the will of $52,988 and superannuation income of $28,158; after tax, her net annual income is $71,704. Her modest current annual expenditure of $37,750 (including a $5,000 provision for holidays), leaves a surplus of income over expenditure of $34,000. She explained that she presently lived frugally, because she did not know what the future held.

3. [83]

   Many years ago, in 1980, the appellant suffered a mental breakdown. She has back pain, and in January 2018 fractured both knees. She sees a psychologist for anxiety and stress, has sciatica and suffers sleep apnoea.

The beneficiaries

1. [84]

   The respondents are well-established, independent adults, aged 43 and 38 respectively. Whatever the quality of their relationship with the deceased, given the size of the estate it could not be – and was not – suggested that any testamentary obligation of the deceased to either of them was such that it would impact on making proper provision for the appellant, even placing her claim at its very highest.

The primary judgment

1. [85]

   The rationale of the primary judge’s conclusion that the annuity provided by the will was adequate for her proper maintenance and advancement in life is encapsulated in paragraph 4 of his Honour’s judgment, as follows:

2. [86]

   I accept, as Mr Wilson SC for the respondents submitted, that in the question “should she be entitled to expect more”, his Honour meant “more than was provided by the will”. Implicitly, his Honour answered that question in the negative. Thus his Honour concluded that because she could continue to live in her unit (not the house that had been her primary place of residence with the deceased for the last five years since they were married) and if she continued to live as frugally as she was with a surplus of income over expenditure and retain her contingency funds, her proper maintenance and advancement was adequately provided for, notwithstanding that she would not have the benefits, security, holidays, comforts and additional financial advantages to which she had been accustomed during her relationship with the deceased.

3. [87]

   Therein lies what I consider to be, for reasons to which I shall return, the fundamental error. In the context of a marriage of this length, in which on any view the appellant had made sustained and substantial contributions to the welfare of the deceased, where there was no-one else responsible for her maintenance, with an estate of this size, and absent any competing claim, provision which did not allow her to retain “the benefits, the security, the holidays, the comforts and the additional financial advantages that she enjoyed during her relationship with the deceased” was not adequate for her proper maintenance and advancement. However, before explaining why that is so, it is necessary to discuss a number of matters to which his Honour gave significance, in particular:

   1. (1)

      deference to the judgment of the testator and his or her position of advantage in knowing all the relevant facts that inform a decision about testamentary dispositions;

   2. (2)

      the role in this context of the notion of freedom of testamentary disposition;

   3. (3)

      the guidance provided by previous decisions in respect of “widows’ claims”;

   4. (4)

      the significance of the appellant’s apparent acquiescence in the terms of the will when it was made;

   5. (5)

      the significance of the nature of the relationship between the appellant and the deceased, which his Honour described as a “mature” one “between persons who came together in mid-life, who retained considerable financial independence and sometimes physical distance, who did not share children and who married 23 years after the commencement of a relationship”; and

   6. (6)

      whether the appellant’s expressed wish to move to Port Macquarie could be dismissed as a preference rather than a need.

The testator’s position of advantage

1. [88]

   The primary judge gave great significance to the judgment of the testator and his position of advantage in knowing all the relevant facts that inform a decision about testamentary dispositions. His Honour set out the following passage from the judgment of White J (as his Honour then was) in Slack v Rogan: [3]

2. [89]

   I respectfully entirely agree that respect should be given to the judgment of a capable testator who has duly considered the claims on the estate, and that a court should not interfere just because the judge would have made a different disposition. Although the analogy is not perfect, there are similarities with the manner in which a court approaches reviewing a discretionary decision; it will not interfere with the testator’s will if it merely considers that it would have made a different will, but only if the testator’s discretion has in some way miscarried.

3. [90]

   However, this will have importance chiefly where a testator, faced with multiple obligations and an estate insufficient to meet them all in full, has had to make a difficult judgment as to which will be satisfied and to what extent. That was not the situation here.

4. [91]

   Moreover, it is difficult to see how this can be regarded as a carefully considered decision. Three years earlier, in 2013, the deceased had considered it appropriate to provide for the appellant at least a lifetime right of residence, if not the fee simple, in the home at Crescent Head Road. At about the same time he told her “I have made a will leaving you this house, my superfunds and one third of the rest of my estate”. His last will was made in circumstances where he was in extremis, facing imminent serious and potentially life-threatening surgery, and was expressing some irritability about the appellant because he thought she was annoyed with him and did not want him to have another colostomy bag.

5. [92]

   Further, insofar as his reasoning is expressed, it is to be found in clause 8 of the will:

6. [93]

   A wish to preserve “the assets that I have worked my whole life for” for the benefit of his children and grandchildren does not reflect a careful balancing of competing claims. The testator allowed this wish to preserve his estate intact to so dominate his decision-making as to fail to have sufficient regard to his obligations to his dutiful wife of 28 years.

