High Court of Ireland Decisions

 
THE HIGH COURT

NO. 2001/240 SP

IN THE MATTER OF A.C. DECEASED AND IN THE MATTER OF SECTION 117, SUCCESSION ACT, 1965

BETWEEN/

K.C.

PLAINTIFF

AND C.F.

DEFENDANT

AND M.C.

NOTICE PARTY

THE HIGH COURT

2001/239 SP

IN THE MATTER OF A.C. DECEASED AND IN THE MATTER OF SECTION 117, SUCCESSION ACT, 1965

BETWEEN/

B.C.F.

PLAINTIFF

AND C.F.

DEFENDANT

AND M.C.

NOTICE PARTY

Judgment of Ms. Justice Carroll delivered the 16^th day of December, 2003.

The deceased, A.C., who died 24^th November, 1999 was a widow who left eleven children her surviving. Five children predeceased her. Her husband, L.C., died 12^th April, 1991. By her last will dated 30^th June, 1993, she appointed the defendant, C.F., her solicitor, to be sole executor thereof and devised and bequeathed all her property to her sons, M.C. and J.C. absolutely. There were no words of severance. J.C. predeceased his mother, a bachelor and intestate, on 12^th January, 1998. In that event M.C. became solely entitled to her estate. He is the notice party.

Probate of the will issued to C.F. on 20^th December, 2000. The gross value of the estate returned in the Inland Revenue affidavit was in the sum of £1,000,152.69 and the net value was returned in the sum of £751,052.15. Certain additional sums will have to be added to that consisting of further assets of the deceased amounting to £13,715.90. Also certain assets belonging to J.C., deceased, amounting to approximately £25,000, will ultimately accrue for the benefit of the estate of A.C., deceased.

The deceased A.C. sold the original family home after the death of her son, J.C., and bought another house in which she lived with her daughter K.C. one of the plaintiffs. A.C. was only there six to seven months when she died. M.C. lived in a caravan in the yard at his mother's home.

M.C. is described in the Inland Revenue affidavit as the sole beneficiary and capital acquisition tax amounting to £244,700 was paid. The estate consisted of the house, valued at £120,000 and the balance in cash.

Of the eleven surviving children, two daughters, namely the plaintiffs K.C. and B.C.F., claim under s. 117 of the Succession Act, 1965, that their mother, A.C., failed in her moral duty to make proper provision for them. None of the other siblings make such claim.

The plaintiff, K.C., was born on 29^th November, 1967 and is now aged 36. She is the seventh eldest of the eleven surviving children. She attended school until the age of twelve and thereafter received no education. She is the only member of her family who is unmarried. She lived with her mother until she died and looked after her. She nursed her in her last illness and was very close to her. She has never had employment and is in receipt of social welfare. She continued living in the house for six months after the death, after which she left. According to her she was put out by M.C.'s wife. She lived with different brothers and sisters and now lives with a brother and his family in a halting site which she says is infested with rats.

During her life she never received gifts or property from her mother, save that on the death of her father, L.C., intestate, her mother, A.C., gave £10,000 to each of her unmarried children, including herself, K.C., the third party, M.C., and three other brothers, T.C., G.C., and B.C. Her mother paid for four weddings for M.C., T.C., G.C. and B.C. and gave each of them a new van and caravan on their wedding. She had lived in settled comfort for years and now describes her existence as living in squalor.

The other plaintiff, B.C.F., was born on 30^th September, 1960 and is now 43. She is the fifth eldest of the surviving children. She was educated to Inter Cert. standard and left school at fifteen years. She has been unemployed since then. On 24^th April, 1979, she married P.F. and they have four children aged 21, 18, 17 and 13, none of whom is working. She resides in a house rented from the Corporation but is in arrears with her rent. Her husband is unemployed and can no longer work at his former occupation due to health reasons. They live on social welfare benefit. She never received any gifts from her mother in her lifetime and never received any distribution from the estate of her father, L.C., who died intestate. She is aware that her mother gave £10,000 to each of her unmarried siblings, K.C., T.C., G.C. B.C., and M.C. (the third party). She is also aware that each of those brothers had their weddings paid for by their mother who gave each of them a van and caravan on the occasion.

While M.C. claims that their mother spent £10,000 on B.C.F.'s wedding and also gave assistance to her during her life, B.C.F. says her father paid £600 and her father-in-law paid £500 for her wedding. She says she lived in England between 1981 and 1998. Her mother came on four occasions to visit. She would bring either M.C. or another brother L.C. with her and they stayed three to four weeks. B.C.F. provided for their food and accommodation and her brothers made no contribution. Following these visits she was in financial difficulties.

Of the remaining seven children the information is at times conflicting.

J.C. and his wife are unemployed and on social welfare. They have eight (or nine) children, seven dependent (according to K.C.) and two under twenty-one (according to B.C.F.). B.C.F. says they have now moved into a new home and, are well provided for.

