Gambacorta v Di Giovanni

1. [1]

   The plaintiff, Caterina Gambacorta, is the niece and executrix of the estate of the late Maria Di Giovanni, who died on 9 August 2017.

2. [2]

   The defendant is the deceased's husband, Giuliano Di Giovanni.

3. [3]

   As has become conventional in matters such as the present, and in conformity with the approach adopted by the parties, I will, without meaning any disrespect, refer to the parties and other relevant members of the family by their first names.

Issues

1. [4]

   These proceedings were commenced by summons filed on 30 July 2019 whereby Caterina principally claims declaratory relief.

2. [5]

   The principal issue in the proceedings is whether half of the value of some shares owned jointly by Maria and Giuliano, as well as half of the money that was in a number of bank accounts in the joint names of Maria and Giuliano at the date of Maria's death, are assets of Maria's estate to be dealt with in accordance with her final will.

3. [6]

   Giuliano withdrew the money from the joint bank accounts, and after negotiations between the solicitors for the parties, half of the amount withdrawn, being $237,319.09, was paid into Giuliano's solicitor's trust account, pending the outcome of these proceedings. The amount of $237,319.09 is therefore the amount in issue insofar as the joint bank accounts are concerned.

4. [7]

   Caterina’s summons also claims a declaration that 1900 AGL shares held in Giuliano’s name were held as tenants in common between Maria and Giuliano as to 50% each and that Maria’s share is an asset of her estate.

5. [8]

   There is some ambiguity concerning the claim in relation to the shares. They are not mentioned in Caterina’s evidence. Caterina’s written opening submissions assert in par 2 that the shares were jointly owned, and in par 32 that: “The shares have not [query now] been sold and the half amount in the joint accounts claimed by the estate have been placed in the trust account of the defendant’s solicitor”. Giuliano’s submissions do not appear to deal with the shares. It will be necessary for the Court to clarify the position concerning Caterina’s claim in respect of the shares after these reasons for judgment have been delivered.

6. [9]

   The primary question is whether Maria and Giuliano, by their conduct culminating in wills made by each of them on 2 December 2016, severed the joint tenancy in the joint bank accounts and the shares with the effect that, upon Maria’s death, half of the funds in the accounts and the shares devolved in accordance with Maria’s will, or whether those assets passed to Giuliano by survivorship.

Background

1. [10]

   Both Maria and Giuliano emigrated from Sicily to Australia as adults and married on 8 October 1972, when they were respectively 42 and 45 years of age. There were no children of the marriage.

2. [11]

   Relevantly, Maria had a niece and nephew by her brother and another nephew by her sister. They were respectively Caterina, Giuseppe and Paolo. It will be convenient to call these three people Maria’s relatives.

3. [12]

   Giuliano has two sisters, Anna and Caterina, who I will call Giuliano’s sisters.

4. [13]

   Maria and Giuliano had already acquired at the date of their marriage the real properties that they owned at the time of Maria’s death. Maria owned two home units in the same block at Lakemba that I will call Unit 1 and Unit 2. Giuliano owned a residential property at Croydon that I will call the Croydon home. Maria and Giuliano lived in the Croydon home during their marriage. Maria rented the two units, although for a considerable period she allowed relatives, including the plaintiff and her family, to live in one of the units rent-free. Maria and Giuliano continued to hold the respective properties in their sole names during their marriage.

5. [14]

   At the time Maria and Giuliano made their 2 December 2016 wills they were parties to a number of joint bank accounts with the Commonwealth Bank of Australia Ltd (CBA) and Australia and New Zealand Banking Group Ltd (ANZ). There is no evidence as to how Maria and Giuliano accumulated the funds in the joint accounts. The proceedings have been conducted on the basis that both parties had an equal beneficial interest in the funds in the joint accounts.

6. [15]

   At the date of her 2 December 2016 will and at the date of her death, Maria also had three CBA bank accounts in her sole name. Giuliano gave evidence that he did not have any bank accounts solely in his name.

Grant of probate to Caterina

1. [16]

   This Court made a grant of probate of Maria’s will made on 2 December 2016 to Caterina on 26 September 2018.

2. [17]

   The Inventory of Property annexed to the grant of probate identified the property owned solely by Maria as follows:

3. [18]

   The Inventory of Property treated the $237,319.09 that was, I understand, half of the money standing in the joint accounts at the date of Maria’s death (and also possibly half of the proceeds of the sale of jointly owned shares) as being property solely owned by Maria. The part of the Inventory of Property form that made allowance for property owned by Maria as a joint tenant was left blank.

4. [19]

   Giuliano gave evidence that he sold the Croydon home for $1,800,000 on 16 April 2018. The difference in the values of Maria’s and Giuliano’s properties may explain the differences between the wills made by Maria and Giuliano on 2 December 2016. I will return to this issue below.

The joint bank accounts

1. [20]

   Caterina accepted that the joint bank accounts in the names of Maria and Giuliano contained the joint property of the account-holders, so that, at common law, the right to the funds in the accounts would pass to the survivor upon the death of the first to die, unless by some act recognised by equity the joint ownership was severed. When the joint accounts were opened, Maria and Giuliano instructed the banks that each of them was authorised to transact operations on the accounts alone, and the banks were authorised to pay the monies in the accounts to the survivor upon the death of one of them.

