The Forfeiture Rule: Report (html)

5. Effect of the forfeiture rule

Introduction

5.1 In preventing an offender^[1] from receiving property or other benefits to which they would be entitled, the forfeiture rule—an unwritten public policy—modifies provisions in Acts of Parliament, the deceased person’s will, trust deeds, contracts of insurance, and other legally binding agreements. Many questions about how the rule applies can arise for the executor or administrator, the offender, innocent beneficiaries or anyone else with an interest in the deceased person’s estate. The Forfeiture Act 1982 (UK) (‘the UK Act’), the Forfeiture Act 1991 (ACT) (‘the ACT Act’) and the Forfeiture Act 1995 (NSW) (‘the NSW Act’) have been criticised for only providing ‘partial coverage’ of the forfeiture rule, by giving the court a discretion to alter its effect but failing to deal with what the effect would normally be.^[2]

5.2 The proposed Forfeiture Act would not only provide for the court to modify the effect of the rule but would also amend existing legislation to provide greater certainty about the effect of the rule on the distribution of a deceased person’s assets, whether within their estate or outside it.

5.3 The amendments to existing legislation are discussed in this chapter and concern the following matters:

• whether the offender can act as executor or administrator of the deceased

person’s estate

• what to do with a forfeited gift in a will that requires it to be given to another named beneficiary in the event that the offender dies before the will-maker

• the effect of the rule on the ability of the offender’s children to inherit a share

of the deceased person’s estate

• whether the offender may make an application for family provision under Part IV

of the Administration and Probate Act 1958 (Vic)

• the effect of the rule on the deceased person’s interest in property that they and

the offender owned as joint tenants.

5.4 The amendments will not address all of the issues that arise for those affected by the rule, but they should reduce the financial and emotional costs of resolving them.

Appointment of personal representative

5.5 The forfeiture rule is usually expressed in terms of disqualifying the offender from receiving a share of the deceased person’s estate. In practice, the rule also disqualifies the offender from acting as a personal representative—either as executor or administrator of the estate. However, the provisions of the Administration and Probate Act and associated court rules regarding the appointment and removal of personal representatives do not readily accommodate this outcome.

Appointment of executors

5.6 The executor is appointed by the will—it is the will-maker’s decision. Often, at least two are appointed, in case one of them dies before the will-maker or is unwilling or unable to take on the role. Any person appointed as executor may apply for a grant of probate and exercise all the powers that the grant confers.^[3]

5.7 It is common practice for the will to appoint at least one person who is also a beneficiary, such as a partner, child or sibling, as executor. If the person who is responsible for the deceased person’s death is appointed, logically the rule should disentitle them not only from their share of the estate but disqualify them from acting as executor as well.

5.8 Certainly, courts will not grant probate to a person to whom the forfeiture rule applies.^[4] The leading authority is the English case of Re Crippen.^[5] Cora Crippen was murdered by her husband and did not leave a will. Her husband was executed for the crime. The executor of his estate applied for a grant of administration, on the basis that the estate would be entitled to the wife’s property. The court passed over the applicant because of the operation of the forfeiture rule:

It is clear that the law is, that no person can obtain, or enforce, any rights resulting to him from his own crime; neither can his representative, claiming under him, obtain or enforce any such rights.^[6]

5.9 However, it appears that the rule itself does not empower the court to pass over an executor and grant administration of the estate to someone else. While the forfeiture rule provided the reason for the decision in Re Crippen, the court relied on a statutory power that enabled it to pass over an executor in ‘special circumstances’.^[7] The court subsequently relied on an equivalent statutory power in Re S,^[8] a case concerning a woman who had killed her husband and was the sole executor and beneficiary of his estate. The court passed her over because she was serving a sentence of life imprisonment for his manslaughter and it was ‘quite impossible’ for her to act as executor.

