Refalo v Gatt (No 2) [2021] NSWSC 1677

Refalo v Gatt (No 2) [2021] NSWSC 1677

Clause 5(b) created an implied testamentary call option for executors wishing to keep estate property, with the seller executors having an express right to trigger the valuation and contract process by written request. Because the defendants did not give that written request and instead disputed the plaintiffs' right to buy, they were not entitled to insist on a current valuation; nor was 10 August 2020 strictly required by the wills. The parties had nonetheless commissioned valuations under clause 5(b)(2)A, so the pragmatic valuation date should be 16 November 2020, approximately halfway between the two valuation report dates, subject to further submissions if sought. The uncertainty and...

Jurisdiction
Australia
Judgment Date
20 December 2021
Procedural Posture
Succession; Construction of Wills; Costs / Consequential Orders After Primary Judgment, Heard on the Papers
Outcome
Consequential issues determined in part, with further opportunity for submissions or relisting on the valuation date and unresolved discontinuance costs issues.
Legal Topics
['construction of Wills' 'testamentary Option' 'valuation Date' 'executor Indemnity' 'testamentary Expenses' 'discontinuance']
['succession' 'equity' 'costs' 'civil Procedure'] ['construction of Wills' 'testamentary Option' 'valuation Date' 'executor Indemnity' 'testamentary Expenses' 'discontinuance']

Case Brief

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Procedural Posture

Succession; Construction of Wills; Costs / Consequential Orders After Primary Judgment, Heard on the Papers

Legal Issues

  1. 1 ['What date should be used for valuation of the subject property under clause 5(b) of the wills after the executors did not implement the written request process contemplated by the wills.' "Whether the defendants should pay the plaintiffs' costs of the determination of prayers 1 to 3, or whether the costs of all parties should be paid out of the estates." 'What costs consequences should follow if the plaintiffs discontinue the remaining claims concerning clause 6(c) of the wills.']

Ratio Decidendi

Clause 5(b) created an implied testamentary call option for executors wishing to keep estate property, with the seller executors having an express right to trigger the valuation and contract process by written request. Because the defendants did not give that written request and instead disputed the plaintiffs' right to buy, they were not entitled to insist on a current valuation; nor was 10 August 2020 strictly required by the wills. The parties had nonetheless commissioned valuations under clause 5(b)(2)A, so the pragmatic valuation date should be 16 November 2020, approximately halfway between the two valuation report dates, subject to further submissions if sought. The uncertainty and...

Court Disposition

Consequential issues determined in part, with further opportunity for submissions or relisting on the valuation date and unresolved discontinuance costs issues.

Orders

  • ['The Court indicated that the order for valuation should not use 10 August 2020 or current value, but should provide for valuation as at 16 November 2020 unless a party sought relisting for submissions.' 'The parties were given seven days from the commencement of the new law term to advise the Associate if they...