2. [21]

   It will be appropriate to briefly record the following matters concerning Maria’s and Giuliano’s joint bank accounts. I will refer to the accounts by their final account numbers.

CBA joint term deposit account No 160426 (CBA term deposit)

1. [22]

   This account was opened on 21 March 1997. It was a term deposit. The CBA statement covered the period 10 January 2003, when the balance was $196,074.25, to 7 March 2018, when the then balance of $343,405.32 was withdrawn. The title to the account was amended on 24 November 2017, after Maria’s death, to be solely in the name of Giuliano. The only transactions on the account were withdrawals on maturity and reinvestment of the capital plus the crediting of interest.

2. [23]

   After 2 December 2016, the only transactions on this account were the crediting of interest.

CBA joint savings investment account No 5001807

1. [24]

   This account was opened on 12 June 1990. The CBA produced a passbook reconstruction covering the period 1 June 2013 to 1 March 2020. The account contained $5,723.36 at the beginning of this period and $5,972.46 at the end. The largest credit balance was $7,379.99. Most of the deposits are described as interest or dividends. Over the period covered by the reconstruction there were nine withdrawals, all bar two of which were in round numbers of thousands or hundreds of dollars.

2. [25]

   This account continued to be used after 2 December 2016, in the same way as before, with dividends and interest and a small number of deposits being credited, and two withdrawals of $5,000 and $3,015 being made on 27 November 2017 and 19 April 2018. There were therefore no withdrawals between the date of Maria’s last will and her death.

CBA joint pensioner security account No 12838

1. [26]

   This account was opened on 10 September 2001. The reconstruction of the account statements provided by the CBA covered the period 1 June 2013 to 3 May 2018, when the account was closed. Almost all of the deposits are described as pensions, family allowance payments or interest. Withdrawals were almost always in round numbers of thousands of dollars, the most common being $2,000.

2. [27]

   This account appears to have been used between 2 December 2016 and the date of Maria’s death, by deposits of pensions and family allowances, and a small number of withdrawals, in the same manner as before 2 December 2016.

ANZ joint term deposit account No 39415 (ANZ term deposit)

1. [28]

   This account was opened in the joint names of Maria and Giuliano, apparently on 16 July 1982. The document recording a reconstruction of the account started with an $80,000 balance brought forward on 9 August 2008. The account was closed on 9 September 2017 by a transfer of $109,819.56. In the intervening period there were only customer deposits of $10,000 on 9 February 2009 and $5,075.97 on 9 January 2012. There were withdrawals of $6,000 on 9 September 2009, $2,621.36 on 11 January 2013, $2,393.93 on 11 August 2014, $1,000 on 10 February 2015 and $2,000 on 10 May 2016. The only other transactions were credits of interest, many but not all of which were debited and transferred to another account.

2. [29]

   Between 2 December 2016 and the date of Maria’s death there were a number of interest credits and transfers of interest into another account, and also, on 9 September 2017, the balance in the account of $109,819.56 was, as mentioned above, withdrawn by transfer. It is not known who effected this transaction. It was not suggested that this transaction is of significance to the outcome of these proceedings, and I will assume that the appropriate portion of this money was paid into Giuliano’s solicitor’s trust account.

Evidence of Caterina’s witnesses

1. [30]

   Caterina gave evidence in her 27 June 2019 affidavit of discussions between Maria and Giuliano at unspecified times that took place in her presence concerning their mutual desire that each of their families would inherit that person’s property and share in the joint property. The discussions were said to have been prompted by an attempt by a niece of Giuliano to secure ownership of Giuliano’s farm in Sicily that Giuliano had permitted her to use. The principal part of this evidence was:

2. [31]

   This conversation was not put as an agreement capable of causing the severance of the joint tenancies, but it is evidence of the mutual intent of Maria and Giuliano at the time they gave practical effect to their aspiration by making their wills on 2 December 2016.

3. [32]

   Caterina affirmed this evidence in cross-examination at T 18.40 when it was suggested to her that Maria had never expressed a wish that half the money in the joint accounts be bequeathed to her relatives under her will.

4. [33]

   Caterina was not present at the meeting in Mr Margiotta’s office on 4 November 2016 at which Maria’s penultimate will was made.

5. [34]

   However, Mr Margiotta, the solicitor who prepared all of the 2016 wills, gave the following evidence in his 24 July 2019 affidavit concerning a conversation that occurred at the meeting on 4 November 2016:

6. [35]

   If the conversation happened in these terms, it did not specifically refer to the property that was owned jointly by Maria and Giuliano, and did not deal with the possibility of severance of the joint tenancy, or include an explanation of the consequences.

7. [36]

   Mrs Margiotta, who was present at the 4 November 2016 conference, deposed in par 4 of her 24 July 2019 affidavit to the conversation given in Mr Margiotta’s affidavit in precisely the same terms.

