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Supreme Court of Papua New Guinea |
PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]
SCA NO. 199 OF 2022 (IECMS)
BETWEEN
CATHERINE GRAHAM
Appellant
AND
MICHAEL KARL KLATT AS ADMINISTRATOR OF THE ESTATE OF FOOK NENG JEE (DECEASED)
Respondent
Waigani: Makail J, Kangwia J & Pitpit J
2023: 27th September
2024: 20th August
SUPREME COURT – Appeal from dismissal of proceedings – Proceedings being time-barred – Application for family testator’s maintenance – Application for proper maintenance and support of children of deceased – Action for breach of constructive trust – Promissory estoppel – Claim against personal estate or any share or interest in personal estate of deceased person – Time limitation of 12 years – Wills, Probate and Administration Act, 1966 – Sections 124 & 126 – Frauds and Limitation Act, 1988 – Section 19
Facts
The appellant commenced proceedings in the National Court under Section 124 of the Wills, Probate and Administration Act 1966 to claim a property which she alleged was promised to her by her late mother when her late mother dies. She relied on an action based on breach of constructive trust to assert her claim to the property. The respondent filed an application and sought dismissal of the proceedings on the ground that it was statute-barred under Section 19 of the Frauds and Limitation Act 1988.
Held:
Cases Cited:
Papua New Guinea Cases
Public Curator of Papua New Guinea v. Kara (2014) SC1420
Kisokel v. Kisokel (2009) N3803
Leontine Ofoi v. Kris Bongare (2007) N3248
Overseas Cases
Dessham [1975] I WLR 1519
Pettitt v. Pettitt [1969] UKHL 5; [1970] AC 777
Gissing v. Gissing [1970] UKHL 3; [1971] AC 886
Eves v. Eves [1975] EWCA Civ 3; [1975] 3All ER 768; [1975] 1 W.LR 1338
Grant v. Edward [1986] EWCA Civ 4; [1986] Ch 638; [1986] 2 All ER 426
Counsel:
Mr D Kipa, for Appellant
Mr I R Shepherd, for Respondent
JUDGMENT
20th August 2024
1. BY THE COURT: This is an appeal against the judgment of the National Court of 26th September 2022 which dismissed the proceedings WS No 429 of 2021: Catherine Graham v. Michael Karl Klatt as Administrator of the Estate of Fook Neng Jee (“Deceased”). The appellant was the plaintiff in the National Court proceedings.
2. The National Court held that the proceedings were statute-barred pursuant to Section 19 of the Frauds and Limitation Act 1988 (“Limitation Act”).
BACKGROUND FACTS
3. The case has a fair bit of history because it tells a story about a Chinese immigrant couple settling in Kavieng of New Ireland Province, Papua New Guinea (“PNG”) in the 1960s. They had children and then at PNGs Independence on 16th September 1975, one of them took up Australian citizenship and moved to and settled in Brisbane, Australia. This person is Fook Neng Jee.
4. After 23 years in Australia, she died on 8th August 1998. She left behind a Will dated 29th June 1995 which was declared by the Supreme Court of Queensland to be in solemn form and appointed Thomas Jee (Meng Chow), the brother of the appellant as Executor on 19th December 2001.
5. The deceased and her husband who is also deceased, had eight children. They are:
(a) Thomas Jee (Meng Chow).
(b) Dennis Jee.
(c) Gerald Jee.
(d) Catherine Graham (Appellant).
(e) Diana Jee.
(f) Elizabeth Fong.
(g) Jenifer Sunderland.
(h) Theresa Goodman.
6. When the deceased moved to Australia, except for the appellant, the rest of the deceased’s children or the appellant’s siblings also moved to Australia. The appellant remained living on the family home at Section 3, Allotment 8, Nuiguria Street, Kavieng Town, New Ireland Province (“the Property”).
7. At all material times and at the time of her death, the deceased was the legal proprietor of the property. This property is the subject of the dispute between the appellant and the respondent.
8. The appellant alleges that the deceased promised to her and made known to her other children that when she dies, she (the appellant)
will inherit the property.
9. On the other hand, the respondent relies on the Will of the deceased and as the appointed Administrator of the estate of the deceased,
alleges that he is the authorised person to deal with the property.
10. The deceased was also a registered proprietor of a residential property located at 8 Woodssiana Street, Robertson, Brisbane, Australia (“Brisbane Property”) but is not a subject of dispute between the parties.
