Jones v Sharma – Claim by estranged children against their father’s will which left everything to a family friend
Charlie Smith died in 2006. His estate was worth approximately $1.625 million ($2.9 million now).
Charlie had four estranged adult children – Louise, Daniel, Brianna and Jill. Charlie had gone through a bitter separation with their mother when the children were all under 15 years old. He had had little to do with the children; had not given them any financial or emotional assistance and had written them off by placing them in the “camp of his ex-wife”.
Caroline Jones and her husband, Carl, were close family friends with Charlie. Charlie had effectively adopted Caroline, Carl and their family as ‘his family’.
Charlie’s will gave $25,000 ($45,000 now) to each of his children and $2,000 to his caregiver. The rest of his estate was left to Caroline and Carl.
Louise, Daniel, Brianna and Jill made a claim under the Family Protection Act against Charlie’s estate claiming that Charlie had breached his moral duty by failing to make adequate provisions for them in his will.
Circumstances of the claimants
Louise told the court that her parent’s separation was very difficult. She received no emotional support from her dad and suffered emotional problems due to the estrangement. Louise was married with two children. She made $67,000 per year and her husband made $32,000 per annum. They had a house worth $550,000 subject to a $19,000 mortgage. They were also supporting their daughter through university.
Daniel was divorced with two children. He said that Charlie’s rejection of him caused him emotional problems and low self-esteem. Daniel earned between $25,000 to $35,000 per year and had debts of $10,000. He had a house worth $560,000 subject to a mortgage of $128,000. One of Daniel’s children was still living at home.
Brianna had had a difficult life, she was in an emotionally abusive relationship, had had several miscarriages and one baby die. She suffered from depression and felt neglected by Charlie. Brianna was a single mum, earning $23,400 a year. She had ongoing medical issues, owed a debt of $20,000 to her mum and had $2,700 on her credit card. Brianna owned a house worth around $330,000 with a mortgage of $66,900.
Jill told the court that she felt abandoned by her dad and had never felt like he had wanted anything to do with her. Jill was having ongoing psychotherapy treatment. She was single earning $66,561 a year, had cash savings of $16,500 and a car worth $1,000. Jill owed her Mum $5,000.
The Court said that Charlie, being the adult at the time of his separation (which is when the estrangement started), bore prime responsibility for the estrangement between him and his children. The court also said that a parent cannot blame lack of communication on young children, or infer that they should have taken the initiative to contact the parent. All of Charlie’s children suffered emotionally due to his lack of interest in them.
Charlie had significantly breached the moral duty he owed to his children. Charlie did not owe that same duty to Caroline or Carl. The Court awarded $145,000 ($262,000 now) to each of the children being 75 per cent of the net value of the estate.
Patterson v Wade - Adult children of first marriage against second wife
Brian Brown died in 1997. His estate was worth $630,000 (approximately $2.2 million now). Brian had three adult children in their 30s from his first marriage, Susan, Courtney and Justin. The children’s mother had died some 18 years earlier.
Brian had remarried and was with his second wife, Stephanie, for 16 years before he died. The family dynamics surrounding the death of Brian’s first wife and his remarriage to Stephanie were difficult.
Brian’s last will provided for:
- all personal and household effects to go to Stephanie;
- gifts of $25,000 to each of his four siblings;
- a gift of $25,000 to his church;
- the remaining part of his estate was to be divided into two shares:
- one share would go to Stephanie; and
- the other share would be split evenly between Susan, Courtney and Justin.
Brian had decided to make provisions for his siblings in recognition of the fact that he had financially benefited over his siblings during their father’s lifetime by being able to purchase the family farm at under market value with a loan from his father. A lot of that loan was eventually gifted to him.
The result of the will was that Stephanie received $235,000 ($642,000 now) and Susan, Courtney and Justin would receive $78,000 each ($213,000 now).
Susan, Courtney and Justin made a Family Protection Act claim against their father’s estate, claiming that he had breached his moral duty to them.
