Firns v Firns; Estate of Ronald Douglas Firns [2000] NSWSC 396

New South Wales Supreme Court

CITATION : Firns v Firns; Estate of Ronald Douglas Firns [2000] NSWSC 396 CURRENT JURISDICTION: Equity Division Probate List FILE NUMBER(S) : SC 109217/98 HEARING DATE(S) : 08/05/2000 JUDGMENT DATE : 8 May 2000

Charles Magnus Wade Firns (P) PARTIES : Kenneth John Firns (D1) Ronald Douglas Firns (Junior) (D2) JUDGMENT OF : Young J

COUNSEL : C J Bevan and A C M Iuliano (P) M S Willmott (D) SOLICITORS : Turner Freeman (P) Tzovaras Yandell (D) CATCHWORDS : Succession [74]- Administration- Court has power to make whatever grant of administration of a deceased person's estate is appropriate. LEGISLATION CITED : Wills Probate & Administration Act, 1898, ss 33, 40, 63, 74, 75 Hamilton v Hamilton (1913) 30 WN (NSW) 46 CASES CITED : Re Potter [1899] P 265 Public Trustee v Permanent Trustee Co Ltd; The estate of Rintoul [1999] NSWSC 722 Re Swan (1909) 26 WN (NSW) 52 DECISION : See paras 13-16

THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION PROBATE LIST YOUNG J MONDAY 8 MAY 2000

109217/98 - CHARLES MAGNUS WADE FIRNS v KENNETH JOHN FIRNS & ANOR; ESTATE OF RONALD DOUGLAS FIRNS

JUDGMENT

1 HIS HONOUR: This is the final hearing of proceedings brought by statement of claim in respect of the estate of the late Ronald Douglas Firns. 2 The matter came into the Probate Judge's list because it was necessary to make at least some interim provision and some order for expedition for the hearing of a dispute between relatives of the deceased, all of whom were named as executors of his will although they were obviously diametrically opposed to each other. 3 After discussion, including discussion between the parties, the necessity for a drawn out hearing was avoided as it was recognised that as there was no challenge to the validity of the will so long as an administrator was appointed cta who would administer the estate properly, the matter could be dealt with relatively summarily. 4 When the matter was last in my list on 10 April 2000, the possibilities for administrators had come down to two; namely, a trustee company (at that stage the Permanent Trustee Company Limited was suggested), or an 'A' List liquidator (Mr Lord being suggested). The matter was stood over to today, mainly to enable the respective parties to obtain reliable evidence as to the cost should either be appointed administrator. 5 Today there is not very reliable evidence as to costs on either side. However, what evidence there is suggests that there will not be that much difference in cost either way. Today the plaintiff wisely seeks that a partner of Mr Lord, Mr Kerr, be added as joint administrator and puts forward that a charge at the liquidator's normal hourly rates would be the best method of proceeding. 6 Mr Bevan and Mr Iuliano, who appeared for the plaintiff, stress that it is not just the question of cost that the Court must take into account, but the matter for decision is the best method of having the estate administered. Further they say that when one is working out what is the best method, one needs to take into account the general law rule that grant follows interest. As the plaintiff appears to have the greatest interest in the estate, because under the will he was entitled to a devise of the property in New South Wales which is the only certain asset of value, his wishes must be taken into account as prime consideration. It was also put that official liquidators are more likely to be able to unravel suspicious transactions that have occurred in Papua New Guinea or Hong Kong because of their experience in unravelling corporate frauds. 7 A problem for the plaintiff, as was pointed out by Mr Willmott who appeared for the defendants, is that the persons nominated appear to have a connection with the plaintiff and do not appear to be particularly experienced in administering deceased estates. They also seem open to the suggestion of retaining the same solicitors as were retained by the plaintiff in these proceedings. Mr Willmott challenged the liquidators' independence. In answer to that Mr Bevan put that the liquidators may not, in fact, retain those solicitors. It was just for the purpose of giving an estimate of what the likely expenses would be, that those solicitors were consulted as to how much they would charge and, in any event, in matters of administration the same degree of independence as is required of a company liquidator is not always looked for. 8 On his side Mr Willmott put forward the Public Trustee. The Public Trustee's brochure was deployed in evidence and that indicated that there is a flat fee based on a percentage of the estate, plus, there would also be fees for investigation. It appears to me that whilst it might be true that the Public Trustee would not be more expensive, the probabilities are that the cost of either method of administering the estate would be roughly equivalent. 9 No administrator is, however, going to embark on anything more than basic administration unless he, she or it has proper funding. Prima facie the only way in which any investigation is going to be funded is through the plaintiff permitting the asset devised to him to be at risk or, alternatively, paying moneys of his own to the administrator for investigation. This will provide some brake on any tendency for excessive administration costs, but because it is the plaintiff who is going to be under burden it seems to me that it is the plaintiff who should have the greater say as to who is to be the administrator. 10 Putting all the matters together I would consider from my experience in the Equity Division of this Court that it is more likely that an experienced company liquidator will have the ability by himself and with his staff to pursue proper inquiries rather than a trustee company or the Public Trustee which is used to more general administration and would probably have to contract out any investigation of misconduct. 11 Because of this and because of the rule that interest follows the grant, in my view it would be appropriate, despite the objections Mr Willmott makes, to appoint Mr Lord and Mr Kerr as joint administrators. 12 I should, however, briefly deal with the technicalities. The Wills Probate and Administration Act, 1898 (the "Act") confers jurisdiction on this Court to appoint an administrator under ss 33 and 40. Particular powers are granted in ss 63, 74 and 75. The way in which the Act has been construed over the years is that unless there has been a statutory taking away of jurisdiction the Court plainly has power to grant administration whenever it considers it appropriate to do so; see Hamilton v Hamilton (1913) 30 WN (NSW) 46. Especially these days, when courts are "sensible" about allowing parties to compromise probate proceedings in situations which do not come within the exact words of either s 74 or s 75, the Court would be empowered to grant administration; see Re Potter [1899] P 265 and Re Swan (1909) 26 WN (NSW) 52. However, in the instant case the matter does, on the facts, fall within s 74(c) or within s 75(1)(a) of the Act. As to s 75(1)(a) I did say in Public Trustee v Permanent Trustee Co Ltd; The estate of Rintoul [1999] NSWSC 722 at para 12 that the order for administration can be granted to the applicant "or some other appropriate person who is a party to the proceedings". Mr Bevan has convinced me that I should have added after that sentence the words "or who otherwise consents to take a grant". 13 Accordingly, dealing with the short minutes submitted by the plaintiff, I make orders 1-5. 14 In my view some of the costs of these proceedings were brought about by the testator naming parties who could not work together as his executors. Part of the costs, accordingly, I think should be absorbed by the estate. It is very hard to work out just where one should draw the line. There are some matters that have occurred in the year 2000 which were realistically caused by the testator in the sense in which I have just used the expression, and there are probably some matters prior to the plaintiff's change of course on 20 September 1999 which would not have been reasonably sourced in the testator. However, doing the best I can and trying to avoid the further expense of cost assessor's apportionments, I think the proper order for costs is that the defendants pay the plaintiff's costs of these proceedings on and after 21 September 1999 and that the costs of both parties prior to that date may be paid out of the estate. 15 I have altered order 6 of the short minutes accordingly and I have added order 7 "Refer to Registrar to complete grant of administration cta". I have also added order 8 "Exhibits may be returned." 16 So I make orders 1 to 8 in the amended short minutes of order initialled by me dated and place with the papers. ***************

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