5.10 Few cases address this question, but the forfeiture rule may not provide the court with the necessary power because an appointment as executor does not give the person a beneficial interest in the estate. Justice Holland noted this possibility in the New South Wales case of Re Pedersen:

The office of executor does not necessarily give the appointee a beneficial interest in the estate and it may be a question whether the murder or manslaughter of a testator is an automatic disqualification from the office of executor of the testator’s estate as well as being a disqualification from taking any interest in it. Whatever be the answer to that question, it is unthinkable that a court could exercise its powers so as to permit a testator’s murderer to administer his victim’s estate. ^[9]

5.11 In Victoria, the Administration and Probate Act does not expressly give the court the power to pass over an executor because the executor caused the will-maker’s death.

The court may pass over an executor who has failed to either apply for or renounce probate of the will within six weeks of the death, and this discretion could be applicable where the offender is in custody and unable to act. Otherwise, the court appears to rely on its inherent power to make all necessary orders for the due administration of the assets of estates.^[10]

5.12 In any event, there have been few opportunities to test the court’s power in Victoria. The Registrar of Probates has observed that, in his experience, where an executor has been convicted of manslaughter they have renounced their executorship and disclaimed any interest in the estate.^[11]

5.13 The Commission considers that it would assist beneficiaries and others with an interest in the estate if there were a clear link, on the face of the Administration and Probate Act, between the application of the forfeiture rule and disqualification from acting in the office of executor. It would confirm the court’s power to bypass the offender in making a grant of representation, strengthen the grounds for innocent beneficiaries in lodging a caveat against probate being granted to the offender, and reduce the complexity of the process and the costs to all parties.

Removal of executors

5.14 The court’s power to discharge an executor who has already been granted probate is more fully described in the legislation. Section 34(1)(c) of the Administration and Probate Act allows the court, on application, to replace an executor or administrator who ‘refuses or is unfit to act in such office or is incapable of acting therein’.

5.15 The court will not lightly remove an executor, as it means setting aside the will-maker’s intention. It needs to be satisfied that it has the authority to remove the executor before deciding that, for the beneficiaries’ welfare and the protection of their interests, the executor should be removed.^[12] A decision under section 34(1)(c) to remove an executor because of their known or suspected involvement with the will-maker’s death would turn on a finding that the executor is ‘unfit to act’. There are no reported cases dealing with the question of whether the term could be applied to such circumstances but the prevailing interpretation of the provision does not exclude the possibility.^[13]

5.16 Although section 34(1)(c) may provide a sufficient basis for applying to remove an executor who is implicated in the will-maker’s death, the procedure would be more accessible, simpler and less costly to all parties if the legislation provided grounds that expressly accommodated these circumstances.

Appointment of administrators

5.17 The court may appoint an administrator when:

• the deceased person has not left a valid will

• the will does not appoint an executor

• the executor is unwilling, unable or unfit to act.^[14]

5.18 The court may also appoint an administrator pending litigation on the validity of the will or for obtaining, recalling or revoking any grant of representation.^[15]

5.19 Unlike equivalent legislation in other states and territories, the Administration and Probate Act does not guide the court’s discretion in selecting an administrator.^[16] The general rule at common law is that the grant should be made to the beneficiary with the most substantial interest in the estate.^[17] However, Re Crippen^[18] provides authority for the court not to grant administration on the ground that the forfeiture rule disqualifies the applicant from obtaining a benefit from the estate.

5.20 In the next section of this chapter, the Commission recommends that a person who has been precluded by the forfeiture rule from a share of the estate should be deemed, for the purposes of distributing the estate, as having died before the deceased person. The effect of this recommendation is that an offender would not have an interest in the estate that could form the basis of an application for a grant of administration. This will indirectly preclude an offender from being eligible to apply, though does not provide grounds for not appointing a person who is suspected of being responsible for the deceased person’s death.^[19]

Removal of administrators

5.21 Should it become apparent, after a grant of administration has been made, that the administrator is responsible for unlawfully killing the deceased person, the court may remove the administrator under the same provisions of the Administration and Probate Act that provide for removal of an executor who refuses to act, is unfit to act or is incapable of doing so.^[20]

Proposed reform

Disqualification from office

5.22 The Administration and Probate Act does not expressly prevent a person from acting as executor or administrator of an estate even though the forfeiture rule has, or might, disentitle them from taking a benefit from that estate. This does not appear to have stopped the court from declining to grant such a person probate or administration, or removing them from office. The court may rely on its inherent jurisdiction and the common law to resist an application from such a person for a grant and, if they have received a grant, arguably the court may remove them under section 34(1)(c).