Testamentary freedom

1. [94]

   His Honour also gave extensive attention to the notion of freedom of testamentary disposition. After referring to his Honour’s earlier writings on the topic in Madden-Smith v Madden, [4] his Honour said: [5]

2. [95]

   Aside from the fact that in such a view the testator appears to have overlooked that he had shared the majority of his adult life with the appellant, and that it is difficult to see why, when having regard to his life as a whole, his “final act” – made in the stressful circumstances which I describe below, [6] and no doubt influenced by his assessments and perceptions at that moment – is necessarily superior to judgments made three years earlier, this suggests that testamentary freedom is a factor to be taken into account in deciding whether or not to make a family provision order. However, “testamentary freedom” is not one of the factors referred to in s 60(2) of the Succession Act 2006 (NSW). It may readily be accepted that the legislation does not authorise a redistribution of an estate according to indeterminate and unreliable concepts such as “fairness or equality”, and that it authorises interference only to the extent of making adequate provision for proper maintenance, education and advancement in life. So much was recognised by McLelland J (as the later Chief Judge then was) in Re Fulop Deceased: [7]

3. [96]

   But neither this, nor the extensive resort that is nowadays made to the jurisdiction, means that “a tight rein” must be exercised on it. As explained by White J in Slack v Rogan (in the passage cited at [88] above) the Act is to be applied according to its terms, and not confined by notions of reluctance to interfere with freedom of testation. This reflects what was pithily encapsulated by Young J (as the later Chief Judge and Judge of Appeal then was) in Stewart v McDougall: [8]

4. [97]

   The statutory family provision jurisdiction is not to be exercised on the footing that it must be approached with great caution because of its intrusion on testamentary freedom. Rather, the statute is to be given full operation according to its terms, notwithstanding that it encroaches on testamentary freedom. Testamentary freedom is constrained by the operation of the statutory jurisdiction, insofar as testators are obliged to make provision for those eligible persons for whom according to community standards they are expected to provide. As Santow J (as he then was) concluded in Gardiner v Gardiner: [9]

Widows’ claims

1. [98]

   His Honour said that claims by widows do not constitute a separate category deserving of more favourable treatment, and that there was no general rule that if the size of the estate is sufficient a widow is entitled to expect that she will be provided for such that she may continue to live in the style to which she is accustomed. That there is no general rule that the widow’s claim is always paramount is undoubted. So much was stated in the passage cited by his Honour from Re the Will of Gilbert, [10] though the qualification stated by Jordan CJ is also important:

2. [99]

   The proposition that there was no general rule that the widow’s claim is always paramount was restated in Bladwell v Davis, [11] by Bryson JA (albeit obiter, as leave to appeal was refused). Again, however, the qualifying comments of Ipp JA, with whom Stein AJA agreed, are important:

3. [100]

   Those statements, about “paramountcy” or “primacy” of a widow’s claim, were made in the context that there were competing claims on estates that were insufficient to meet all of them. In contrast, the present case is not one in which questions of primacy or paramountcy arise. That is because, as the primary judge said, the deceased’s estate was ample to accommodate the appellant’s claim without occasioning hardship to the respondents. This was not a case in which the estate was insufficient to meet all claims on the testator, or to enable him to satisfy his obligations to all of them, and so no occasion to determine whether primacy had to be given to one over the others arose.

4. [101]

   The question of what provision ought as a matter of community standards be made for a widow has been addressed in numerous cases, and the obligations of a testator towards a surviving spouse have often been described. In Elliott v Elliott, [12] in a passage that would later be endorsed by Young J in Court v Hunt, [13] Powell J (as he then was) described the testator's duty to his widow of a longstanding and harmonious marriage as requiring, at a minimum, provision of security in her home for the rest of her life and the capacity to change it; an income sufficient for her to live in a reasonable degree of comfort; and a fund for modest luxuries and contingencies. His Honour said:

5. [102]

   To similar effect, in Luciano v Rosenblum, [14] which is perhaps the case most often cited in this context, Powell J said:

6. [103]

   In Paton v Public Trustee, [15] Young J, in dealing with a long but relatively unhappy marriage, said:

7. [104]

   The “broad general rule” referred to in Luciano v Rosenblum was echoed by the Court of Appeal in Golosky v Golosky, [16] in which Kirby P (as his Honour then was), with whom Cripps JA agreed, said that in the absence of special circumstances, it will normally be the duty of a testator to ensure that a spouse is provided with accommodation appropriate to that which she or he has been accustomed, and to the extent that the assets available permit, a fund to meet unforeseen contingencies:

8. [105]

   In O'Loughlin v O'Loughlin, Davies AJA, with whom Mason P and Meagher JA agreed, said: [17]

9. [106]

   As this Court pointed out in Burke v Burke, [18] such observations are not rules of law, but guidelines that may give assistance and provide guidance that are not to be elevated to rules of law. That does not mean that they are without importance and significance, because, as Basten JA explained in Chapple v Wilcox: [19]

10. [107]

    Similarly, Barrett JA explained: [20]

11. [108]

    Such guidelines also provide the additional benefit of affording a certain amount of consistency in decision-making, and indication of expectations and advice to litigants. Without such guidelines, decision-making and advising in this field becomes a morass of idiosyncratic decisions devoid of any consistency.

12. [109]

    Some of the passages to which I refer use the traditional concept of “moral duty”, rather than the more fashionable one of “community standards”. For my part, I prefer the former, which – despite its disapproval in Singer v Berghouse (No 2) [21] – was rehabilitated in Vigolo v Bostin, [22] and is recognised in the statute. [23] However, I doubt that the difference matters much; what the community expects a testator to do by way of provision for claimants on his or her bounty, and what the testator is morally obliged to do in that respect, are probably the same thing.