The circumstances of the claimants
Susan was the eldest of the children. After their mother died and she married Susan took care of Courtney and Justin including financially. Susan and her husband had four children, all under 18, who still lived with them. Her net assets were worth around ($116,000).
Courtney had $48,600 in net assets, and Justin’s assets equalled his liabilities.
Stephanie had her own assets worth around $400,000 ($1.1 million today) as well as the proceeds of insurance policies and other assets under a matrimonial property settlement reached during Brian’s lifetime. She used to work as a veterinary technician, although she was then currently unemployed and living on capital reserves and redundancy money.
The court said that Brian had breached his moral duty to his children and that the appropriate way to remedy this breach was out of Stephanie’s share of the estate. The court said it was reluctant to disturb the gifts to Brian’s siblings and his church.
The court increased the award to the children from a 1/6 share each, to 1/5 each ($93,600 each – $256,000 in 2020) of the remaining part of the estate, leaving Stephanie with a 2/5 share in the residue ($186,000 – $508,000 today). The court recognised that Stephanie had already been provided for under her earlier matrimonial property settlement and, from the estate, by receipt of the major share in the remaining part of Brian’s estate.
Bates v Bates – Claim by adult children against father’s will which left everything to their mother
When John Bates died in 2009, his estate was worth around $1.2 million (approximately $2.09m now). John’s wife, Anna, had her own personal wealth of $1.4 million ($2.4m now).
John and Anna had five children, Justine, Andrew, Samantha, Christine and Joanna. The children were estranged from Anna. They had all suffered psychologically from an abusive and traumatic upbringing, which they attributed to Anna’s battle with depression.
Some of the children had spent long periods of time in foster homes and boarding schools from a young age, which was emotionally distressing to them. Andrew was abused while he was at boarding school, a fact that both Anna and John turned a blind eye to.
Along with Anna, three of the children suffered from mental health issues and Joanna committed suicide.
While John did not contribute to the abusive childhood that his children experienced, he was criticised for standing by while Anna mistreated their children.
John’s will left everything to Anna. If Anna predeceased him, he left gifts of $25,000 ($44,000 now) to each of his surviving adult children with the remainder of his estate to go to Mother Teresa.
Anna had made it known that she didn’t intend on leaving anything to their children either. John knew about that – they both shared the view that once children reached adulthood they should look after themselves.
All four of John’s surviving children made a claim against his estate, as well as his grandchild, the son of the late Joanna, Henry.
It is not unusual to see claims by the children of a previous marriage in competition with a second wife. This was an unusual claim by the natural children (and one grandchild) under the Family Protection Act against an estate where their biological mother (and grandmother) was the sole beneficiary.
The circumstances of the claimants
Andrew had two children. His financial circumstances were difficult, he had substantial debts and his business was suffering financially. Andrew rented the house that he lived in.
Henry’s financial circumstances were also difficult. He was unemployed and facing criminal charges at the time of the hearing. His mother’s suicide naturally had had a severe impact on him. He placed part of the blame for his mum’s suicide on Anna.
Samantha had three children. She suffered from PTSD and struggled financially and physically. She was a victim of a home invasion where she was severely injured. Because of this Samantha was unable to work and relied on a benefit of $660 per week, $450 of which paid for her rent. Her ex-husband stayed with her at her home to help the children but was also unemployed.
Christine was not in good physical health; she suffered from blot clotting and liver disease. She was also severely injured in an accident. She was divorced and had two children. Christine was unable to work, rented her home and had credit card debt of $35,000. She did, however, have a superannuation account of about $110,000 and so her assets did exceed her liabilities by around $100,000.
Justine had her own house worth around $350,000 ($610,510 now) with a substantial mortgage and a car.
The court decided that John had breached his moral duty to his children and grandchild by leaving his whole estate to Anna. The judge said that the obligation to provide for both the emotional and material needs of children is an ongoing one. The troubled upbringing and lack of financial and emotional support during their adult years had significantly impacted the health and wellbeing of John’s children and Henry.
