SISTER DEMANDS BROTHER TO PAY FOR AMOUNT RECEIVED BY HIM FROM THEIR DECEASED MOTHER’S ESTATE ON THE GROUND OF UNDUE INFLUENCE
Torok v Becker [2020] NSWSC 1570 (9 November 2020)
This is a dispute between siblings over a deceased parent’s estate, involving complaint as to events that occurred prior to the deceased’s death with allegations of undue influence and unconscionable conduct on the part of the defendant.
Facts:
Mrs Isolde Becker (the deceased) deceased had survived her husband, Dr Theodore Becker, who had died three years earlier, aged 93. The deceased and her husband had two children, Lara Caroline Torok (the first plaintiff) and David Theodore Becker (the defendant).
Lara contends that David received (or had the benefit of) funds totalling some $2,958,525.13 from the deceased following the making of her August 2016 Will and that, from the period after David and his family moved into the deceased’s Glenhaven residence in 2014, David benefited by the receipt of amounts (including the abovementioned funds) totalling $3,298,326.13. There is also a claim in relation to the apparent disposal by David of various chattels of the deceased. Lara’s position, as noted above, is that the NetBank transfers were not made by the deceased but, rather, were effected by David. Lara contends that David accessed the deceased’s NetBank facility and “set about transferring sums as and when he pleased” for the benefit of David, David’s wife, and David’s business.
By 2015, or early 2016, the deceased could not look after herself, (her surgeon describing her as almost completely disabled); and that, on David’s own evidence, the deceased entrusted David with significant sums of money (her life savings) leaving her without sufficient funds for her future in the event that her relationship with David “turned sour”, or she were otherwise in need of funds (for, say, accommodation or medical care).
In the alternative, in the event that the amounts received or transferred to David or for his benefit are held to have been authorised by the deceased and/or were valid gifts to him, then Lara brings a claim for provision pursuant to s.59 of the Succession Act 2006. David has sworn a number of affidavits in these proceedings in which he deposes that it was the deceased who effected the $1.77 million worth of NetBank transfers from her account over the relevant period.
Issue: Is David liable to the estate of the deceased for disposing part of the estate which benefited him?
Law:
- Succession Act 2006 ss 59, 60, 75, 76, 78, 80 &87
Conclusion:
David is liable to account to the estate for the amount of the NetBank transfers. The court reached that conclusion on the basis that these were effected by David (and not authorised by the deceased) as the deceased’s agent and/or as her fiduciary (he having been entrusted by her, on his own case, to manage his finances). Having not satisfactorily accounted to the estate for those amounts, the court concluded that David should reimburse the estate for the sum of $1,819,513.84.
The court finds that there was a sufficient relationship of dominion and ascendancy of David in respect of the deceased so as to give rise to a presumption of undue influence in relation to: the NetBank transfers; the proceeds of sale of the Glenhaven Property that were applied to the Beaumont Hills Property; and the acquisition of the new furniture for the Glenhaven Property at the time that it was marketed for sale. The presumption of undue influence has not been rebutted and (had it been necessary to determine) the court concludes that this was a case where actual undue influence and unconscionable conduct were made out. Accordingly, David should account to the estate and is liable for equitable compensation in favour of the estate for those amounts. Taken together, the proceeds of the sale of Glenhaven Property that were applied for the purchase of the Beaumont Hills Property ($1,522,272.03), and the amount of NetBank transfers that the concluded should be reimbursed to the estate ($1,819,513.84), comes to a total of $3,341,785.87.
Conclusion: The court orders the defendant to pay the plaintiff, as legal representative of the estate of the deceased, equitable compensation in the sums of $1,522,272.03 and $1,819,513.84 (totalling $3,341,785.87)
