The Facts
Father leaves most of his estate to charities
A NSW man died in September 2018, leaving an estate of about $2.5 million.
His will left $50,000 to his only son, together with smaller gifts to two other people, with the rest of the estate passing equally to two charities. The amount to be distributed to the charities was about $1.8 million (ie $900,000 each).
Father leaves his family behind and moves to Australia
The relationship between the father and son was a distant paternal one. It was accepted to be a poor relationship, marked by distance and aloofness on the part of the father, who was absent for significant periods of the sonβs life. The family lived in Eastern Europe during the sonβs early childhood and the father was a medical specialist who would work away from home for three months at a time and return for a week to the family home.
During these times away, the father had an affair with another medical specialist and formed a relationship with her. The father and his new partner moved to Australia to live, leaving the young son with his mother in Eastern Europe.
Adult son emigrates to Australia
After reaching adulthood, the son spent four years in prison in Eastern Europe as a result of getting into trouble with the communist government in his country. Following his release from prison, the son moved to Australia with some help from his father, who acted as the βguarantorβ for him. He lived with his father for 14 months after he arrived while he learnt to speak English.
The relationship between father and son was not a close or emotional one, despite the son wanting it to be. The son admitted that between 1994 and 2018, he only saw his father on about five or six occasions, although he spoke to him about fortnightly, and then weekly following the death of his fatherβs second partner in 2017. Most of the conversations were unpleasant or argumentative.
Sonβs poor financial position and lack of employment
The son had previously been a mechanical fitter and was 61 years old at the time he began the proceedings against his fatherβs estate. He lived in rental accommodation, with few assets, little cash in the bank and a superannuation balance of $54,000.
He had little prospect of returning to the workforce due to his age and poor health. He was receiving Newstart payments fortnightly due to being unemployed.
Widely differing assessments of sonβs future needs
The son submitted that he should receive provision of $550,000 – $650,000 so he could purchase accommodation, plus a further lump sum of $500,000 to cover future contingencies, including health care and the cost of living. The son sought a total provision of approximately $1.1 million, which would have left about $300,000 to each of the charities.
It was accepted by the estate that improper provision was made for the son. However, the estate argued that the appropriate amount to be given to him would be approximately $450,000 in total, being $400,000 in addition to the $50,000 that he had already received under the will.
It was up to the court to decide whether the son should receive more than $450,000 from his fatherβs estate.
Expert commentary on the court's decision
Supreme Court decides son should receive $700,000 from fatherβs estate
In the case ofΒ Stejskal v Hely & OrsΒ [2019] NSWSC 1417,Β the Supreme Court of NSWΒ agreed that the father, Dr Jan Stejskal,Β owedΒ his son,Β MrΒ TomasΒ Stejskal,Β a moral duty to give him a sufficient sum to buy his own home,Β together with a sum for contingencies, which exceeded $450,000.Β
In its decision, the courtΒ orderedΒ thatΒ TomasΒ shouldΒ receive additional provision of $650,000,Β in addition to the $50,000 he was bequeathed under his fatherβsΒ will.Β Β
In making this order,Β theΒ court took the position, on evidence, that Tomas could purchase suitable accommodation for $350,000.Β TheΒ court held that the provisionΒ of a total sum of $700,000Β to Tomas stillΒ leftΒ a large sum to each of theΒ twoΒ charities,Β albeit being approximately $500,000, rather than $900,000 each.
Reasons why greater provision made for the son
WhileΒ it is generally accepted by willsΒ and estatesΒ lawyers that the days of any child receiving greater provision from aΒ will are over, this case shows that where thereΒ are noΒ competing beneficiaries,Β such as a dependent spouse orΒ anotherΒ child,Β then theΒ court is open to increasing provision.Β
In NSW a claimΒ for a family provision orderΒ must be commenced within 12 monthsΒ after a person’s death.Β Tomas brought the case within time.Β
The court appreciated the fact that the estateΒ accepted at an early stage that further provision should be made for Tomas, rather than arguingΒ thatΒ adequate provisionΒ had already beenΒ made forΒ him.Β
Son morally blameless for estrangement from father
In some cases where theΒ questionΒ ofΒ βestrangementβΒ between parent and child is raised, it is the childΒ whoΒ has caused the estrangement;Β thisΒ detrimentally affects their claim.Β Β
However, in this case it was accepted by theΒ court thatΒ the sonΒ was morally blameless for the poor and difficult relationshipΒ he had with his father. As such,Β the courtΒ did not consider theΒ matterΒ of estrangementΒ asΒ a factor to be considered.Β
Lessening the burden on the public purse
It was argued by the lawyers for Tomas that this was a case where there was plenty in the estate to make proper provision for him and also that it was a matter of public interest to do so, because it might remove the burden of supporting him from the public purse, as he would not need ongoing Newstart payments if he received significant provision from his fatherβs estate.