5.23 However, for an innocent beneficiary or other interested person to bring the matter before the court, the processes are indirect and the grounds uncertain.

5.24 The Commission considers that it should be clear on the face of the relevant legislation that a person who stands to benefit from the death of a person that they unlawfully killed is disentitled from obtaining a grant of representation.

5.25 For consistency with recommendations made later in this chapter concerning benefits from the estate, the effect of the forfeiture rule on a person who is appointed executor by the deceased person’s will, or would have been eligible to apply for a grant of administration, should be that they are treated as if they had predeceased the deceased person. However, unlike benefits from the estate, the offender’s disqualification from acting as a personal representative would not be able to be modified by a forfeiture rule modification order.

Recommendation

20 The Administration and Probate Act 1958 (Vic) should be amended to provide that, where a person appointed executor by a will or who is otherwise eligible to be appointed administrator is precluded by the forfeiture rule from acquiring an interest in the deceased’s estate, the person is to be treated as having died immediately before the deceased person.

Court’s power to refuse grant

5.26 There may be a substantial period of time between when the deceased person dies and when the person responsible for the death is established. It would be sensible to expressly provide for the court, in its discretion, to refuse a grant to a person where there are reasonable grounds for concluding that the applicant is implicated in causing the death.

5.27 In 2009, the National Committee for Uniform Succession Laws recommended model legislation for the administration of estates.^[21] It identified a need to expressly authorise courts to pass over a person who would otherwise be entitled to a grant of representation if there are reasonable grounds for believing that the person has committed an offence related to the deceased person’s death. It proposed the following provision, as clause 348 of the model legislation:

348 Offences relating to the deceased’s death

This section applies if the Supreme Court, on application, considers there are reasonable grounds for believing that a person otherwise entitled to a grant of probate or letters of administration of a deceased person’s will or estate has committed an offence relating to the deceased’s death.

The Supreme Court may refuse to make a grant of probate or letters of administration of the will or estate to a person otherwise entitled to the grant and make the grant of probate or letters of administration to—

(a) without limiting paragraph (b), if there is more than one person entitled to the grant—any or all of the other persons entitled; or

(b) any person the court considers appropriate.^[22]

5.28 The Commission considers there is merit in the proposal. Such a provision would provide directly relevant grounds for an interested person to object to the making of a grant to a suspected offender, and would underpin the court’s authority not to make a grant in the circumstances where there are reasonable grounds for believing that the person seeking the grant is responsible for unlawfully killing the deceased person.

Recommendation

21 The Administration and Probate Act 1958 (Vic) should be amended to provide for the Court to pass over a person who applies for a grant of representation where there are reasonable grounds for believing that the person has committed an offence related to the deceased’s death. The provision should be based on section 348 of model legislation proposed in the December 2009

report of the National Committee for Uniform Succession Laws to the Standing Committee of Attorneys-General on the administration of estates

of deceased persons.

Benefits from the estate

When an alternative beneficiary is unable to inherit

5.29 The application of the forfeiture rule to an offender can have implications for the rights of others to inherit under a will or on intestacy. The offender to whom the forfeiture rule applies is excluded from inheriting from the deceased person, but an alternative beneficiary who is innocent of the offence may also be unable to inherit because the transfer of this benefit is predicated on the offender dying before or soon after the deceased person. This may occur in circumstances where:

• There is a provision in a will, called a gift over, that if the beneficiary of a gift (the principal beneficiary) predeceases the will-maker, the gift goes to another beneficiary.

• A will-maker leaves a gift to a direct descendant. The direct descendant is responsible for the will-maker’s death and survives the will-maker by 30 days or more.

• A person dies without making a will and the offender would have inherited from the deceased person according to intestacy laws.

