Estate of Grahame David Wright

The plaintiffs and the first defendant are the executors and trustees of the will of the late Grahame David Wright (“Mr Wright”) made on 27 June 2014 (the "Will"). By summons filed on 15 July 2016, the plaintiffs seek declarations as to the proper construction of certain parts of the Will and, if necessary, orders for rectification.

The proceedings raise four questions:

As a result of directions made by Lindsay J sitting as Probate Judge on 15 August 2016, all persons interested in these questions (including the step-grandchildren) are represented today before the Court. They all agree that the relief sought by the plaintiffs should be granted. That agreement does not relieve the Court of its obligation to be satisfied that the relief, or any other relief, should be granted.

The Court notes with gratitude that both the evidence and submissions have been thoroughly prepared and presented by the legal representatives of the plaintiffs. That enables the matter to be dealt with today in relatively short compass. The plaintiffs were represented by Mr T Maltz of Counsel. The defendants appeared for themselves. The brevity with which I propose to deal with the matter is not intended to diminish the assistance which the Court has derived from the careful and compendious submissions that have been presented by counsel.

Without any disrespect intended, I shall refer to the various family members who feature in these reasons, other than Mr Wright, by their given names. The Court finds the facts as set out in paragraphs [6] to [21] below.

Mr Wright married his wife, Lesley, in 1983. In that year, their son David was born. Later they had a second son, James.

At all material times, James and his wife had one child, Banjo. On the other hand, David, with his wife Tara, now have four children. Tara brought her own natural children from a previous relationship, Makayla and Maddyson, to her relationship with David. David and Tara then had their own daughter, Hannah. At the time of Mr Wright's death, Tara was pregnant with her and David’s second child, who was subsequently born and is named Lucy. These proceedings are about whether or not Makayla and Maddyson — David’s step-children — were intended by Mr Wright to be beneficiaries of a testamentary trust established by the Will.

Mr Wright was a very successful businessman. However, like many people, he resisted the frequent encouragement of his solicitor, Mr Gregory Judd, and his accountant, Mr Christopher Kirkwood, to make a will. Unbeknown to either of them, Mr Wright had, in fact, made a will some years before his final illness, but nothing turns on that.

When Tara and David commenced their relationship in December 2008, Mr Wright immediately welcomed Makayla and Maddyson (and Tara) as members of his family. Mr Wright doted on Makayla and Maddyson, as he did on his other grandchildren. There is uncontested evidence as to the nature of Mr Wright’s relationship with Makayla and Maddyson, which includes (and the Court accepts) that:

By reason of the matters referred to in the preceding paragraph, the Court finds that, at all material times, Mr Wright regarded Makayla and Maddyson without discrimination as members of his extended family and intended to benefit them as such in the Will.

Mr Wright suffered from ill health for many years. That poor health reached a crisis in late June 2014, at which time Mr Wright was in Hunters Hill Private Hospital.

The crisis in Mr Wright's health precipitated a meeting attended by Lesley, David and James at the offices of Mr Judd on 26 June 2014 to give Mr Judd instructions, on Mr Wright's behalf, in relation to the Will. At that meeting, they conveyed to Mr Judd that they had seen Mr Wright and that he wanted a third of his estate to be held for each son and "his [each son’s] family", with Lesley to have a life interest in the final third of the estate. Mr Judd confirmed during the course of that meeting that those instructions were consistent with what Mr Wright had previously told him were his testamentary wishes on those occasions when Mr Judd had attempted to persuade Mr Wright to make a will.

Mr Judd sought instructions from David and James as to the names of their children. On the same day, 26 June 2014, David sent an email to Mr Judd, which included the names of Makayla and Maddyson as among those who, at least as David understood it, Mr Wright intended to benefit. However, it does not appear that Mr Judd ever saw that email, probably because events moved very quickly.

Mr Judd himself was not told by anyone that of David's children, two were stepchildren. In the limited time Mr Judd had to draft the Will, he did not independently identify that fact.

Mr Judd prepared the Will urgently. On the next day (27 June 2014), Mr Judd attended Hunters Hill Private Hospital with the draft Will. Other family members were present at the time.