8. [37]

   Caterina also gave the following evidence concerning statements made by Maria in Giuliano’s presence on 2 December 2016 in the office of Mr Margiotta:

9. [38]

   Caterina’s daughter, Gabriella, who was 18 years of age at the time she swore her 27 June 2019 affidavit, gave evidence that she attended the conference in Mr Margiotta’s office that occurred on 2 December 2016, and sat behind her mother. Gabriella deposed to the following conversations at the conference:

10. [39]

    There were a number of deficiencies in the recollection of the witnesses called in Caterina’s case.

11. [40]

    Giuliano’s counsel submitted that the only evidence of an agreement that had satisfactorily been put forward was whatever could be spelt out of the wills (T65.33 and T 68.7). He submitted that Caterina’s evidence was often inaccurate and self-serving (T 69.4), and that it was often contradicted by other witnesses that were called.

12. [41]

    I accept that there were deficiencies in Caterina’s evidence concerning the details of what transpired at Mr Margiotta’s office on 2 December 2016. In particular, Caterina gave evidence that the terms of the completed wills were translated from English into Italian in full by Mrs Margiotta before they were executed (par 30). Mrs Margiotta denied doing so in her evidence, and it is perfectly clear that she could not have done so because of a visual impairment from which she suffers that requires certain visual aids to enable her to read, which she did not have access to during the meeting.

13. [42]

    Both Caterina and Gabriella wrongly recalled that, when they entered Mr Margiotta’s office on 2 December 2016, draft wills had already been prepared and they were sitting on the desk. Mr Margiotta’s evidence was that he used Maria’s and Giuliano’s earlier wills as the basis for drafting the new wills by making revisions to the earlier wills, and that the process of having new drafts typed and revised occurred numerous times over the approximately two hour period of the meeting, before the final drafts were agreed by Maria and Giuliano.

14. [43]

    Mr Margiotta did not recall that Gabriella was present at the meeting. That may be because Gabriella sat behind her mother and took no part in the meeting. Gabriella was a schoolgirl at the time and may have sat in the background.

15. [44]

    Gabriella overestimated the duration of the meeting, but that may be because the meeting may have seemed for a schoolgirl to drag on.

16. [45]

    I accept that all of the witnesses called by Caterina gave their evidence truthfully in accordance with their best recollection. However, it is unlikely that the witnesses have clear recollections of what was said at the various meetings or during relevant conversations. It is not surprising that the witnesses may not now be able to recall the details of events in a clear and accurate manner.

Giuliano’s evidence

1. [46]

   Giuliano responded to Caterina’s claim in an affidavit sworn on 29 November 2019. The affidavit was made in the Italian language and a translation into English was relied upon at the hearing.

2. [47]

   Giuliano was cross-examined by audio-visual link while he was present in Italy, where he now lives with his sister. The evidence was translated by an interpreter in the court room. I understand that Giuliano, who is in his nineties, was assisted by a niece who was required to prompt him on a number of occasions to address relevant questions. That is not to suggest that the niece influenced the evidence that Giuliano gave.

3. [48]

   Giuliano said that he does not read, write or speak English. He knows a few words of English, but only basic words, and not enough to have a conversation.

4. [49]

   Giuliano said in par 11 of his affidavit that he and Maria “saw Mr Margiotta again in November 2016 to do new wills”, and that that was done because Caterina had been shown Maria’s 4 November 2015 will and persuaded Maria and Giuliano to make a new will that “nominate[d]” Caterina as executrix. There may be some misunderstanding with this part of Giuliano’s evidence, because Giuliano did not make a will on 4 November 2016, although he did attend the conference with Mr Margiotta at which Maria did so.

5. [50]

   There was, according to Giuliano, no discussion in Italian at the conference about altering or changing the way jointly held bank accounts or shares were held by him and Maria. He said that he was unable to say whether there was any discussion about those issues in English with Maria.

6. [51]

   Giuliano said that he understood that his 2015 will remained unchanged, and the effect of his will was that Giuliano’s side of the family would inherit his property when he died subject to Maria’s life interest, and that Maria’s family would inherit her property when she died.

7. [52]

   According to Giuliano, the conference with Mr Margiotta on 2 December 2016 was arranged by Caterina because “she was still not happy with our wills”.

8. [53]

   It is clear from Mr Margiotta’s evidence that he called the 2 December 2016 conference because he was concerned that he had made a mistake when he drafted Maria’s 4 November 2016 will, in that he had provided the wrong fraction when describing the bequest that Paolo was to receive as a proportion of the total value of Unit 1 and Unit 2.

9. [54]

   Giuliano also said that, at the conference on 2 December 2016: “Caterina spoke in English to Mr Margiotta, telling him what to put in the new wills”.

10. [55]

    The evidence given by Caterina and Gabriella was clearly to the effect that Maria and Giuliano gave their own instructions to Mr Margiotta, and that Caterina’s role was only to intervene from time to time to ensure that Maria and Giuliano understood the effect of what they were doing by translating what had been said in English into Italian.

11. [56]

    Giuliano said that about 90% of the conference was spoken in English and towards the end Mr Margiotta spoke to Giuliano and Maria in Italian and advised them of the effect of the wills.