M.C., (not the third party) and his wife are unemployed and on social welfare with nine (or ten) children, all dependent (according to K.C.). B.C.F. says four children are over eighteen and there are five dependent children. They live on a halting site.

P.C. and his wife are unemployed and on social welfare. They live in a council house with eight children, four dependent. They are described by K.C. as financially comfortable. M.C., the third party, says they are in bad circumstances and that the council are going to knock down the house.

M.C. (a sister) is supported by her husband. They have nine children, two dependent. K.C. says they live in a new caravan. M.C. says there are three dependents and that the caravan is thirteen years old. B.C.F. says that she owns land and is building a house.

T.C. is not on social welfare, his wife is employed. They live in rented accommodation and have two dependent children. He is described by K.C. as comfortably off. M.C. says he has three dependent children and he understands he has a lot of debts.

G.C. is not on social welfare. His wife is on social welfare. They live in a council house and they have two children. He is described by K.C. as comfortably off. M.C. says their circumstances are very poor.

B.C., is not on social welfare, his wife is on social welfare. They have three dependent children. They live on a halting site. B.C.F. says the County Council has recently provided them with accommodation and that he owns a new 2003 Toyota Avensis costing €25,000 and a 1999 van.

L.C. works in London. His wife receives social welfare. They have seven children, all dependent. He lives in a four bedroomed property and is described by K.C. as very comfortable financially. M.C. says the house is in poor order and he is not in good enough financial circumstances to travel to Ireland for the hearing of the case. B.C.F. says this is not true.

None of the siblings swore any affidavit relative to their circumstances or whether they knew or agreed that M.C. had given a solemn undertaking to divide the residue of the money among the eleven surviving children or whether they forebore from suing under s. 117 on foot of an expectation that they would each get 1/11^th of the money residue.

M.C., the third party, describes himself as a casual trader and is married with four dependent children. He claims in his affidavit in both proceedings that he told his mother she should make a will, particularly after J.C. died and she said she did not need to as she trusted him to carry out her wishes. He says he made a solemn promise to her about the division of her property, that he would own the house and divide all the remaining money equally between her eleven children (including himself) in equal shares. He says each of his brothers and sisters was aware before his mother died how her estate was going to be divided and agreed with this course of action and that he would be the owner of the house. He says that each of his brothers and sisters has a legitimate expectation to receive a 1/11^th share based on the promise to his mother and on the fact that there was forbearance on the part of each of his brothers and sisters, excluding the plaintiffs, from taking any court action under s. 117. He says in his affidavits that he held the money on a solemn trust for his brothers and sisters and he believes he was constituted a trustee of the fund of money and that his mother was constituted a trustee of it, prior to her death. He avers he is willing to vest 1/11^th share of the money in both K.C. and B.C.F.

K.C. says in her affidavit her mother asked M.C. to arrange for a solicitor to meet her so she could change her will on numerous occasions and he failed to do so. She denies that the contents of the will and the alleged agreement were well known within the family and says the first time she knew of it was after the proceedings were instituted. She corroborated this in her oral evidence.

B.C.F. in her affidavit and also in her oral evidence denies that she was ever aware of the alleged agreement between her mother and M.C. that the estate would be split evenly between the brothers and sisters. In her affidavit she says her mother was dead ten months before she became aware of a will executed by her mother. She only became aware of it after she personally carried out a search in the Probate Office. She said she revealed the contents to the various members of her family who were very shocked when they heard the contents of the will. The first she became aware of the alleged agreement was after she had issued proceedings. She did not believe there was an agreement between her mother and M.C. She said her mother asked M.C. on at least three occasions in hospital and on two occasions when at home to arrange for her to see a solicitor but he did not do so. She believes it was her mother's intention to leave the house to K.C. who is unmarried and had lived with her for many years and cared and provided for her. She said her mother made that known to her. She says she believes her mother frequently gave M.C. money. She believes he is well provided for.

C.F., the defendant and executor, avers in his affidavit that M.C. attended his office on several occasions and indicated he wished to divide the net proceeds of his mother's estate between his siblings equally. In his oral evidence he referred to a contemporaneous note of an attendance made on 1^st December, 1999, when he interviewed M.C. He reviewed the terms of the will with him and the fact that all the estate passed to him. He then said:

"I advised M. as to the serious taxation implications arising from this. He himself is not keen to inherit the entire estate. In fact basically he is aware that his mother was of a mind to change the terms of the will before she died. Basically his understanding is that she wanted to leave the house at –- to him and the residue of the estate to the rest of his family equally."

Later in the attendance he notes:

"In the circumstances that have arisen M. would be happy to renounce his rights under the terms of the will if he could be sure that he would get the house. In these circumstances I suggested that all the members of his family might complete a deed of settlement with him whereby they would agree to release their shares in the house to him. This, of course, would have to be done from the deed of renunciation."

