Ex-wife fails in attempt to claim from husband’s estate

Decisions coming from the Supreme Court have been a little on the quiet side, no doubt due to the impact of COVID19.

We are busy as ever, and a current matter has caused me to revisit some of the cases specifically in the area of family provision.

The deceased was a doctor. Some 20 odd years ago he had a brief marriage. They had a child together, and the marriage lasted about 2-4 years. The couple formally divorced and had formal property orders as well. She ended up with full custody of the child, and he was required to provide child support. The division of assets was complied with, but she wasn’t happy. She appealed the Family Court orders unsuccessfully.

Throughout the rest of his life the deceased abided by the court orders and provided for his daughter in addition to the court orders. He was not able to have a proper relationship with his daughter as the ex-wife prevented contact. By the time the proceedings were heard, the daughter was estranged from the mother.

The ex-wife clearly carried a lot of resentment towards her ex-husband. Following the divorce and for the rest of the deceased’s life, she continued to be a thorn in the deceased’s side. She made a claim to the medical board that he had commenced a relationship with her whilst he was her patient and engaged in sexual misconduct. There were a whole number of other things she did throughout the deceased’s life including denying access to his daughter.

Other than expensive and unsuccessful legal proceedings, she also had a number of car accidents. By the time of the deceased’s death her financial position was significantly inferior to what it was at the time of the divorce. She felt she was entitled to provision out of the deceased’s estate.

The Estate was approximately $5 million, and the sole beneficiary was the daughter of the relationship. Whilst a will had been prepared, leaving the entire estate to his daughter, he never executed the will, so died intestate. His daughter was the sole beneficiary on intestacy.

The ex-wife did not think that was fair (despite her daughter being the sole beneficiary – they were estranged afterall) so made a claim for further provision.

At first instance, she was successful, with the court finding that the size of the estate justified the making of an order in favour of the ex-wife. However, this decision overlooked the requirement for a former spouse to provide ‘factors warranting’ the making of a claim. It also overlooked the fact that there had been a formal property settlement that had been complied with.

The judge at first instance considered that the ex-wife had been particularly affected by the breakdown of the marriage some 20 years prior, and that the deceased owed an obligation to the ex-wife to make some provision for her.

However, the daughter, as executor for the Estate, appealed the decision, and the Court of Appeal overturned the decision. The Court followed prior judgments that found that usually a property settlement, whether by agreement or court order, was a bar to the parties claiming on each other’s estate.

The Court looked at the history of the provision and noted that the inclusion of the category of former spouse was not to permit disgruntled persons another attempt at a property distribution, but was a recognition that sometimes one of the parties to the former marriage die without a formal property settlement having been finalised. In those circumstances it would be reasonable that the deceased owed an obligation to their former spouse to make further provision for them on their death. Another circumstance where a former spouse may be successful would be where the deceased did not comply with the terms of any property settlement, had been misleading as to their assets in any representations for child support, or who had neglected to provide for their minor children in any way.

These would be ‘factors warranting’ that would justify the Court making an order of provision for a former spouse.

As these factors were not present in this case, the Court of Appeal found that the former spouse was not an eligible person and was unsuccessful in her claim for provision. The Court further ordered that she should pay the costs of the Estate on the ordinary basis.

The Court of Appeal dismissed the size of the estate being a relevant consideration in determining whether the former spouse was an eligible person.

Lodin v Lodin [2017] NSWCA 327

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