Gifts over

5.30 It is common for wills to contain provisions that provide for a gift over to another beneficiary in the event that the principal beneficiary dies before the will-maker. ^[23] When a will includes such a provision, the will-maker is likely to have wanted the beneficiary of the gift over to take the gift in most circumstances in which the principal beneficiary is unable to inherit.^[24]

5.31 However, it is a well-settled principle of the law that the court cannot give effect to an intention that is neither expressed nor implied in the language of the will when read with the circumstances in which the will was made.^[25] When a will provides for a gift over in the event that the principal beneficiary of a gift predeceases the will-maker, courts will generally interpret the will literally.^[26] Consequently, a gift over to a third party contingent on the principal beneficiary predeceasing the will-maker is likely to fail when the forfeiture rule prevents the offender from taking the gift. The property subject to the gift over would then be distributed to the residuary beneficiaries or on intestacy. The same outcome will occur when a beneficiary disclaims a gift.

5.32 This outcome can prevent an innocent person from inheriting even though it may be reasonably predictable that the will-maker would want the beneficiary of the gift over to inherit in place of the offender.^[27] For example, in Davis v Worthington,^[28] a gift was left to a friend, but the will also provided that, if the friend failed to survive the will-maker by 14 days, the gift was to go to the Muscular Dystrophy Research Association. The friend later unlawfully killed the will-maker. Because the offender had survived the will-maker by 14 days, the gift failed and the Muscular Dystrophy Research Association was unable to take the gift.

5.33 Although the court generally interprets the will literally, it does not always do so.^[29] Alternative approaches that have been taken in Australia are:

• interpreting the condition of the gift over as having been fulfilled so that the gift over is successfully distributed as if the offender had predeceased the will-maker^[30]

• interpreting the will according to the imputed intention of the will-maker, which may result in the gift over succeeding^[31]

• interpreting the gift to the killer as having failed but requiring that the offender hold that gift on constructive trust for the benefit of an appropriate person, who may or may not be the beneficiary of the gift over.^[32]

5.34 These alternative approaches potentially enable the court to ensure that the gift is distributed as the will-maker is likely to have wanted, while also ensuring that an inappropriate person does not take the benefit.

5.35 In Public Trustee v Hayles,^[33] for example, the deceased person gifted his estate to

a friend and, in the event that the friend predeceased him, to the friend’s mother,

Mrs Hayles. The friend murdered the will-maker and the forfeiture rule applied to deny him any entitlement to the estate. At issue was whether Mrs Hayles should inherit as a consequence of the gift over. There was no evidence that the deceased person knew her. The court applied a constructive trust to the gift and sought to determine who would be the correct beneficiary of that trust. The court found that it was appropriate for the estate to be held on trust for the deceased person’s next of kin. The issue of whether it would be appropriate for the mother of the offender to inherit was not pursued; however, given the relationship between the beneficiary and the offender, the will-maker may not have wanted her to inherit in the circumstances.

5.36 However, when the court has adopted an alternative approach to interpreting the will, sometimes the beneficiary of a gift over has been able to inherit. Even if the alternative approaches were used more frequently, the existence of multiple approaches can create inconsistency in outcomes and consequent uncertainty. This in turn makes it difficult for executors to determine how to distribute an estate and for legal practitioners to provide advice. Determining the intention of the will-maker can also present practical difficulties for the court.^[34]

Gifts left to the will-maker’s descendants

5.37 When a will-maker leaves a gift to a direct descendant who does not survive the will-maker by 30 days, then the direct descendants of that beneficiary take the gift in their place by representation.^[35] However, if a gift is left to a direct descendant to whom the forfeiture rule applies, not only is the offender precluded from receiving the gift, the offender’s descendants will be unable to take the gift in the offender’s place. The same issue will arise when a person disclaims the gift.

5.38 For example: a woman leaves a gift by will to her son, and the residue of her estate to her daughter. The son kills his mother and the forfeiture rule prevents him from taking the gift. If he then dies within 30 days of his mother, his children can take the gift in his place. However, if he survives his mother by more than 30 days, his children cannot take the gift in his place by representation and it will go to his sister along with the rest of the estate.