Lawyers for Tomas referred in their submissions to another case, Evans v Levy [2011] NSWCA 125, where it was argued that the law has a public policy purpose:
The judge stated that while he considered this argument, it played no part in his reasoning in the case, because Tomas Stejskal did not present any evidence concerning what his entitlement to a pension would be (if any) if he received the amount that he was seeking from his fatherβs estate.
General obligations of a parent to an adult child
With respect to the general obligations a parent owes to an adult child,Β the court referred to theΒ case ofΒ Taylor v FarrugiaΒ [2009] NSWSC 801, where the judge contrasted what the community expects parents to do for their children while they are children, with the obligations of parents towards those children when they become adults.Β
For the former, the community expects parents to βraise and educate their children to the very best of their abilityβ, to βassist them with a tertiary educationβ and where they have the financial means, to βprovide them with a start in life β such as a deposit on a homeβ.Β
Nonetheless, as the judge inΒ Taylor v FarrugiaΒ noted, if an adult child falls on hard times and where there are assets available:Β
The judge inΒ Stejskal vΒ HelyΒ had no doubt that Dr Stejskal had a βmoral dutyβ to provide for his sonβs accommodation, expenses and some contingency for the remaining 22 yearsΒ that he was expected to live.Β
The factors taken into account in reaching this conclusion included the sonβs age, his limited future prospects and his lack of assets. Another important consideration was the substantial size of the estate.
Why did the court grant the son less than he asked for?
Lawyers for Tomas had argued that he needed between $550,000 and $650,000 to buy a house, as well as a lump sum of $500,000 to cover necessary expenses and provide a buffer for contingencies.
The necessary expenses listed by Tomas included a newer vehicle, a newer boat, new furniture, a holiday cruise and a trip to the Czech Republic to visit his elderly mother. The judge described many of these expenses to be βwants and not needsβ in pruning the requested $500,000 sum to $350,000.
Court allocates funds for a modest home, not a lavish one
The court found that the $550,000-$650,000 requested by Tomas to buy a suitable house also overstated his needs, as the sample house prices he had compiled for the court were for βgrandioseβ dwellings of three, four or five bedrooms, with a number of these dwellings being on the waterfront at Bribie Island.Β
Lawyers for the estate argued that Tomas had lived happily in aΒ two bedroomΒ apartment for nearly 20 years and had not sought to change those arrangements, so it would be appropriate for him to receive a sum equivalent to the cost of a two-bedroom apartmentΒ in the locality he had specified.Β
The court agreed with this argument and allocatedΒ $350,000 to Tomas for the purchase of a home, taking the total sum he was to receive from the estate to $700,000, including the $50,000 he had already received.Β
Court strikes balance between sonβs needs and testamentary wishes of deceased
This arrangement left just over $500,000 forΒ each ofΒ the charities, the Royal Flying Doctor Service and St Vincentβs Clinic Foundation.Β Β
The judge stated that this arrangement gave βthe appropriate degree of respect to Dr Stejskalβs express testamentary wish to leave significant benefactions to the Charitiesβ.Β
TheΒ court had regard toΒ the fatherβs right to testamentary freedom,Β but held thatΒ theΒ alternativeΒ arrangements which it hadΒ ordered gave effect toΒ his moral obligation to his only son,Β whileΒ still providing for the charities which were close to his heart.Β
For more information about family provision claims, please see Family provision claims in NSW β spare us the details and curb your expectations.