12. [57]

    According to Giuliano: “To the best of my recollection the only material change from my will is that Caterina was named as executor. At no stage during that meeting did I hear or learn that other changes had been made compared to our previous wills”.

13. [58]

    I will consider the terms of Giuliano’s 2 December 2016 will below. It will be seen that there were a number of significant alterations to Giuliano’s 4 November 2015 will, including in respect of gifts of Giuliano’s property that were not included in the earlier will.

14. [59]

    Giuliano then gave the following evidence:

15. [60]

    It will be necessary to judge the credibility of Giuliano’s denials having regard to the terms of the will that he signed on 2 December 2016, to which I will come shortly.

16. [61]

    It was Caterina’s evidence concerning Giuliano’s proficiency in English that: “He wasn’t fluent, but he understood English… understood what he wrote on the wills, as my auntie did” (T 17.16).

17. [62]

    In her 2 March 2020 affidavit in reply to Giuliano’s affidavit, Caterina said:

18. [63]

    Gabriella said: “My Great Aunt and Great Uncle both understood English however were only fluent in the Italian language and their English was basic”: par 6. Gabriella added in cross-examination (T 22.50):

19. [64]

    On the subject of whether Giuliano was capable of speaking and understanding English, Mr Margiotta said in his 28 February 2020 affidavit in reply:

20. [65]

    In relation to Giuliano’s assertion that Caterina gave instructions to Mr Margiotta concerning the terms of Maria’s and Giuliano’s wills, Mr Margiotta said:

21. [66]

    Mr Margiotta referred to Giuliano’s evidence that the only material change to his will was that Caterina was named as executor, and said in par 8 that it: “cannot be true. Every paragraph in Mr Di Giovanni’s Will was explained to him and his wife Mrs Maria Di Giovanni in simple English and slowly. Mrs Di Giovanni and her husband understood each paragraph”.

22. [67]

    Mr Margiotta did confirm in par 11 that there was no discussion about altering or changing the way the jointly held bank accounts were owned by Maria and Giuliano. I take this evidence to mean that, although Mr Margiotta confirmed in pars 9 and 10 of his affidavit in reply that both Maria and Giuliano explicitly gave him the instructions that he included in their respective wills, so that they each made provision for their half shares in the joint assets, there was no discussion that explicitly concerned how the joint property was to be owned.

23. [68]

    Finally, Mr Margiotta said in cross-examination ( T37.16 – T38.19):

24. [69]

    The circumstances in which Giuliano was cross-examined put him at a disadvantage, and the Court was not able to reach a comfortable conclusion concerning the credibility of his evidence based upon his demeanour. In the circumstances, the weight to be given to Giuliano’s evidence should be determined by comparing that evidence with the evidence given by Caterina’s witnesses. It will also be appropriate for the Court to proceed cautiously and to avoid expressing negative conclusions concerning Giuliano’s credibility on issues that do not make that necessary.

25. [70]

    I accept that the evidence establishes that Mr Margiotta did not at the 4 November 2016 or 2 December 2016 meetings give Giuliano an explanation of the law governing the effect of joint tenancies, the means by which the severance of joint tenancies may be effected, or the exclusion of the right of survivorship that may result. However, the evidence satisfies me that Giuliano has understated his capacity to understand the English language in 2016, where matters were explained to him in simple terms by a solicitor with long experience of Italian Australian clients, and where there was a facility available to ask for matters that were not satisfactorily understood to be explained in Italian by a reliable relative in the person of Caterina.

26. [71]

    There was no evidence by any witness, including Giuliano, that he signed his 2 December 2016 will in circumstances where he felt doubt as to the practical meaning of the terms in his will, or that he did not understand the effect of Maria’s will. There is no reason for the Court to think that Giuliano did not fully understand the significance of Maria and he making their final wills. I consider that, if Giuliano was not satisfied that the terms of the wills had adequately been explained to him, he would have protested and sought further explanation, if necessary in Italian, before he signed his will.

27. [72]

    I am therefore satisfied that at the time that both Maria’s and Giuliano’s wills were made on 2 December 2016, Giuliano understood in practical terms how the wills would work depending upon which of Maria and Giuliano died first.

28. [73]

    It follows that I am satisfied that Giuliano understood that both Maria’s and his wills dealt with each testator’s half of their joint property, albeit as will be seen in different ways, to give their half to their relatives in a manner that was inconsistent with the property that was held jointly passing to the surviving joint tenant by survivorship on the death of the first to die.

Maria’s and Giuliano’s 4 November 2015 wills

1. [74]

   The earlier wills made by Maria and Giuliano, before they made wills that purported to bequeath their interests in their joint property in a manner inconsistent with the right of survivorship, are of background significance to the determination of the issues before the Court.

Maria’s 4 November 2015 will

1. [75]

   By clause 2 of her 4 November 2015 will, Maria appointed Giuliano as her executor and trustee, and in the event that Giuliano predeceased Maria, Caterina was appointed in his stead.

2. [76]

   The principal gift is found in clause 4, which materially provided:

3. [77]

   Clause 6 was a gift of “the residue of my estate to my beneficiaries referred to above in equal shares”.