When the offender is eligible to inherit on intestacy

5.39 At common law, an offender is precluded from inheriting from the deceased person on intestacy.^[36] Under the Administration and Probate Act, an intestate estate is distributed among the surviving children of the intestate and the living representatives of any children who predeceased the intestate.^[37]

5.40 This has implications for the rights of innocent descendants of an offender who claim a benefit through the offender. A literal interpretation of the Administration and Probate Act, when combined with the effect of the forfeiture rule, precludes them from an inheritance that they otherwise would have expected to receive from the offender when the offender died. The same issue will arise when a person disclaims their right to a share in an intestate estate.

5.41 In the English case of Re DWS (deceased), ^[38] an only son was convicted of murdering his parents, who both died intestate. The offender’s two-year-old son, the deceased couple’s only grandchild, claimed the estate. If the offender had predeceased his parents, ordinarily their grandchild would have inherited under intestacy laws. However, the court held that the forfeiture rule did not require that the offender be treated as predeceasing the deceased person and the intestacy rules under the Administration of Estates Act 1925 (UK)

were to be given their literal meaning. The deceased couple’s only grandchild was therefore precluded from inheriting the estate, which went to other relatives.

5.42 The Law Commission of England and Wales strongly criticised the effect of the forfeiture rule, when combined with this interpretation of intestacy provisions, in effectively disentitling those claiming through the offender. It considered that the decision in DWS (deceased) unfairly punished the descendants of the offender, particularly as it is likely that the deceased couple in that case may have preferred their grandchild to inherit.^[39]

5.43 This consequential effect of the forfeiture rule produces an arbitrary distinction between the rights of the descendants of an offender and other relatives and may be inconsistent with the general policy of intestacy law, which gives preference to descendants over siblings and other relatives.^[40]

Options for reform

5.44 No theory has yet been accepted for determining who becomes entitled to forfeited benefits upon application of the forfeiture rule.^[41]

5.45 In most circumstances, the beneficiary of a gift over that depends on the principal beneficiary predeceasing the will-maker will be prevented from taking the gift. This is often unfair for the beneficiary of the gift over. It may also seem contrary to the will-maker’s intention.

5.46 Innocent persons claiming through an offender are likewise generally unable to take the offender’s share once the forfeiture rule has been applied. This is due to the literal interpretation of legislation that provides that the descendants of the beneficiary can only take in that beneficiary’s place if the beneficiary predeceased the deceased person or died within 30 days of the deceased person. It produces an arbitrary distinction between the rights of the offender’s descendants and their relatives.

5.47 The Commission invited submissions on the effect that the forfeiture rule should have on gifts over and whether the intestacy laws should permit an offender’s descendants to inherit, as representatives of the offender. Two possible reforms were proposed:

• deeming the offender to have died before the deceased person, so that an alternative named beneficiary can benefit from a gift over under a will, and the innocent descendants can take by representation under intestacy laws

• broadening the court’s rectification power to enable it to ascertain the hypothetical intention of the will-maker in unforeseen circumstances and construe the will accordingly.

Offender deemed to have predeceased the deceased person

5.48 The National Committee for Uniform Succession Laws recommended that, where the forfeiture rule prevents a person from sharing in an intestate estate, that person should be deemed to have died before the intestate.^[42] This is the case in New South Wales and Tasmania, but all other Australian jurisdictions are yet to give effect to this recommendation.^[43]

5.49 England and Wales have introduced legislation that deems the offender to have predeceased the deceased person not only for the purposes of intestacy law but also when interpreting a will. The Estates of Deceased Persons (Forfeiture Rule and Law of Succession) Act 2011 (UK) amended the law in England and Wales so that if a person is entitled to an interest in an intestate estate, or a under a will, and forfeits it under the forfeiture rule, the person is treated as having died immediately before the deceased.^[44] This reform was also extended to the circumstance in which a person disclaims an interest. New Zealand and some jurisdictions in the United States have adopted a

similar approach.^[45]