Mr Judd went through the terms of the draft Will with Mr Wright. There is no question that Mr Wright had testamentary capacity at the time.

Mr Judd's evidence (which the Court accepts) is that in taking Mr Wright through the terms of the draft Will, he said to Mr Wright (after referring to Lesley’s one-third life interest):

Either by not objecting, or by express affirmation, Mr Wright indicated his assent to the various provisions of the draft Will as they were explained to him by Mr Judd, including in relation to the testamentary trusts. Mr Judd particularly recalls reading to Mr Wright the definition in clause 10 of the draft Will (see paragraph [20] below) which speaks of "children" and "descendants".

Mr Judd also recalls that Mr Wright said after Mr Judd had explained the provisions of the draft Will, but before Mr Wright signed it:

Mr Wright then executed the Will, which includes:

Mr Wright died on 31 August 2014.

On 29 July 2015, probate of the Will was granted to the plaintiffs and the first defendant. The original grant of probate has been surrendered to the Court for the purposes of these proceedings.

I set out the general principles relating to the construction of wills (including what is often referred to as the "armchair" principle) in my judgment in Carolyn Margaret Hickin v Robyn Patricia Carroll & Ors (No 2) [2014] NSWSC 1059:

To that summary of the common law must be added s 32 of the Act:

The Court accepts Mr Maltz’s submission that the references to "descendants" in clauses 5 and 10 of the Will and "children" in clause 10 of the Will, are ambiguous on the face of the Will (see s 32(1)(b)) and ambiguous in the light of the surrounding circumstances — those circumstances being the existence of Makayla and Maddyson — (see s 32(1)(c)). Section 32 is therefore engaged.

The Court was taken to a number of cases dealing with the interpretation of wills in the case of stepchildren. These focused on the word “child” or “children”. However, it seems to me that the same considerations apply to the proper construction of both "descendants" and "children" as used in the Will.

Many authorities have recognised that the meaning of "child" or "children" in contemporary society can be much wider than its original legal meaning of children by blood. However, for my part I do not think that the natural and ordinary meaning of “child” or “descendant” in contemporary Australian usage has reached the point where, without more, they necessarily include stepchildren. I respectfully adopt what fell from Davies AJ in Estate of Jack Alexander Warren [2001] NSWSC 104. His Honour reviewed a number of the cases dealing with the meaning of "children" where it had been held to include stepchildren, but nevertheless concluded:

Notwithstanding adherence to what might be seen as the traditional meaning of the word "children", the Court has no doubt that in today’s society in particular cases its meaning readily extends to stepchildren. As Davies AJ pointed out, that result may be brought about "when legislation so requires or when the terms of the will or evidence show that there is a reason for doing so". In my respectful view, the evidence in this case (see, in particular, paragraph [9] above) makes it clear by application of the armchair principle that, in referring to either "descendants" or "children", Mr Wright intended to include Makayla and Maddyson. He considered them to be an integral part of his extended family and, more importantly perhaps for present purposes, an integral part of his son David's family.

For this reason, the Court construes those terms in accordance with the conclusions just expressed. However, this seems to me to be a case where, if it can be done, it would be desirable to rectify the Will to reflect those conclusions in terms. I respectfully adopt this observation made by J C Campbell J (as his Honour then was) in Rawack v Spicer [2002] NSWSC 849 (“Rawack”) at [25]:

The orderly and efficient administration of the estate will be facilitated if the Will can be rectified so that it expressly includes Makayla and Maddyson.

Section 27 of the Act provides:

These proceedings were commenced more than 12 months after Mr Wright's death. The reasons given for that delay do not bespeak tardiness or negligence on the part of the plaintiffs and first defendant. The effect of the Will had to be appreciated and considered. Instructions had to be sought. Mr Judd's file had to be obtained by the plaintiffs' solicitors. Statements of evidence had to be garnered. In short, the delay in bringing the proceedings is not a delay of the kind that would prevent an extension of time being granted. Furthermore, it is common ground that no one is prejudiced by an extension of time.

The Court's discretion to extend the period of time for the making of an application under s 27 is engaged if the Court is satisfied of two matters.