4. [78]

   It is significant that clause 4 dealt specifically with Unit 1 and Unit 2, which were properties owned solely by Maria, and also Maria’s “property” in the CBA term deposit and the ANZ term deposit, both of which were in the joint names of Maria and Giuliano. Evidence in the form of a letter from the CBA shows that the term deposit with the final account numbers 50290060 was an account in Maria’s sole name.

5. [79]

   Maria evidently understood that she could devise her interests in the two joint term deposits separately by her will.

6. [80]

   Clause 4, in the chapeau, purports to give Maria’s property to Maria’s relatives equally, and subpar (ii) provides that the money in the accounts is to be given to the three relatives equally, but Paolo’s third share is to be valued as at the date of Maria’s death and paid out to him in money. That provision would only be effective if the money in the bank accounts referred to by Maria totalled at least one third of the value of the whole of Maria’s property disposed of by clause 4.

Giuliano’s 4 November 2015 will

1. [81]

   By clause 2, Giuliano appointed Maria as his executrix and if Maria predeceased him, he appointed Caterina.

2. [82]

   Clause 4 devised an interest in the Croydon home to Maria for her life or so long as she resided in the home, and, after Maria’s death or her vacating the home, devised the Croydon home to Giuliano’s sisters absolutely.

3. [83]

   Giuliano gave the residue of his estate by clause 6 to the “beneficiaries referred to above in equal shares”.

4. [84]

   The evidence does not establish why Giuliano gave a life interest in the Croydon home to Maria, and Maria gave her interests in Unit 1 and Unit 2 directly to Maria’s relatives.

Maria’s 4 November 2016 will

1. [85]

   Maria made a further will on 4 November 2016. Giuliano did not, although the evidence establishes that he was present at Mr Margiotta’s office when instructions were given by Maria for the 4 November 2016 will and it was executed by Maria.

2. [86]

   The terms of this will were materially the same as Maria’s previous will, save that revisions were made for the apparent purpose of curing a number of practical inadequacies in the drafting of the 4 November 2015 will.

3. [87]

   First, Unit 1 was specifically given to Caterina and Unit 6 was given to Giuseppe.

4. [88]

   The part of clause 4 of the previous will, after subpars (i) and (ii), was refined to provide as follows:

5. [89]

   It may be noted that, by providing in subpar (iii) that Paolo was to receive one half the value of the two home units, this will adopted the correct fraction. As Maria’s intention was that Paolo would receive in money a bequest approximately equal to the value of each of the home units that were given to Caterina and Giuseppe, it was necessary for the will to provide for the gift to Paolo to be the average of the value of the two home units, or one half of that aggregate value.

6. [90]

   There can be no doubt from the terms of Maria’s first two wills, as well as the 2 December 2016 will that will be considered below, that Maria personally intended that her shares of the joint bank accounts and her joint interests in the shares would be part of her estate on her death, and would devolve in accordance with her wills. It may be assumed that Maria expected that her wills would take effect in accordance with their terms.

7. [91]

   Apart from this conclusion being obvious from the terms of the wills, it was an important aspect of Maria’s plan to give one of her two home units to each of Caterina and Giuseppe in specie, and for Paolo to receive an equivalent bequest in money, that Maria ensure as far as possible that her estate included an amount of cash equal to half of the combined value of the two home units.

8. [92]

   As appears from the Inventory of Property that is considered above, the total amount of money that Maria had in bank accounts in her sole name at the date of her death was $187,020.61. The average in the value of the two home units was $375,000. It is probable that those values did not change significantly between 2 December 2016 and 9 August 2017. To achieve her explicit aim, Maria would need to ensure that her estate contained an extra amount of money of almost $200,000.

Terms of the 2 December 2016 wills

1. [93]

   Caterina’s case is that the wills made by each of Maria and Giuliano on 2 December 2016 had the effect of implementing by conduct the general agreement embodied in earlier discussions between Maria and Giuliano that both would be free to deal separately in their wills with their half shares in the jointly owned property, so that a severance of the joint ownership was effected by conduct.

2. [94]

   Giuliano’s response was, in substance, that the appearance of his agreement was illusory because he did not sufficiently understand any of the conversations that took place in English, or the English wording of the draft wills. In addition, he said that in any event, the wording of the wills as executed was inconsistent with the severance of the joint tenancies, and in fact implied their continuation.

Maria’s will

1. [95]

   Maria’s 2 December 2016 will appointed Caterina as her executrix in lieu of Giuliano as executor.

2. [96]

   The will, insofar as is now relevant, replaced clause 4(iii) to (iv) and added a new clause 5, but otherwise bequeathed Unit 1 to Caterina and Unit 6 to Giuseppe in the same terms as the 4 November 2016 will, as follows:

3. [97]

   The first thing that should be noted about the revision to clause 4(iii), insofar as it changed the bequest to Paolo from one half of the combined value of Unit 1 and Unit 2 (as in the 4 November 2016 will) to one third, was that the change by Mr Margiotta was an arithmetical error. The parties agreed that Mr Margiotta was correct in the fraction that he used on 4 November 2016, and the concern that he expressed at the time that he had made a mistake was itself an error. No party suggested that the fact of this error was material to the resolution of the dispute between Caterina and Giuliano.