11. The deceased under the Will, amongst others, bequeathed her estate to her eight children as follows:
“I Direct my trustee that after the payment of all probate, succession and estate duties payable on or in respect of my estate or in respect of any succession arising on my death and all debts and testamentary expenses payable by law to divide the rest and residue of my estate both real and personal of whatever kind and nature and wherever situate into eleven (11) parts AND I GIVE, DEVISE AND BEQUEATH 2 of such parts to my son THOMAS JEE, 2 of such parts to my son DENNIS JEE, 2 of such parts to my son GERALD JEE, 1 of such parts to my daughter CATHERINE GRAHAM, 1 of such parts to my daughter DIANA JEE, one of such parts to my daughter ELIZABETH FONG, 1 of such parts to my daughter JENIFER SUNDERLAND and 1 part of such parts to my daughter THERESA GOODMAN.”
12. The Will made no mention of which child or anyone for that matter will receive the Kavieng and Brisbane properties.
13. After some time, the brother of the appellant Thomas (Meng Chow) Jee was replaced by the respondent as Administrator of the estate of the deceased by an order of the Supreme Court of Queensland, Australia on 30th July 2012 which was resealed by the National Court of Justice at Waigani on 18th November 2013.
14. The respondent, upon his appointment as Administrator of the deceased, claimed all rights to title and interest in the property. The appellant made an offer to settle the claim through her lawyers, Paul Paraka Lawyers to Gaden Lawyers acting on behalf of the respondent, but the respondent rejected it. A follow up by her other lawyers Young & Williams Lawyers also yielded no results.
15. On 3rd September 2019 the respondent obtained an order from the Supreme Court of Queensland which, amongst others, ordered the appellant to take all proceedings proper to enforce or establish any claim she has against the deceased within three months of being served a notice under Section 60 of the Wills, Probate and Administration Act 1966 (“WPA Act”). If she fails to do that, the respondent will apply to the National Court of Justice of PNG to bar her from bringing such claims and for possession of the property.
16. On 19th December 2019 the respondent followed through his threat by serving on the appellant a notice to enforce or establish a claim to the estate of the deceased dated 6th November 2019 under Section 60 of the WPA Act.
17. In response, in 2020 the appellant filed the proceedings WS No 172 of 2020: Catherine Graham v. Michael Karl Klatt as Administrator of the Estate of late Fook Neng Jee. That proceeding was dismissed by the National Court on 22nd July 2021 because the appellant did not seek an extension of time under Section 126 of the WPA Act before filing that proceeding.
18. On 23rd September 2021 the appellant commenced proceedings WS No 429 of 2021: Catherine Graham v. Michael Karl Klatt as Administrator of the Estate of late Fook Neng Jee to challenge the decision of the respondent to claim all rights to the title and interest in the subject property. The proceedings described as an “application” were commenced under Section 124 of the WPA Act for proper maintenance and support of the appellant.
19. Such proceedings will not be heard unless it is made within nine months after the date of grant of probate or letters of administration. As the appellant was outside nine months, she applied and was granted an extension of time to commence proceedings under Section 126 of the WPA Act.
20. Shortly after close of pleadings, the respondent filed an application seeking dismissal of the proceedings pursuant to Order 12, rule 40(1)(a), (b) or (c) of the National Court Rules (“NCR”).
21. The National Court heard the application on 03rd May 2022 and on 26th September 2022, in an ex tempore ruling, dismissed the proceedings on the ground that the action was statute-barred under Section 19 of the Limitation Act.
GROUNDS OF APPEAL
22. There are six grounds of appeal, but collectively, they bring up one major question for our consideration. The question is whether the action in the National Court is one of breach of constructive trust and whether the property in dispute is real property as opposed to a personal property, and pursuant to Section 19 of the Limitation Act and Section 1 of the WPA Act, the time limitation of twelve years to commence an action for breach of constructive trust does not apply. The other question which came up for consideration is whether the appellant can rely on the doctrine of promissory estoppel to enforce her claim to the property.
BREACH OF CONSTRUCTIVE TRUST
23. The appellant submits that Section 19 of the Limitation Act applies to personal estate and not real estate of a deceased person. Consequently, it operates as a bar to an action in respect of any claim to the personal estate or any share or interest in the personal estate of a deceased person unless the action is brought before the expiration of twelve years commencing on the date when the right to receive the personal estate or the share or interest in the personal estate accrued.
24. We note Section 19 of the Limitation Act states:
“19. ACTIONS CLAIMING PERSONAL ESTATE OF A DECEASED PERSONS, ETC.
(1) No action in respect of any claim –
(a) to the personal estate; or
(b) to any share or interest in the personal estate,
of a deceased person, whether such claim is under a will or on intestacy, shall be brought after the expiration of 12 years commencing on the date when the right to receive the personal estate or the share or interest in the personal estate accrued.”