5.50 In submissions and during consultations, support was expressed for this option as a default solution for both gifts under a will and dispositions on intestacy.^[46] The Property and Probate Section of the Commercial Bar Association pointed out that deeming the offender to have died before the deceased person for the purposes of dispositions under a will or intestacy would:

avoid there being an unjust outcome for those entitled to claim through the killer such as his or her children, particularly minor children, who have no moral culpability in relation to the unlawful killing.^[47]

5.51 The Crime Victims Support Association also supported this approach, but only in relation to gifts over under a will.^[48] It was concerned that offenders may obtain an indirect benefit from those claiming through them or could be motivated to kill in order to financially benefit their family or take sole responsibility for an offence that they did not commit alone.^[49]

5.52 Although it is possible that an offender could be motivated to kill a person in the expectation that the forfeited benefits could flow to the offender’s descendants, it is improbable due to the personal cost of a conviction.^[50] Furthermore, it is not necessary. Killing does not create or enlarge the entitlements of the offender or anyone claiming through the offender; on the contrary, it jeopardises them.

5.53 The possibility that the offender will benefit indirectly from other beneficiaries is not necessarily confined to intestacies. The Institute of Legal Executives (Victoria) expressed concern that the beneficiary of a gift over could choose to benefit the offender.^[51] However, it put the view that it would be ‘particularly harsh to automatically disinherit those persons due to the unlawful actions of another’ and suggested that the court be granted a discretion to modify the effect of the rule in favour of alternative beneficiaries.^[52]

5.54 Judges of the Supreme Court of New South Wales expressed the view that it would be difficult to find a sound policy that could cover every possible scenario in which the offender might derive an indirect benefit. They also suggested that, if a gift goes to a person of free will, subject to special circumstances this would not be a matter in which the court should intervene in how it is ultimately distributed.^[53]

5.55 The Commission agrees. It is not the role of the court to dictate what individuals do with their own property. The beneficiary of a gift over or the innocent descendant of the offender should be treated no differently from other beneficiaries. A beneficiary who is entitled to property by law should therefore have the same rights to use that property for any purpose, as does any other beneficiary.

5.56 Carolyn Sparke QC suggested that it cannot be assumed that a will-maker who is killed by a descendant beneficiary would want the beneficiary’s children to benefit.^[54] However, this outcome is no different to what would happen in a range of other scenarios including on intestacy. The Commission considers it preferable that beneficiaries are treated consistently and equally before the law. The descendants of an offender are innocent of the offender’s crimes and should not be required by the effect of the law to forfeit a claim or interest in the deceased person’s estate. If a will-maker or intestate wished to benefit another in preference to the offender’s descendants in particular, then they could have provided for this scenario in a will.

Rectification of a will

5.57 If a will does not carry out the will-maker’s intentions because of a clerical error or because it does not give effect to the will-maker’s instructions, the Supreme Court of Victoria may make an order to rectify the will.^[55] It may modify the actual text as necessary to ensure that the will actually contains the provisions that the will-maker intended it to contain. The intention needs to be expressed in or implied by the words of the will: the court cannot give effect to what the will-maker would have intended had they considered unforeseen circumstances which have since arisen.^[56]

5.58 A broad statutory power to rectify a will could enable the court to ascertain the hypothetical intention of the will-maker in unforeseen circumstances—including when a beneficiary kills the will-maker—and construe the will accordingly.^[57] This would provide the court with the power to give effect to a gift over as well as to prevent a beneficiary who might provide the offender with an indirect benefit from taking the gift.

5.59 The Supreme Court of the Australian Capital Territory has a broad statutory power to rectify a will.^[58] However, the National Committee for Uniform Succession Laws did not recommend that the Australian Capital Territory’s rectification power be adopted nationally.^[59] It suggested that the rectification power, as expressed in the Australian Capital Territory legislation, may be too broad and may have the potential to destabilise the accepted rules for construing a will.^[60] This does not appear to have been the case in the Australian Capital Territory, where the provision has existed since 1991.