In his affidavit he exhibits a letter of 16^th March, 2001 to the plaintiffs' solicitors. In the course of the letter he states as follows:

"In relation to the estate of K.C. deceased, as you know our Mr. F. is executor of the deceased's estate. On the basis of the instructions from the beneficiary under the will we understand he is quite agreeable to make substantial assets available for distribution among the family members. We understand this has already been mentioned to the family. Our client will be anxious to have the family settlement completed and to formalise these proposals. Please confirm if you would be agreeable to attend a meeting to advance matters in this regard."

In his evidence C.F. stated that when M.C. told him he wanted to divide his inheritance and spoke of his mother's wishes, he did not take that to mean a secret trust. He advised him he could not make a partial disclaimer, only a total disclaimer and he would need a family settlement. He said he was not told of any secret trust at the time he drafted the will. His view was that M.C. felt he had a moral obligation but that it was not a legal obligation. He was happy to swear the Inland Revenue affidavit naming M.C. as sole beneficiary.

The relevant provisions of section 117 of the Succession Act, 1965 (as amended) are as follows:-

Subsection (1) Where on the application by or on behalf of a child of a testator, the Court is of opinion that the testator has failed in his moral duty to make proper provision for the child in accordance with his means whether by his will or otherwise, the Court may order that such provision shall be made for the child out of the estate as the Court thinks just.

Subsection (2) The Court shall consider the application from the point of view of a prudent and just parent, taking into account the position of each of the children of the testator and any other circumstances which the Court may consider of assistance in arriving at a decision that will be as fair as possible to the child to whom the application relates and to the other children.

And

Subsection (6) An order under this section shall not be made except on an application made within six months from the first taking out of representation to the deceased's estate.

The first issue to be decided is whether the testatrix, A.C., made proper provision for her daughters K.C. and B.C.F.

In order to know if she made any provision, it is necessary to decide whether A.C. created a secret trust in relation to the assets of her estate.

In my view no secret trust has been established.

M.C. did not inform the executor of the will, C.F., of the existence of any such trust. He told C.F. that his understanding was his mother wanted him to have the house and the remainder of the estate to be divided equally among the rest of the family. This is contradicted in his affidavit where he says it was his understanding that he would share in the division of the money. The two plaintiffs were never informed either by their mother or by him that there was any trust arrangement. I accept their evidence that the first they heard of this alleged trust was after they had issued proceedings, which they only issued as time was running out.

Therefore A.C. did not make any provision for the plaintiffs at all whether by will or by this alleged secret trust. Neither did she make any provision for either of them during her lifetime. The £10,000 paid to K.C. by A.C. after the death of her father did not absolve A.C. from her moral duty to make proper provision for K.C. There is no evidence as to the size of L.C.'s estate and the share to which K.C. would have been entitled on intestacy. There is a strong possibility that the money came from L.C.'s estate.

I am satisfied that both K.C. and B.C.F. are in want without any means and that K.C. is worse off because she has nowhere to live. She had led a settled existence for many years in the comfort of a house. I have no doubt that A.C. did fail to make proper provision for both of them in accordance with her means.

The next issue is what is proper provision in all the circumstances. The Court in ordering provision which is just must, under subsection (2), consider the application from the point of view of a prudent and just parent taking into account the position of each child of the testator and any other circumstances in order to arrive at a decision which would be as fair as possible to the applicant children and the other children.

I have been referred to the case of M.F.H. & Ors v. W.B.H. [1984] I.R. 599 in which Barron J. said at p. 607:

"In this context, the expression 'other children' means any other child who is also an applicant or who is a beneficiary under the will and whose benefit thereunder may be affected by the exercise of the court's powers. The court should not be required to take into account provision or lack of provision made for children not in either of these categories. The provision made for such children cannot be affected by its order. It must strike a balance where necessary between children before the court on the basis of what is just, having regard as well as to the other matters it has to take into account, to the means of the testator passing by his will."

It has been submitted that I should not take any of the other children into account because they do not benefit under the will and have not applied for relief under s. 117. However, I think there are special circumstances which must be taken into account in this case. I do not think I can ignore those other children completely. M.C. has sworn an affidavit that he holds the money residue on a solemn trust for his brothers and sisters each to get 1/11^th. Therefore, if he does follow through on this solemn trust which he has imposed upon himself (omitting K.C. and B.C.F.), the other brothers and sisters, while not beneficiaries under the will, will be affected by the exercise of the Court's powers. These are circumstances which I believe I must take into account and I cannot deal with the matter as if there were only K.C., B.C.F. and M.C. to consider. Neither can I deal with it on the basis that an eleventh share in the money residue is proper provision for either K.C. or B.C.F. This is not a case where an equal division of the residue would be fair.

In trying to be fair in all the circumstances I am of opinion that K.C. is entitled to €200,000 and that B.F.C. is entitled to €100,000 out of the estate. I seriously considered providing that K.C. should have a life interest in the house but this might well lead to complications. The arrangement prior to A.C.'s death was that M.C. lived in a caravan in the yard of the house with his wife and children. It would not be an ideal arrangement if K.C. were living in the house and M.C. was in a caravan in the yard. I hope that the larger sum which K.C. will receive would enable her to provide herself with reasonable accommodation.