The appellant’s acquiescence

1. [110]

   The primary judge gave considerable significance to the view that the appellant “seemed to think that the provision was adequate when the will was made”, but presumably later changed her mind, only when she became aware of the size of the estate and the extent of the deceased’s beneficence to his children. His Honour referred to the draft will having been read aloud in her presence in a hospital room with the deceased and his son-in-law Mr Shannon – the first respondent’s husband, who was a solicitor and who drafted the will. Having proposed an alteration in the annuity from $50,000 to $52,000 and obtained an assurance that his children were legally obliged to keep paying the annuity, the deceased asked the appellant: “Are you happy with that?”. His Honour recorded the reply, according to Mr Shannon’s evidence: “Yes, but I keep telling you Geoff that I do not want anything from your estate”, and said that she did not contradict and her counsel did not challenge that evidence. In fact she did to some extent contradict it, her version of her response being: “I would be happy with anything you would like to bequeath me”. She was not cross-examined about that, nor about her explanation that though she quickly read the will she did not comprehend it “as I was more concerned about Geoff’s health than a last-minute will”. Nor was she then aware of the value of the deceased’s estate.

2. [111]

   The will was made in circumstances that the deceased had been told on 19 September that he was required to have urgent surgery, which he contemplated he might not survive. He spoke to his son-in-law on the telephone with instructions for a will, and within an hour his son-in-law arrived at the hospital, read it over to the deceased and had it executed. The appellant’s concurrence, if it be that, was in the context that her husband was about to undergo surgery, which he might not survive.

3. [112]

   I accept that arrangements and understandings made between a testator and potential beneficiary are not irrelevant in determining what may be proper for the beneficiary’s maintenance and advancement. Representations made by testators have always been regarded as relevant to the ascertainment of what is proper provision. [24] Thus it seems to me that a well-established and long-standing understanding between a testator and potential beneficiary, properly informed, could well be relevant in assessing what is proper provision for that beneficiary. But in this case, an expression of acquiescence in a will with which the appellant was confronted at very short notice, which she did not fully comprehend, in circumstances where any sensitive human being would be astute to avoid upsetting a man about to undergo surgery from which he might possibly not emerge, and when she was largely uninformed as to the nature and extent of his estate, was entitled to no weight whatsoever. Even less relevant is the circumstance, referred to and taken into account by his Honour, that there was no evidence that during their relationship the appellant ever discussed with the deceased any desire let alone need for her to move after his death.

The nature of the relationship

1. [113]

   Next, the primary judge appears to have afforded significance to the circumstance that the relationship was a “mature” one, “between persons who came together in mid-life, who retained considerable financial independence and sometimes physical distance, who did not share children and who married 23 years after the commencement of a relationship”.

2. [114]

   The fact that their formal marriage came relatively late in their very long cohabitation makes little if any difference. The circumstance that each retained a degree of independence, and that the appellant did not comingle her assets with those of the deceased, is of slight significance; what is more significant is that on any view she was, notwithstanding that she had her own assets and income, at least partly dependent on him. The primary judge found that the appellant did not contribute to the deceased’s business or the management of his affairs or the accumulation of his wealth, and that finding is not challenged. Nonetheless, as his spouse of 28 years, during which his estate was conserved if not accumulated, her support and care for him must have to some measure contributed indirectly to the conservation of his estate. Moreover, while she may not be able to claim to have made contributions to the parenting of children, it is clear that she made sustained and substantial contributions to the deceased’s welfare particularly in his very long illness. The appellant has made substantial and sustained contributions of the kind referred to in s 60(2)(h).

3. [115]

   Thus the particular circumstances of their relationship as described by his Honour do not materially affect the nature and extent of the deceased’s obligation to her. This was not some second-class marriage. She was his wife, partly dependent on him, whom he had a legal and moral obligation to support. That they might not have spent every night together in the same home is of no import; that was how they ordered their married life. That she had some assets and income of her own might moderate that duty, particularly had there been significant competing claims. While the appellant might not be able to propound some types of contributions (such as parenting), in other areas (such as her care for the deceased) her claims are very strong.

Need, preference, or proper maintenance and advancement?

1. [116]

   His Honour dismissed the appellant’s wish to move to Port Macquarie as a preference rather than a need.

2. [117]

   The appellant expressed a wish to move to Port Macquarie, partly for health reasons and partly to avoid sad memories while driving past the former home she had shared with the deceased. In her affidavit evidence, the appellant said that she was concerned that she needed to be close to proper health care as she became older, and that Port Macquarie provided a high level of health care. She also deposed:

3. [118]

   In cross examination, the appellant said that she needed to have facilities that she does not have presently, and in particular:

4. [119]

   She accepted that two bedrooms would suffice. When asked whether she wanted the best property in the best street rather than a reasonable property in a reasonable situation, she answered:

5. [120]

   Elsewhere in cross examination it was put to her that she lived a frugal lifestyle, to which she responded:

6. [121]

   Asked to clarify what she meant by “centralised” she explained “The CBD of Port Macquarie”. In re-examination, she explained what she meant by a frugal lifestyle:

7. [122]

   The evidence of the appellant which I have summarised represents an entirely reasonable assessment of her prospects and future requirements. To dismiss the wish to move to a place where she will have better access to health care (and other support services) as she ages as a mere preference, in respect of which no obligation to make provision arises, reveals a misapplication of the concept of “proper maintenance and advancement”.

