The contest between a deceased’s obligations to a second wife and his obligations towards adult children by his first wife is a familiar one. Recently, in Thompson V Thompson the Victorian Supreme Court considered a claim against an estate by a second wife, aged 77 (widow).
The facts: Jack Thompson (the deceased) died in 2013 aged 93. His estate consisted of a half interest in a Collingwood apartment valued at $475,000, (his widow owning the other half) and gross assets of almost $200,000. The deceased left his widow some cash, chattels, a car and a simple non-portable life interest in the apartment. On her death his share of the apartment was to pass to his two adult children from his first marriage.
The claim: The widow claimed full ownership of the apartment. She argued that a non-portable life interest was inadequate proper provision due to a lack of flexibility, absence of independence, lack of security, for example if funds are required for medical expenses or if more suitable housing is required, as well as the prospect for ongoing disputes with the executor.
The Defendant, being the executor and son of the deceased, agreed that a simple life interest was inadequate, but argued that any enlarged provision should be limited to giving the widow a ‘portable’ life interest in the Collingwood apartment with additional rights to use the proceeds of sale of the property for alternate accommodation such as a retirement village or nursing home.
The Court noted that during their long relationship, the widow and deceased maintained separate ownership of the apartment, both contributed to its purchase and that this was not uncommon in second marriages where both wished to preserve assets to be left to their respective families.
The law: The Court noted that the normal duty of a testator, in traditional terms, is to provide a widow with security of a home, secure income and a fund for unforeseen contingencies. A mere right to reside will usually be unsatisfactory where the widow can no longer live in the property. This duty is seen as high in a long and happy marriage in the absence of competing claims.
The decision: In the circumstances of this case, the Court held that further provision be made for the widow by way of providing for her an extended portable life interest in the Collingwood apartment. This provided a more flexible arrangement for the widow, for example improved accommodation options and the right to earn income if the apartment is sold, while also preserving the deceased’s wishes that his financial interest in the apartment passes to his children on his widow’s death.
A final note of caution is that every case turns on its own facts, but a good lesson from this case is that a simple “right to reside” for any spouse, is open to being challenged.
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