First, I am satisfied that it is necessary for an extension of time to be granted. This is a matter where it is clear that the Will does not reflect the intentions or instructions of Mr Wright insofar as the position of Mikayla and Maddyson is concerned. There are also clerical errors (to which I will come) which need correction. For the application to be made time must be extended and, therefore, it is necessary.

The second precondition is that "the final distribution of the estate has not been made". The evidence makes it clear that, advisedly, a number of steps necessary to finalise the distribution of the estate have deliberately not been taken to ensure that s 27(3)(b) of the Act is satisfied. Accordingly, the final distribution of the estate has not been made.

By reason of the matters referred to in the preceding paragraphs, the Court is satisfied that an order extending the period of time for the making of the present application should be made.

In applying s 27, I respectfully adopt the observations on the construction of that section made by Barrett J (as his Honour then was) in Vescio v Bannister [2010] NSWSC 1274; (2010) 3 ASTLR 619:

The evidence which I have set out in paragraphs [17] to [19] above demonstrates that Mr Wright gave instructions that there should be three trustees of his sons’ testamentary trusts, namely David, James and the family accountant, Mr Kirkwood. As Barrett J points out, the section requires there to be, at least, a correspondence between the testator's instructions and the testator's intentions. The Court finds that not only did Mr Wright give instructions for those three persons to be the testamentary trustees but that that was also his intention.

The Court accepts Mr Judd's evidence that in clause 11 of the Will (see paragraph [20] above) typographical errors were made which have the effect, on their face, of incorrectly describing who the trustees of those trusts are to be. The Court will make orders rectifying those errors so that in clause 11 of the Will, David, James and Mr Kirkwood are consistently referred to, together, as the trustees of those trusts.

I have referred in paragraph [29] above to the decision in Rawack for the proposition that the Court may rectify a will, out of an abundance of caution, to enable it better to reflect in terms the construction which the Court has found applies. As Mr Maltz correctly submitted, construction precedes rectification.

Having determined the proper construction of the Will, it might be asked how s 27 of the Act is satisfied in those circumstances. Rawack concerned the predecessor to s 27 of the Act, being s 29A of the Wills, Probate and Administration Act 1898 (NSW), which was enlivened if the Court was satisfied a will “fails to carry out the testator’s intentions”. In my respectful view, that same conclusion applies to s 27 of the Act because the expression "the Court is satisfied the will does not carry out the testator's intentions" in s 27 should be read as including a situation where the assistance of the Court has been required to determine the true construction of a will. It may readily be inferred that in the ordinary course a testator intends her or his will to be sufficiently clear that those interested in the matter are not required to ask the Court to construe it.

For the same reason, the requirement for the Court to be satisfied that "the will does not give effect to the testator's instructions" (see s 27(1)(b)) is to be understood as encompassing a situation where a will has not given effect to the testator's instructions without the intervention of the Court. Again, the obvious inference is that there is to be implied into a testator’s instructions that his or her intentions are to be expressed in a way that does not require judicial exposition.

With that understanding of how s 27 can operate out of an abundance of caution, the Court is satisfied by reason of the matters set out in paragraphs [9] and [17] to [19] above, that Mr Wright gave instructions that David's stepchildren, Makayla and Maddyson, should be included as beneficiaries of his son David’s testamentary trust. Given that the Court has been required to intervene to construe the Will, the prerequisites for the Court to make an order to rectify the Will are satisfied.

For these reasons, the Court will order the Will to be rectified so as to make clear, in terms, that Mikayla and Maddyson are included within the expressions "descendants" and "children" in clauses 5(b)(ii) and 10(b)(i) of the Will.

In addition to an order extending time, the Court will make orders rectifying the Will by reference to a rectified version of the Will which I will initial and date today for the purposes of identification. A question arises as to what is to happen to the current grant of probate, which has been surrendered to the Court for the purposes of these proceedings. As a matter of good order, it seems to me that the appropriate course to give effect to the Court's conclusions is that the Court should revoke the current grant of probate and order that probate in solemn form be granted to the executors and trustees appointed under the Will as rectified.

The plaintiffs are entitled to an order that they have their costs out of Mr Wright's estate on the indemnity basis. The other parties appeared in person and do not seek costs.