8. [123]

   First, the jurisdiction is not exclusively needs-based; there are other relevant considerations, as the list of relevant factors in Succession Act, s 60, makes clear:

9. [124]

   There is no reason why the reference to “financial needs” in s 60(2)(d) should have primacy when viewed alongside the reference to “contribution” in s 60(2)(h), let alone exclusively so. That factors in addition to “needs” are relevant has repeatedly been stated, at least from the earliest days of the Family Provision Act 1982 (NSW). Thus, in Re Fulop Deceased, [25] McLelland J explained (emphasis added):

10. [125]

    To similar effect, in Singer v Berghouse (No 2), [26] the High Court referred to the considerations that informed both stages of the two-stage process of consideration of a family provision application:

11. [126]

    And in Alexander v Jansson, this Court said: [27]

12. [127]

    Secondly, the legislation is concerned with provision not only for maintenance, but also for “advancement in life” [28] – which envisages not merely maintaining a standard or status of an eligible person but, in an appropriate case, improving and enhancing it.

13. [128]

    Thirdly, insofar as “needs” are relevant, no narrow view of what is encompassed by that concept is to be adopted. In Gorton v Parks, [29] Bryson J (as he then was) explained that the narrow approach to that concept, which had once been expounded by Dixon CJ in Pontifical Society for the Propagation of the Faith v Scales, [30] was not to be applied in the present day and age. Expressing scepticism at the view of Dixon CJ that a public servant aged 50 who had attained the position of Section Leader in a branch of the Department of Customs earning £2,200 per year in 1961, with two children aged 16 still at school and owning a home a home subject to a mortgage, could not be said to be in need, his Honour said: [31]

14. [129]

    Bryson J preferred the approach of Taylor J, in dissent in Scales, [32] who had said:

15. [130]

    Bryson J continued:

16. [131]

    To like effect are the observations of White J (as his Honour then was) in Wardy v Salier: [34]

17. [132]

    It therefore bears repeating and reemphasising that:

    1. (1)

       the jurisdiction is not solely needs-based, but by reason of some of the factors specified in s 60(2), plainly also contributions-based;

    2. (2)

       the jurisdiction is not limited to maintenance, but extends to advancement in life, which encompasses improvement and enhancement of the claimant’s position;

    3. (3)

       to the extent that “needs” are relevant, no narrow view of that notion limited to the necessities or essentials of life is to be taken; and

    4. (4)

       ultimately, in the words of McLelland J in Re Fulop, the cases make clear that attention must be directed to “a standard appropriate to all the circumstances of the case”.

What was adequate provision?

1. [133]

   Having regard to the guidance provided by the cases to which I have referred, but focussing on the particular circumstances of the case – in particular, that the marriage (de facto and formal) was lengthy at 28 years; that the appellant was the deceased’s domestic partner throughout a period while his substantial estate was at least conserved if not accumulated; that she made substantial and sustained contributions to his welfare, particularly over the period of 15 years while he was ill, enabling him to remain in his home rather than moving into care accommodation; that he had earlier represented to her that he had made a will leaving her inter alia the home at Crescent Head Road; that her separate income was a superannuation pension; that they had cohabited, at least for the last five years, primarily in the Crescent Head Road home, which at least by the time of his death was her primary place of residence; that he provided for her and she was dependent on him for accommodation in the Crescent Head Road property, and additional benefits, holidays, comforts and financial advantages such that she wanted for nothing – then proper provision for her, to the extent that his estate permitted it, involved no less than provision of a fund such as would provide her with an income sufficient to keep her in the same station and style which she had enjoyed during their lives together, and the home which had been their matrimonial home; notwithstanding that she had a “much more modest” duplex unit, and some accumulated savings.

2. [134]

   Things have moved on, and provision of the home in Crescent Head would not meet the appellants’ current circumstances and future reasonable requirements. In any event, in the words of Powell J in Luciano v Rosenblum, she ought to be at liberty to change her home if the whim so strikes her. Here it is no mere whim, but a reasonable plan for her future as she ages, that she move to Port Macquarie. This does not mean that the deceased’s obligation is necessarily characterised as one to provide her with a unit in Port Macquarie; the value of such a unit, like the value of the Crescent Head Road property, merely serves as a yard-stick to guide an assessment of what would have been appropriate provision, and what order should now be made.

3. [135]

   The Crescent Head home was attributed a value, by admission of the respondents, of $650,000. There was secondary evidence elicited in cross examination that an estate agent had given an appraisal of $1 million. Evidence was adduced of the approximate cost of a number of potentially suitable units in Port Macquarie and in South West Rocks (an alternative location under consideration by the appellant), which generally described a range between $900,000 and $1.3 million approximately. The most reliable objective evidence of the value of the Crescent Head Road property would place it in the order of $1 million, and that sum is at the first quartile of that range of $900,000 to $1.3 million.

4. [136]

   Counsel for the respondents pointed to evidence that the median price of a two-bedroom unit in Port Macquarie was $347,000, but the appellant said, not unreasonably, that she had enjoyed a high standard and quality of life with the deceased, and did not want to lose that:

5. [137]

   That said, the units were typically three-bedroom rather than two-bedroom apartments, and the appellant accepted that she had no need for a third bedroom.

6. [138]

   The will provided the appellant with an annuity of $52,000 for the remainder of her lifetime, payable quarterly with the first payment to be made three months from the date of death, and adjusted annually according to the Consumer Price Index. The annuity under the will of $1,000 per week, capitalised for the appellant’s life expectancy of 23.5 years at trial, on the three percent tables, is equivalent to a present lump sum of $880,000.