25. We further note that according to the appellant, because the Limitation Act does not define personal estate and real estate, the appellant refers to Section 1 of the WPA Act and submits that personal estate means “all property other than real estate” when Section 1 of the same Act defines real estate as:
“(a) messuages, land or hereditaments of any tenure whether corporeal, incorporeal or personal; or
(b) any undivided share in any such messuages, land or hereditaments; or
(c) an estate, right or interest (other than a chattel interest) in any such messuages, lands or hereditaments,
but does not include land held under a lease for a term of less than 21 years whether or not there is a right to renew the lease.”
26. The appellant reinforces the distinction between personal estate and real estate of a deceased persons by relying on the case of Public Curator of Papua New Guinea v. Kara (2014) SC1420 where the Supreme Court explained the difference between personal estate and real estate and at [77] of the judgment held that:
“In our view, the ordinary meaning of the phrase “personal estate” is clear. It means all property other than real estate.”
27. However, we note from the respondent’s opposing submissions that what was before the National Court was an application under Section 124 of the WPA Act for proper maintenance of the appellant. This is because the appellant sought and was granted an extension of time under Section 126 of the same Act to make such an application.
28. We note Section 124 of the WPA Act states:
“124. Order for proper maintenance, etc.
If a person dies leaving a will and without making adequate provision in it for the proper maintenance and support of his spouse or children, the National Court may, in its discretion, on application by or on behalf of the spouse or children, order that such provision as the Court thinks just be made out of the estate of the testator for the spouse or children.”
29. Relevantly, Section 126 of the same Act states:
“126. Time for application
(1) Subject to Subsection (2), an application under Section 124 shall not be heard by the National Court at the instance of a party claiming the benefit of this Division unless the application is made within nine months after the date of the grant of probate or of letters of administration with the will annexed, as the case may be.
(2) The time for making an application under Section 124 may be extended for a further period by the National Court, after hearing such of the parties affected as the Court thinks necessary.
(3) Subject to Subsection (4), the power conferred by Subsection (2) extends to cases where the time limited by Subsection (1) for an application has expired, whether before or after the commencement date.
(4) Subsection (3) does not apply where the application for extension is made after the final distribution of a part of the estate made before that application.”
30. We uphold the respondent’s submissions. It is abundantly clear that an application under Section 124 of the WPA Act is for proper maintenance and support of a spouse or children of a deceased person. It is a separate and distinct claim provided by statute from an action for breach of constructive trust. In the former case, the Court would look at the Will of the deceased to ascertain if it made adequate provision for the maintenance and support of the spouse or children while the latter is based on equity. In the present case the Court would look at the Will of the deceased to ascertain if it made adequate provision for maintenance and support of the appellant. If the deceased had promised to the appellant and the other children that the appellant will inherit the property, the Will would make provision for it.
31. As to the latter, as the National Court explained in Kisokel v. Kisokel (2009) N3803 at [23], it will involve proof of an agreement between the legal owner and the aggrieved party, that the aggrieved party is to have a distinct interest in the property and the agreement can be either expressed or implied. Secondly, once an agreement of the sort is established, it must be shown that the aggrieved party acted in respect of that agreement to his or her detriment. The legal owner is then said to become constructive trustee for the aggrieved party and hold the property in trust for the aggrieved party. The legal owner must, then give effect to the aggrieved party’s share of the property.
32. Further, we note that Kisokel v. Kisokel (supra) was a case where the wife and husband had a dispute over a property that was purchased by the husband who told the wife that it was jointly owned by them. Later the husband sold the property to the second defendants after he and the wife separated and were living apart. In that case, the National Court referred to English cases of Dessham [1975] I W.L.R. 1519, Pettitt v. Pettitt [1969] UKHL 5; [1970] AC 777, Gissing v. Gissing [1970] UKHL 3; [1971] AC 886 and Eves v. Eves [1975] EWCA Civ 3; [1975] 3All ER 768; [1975] 1 W.LR 1338 when explaining what constitutes a constructive trust.
33. However, except for Eves v. Eves (supra) it is observed that the other cases were decided on a dispute between a husband and wife over a property (house). None of them concerned a dispute over a property between a parent and children, moreover an administrator of the estate of the deceased parent and the children. In addition, the appellant did not refer us to any case authority that says that a constructive trust exists between children and administrator of the estate of a deceased parent where there is a dispute over a property (house) as in the present case.
34. It is further observed that in Leontine Ofoi v. Kris Bongare (2007) N3248 at [16] Injia DCJ (as he then was) referred to Eves v. Eves (supra) and noted that it was a case of two divorcees living in a de facto relationship. They were not permitted to buy a house in their joint names because the female partner was under the age of 21 years and lacked the capacity to hold title to the property in her own name. The male partner purchased the property in his own name but later did not change the title to both when she turned 21. As it was a dispute between a couple living in a de facto relationship, it is of no assistance.