5.60 There was some support for conferring on the court a rectification power such as that in the Australian Capital Territory. Among the supporters was The Institute of Legal Executives (Victoria).^[61] Professor Prue Vines and Carolyn Sparke QC also recommended that Victoria provide the court with a rectification power in addition to deeming an offender to have predeceased the will-maker as a default position.^[62]

5.61 While noting the support expressed in submissions, the Commission does not favour this option because it does not provide the certainty for executors that a deeming provision would. It would increase the legal costs to the estate and delay distribution of the assets. Perhaps for this reason the court does not appear to have had the opportunity to exercise this power in the Australian Capital Territory. Moreover, this option would create a discretion that is not confined to circumstances where the deceased person was unlawfully killed by a beneficiary. Broader consultation would therefore be needed if any such provision were to be introduced in Victoria.

Proposed reforms

5.62 The effect of the forfeiture rule on the succession rights of third parties should be clarified to ensure certainty and avoid unjust outcomes. The problems with the current law arise because of the way relevant legislation is constructed and due to a common drafting approach to gifts over in wills. It is therefore appropriate that lawmakers intervene to address the issue.

5.63 The simplest solution, which also provides the greatest certainty, is to treat an offender as having predeceased the deceased person when the forfeiture rule applies, in line with the approach taken in England and Wales. This solution provides an appropriate balance between respecting the expressed intention of the will-maker and a general policy that gives preference to linear descendants on the one hand, and ensuring that innocent parties are not deprived of entitlements that they might otherwise receive on the other. It is also the solution supported by the majority of those consulted by the Commission in the course of this review. Accordingly, the Commission considers that, once the forfeiture rule has been applied, an offender should be treated as having predeceased the will-maker or the intestate.

5.64 Further, in the interests of legislative and conceptual consistency, the Commission considers that the deeming provision should apply where a beneficiary under a will or a person entitled to an interest in an intestate estate disclaims their interest. Currently, a disclaimer has the same effect as the forfeiture rule on the ability of third parties to take a benefit under a will or on intestacy. Unless the effect of a disclaimer is modified in the same way, deeming an offender to have predeceased a will-maker or intestate upon the application of the forfeiture rule would create an inconsistency. It would also create a disincentive for offenders to disclaim because their descendants would be disadvantaged. Voluntary resolution of the matter by the offender disclaiming their interest would be preferable to litigation. It would alleviate strain on family relationships and reduce costs

to the estate.

5.65 The Commission agrees with the reasoning of the Law Commission of England and Wales that it would be illogical to treat a disclaimer differently from where a beneficiary is precluded from inheriting due to the forfeiture rule.^[63] Instead, the same rules of succession should apply, notwithstanding the reason that a gift has failed. For these reasons, the Commission considers it important to make a recommendation even though this issue is outside the terms of reference.

5.66 The legislative reform should ensure that persons claiming through the offender are able to take the share of the estate that would have gone to the offender had the forfeiture rule not applied or to the person disclaiming had they not disclaimed that interest. Where an interest in some, but not all, benefits has been forfeited or disclaimed, the offender or the person disclaiming should be treated as having predeceased the deceased person for those benefits only and not for other interests that they still stand to inherit.

5.67 Any person who stands to take a share in a deceased person’s estate by representation is only eligible to inherit the value of the interest of the beneficiary in whose place they take. If the offender’s interest is considered to be nothing due to the effect of the forfeiture rule, it follows that those claiming through the offender are also entitled to nothing. For this reason, the offender should be deemed to have been entitled to the forfeited or disclaimed share of the estate at the time of their deemed death.

5.68 This reform will require amendments to the Wills Act 1997 (Vic) and the Administration and Probate Act 1958 (Vic). Similar amendments have been made to the equivalent legislation in the United Kingdom.^[64]

Recommendations

22 Part 4 of the Wills Act 1997 (Vic) should be amended with the effect that:

(ak) (a) where a will contains a devise or bequest to a person who:

(i) disclaims it, or

(ii) has been precluded by the common law rule of forfeiture from acquiring it

(al) the person is, unless a contrary intention appears by the will, to be treated for the purposes of the Act as having died immediately before the will-maker, and entitled to the devise or bequest at the time of the deemed death.