4. [98]

   Maria’s testamentary purpose of giving her own property to Maria’s relatives is clearly made more specific by the addition of clause 4(iv) dealing with the monies in the CBA accounts in Maria’s sole name. This term may have been included to avoid any uncertainty in the words: “In relation to my other assets including all my moneys particularly…” in the equivalent clause of the 4 November 2016 will.

5. [99]

   The new clause 5(v) purports to deal with “my Shares and all my monies held with the Commonwealth Bank of Australia and the ANZ Bank jointly with my husband [GIULIANO]”. This is unambiguous evidence of Maria’s intention and expectation that her will would be effective to deal with her half interest in the jointly owned assets. That intention and expectation is clear, even if it turns out that Mr Margiotta’s draughtsmanship was no more felicitous than his arithmetic.

6. [100]

   There is a question about the proper construction of clause 4(v) insofar as it contains a direction: “that one-half of these funds” was to be applied towards the payment of the bequest to Paolo. As Maria’s share of the jointly owned shares and monies in the bank accounts was as to one half, a direction “that one-half of these funds” be applied for the stated purpose could be interpreted to apply only to one quarter of the jointly owned assets; being one half of one half. If that construction were given to the term, Maria would have failed to have dealt with the other one quarter, which would have fallen into residue.

7. [101]

   I do not think that this is a problem, if the whole of the will is construed in its context. I consider that the expression “one-half of these funds” was intended to mean, although infelicitously worded, Maria’s one half of the jointly held funds, and not one half of her half.

8. [102]

   Construed in that way, clause 4(v) would be a clear statement of Maria’s testamentary intention to bequeath her half of the jointly owned property to her relatives for the stated purpose. If she died at any instant after she made her 2 December 2016 will that would be the intended consequence.

9. [103]

   It is then necessary to consider how clause 5 was intended to take effect. At first sight the opening words of clause 5 appear strange, because they provide for the event that Giuliano predeceases Maria by making a bequest of Maria’s property in circumstances where Maria has not made any bequest to Giuliano in her will. It follows that clause 5 was not intended as an alternative to an earlier gift that would take effect if Giuliano survived Maria.

10. [104]

    The bequest in clause 5 is expressed to be of “one-half of my shares and one-half of the Bank Accounts which were held jointly with my husband [GIULIANO]”. It is likely that the reference to “one-half” should be construed in the same way as the same expression in clause 4(v).

11. [105]

    It is at least clear that the one-half was to go as to one half to Anna and as to the other half to Caterina, Giuliano’s sister.

12. [106]

    It is necessary to suspend consideration for the moment as to how clause 5 was intended to operate, until the relevant terms of Giuliano’s 2 December 2016 will have been analysed. The parties were agreed that the two wills were not mutual wills in the technical meaning of that term. However, in my view, it is clear that the two wills were drawn by Mr Margiotta as part of the one drafting exercise, and that they were intended to work together to achieve the objectives of both Maria and Giuliano as Mr Margiotta understood them.

Giuliano’s will

1. [107]

   Giuliano’s 2 December 2016 will also made Caterina his sole executrix.

2. [108]

   By clause 4, Giuliano bequeathed one half of his shares in “Insurance Australia Group” to Maria absolutely. There was no evidence that explained that gift or even the circumstances in which Giuliano acquired those shares.

3. [109]

   Clause 5 had the same practical effect as clause 4 of the previous will, insofar as it gave Maria an interest in the Croydon home for her life, or until she vacated it, and thereafter a gift to Giuliano’s sisters in equal shares. Clause 5 added a right in Caterina, Giuseppe and Paolo to purchase the Croydon home for its market value at the date of Giuliano’s death.

4. [110]

   Then, by clause 6, Giuliano gave his farm in Sicily to his sisters Anna and Caterina in equal shares.

5. [111]

   Clauses 7 and 8 of Giuliano’s 2 December 2016 will were in the following terms:

6. [112]

   The wills made by Maria and Giuliano were not ‘mirror’ wills. Experience shows that often married couples in the position of Maria and Giuliano make wills that have the same structure, save that the wills have a mirror effect depending upon which testator dies first. The differences in structure between the two wills made on 2 December 2016 can only be explained upon the basis that each testator gave different, considered instructions to Mr Margiotta. As noted above, in par 16 of his affidavit, Giuliano claimed that Caterina told Mr Margiotta what to put in the wills and that about 90% of the conference was spoken in English. He said: “To the best of my recollection the only material change from my will is that Caterina was named as executor. At no stage during that meeting did I hear or learn that other changes had been made compared to our previous wills”. I do not accept that Caterina was responsible for giving Mr Margiotta the instruction to include clause 6 in Giuliano’s will. I can see no reason why Caterina would have given an instruction to Mr Margiotta to leave Giuliano’s farm in Sicily to Anna and Caterina. Further, it is clear that Giuliano’s 2 December 2016 will contained a number of significant changes from his 4 November 2015 will.

Nature of the agreement between Maria and Giuliano

1. [113]

   Maria and Giuliano did not make an agreement or reach an understanding that they would sever the joint ownership of any of their assets immediately and before the death of either of them. So far as the evidence discloses, they did not address subjectively the legal effect of the terms of their final wills on a day to day basis pending the death of one of them.