35. Even the case of Grant v. Edward [1986] EWCA Civ 4; [1986] Ch 638; [1986] 2 All ER 426 which the National Court referred to in Kisokel v. Kisokel (supra) does not assist because it was a dispute over a house between Mrs Linda Grant and Mr George Edwards who were living in a de facto relationship.
36. Given this, it has not been established to our satisfaction that the appellant has an option of bringing an action for breach of constructive trust, independently and separately, from a statutory claim for proper maintenance and support under Section 124 of the WPA Act.
37. On the other hand, we accept the respondent’s submissions that the appellant is trying to argue that what was before the National Court was an action for breach of constructive trust which is not statute-barred as the nature of the relief sought is equitable. However, this is an entirely different course of action to that which the National Court granted leave to make, which is pursuant to Section 124 of the WPA Act.
38. Consequently, the cause of action in the National Court is not one of breach of constructive trust. For the appellant to progress the proceedings in the National Court under Section 124 of the WPA Act, it was in fact an application for proper maintenance and support pursuant to the Will. As noted, the distinctive feature of an application under Section 124 of the WPA Act is the reliance on the Will of the deceased and the Court will ascertain from the Will if it makes adequate provision for maintenance and support for the appellant.
39. As to the Will, it will be noted that it made provision for the appellant. The appellant is to receive 1/11 of the “residual estate” of the deceased. It is important to note that it is not expressed in the Will that the deceased bequeathed the property to the appellant. Given this it will be the case that the property forms part of the residual estate of the deceased. In practice, after the respondent has settled all debts and testamentary expenses of the deceased, and if the property has not been disposed of to settle the debts and testamentary expenses of the deceased, it will be included in the distribution to the appellant and her siblings. Any expenses incurred by the appellant for repair and maintenance of the property can be submitted to the respondent to consider.
40. On the other hand, the appellant’s heavy reliance on the case of Public Curator of Papua New Guinea v. Kara (supra) and strong submissions in relation to the distinction between personal estate and real estate of a deceased is distinguishable on its facts. In that case the action was based on the common law tort of negligence and breach of statutory duty under the Public Curators Act in relation to administration and management of the estate of the deceased by the Public Curator. It was alleged that the Public Curator was negligent and breached its statutory duty in dealing with four real property which formed part of the estate of the deceased.
41. One of the issues for consideration was whether the action was statute-barred. The question of residual estate of the deceased was not raised for consideration and the Supreme Court only explained the difference between these two concepts in deceased estate claims. Secondly, the case was against the negligence discharge of duty and breach of statutory duty by the Public Curator while this case is based on breach of constructive trust which we have found does not apply to the deceased’s estate.
42. For these reasons, we are of the view that the property formed part of the residual estate of the deceased and fell under the personal estate of the deceased and any claim for proper maintenance and support by the appellant must be brought under Section 124 of the WPA Act. According to Section 19(1)(a)&(b) of the Limitation Act, “No action in respect of any claim to the personal estate or to any share or interest in the personal estate of a deceased person, whether such claim is under a will or on intestacy, shall be brought after the expiration of 12 years commencing on the date when the right to receive the personal estate or the share or interest in the personal estate accrued.”
43. We accept that “the right to receive the personal estate or the share or interest in the personal estate accrued,” by the appellant accrued on the date of grant of probate which was 19th December 2001. It follows that we find no error in the National Court’s decision to hold that “An application under section 124 should be filed within 12 years after the grant of probate.......” The time limitation of 12 years ran from 19th December 2001 and expired on 19th December 2013. The appellant commenced the proceedings in the National Court on 23rd December 2021. This was more than 8 years after the time limitation of 12 years had expired and statute-barred by Section 19 of the Limitation Act.
PROMISSORY ESTOPPEL
44. As a promissory estoppel is a legal doctrine as opposed to a cause of action, in our view, it rides on the action for breach of constructive trust. Where it has not been established that the appellant has a case against the respondent for breach of constructive trust, the doctrine of promissory estoppel goes out with it.
CONCLUSION
45. The appellant has failed to establish the grounds of appeal. The appeal is dismissed. The appellant shall pay the respondent’s costs of the appeal, to be taxed, if not agreed.
ORDER
46. The final terms of the order of the Court are:
1. The appeal is dismissed.
________________________________________________________________
Wang Dee Lawyers: Lawyers for Appellant
Ashurst Lawyers: Lawyers for Respondent
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