7. [139]

   The primary judge described the annuity as “an inherently conservative, yet nonetheless thoughtful provision” which was “protective, albeit rigid”, being designed to “ensure the continuation of regular income for the whole of the beneficiary’s life without the problems associated with poor investment advice, voracious agent’s fees, market fluctuations, capital dissipation and the stress and anxiety that may accompany the gift of a large capital sum and the necessity for its management”. His Honour observed that it was sometimes said to be a “paternalistic form of legacy”, but that it was “undoubtedly a caring one” – referring to observations of Santow J, in Gardiner v Gardiner. [35] In fact, Gardiner was a case in which Santow J held that an annuity would not be proper provision for a widow; the full context of his Honour’s remarks was:

8. [140]

   For many years it has been said that usually, a life estate (and, a fortiori, a lifetime right of residence) will be inadequate provision for a widow, because of its inflexibility.

9. [141]

   There are undoubtedly cases in which an annuity may be an appropriate means of providing for a beneficiary. They may include cases where the beneficiary is not well equipped to manage a large capital fund, or where it is necessary to balance the claims of a surviving spouse against those of children, particularly in the case of elderly widows or widowers where incorrect prediction of life expectancy might result in enormous hardship to the widow or widower if she or he lives longer than predicted, or a windfall to her or his estate (to the detriment of the deceased’s other beneficiaries) on the other, if she or he dies sooner than anticipated.

10. [142]

    The present is none of those cases. There was nothing to suggest that the appellant would be otherwise than prudent in the management of what was bequeathed to her, nor to suggest that she would be troubled with the “stress and anxiety” of having to manage a large capital sum; to the contrary his Honour found that she was “thrifty, prudent and organised”, with her own superannuation fund generating a high return and maintaining cash reserves in excess of $100,000. The gift was in the form of an annuity, not because that was considered best for the appellant, but because it facilitated preservation of the deceased’s estate for his children and grandchildren.

11. [143]

    In this case, the annuity is not charged on the estate, but a personal obligation imposed on the respondents as a condition of their gifts. This is a significant defect in the form of the provision made, because – although the point was not taken before his Honour – enforcement, should it ever become necessary, would present significant difficulties. However, his Honour found that the respondents may be relied upon to pay the annuity, and that finding was not challenged.

12. [144]

    Quite apart from the question of its form and enforceability, however, to leave a 65 year old widow reliant for the rest of her life on quarterly payments by the children of her deceased husband’s first marriage, rather than placing her in control of her own resources, is in this day and age not an appropriate form of provision for a widow who is well and truly capable of managing her own affairs and when there have historically been tensions between her and at least the first respondent. However reliable the respondents might be, this form of provision effectively obliges her to have an ongoing relationship with them, and to trust them to perform the obligation, and does not afford her the independence and self-reliance which, according to today’s community standards, a widow should have. It is not only rigid and paternalistic, but demeaning and controlling.

13. [145]

    While by his will the deceased provided for the appellant’s income needs, he did so in a form – an annuity – which was not proper in the circumstances; and he failed to provide adequately for her accommodation. Accordingly, the deceased failed to make adequate provision for the proper maintenance and advancement in life of the appellant.

14. [146]

    The matters to which I have referred – the value of Crescent Head Road property, the cost of an appropriate unit, and the value of the annuity – are but guides or aids to assessing what is proper provision. In particular, given that the annuity substantially exceeded the appellant’s expenditure, and that she will receive a substantial sum for her accommodation needs while retaining her own not insignificant resources, proper provision is not to be calculated merely by adding the value of the annuity ($880,000) to provision for her accommodation ($1,000,000). Although, as the appellant has pointed out, she is living frugally at the moment because she does not know what the future will hold, and although, given the absence of competing claims, a wise and just testator would have erred on the side of generosity in providing for his widow, nonetheless it will not require as much as $1,000 per week – in addition to a sum of $1 million to enable her to acquire appropriate accommodation – to maintain her in the style and station which she enjoyed during the testator’s lifetime.

15. [147]

    In my judgment, in the events which have happened, proper provision for the appellant now is, in lieu of the annuity given by the will, a legacy of $1,750,000. Her receipts of payments of the annuity to date should be regarded as interim maintenance and should not have to be repaid or brought to account.

16. [148]

    Had the marriage come to an end in 2016 by divorce rather than by death, the appellant would have had a claim for financial adjustment under Family Law Act 1975 (Cth), s 79. While the considerations that inform matrimonial property adjustment under Family Law Act, s 79, are not identical to those referred to in Succession Act, s 60(2), there is a substantial overlap. Moreover, there is neither social sense nor legal logic in parallel regimes that would have the consequence that the widow of a marriage that endures is left worse off than would have been the case had she separated from her husband immediately before his death and commenced proceedings for matrimonial financial adjustment. In my view, the community expects a testator to provide for his or her spouse financially no less than her entitlement upon matrimonial property adjustment on divorce. Such entitlement is at least a relevant consideration under Succession Act, s 60(2)(p): “any other matter the court considers relevant …”.

17. [149]

    The combined estates of the deceased and the appellant – his of $6,650,000 and hers of $730,000 – would have produced a divisible pool of $7,380,000. In circumstances where the evidence does not disclose the respective financial positions of each of them when cohabitation commenced, it is difficult to form an accurate view of how, in proceedings under Family Law Act, s 79, their respective entitlements would have been worked out. However, even if one assumes – adversely to the appellant because she adduced no evidence of it – that substantially all the deceased’s estate had already been accumulated when their cohabitation commenced, nonetheless the length of their relationship and the circumstance that his estate must at least have been conserved during that period, coupled with her significant and substantial domestic contributions particularly over the last 15 years while he was ill, and the weight in her favour of the factors referred to in Family Law Act, s 75(2) arising from the enormous disparity in their positions and her partial dependence on him, renders it inconceivable that she would have received less than 30%, being $2,214,000. On the basis that she would retain her own assets, that would require an adjustment in her favour out of the deceased’s property of $1,484,000.