The court said that all of the children were in significant need, financially and emotionally, though Justine had some financial security – Justine’s claim was based more on an emotional need rather than a financial need. The court said however that she was likely to have carried a larger emotional burden of alienation compared to the other children.
The court awarded the four children 10% of the estate each. The grandchild, Henry, was awarded 5% of the estate leaving Anna with 55%.
The court commented that a life interest might be appropriate where a stepmother is involved. However, in this situation, a life interest was not appropriate. Given the dysfunctional relationship between Anna and her surviving children, a clean break was desirable.
White v White - A claim by two adult children under the Family Protection Act challenging their mother’s will which left everything to their adult sister
Mrs White, and her husband who died before her, had three children; Laura, David and Sarah. Mrs White died in 2011.
Laura had lived with her mother her whole life and had been her primary carer.
At the time of Mrs White’s death:
- all three children were in similar financial circumstances – each having assets of around $600,000 to $700,000. Laura’s assets included a half share of the family home left to her after her father died;
- David was 70 and had reoccurring prostate cancer and back problems;
- Sarah was 66 and had Barrett’s oesophagus and back problems from a car crash in the 1970s;
- Laura was 66 with no reported health concerns;
Mrs White’s estate was worth approximately $657,000 ($1.13 million in 2019) including a half share of the family home.
Mrs White’s last will provided that:
- Laura would receive a life interest in her mother’s half share of the family home as well as all of her remaining estate valued at $215,300 ($369,406 in 2019);
- David and Sarah would only receive their mother’s half share of the family home if Laura died before them. Otherwise they would receive nothing.
David and Sarah were shocked to learn about their mother’s will. They brought a claim under the Family Protection Act claiming that their mother had breached her moral duty to them to make provision for their maintenance and support.
The Court decided that the provision made by Mrs White for David and Sarah was grossly disparate (different) taking into account financial, moral and ethical considerations. This was exacerbated by the fact that as David and Sarah were much older than Laura the prospect of them receiving anything from their mother’s estate was low.
The Judge indicated that a just result for all the children would be achieved allowing Laura to remain in the family home for 5 years and, after that, vesting Mrs White’s half share in the family home in David and Sarah in five years’ time. This would give Laura ample time to find alternative accommodation and David and Sarah a fixed point in terms of the recognition to which they were entitled. Rather than enter judgment on those terms the Court left it to the parties to make submissions on the proper relief taking into account the guidance provided by the Court on the issue.
Alex McDonald, Family Protection Act Lawyer
Wallace v Brown – claim by children against father’s estate where he left everything to his second wife
Bob Wallace died in 2003. His estate was worth $1.1 million ($3 million by today’s standards). The estate’s main asset was a block of farmland, which had been in Bob’s family for a long time.
Bob had two sons, Mark aged 17 and Richard aged 20. Both of them had been neglected by Bob since the divorce of their parents. Bob had separated from their mother eight years earlier. Five years before he died, he remarried a younger Ukrainian woman, Alina, who came to New Zealand with her daughter to marry him.
Bob’s will left everything to Alina.
Mark and Richard brought a Family Protection Act claim against Bob’s estate claiming that Bob had breached his moral duty by failing to provide for them in his will.
Circumstances of the claimants
Mark and Richard, as young adults at the start of their working lives, had no money of their own.
Richard had a de facto partner and a young child. His income was based on seasonal work and family support. He also had debts. Richard was due to start university shortly.
Mark also relied on seasonal work, loans and benefits while he was completing his studies.
Alina was not working, had no cash assets and limited employment opportunities. She also had a dependent child.
The court said that both Mark and Richard had suffered emotional distress from Bob’s lack of affection and interest. The court also took into account the fact that Alina had no family in New Zealand, a dependent daughter, and little to no job prospects and awarded Mark and Richard $100,000 each ($273,000 now).