2. [114]

   I accept that conversations occurred between Maria and Giuliano in Caterina’s presence broadly as deposed to by Caterina. That is, I accept that Maria and Giuliano discussed their intention that the property of each, including that person’s share in the jointly owned property, would be left to that person’s family. However, discussions to this effect only established the couple’s aspirations. It was subject to the process of working out the detail of what would be included in the wills. While there may have been further discussions between Maria and Giuliano, that was an exercise that was completed on 2 December 2016 in Mr Margiotta’s office.

3. [115]

   As I have said above, I find that Giuliano’s capacity to speak and comprehend English was much better in 2016 than he was prepared to acknowledge in his evidence. Giuliano had a long working life in Australia during which he must have become reasonably competent in English in dealing with the requirements of his employment as well as his day to day existence. When Maria’s 4 November 2016 will was made and at the time he and Maria made their 2 December 2016 wills, the terms of those wills were explained at length in simple English by a solicitor who, I infer, had considerable experience of explaining wills to clients whose first language was Italian.

4. [116]

   The evidence does not explain why the two wills have a different structure and effect in relation to the terms that provide for the devolution of the jointly owned property. I am satisfied, however, that the terms of the two wills reflect an agreement or understanding between Maria and Giuliano in respect of the substance of how their individual and joint assets would be dealt with in their respective wills. It is possible that Mr Margiotta’s draughtsmanship was not entirely competent, but the evidence of the lengthy process of taking instructions and revising the draft wills satisfies me that their terms recorded in substance what each of Maria and Giuliano wanted to do with their own share of the matrimonial property, and what the other wished to do, depending upon the eventuality of who died first.

5. [117]

   I find that Maria and Giuliano each understood that, whatever the legal consequences were of their joint ownership of assets in life, when one of them died that person’s will would take effect in accordance with its terms. The die would then, so to speak, be cast, and the survivor’s will could only then operate having regard to the effect of the will of the first to die. Because each of the wills contained structurally different provisions, the happenstance of which person died first would make a difference to the ultimate disposition of the couple’s property, but that would be because of the operation of the couple’s agreement as embodied in the two wills, and not by reason of the operation of any legal doctrine, such as survivorship.

Maria predeceases Giuliano

1. [118]

   So far as the two wills are concerned, the only term dealing with the jointly owned property that has yet taken effect is clause 4(v) of Maria’s will, which relevantly directs that one half of the joint funds be applied to funding the bequest to Paolo under clause 4(iii). Clause 4(v) of Maria’s will is inconsistent with any intention that Maria’s interest in the joint property should pass to Giuliano by survivorship.

2. [119]

   The term of Giuliano’s will that is expressed to be intended to take effect if Maria predeceased Giuliano is clause 8, which provides that “my shares and all joint Bank Accounts held with my wife” would be given as to one half equally between Giuliano’s sisters and the other half equally between Maria’s relatives.

3. [120]

   It is arguable that clause 8 is consistent with the joint tenancy in the jointly owned property continuing and Giuliano receiving Maria’s share in that property by survivorship. That may be implied from the gift of half of that property to each of Giuliano’s sisters and Maria’s relatives. Clause 8 could not take effect in accordance with its literal terms (apparently applying to the whole of the jointly owned property) if Maria predeceased Giuliano, because clause 4(v) of Maria’s will would have had the effect that half of that property had already been given to Maria’s relatives. Clause 8 of Giuliano’s will only works if it is understood that it can only operate on Giuliano’s remaining half of the jointly owned property.

4. [121]

   It is also arguable that clause 7 of Giuliano’s will is consistent with an understanding that Giuliano’s share in the jointly owned property will not pass to Maria by survivorship if Giuliano died first. Clause 7 need not have referred to the jointly owned property if it were understood that Maria would get that property by survivorship anyway.

5. [122]

   The better view may be that the drafting mistake lies in clause 8(ii) of Giuliano’s will. That is because clause 8 in terms applies in the event of Maria predeceasing Giuliano. As Giuliano should have been aware of the general effect of clause 4(v) of Maria’s will, which if effective would only leave Giuliano with his half of the jointly owned properties, the better view is to conclude that the division by clause 8 of Giuliano’s will of his half share into quarters to be given to both Giuliano’s sisters and Maria’s relatives was an error.

6. [123]

   It appears that Mr Margiotta may have made a further error, at least when the two wills are considered together. While it is impossible to be sure, I think it likely that the explanation is that Mr Margiotta took instructions from Maria and Giuliano separately, and the two wills reflect those instructions even though, on close analysis, the wills do not correctly dovetail. There is no evidence or appearance that Mr Margiotta gave any thought to how the terms of the wills related to the issue of joint ownership and the doctrine of survivorship.

7. [124]

   It will accord with the reality of the situation to determine the effect of the two wills simply upon the basis that each testator intended that person’s will to operate in the terms contained in it. Each understood what the other had included in that testator’s will and each accepted the other’s testamentary intentions. The practical result would be that the ultimate outcome would depend upon who died first. Considered in this way, the possibility that in fact there are drafting defects and conceptual inconsistencies within and between the two wills is not material. Those matters do not affect the intention and understanding of the couple as to what would happen.