Conclusion

1. [150]

   I would allow the appeal, set aside the orders of the primary judge and in lieu thereof order that:

   1. (1)

      In addition to the provision made for her by clause 6 of the will dated 19 September 2016 of Geoffrey Leslie Steinmetz deceased, but in lieu of the provision made for her by clause 7 thereof, the appellant Gayle Maria Warr Steinmetz receive from the estate of the deceased a legacy of $1,750,000, such legacy not to bear interest if paid within 90 days, but otherwise to bear interest at the rate prescribed for unpaid legacies.

   2. (2)

      The respondents pay the appellant’s costs of the appeal and of the proceedings at first instance.

2. [151]

   SIMPSON AJA: The facts relevant to this appeal are to be found in the judgment of Brereton JA, which I have had the advantage of reading in draft. I agree with his Honour that the appeal ought to be allowed and provision made for the appellant out of the estate of the late Geoffrey Leslie Steinmetz (to whom I will refer by name). Except where otherwise stated, I also agree with his Honour’s reasons. It is necessary, however, to set out my own approach to, and additional reasons for, reaching that conclusion.

3. [152]

   There being no issue that, as Mr Steinmetz’s spouse, the appellant was an “eligible person” as defined by s 57(1)(a) of the Succession Act 2006 (NSW), the sole question for determination by the primary judge was whether adequate provision for her “proper maintenance, education or advancement in life” had been made by Mr Steinmetz’s will: Succession Act, s 59(1)(c). In my opinion, the fundamental error in the primary judgment lay in the acceptance that provision in the form of “an annuity” met that description. I will return to explain why that is so.

4. [153]

   Such provision as was made was made in clause 7 of the will which provided:

5. [154]

   Clause 8 of the will was in the following terms:

6. [155]

   The concept of “proper maintenance, education or advancement in life” dictates that the whole of the appellant’s circumstances, including the circumstances in which she had lived to the time of the death of her husband, are to be taken into account. So also are the resources of the estate and any competing demands on those resources. The determination is to be made at the time the court is considering the application – in this case, July 2018.

7. [156]

   The appellant’s circumstances have been described in some detail in the judgment of Brereton JA. At the time of trial, the appellant was 65 years of age. As found by the primary judge, she was the owner of a residential property, half of a duplex, that she had purchased on the advice of Mr Steinmetz (who was then a real estate agent) in Crescent Head in 1991. At the time of the hearing, the appellant was living in the duplex, which she agreed in cross-examination was “comfortably appointed”. She had an income of about $28,000 from a superannuation fund. She was also receiving quarterly payments from the respondents (as required by the will) of $1,000 per week. She was not working. In her affidavits she gave her occupation as “retired clerk”. She had significant health issues, including a back condition and sciatica that required physiotherapy and pain management; she had suffered stress and anxiety since the death of Mr Steinmetz; she suffered from sleep apnoea. She may require surgery for her back condition.

8. [157]

   She had some significant assets in addition to her residential property, including a superannuation fund, funds in bank deposits and shares of a relatively small value. She was, as the primary judge said, living frugally.

9. [158]

   The appellant’s lifestyle at the time of the proceedings may be contrasted with her lifestyle prior to the death of Mr Steinmetz. Mr Steinmetz was the owner of a large house and garden, also in Crescent Head. The appellant and Mr Steinmetz did not intermingle their finances. However, as the primary judge found, Mr Steinmetz paid household, entertainment and holiday expenses. The appellant’s evidence (not challenged and not rejected) was:

10. [159]

    There was some conflict in the evidence concerning the extent of the cohabitation of the appellant and Mr Steinmetz. They began a de facto relationship in 1988, but did not marry until 2011. The appellant’s evidence was that, from the commencement of their relationship, she and Mr Steinmetz spent most nights together, either at his house or hers, although there were occasional evenings when, by reason of work commitments or his hospitalisation, she stayed alone at her property. The primary judge determined this conflict adversely to the appellant. He expressly rejected, as “only partly true”, the appellant’s evidence that she lived with Mr Steinmetz at his house. He also cast some doubt on the nature of the relationship by referring to their financial independence and the appellant’s description of herself as a “companion”. He commented that they “were certainly not inseparable”.

11. [160]

    It is against this background that the adequacy of the provision made for the appellant in the will must be answered. The competing claims of the respondents may be put to one side – the primary judge found that the estate:

12. [161]

    Also immaterial in this case was any question of provision for the appellant’s education: the issue was whether, by clause 7 of the will, adequate provision was made for her proper maintenance and advancement in life. For the reasons that follow, I am satisfied that it was not. I acknowledge that, in some respects, my reasons go beyond the issues identified by the parties, although the basis for my reasons did emerge during the course of the appeal.

13. [162]

    A clear challenge to the adequacy of the provision made by clause 7 was made before the primary judge, although, as will be seen, in my opinion, that challenge was at least partly based on a misapprehension of the effect of that clause. The misapprehension was that, in some undefined way, clause 7 bound the assets of the estate and prevented their distribution.