Brown v Brown - a Family Protection Act claim by an adult daughter against mother’s will leaving family farm to adult son
Four generations of the Brown family had farmed the family property. Both Mr and Mrs T had farmed it at certain times before their deaths. Their son Richard had worked his entire adult life on the family farm and had contributed to its increased value through both physical labour and financial contributions.
Mr Brown died in 2014 and his wife, Mrs Brown, died the following year. They had three children, Richard, Elizabeth, and Nicola.
Mr and Mrs Brown had made it clear to their family that they wished to keep the farm within the family and would do so by leaving it to Richard who would continue to farm the land.
At the time of their parents’ deaths:
- Richard had 4 children and assets valued at $3.5 million ($4.4 million in 2019).
- Nicola had 2 children. She and her husband had property interests worth about $1.5 million ($1.9 million in 2019).
- Elizabeth had 3 children. Her personal net wealth was less than $450,000 ($563,109 in 2019). Her fiancé had assets of up to $4.5 million ($5.6 million in 2019) and paid for all of their household expenses. However, Elizabeth and her fiancé had an agreement that her fiancé’s assets were to remain his.
Mr and Mrs T’s estate was valued at approximately $6.2 million ($7.8 million in 2019). Their last wills provided that:
- Richard was to receive the family farm. His share of his parent’s estate totalled around $4 million ($5 million in 2019)
- Elizabeth and Nicola were to receive the remainder of their estates. Amounting approximately $1.1 million each ($1.3 million in 2019).
Elizabeth made a claim under the Family Protection Act for the redistribution of her parent’s estate to discharge their moral duty to provide for her proper maintenance and support. Richard, opposed the claim stating that Elizabeth was not in financial need and $1.1 million was more than enough to provide for her. Nicola supported Richard’s opposition and made no claim for herself.
The Court dismissed the Family Protection Act 1955 claim. The parents’ intentions were made clear for some considerable time before their deaths. There was evidence that Mr and Mrs T met with the family to explain their intention to leave the farm to Richard and their reasons for doing so. They had given considerable thought as to how they would provide for their daughters. This included growing ‘off-farm’ assets for Elizabeth and Nicola’s benefit. The Court said that it was hard to see how in these circumstances that an inheritance of over $1 million was insufficient to adequately provide for Elizabeth’s proper maintenance and support
Alex McDonald, Family Protection Act Barrister
Smith v Smith - A Family Protection Act 1955 claim by two adult grandchildren
During their lives Mrs and Mrs Smith established a family business providing rides, sideshows and other entertainment at events and fairs throughout the North Island. Mr and Mrs Smith had two sons, Andrew and Jack. By the time Mr Smith died in 1999, the family business was being run by Andrew and Jack.
In 2004 Andrew was tragically killed while servicing one of the rides at the Easter Show. Andrew left behind three children: Anne, James and Paul. Following Andrew’s death, Jack took over the overall management of the family business. Andrew’s son, David, also worked full time in the company.
When Mrs Smith died in 2012, she left an estate valued at approximately $5.276 million (now worth $8.49 million in 2019). Her last will provided that:
- Jack would receive properties valued at $485,000; the proceeds of sale of Mrs Smith’s residence ($345,000); her car and on top of that 60% of the residue of her estate ($2.67 million);
- David would receive $888,000;
- James and Anne would receive $444,000 each.
James and Anne made a claim under the Family Protection Act claiming that their grandmother, Mrs Smith failed to make adequate provision for them.
The Court dismissed James and Anne’s claim. Mrs Smith was concerned about the continuance of the family business, and wanted to make that possible by favouring Jack and David who continued to work in it. Mrs Smith had turned her mind to the unequal division of her estate, but she thought that David and Anne would understand her reasons for doing so. The provision made for David and Anne was not so small as to leave a justifiable sense of exclusion from participation in the family estate.
Alex McDonald, Family Protection Act 1955 Lawyer