Legal principles

1. [125]

   Caterina did not suggest that Maria and Giuliano made a specific agreement to sever the joint interests in the bank accounts and the shares. She submitted that severance could be achieved by a course of conduct that exhibited a mutual intention that the parties would hold their interests separately as tenants in common, and that, on the facts of the present case, such a mutual intention was established.

2. [126]

   As Dixon and Evatt JJ said in Russell v Scott (1936) 55 CLR 440 at 450, 451, the question that must be addressed in the case of a joint bank account is:

3. [127]

   Unlike in that case, where the answer to the question depended upon the intention of the aunt at the time she paid money into the account, in the present case the answer depends upon whether, by reason of the conduct of Maria and Giuliano, money that was originally deposited into the joint accounts with the intention that it be beneficially owned jointly, ceased to be so owned by reason of the severance of the joint estate.

4. [128]

   To the extent that Maria and Giuliano jointly owned shares, the question is more straightforward: did they sever the joint interest at some relevant time?

5. [129]

   The principles governing the manner in which a joint tenancy can be severed are as stated by the High Court in Corin v Patton (1990) 169 CLR 540; [1990] HCA 12. As Mason CJ and McHugh J said at 546, 547 (footnotes omitted):

6. [130]

   Deane J, at 572-574, relevantly added (footnotes omitted):

7. [131]

   In Mischel Holdings Pty Ltd (in liq) v Mischel [2013] VSCA 375, the Victorian Court of Appeal undertook an authoritative review of the principles that govern when a joint tenancy may be severed by the mutual conduct of the joint tenants. The following extract is edited to refer to the passages that deal directly with the question of severance by the mutual conduct of the joint tenants (footnotes omitted):

8. [132]

   In respect of the issue of the degree of proof necessary to establish a mutual intention to sever the joint tenancy, I note and accept the following statement by Ward J (as her Honour then was) in Scott v Scott [2009] NSWSC 567:

9. [133]

   Giuliano relied in submissions on the following extract from the judgment of Newbury JA, with whom Frankel and Bennett JJA agreed, in the British Columbia Court of Appeal in Bergen v Bergen 2013 BCCA 492:

10. [134]

    As I understand this argument, it was to the effect that, because of the unique attributes of a joint bank account, being a chose in an action against the bank, there were special difficulties in severing a joint tenancy in such an account because of the practical difficulty in terminating one of the four unities, as what the joint account holders could do was constrained by the terms of the contract between the joint account holders and the bank.

11. [135]

    I take her Honour to have been considering the practical difficulties that may be involved in severing at law the joint tenancy in a bank account. That is because the existence of the property jointly owned flows out of the terms of the contract with the bank, and cannot be altered without the bank's participation. Consequently, it may be that the only way to end the joint tenancy at law is to withdraw the funds in the account so that the chose in action no longer exists and can be replaced by accounts in the separate names of the joint tenants.

12. [136]

    It is not necessary to decide the question, but it may be that the joint tenancy in a jointly owned bank account could be severed at law by obtaining the agreement of the bank to change the terms of the contract governing the account to include a term that, on the death of one account-holder, the funds in the account should not be paid to the survivor, but should be paid to both the estate of the deceased and to the survivor in equal shares.

13. [137]

    However, these considerations are not decisive in the present case, because, as the authorities considered above demonstrate, severance of a joint estate in property may become effective in equity even where severance is not recognised at law.

Consideration

1. [138]

   I return to my finding that Maria and Giuliano understood the terms of each other’s will and agreed and intended that each will would operate in accordance with its terms. That operation would depend on the order in which they died. Consequently, I consider that the effect of the above authorities is that no later than the time of Maria’s death the joint tenancy in the couple’s jointly owned property was severed so that Maria’s will would operate on Maria’s half of that property, and accordingly it would not pass to Giuliano by survivorship.

2. [139]

   It is not clear whether the joint tenancy was severed immediately upon Maria’s and Giuliano’s wills being made on 2 December 2016. As I have noted, there is no evidence that the couple adverted to the issue or that it had any practical significance until Maria died first. It must be inferred that Maria died with the expectation that her will would operate and that her half of the jointly owned property would pass to her relatives. That expectation accorded with the common intention of the couple as reflected in their conduct in each making their wills on 2 December 2016 with the concurrence of the other.

3. [140]

   Caterina is entitled, as Maria's executrix, to a declaration that Maria's half share in the jointly owned property is part of Maria's estate for the purpose of the administration of her will. It may be that Maria is entitled to consequential orders to give effect to the declaration. As I have noted above, there is an element of uncertainty as to what the position is in relation to the joint interest in any shares that were jointly owned.

4. [141]

   In principle, Caterina is entitled to an order for the costs of the proceedings. If necessary, I will hear submissions concerning the basis of the costs order.

5. [142]

   The parties' legal representatives should confer for the purpose of submitting draft short minutes of order to give effect to these reasons. If any difficulties arise, arrangements should be made with my Associate to relist the proceedings.