14. [163]

    It was expressed in written submissions:

15. [164]

    In oral submissions senior counsel said:

16. [165]

    There is, on my reading of the will, nothing therein that prevents the winding up of the estate or the distribution of its assets. Clause 8, which expressed Mr Steinmetz’s wish that the estate “remains a whole for my children and grandchildren” was not, and could not be, binding or effective, and could not prevent the disposal of assets of the estate. No asset of the estate was earmarked or quarantined for the purpose of securing the payment of the annuity to the appellant. While there may be a legitimate question as to the construction of clause 7, payment of the amount was, in my opinion, a personal obligation imposed upon the respondents. Whether that obligation was imposed jointly or severally is not clear.

17. [166]

    Notwithstanding, the primary judge found that the provision was adequate. He stated this conclusion in a number of places, culminating at [38], in which he said:

18. [167]

    His Honour went onto find that, rather than being based upon the adequacy of the provision made for her, the appellant’s claim was “largely influenced” by the size of the estate and the relative lack of hardship that would be caused to the respondents were provision for her to be made.

19. [168]

    Earlier, his Honour had said:

20. [169]

    The primary judge expressed his confidence that the respondents would meet their obligations. He said:

21. [170]

    Ground 1 of the appeal asserted error in the finding that the provision was “proper and adequate”. Ground 3 asserted error in the exercise of discretion:

22. [171]

    No submissions under either of these grounds were directed to a proposition that the imposition on the respondents of a personal obligation to pay for the remainder of the appellant’s life failed to make proper provision for her maintenance or advancement in life. No doubt that was because of the perception that the annuity was somehow attached to estate assets. No submissions drew attention to any issues of the construction, or the enforceability, of the obligation imposed on the respondents.

23. [172]

    Nevertheless, there are, it seems to me, clear difficulties in the construction of clause 7, obviously not appreciated at first instance, and, indeed, not fully appreciated on appeal.

24. [173]

    When the question was raised during the course of the appeal, it emerged that the parties proceeded on the same assumption stated in the appellant’s written submissions at first instance, that is that the estate would not be fully wound up, and that the liability to the appellant was (in the words of senior counsel for the appellant):

25. [174]

    The expectation that the estate could, or would, not be fully wound up while the obligation to pay the annuity to the appellant subsisted – that is, for the remainder of her life – needs only to be stated to show the impracticality and the untenable nature of the proposition. At 65, the appellant had a life expectancy of 23 years. The estate consisted of real estate, a superannuation policy, a real estate business and a liquor outlet business. It could scarcely be contemplated that none of those assets could be disposed of for 23 years – or longer, if the appellant outlived what is predicted by the life expectancy tables. And, if some assets were to be disposed of, which? Which assets were required to be preserved for the protection of the appellant’s rights? If the businesses, or either of them, were to be preserved for that purpose, did that oblige the respondents to continue to operate them, even into their old age? What if the businesses, or either of them, failed?

26. [175]

    Given that the issue as to construction arose only during argument on the appeal, and at the instigation of the court, no final conclusions can be drawn. That there are such questions of construction is, however, a sufficient basis to conclude that it was erroneous for the primary judge to find, as he did, that clause 7 of the will made adequate and proper provision for the appellant. Indeed, in my opinion it is quite uncertain what provision was made.

27. [176]

    Ground 1 of the appeal is framed sufficiently broadly to accommodate these conclusions, which are more than adequate to justify upholding the ground. I appreciate, however, as I have said, that they go somewhat beyond the argument raised in support of that ground.

28. [177]

    Independently of these conclusions, there are a number of specific errors in the primary judgment that led the primary judge to the conclusion that the provision was adequate and proper, such as to warrant the intervention of this Court, the setting aside of the orders, and the re-exercise of the discretion: see Supreme Court Act 1970, s 75A(5) and (6).These have been discussed comprehensively by Brereton JA. In the light of Brereton JA’s comprehensive analysis, I can address these issues briefly.

29. [178]

    It was erroneous for the primary judge to find, and to take into account, that the appellant “seemed to think that the provision was adequate when the will was made”. That finding must be examined in the context of the circumstances in which (it was said) the appellant signified her approval of the terms of the will, circumstances which may be restated briefly.

30. [179]

    Mr Steinmetz was in hospital about to undergo surgery. He had been advised by his doctor, in effect, that the surgery was life threatening. At very short notice he asked his son-in-law, Matthew Shannon (the husband of the first respondent), to draft a new will. This was done, and Mr Shannon took the will to the hospital. The appellant was present with her husband. The conversation, as recorded in Mr Shannon’s affidavit was:

31. [180]

    To find that this conversation evidences an opinion on the part of the appellant that the provision was adequate entails the corollary that it would have been reasonable and appropriate for her, in those dire circumstances, to protest and demand more. The proposition is unsustainable. It was quite unreasonable, and erroneous, to take into account, adversely to the appellant, that she “seemed to think that the provision was adequate”.

32. [181]

    The primary judge also found that Mr Steinmetz “appears to have thought carefully about what was appropriate for his wife”. There was no evidence to support this finding; the evidence shows that – having been advised that his surgery was life threatening – he made a hasty phone call to Mr Shannon shortly before the surgery was due to start. Moreover, the proposition is contradicted by clause 8 of the will, which demonstrates that Mr Steinmetz’s focus was on retaining the estate, as a whole, for the benefit of his children and grandchildren. There is no indication in this of any thought, let alone careful thought, for the position of the appellant. The statement that Mr Steinmetz believed that the manner in which the will was drafted would enable her to live comfortably for the rest of her life in no way established that careful thought had gone into the provision: rather, what immediately follows (“without having to dispose of the assets that I have worked my whole life for”) confirms that Mr Steinmetz’s mind was centred on maintaining the estate as a whole. It was an error to take this circumstance into account.

33. [182]

    Also erroneously taken into account (clearly adversely to the appellant) were findings made concerning the circumstances of the cohabitation of the appellant and Mr Steinmetz. As mentioned above, the primary judge expressly rejected, as “only partly true”, the appellant’s evidence that she had lived with Mr Steinmetz at his home. He described the nature of the relationship as retaining “a quality of independence”. He accepted – in a way that was clearly adverse to the appellant – her description of herself as “Mr Steinmetz’s companion”. He commented that they “were certainly not inseparable”. Just what relevance was perceived to be attached to those circumstances is unclear. The evidence revealed that both the appellant and Mr Steinmetz retained their own properties, but spent the majority of their non-working time together, travelled together, and enjoyed common interests such as their garden. They ate dinner together almost every night. That these living arrangements may have departed in some small way from conventional “norms” had no bearing on Mr Steinmetz’s obligation to make proper provision for the appellant, or the extent of that obligation.

34. [183]

    Finally, the primary judge said:

35. [184]

    The meaning of this passage is obscure. It is the task of the court to implement the will of the legislature, as expressed in legislation. It is no function of the court to exercise “a tight rein” on the exercise by litigants of rights conferred by statute, nor to deter litigants from exercising those rights, nor to cast obstacles in the way of litigants’ access to the court. If unmeritorious or misconceived claims are made they will be appropriately dealt with by the court. Whatever the primary judge meant, it is clear that his decision was influenced by an extraneous consideration, a view of the desirability of discouraging applications under the Succession Act. It is not saved by the insertion of the words in parenthesis.

36. [185]

    These errors, independently of what I conceive to be the error concerning the nature of the provision made for the appellant, are alone sufficient not only to warrant, but to require, the intervention of this Court.

What order should this Court make?

1. [186]

   Against the possibility of intervention, senior counsel for the respondents urged that an appropriate form of order would be one that, in conformity with clause 8 of the will, would maintain the integrity of the estate, and include an annuity as distinct from a lump sum to be paid from the assets of the estate. Just how this could be achieved, while providing security to the appellant, was not spelled out.

2. [187]

   It was in this context that the discussion concerning what I perceive as the inadequacies of the annuity provision initially arose. As I see it, an annuity (at least one framed in terms of clause 7 of the will) has numerous deficiencies. No asset of the estate is quarantined as the source of, or to secure, the payments (something that, it seems to me, confirms that the obligation is personal). Clause 7 is not clear as to whether the sum of $1,000 per week is the sum for which both respondents are jointly and separately liable, including after the death of one or the other. It is not at all clear what right the appellant would have on the death, or the bankruptcy, of either or both of the respondents before her death. Nor is it clear what rights the appellant might have in the event of default of payment. Certainly, even if there were some right of enforcement, the appellant should not be in a position of having to take action to secure her entitlement. Nor should she be dependent, for the rest of her life, on the quarterly compliance by both respondents with their obligations.

3. [188]

   One alternative, recognised by senior counsel for the respondents, would be to make an order that quarantined sufficient assets of the estate for the life of the appellant in order to secure payment. I doubt that such an order would appeal to the respondents. Even if it did, it has in itself numerous difficulties. Unless the asset were a sum of money invested so as to yield the necessary amounts, there would be administration issues. For example, if the asset to be quarantined were Mr Steinmetz’s residential property at Crescent Head, in order to yield income it would need to be tenanted, and the tenancy managed; there would be expenditure on maintenance and other outgoings. The concept is quite impractical.

4. [189]

   When this was discussed, senior counsel sought an opportunity “to obtain undertakings to protect that position”. That was not pursued. Nor, in the view to which I have come, would undertakings be appropriate. The appellant is entitled to the security of a lump sum, by which she will be able to manage her own life and affairs.

Quantum

1. [190]

   That raises the question of the quantum that ought to be ordered. In this respect, I am unable to agree with Brereton JA that s 79 of the Family Law Act 1975 provides an appropriate point of reference. This is not a matter that was argued (although it was raised briefly during the course of the appeal) and the views I here express are necessarily tentative.

2. [191]

   As I understand it, s 79 provides for alterations to property interests of the parties to a marriage, or of either of them, in the context of the dissolution of the marriage. The court is given a wide discretion “to make such orders as it considers appropriate”. Although the orders that may be made include orders requiring either or both of the parties to the marriage to make “such settlement or transfer of property as the court determines”, including to a child of the marriage (s 79(1)(d)), generally no competing claims are relevant. Nor does there appear to be any equivalent of the consideration (discussed both by the primary judge and by Brereton JA) of freedom of testamentary disposition.

3. [192]

   I approach the question of quantum of the provision to be made for the appellant without reference to any analogy with proceedings under the Family Law Act.

4. [193]

   Notwithstanding that, I have come to the view that the legacy proposed by Brereton JA is appropriate. As I understood his Honour’s reasons, he arrived at that result without depending on the analogy with s 79 of the Family Law Act, which he utilised as a “cross check”. I therefore agree with the orders proposed.