(am) (b) this amendment does not affect the Court’s power under the Forfeiture Act to modify the effect of the forfeiture rule.

23 The Administration and Probate Act 1958 (Vic) should be amended with the effect that:

(an) (a) for the purposes of the distribution of an intestate’s residuary estate, a person who:

(i) is entitled in accordance with section 52 to an interest in the residuary estate but disclaims it, or

(ii) would have been so entitled if not precluded from acquiring it by the common law rule of forfeiture

(ao) is to be treated as having died immediately before the intestate, and entitled to the interest in the residuary estate at the time of the deemed death.

(ap) (b) this amendment does not affect the Court’s power under the Forfeiture Act to modify the effect of the forfeiture rule.

Entitlement to apply for family provision

Common law

5.69 In Victoria, a person for whom a deceased person had a responsibility to make provision can apply under Part IV of the Administration and Probate Act for a court order redistributing the deceased person’s estate in their favour.^[65] This can occur whether or not the deceased person made a will.^[66]

5.70 At common law, unlawful killers have been precluded from claiming family provision or equivalent entitlements from the estate of their victim where the forfeiture rule applies.

5.71 In the English case of Re Royse (deceased),^[67] a woman who had been convicted of her husband’s manslaughter, with a finding of diminished responsibility, had applied for provision out of her husband’s estate. She had been the sole beneficiary of his estate under his will but had lost her entitlement because of the effect of the forfeiture rule. The court found that, because the effect of the forfeiture rule, she was disqualified from applying for family provision. Lord Justice Ackner said:

The absence of a reasonable financial provision for the plaintiff cannot be attributed either to her deceased husband’s will or to the intestacy laws if these had been relevant. It is solely the result of the rule of public policy which precludes her from acquiring a benefit under his will, or upon his dying intestate if he had so died, because she had unlawfully killed him.^[68]

5.72 The decision of the English Court of Appeal in Re Royse (deceased) was endorsed by the Supreme Court of New South Wales in Troja v Troja.^[69] Mrs Troja had sought an order that she was entitled to provision out of her husband’s estate pursuant to the Family Provision Act 1982 (NSW). She was serving a term of imprisonment for killing him, and it had already been established that the forfeiture rule disentitled her from a share of the estate. Master McLaughlin declined the application:

Waddell CJ in Equity and the Court of Appeal of New South Wales having held that the effect of the forfeiture rule is to deprive [Mrs Troja] of any beneficial interest in the estate, it would be totally inconsistent with that decision and totally inconsistent with public policy and, indeed, an affront to the public attitude which is the basis for the forfeiture rule, were [she] now to be able to avail herself of the provisions of the Family Provision Act 1982 and to seek to obtain an order for provision for her maintenance out of the estate of the husband whom she killed.^[70]

5.73 Although there is no case law in Victoria on this point, these precedents indicate that the forfeiture rule prevents an offender from claiming family provision under Part IV of the Administration and Probate Act. It could also be argued, as it was in Re Royse (deceased),^[71] that the family provision legislation was passed against the background of the forfeiture rule and it would be strange to deny a person a share of an estate under the rule and then enable them to apply for a share under family provision legislation.

5.74 Even if the rule does not preclude them from applying, the conduct that caused the rule to be invoked could well deter the court from agreeing to the claim. In making a decision on a family provision application, the court is required to have regard to a number of statutory factors including the character and conduct of the applicant.^[72] An unlawful killing is conduct that is likely to be viewed negatively by the court in any application for family provision.

Legislative responses

5.75 The UK, ACT, NSW and NZ Acts convey different responses to this issue.

• The UK Act specifies that the forfeiture rule does not preclude anyone from making an application for family provision.^[73]

• The NSW Act allows an application to be made for an order modifying the effect of the rule, if the rule precludes a person from any entitlement under family provision legislation.^[74]

• The NZ Act expressly provides that the offender is not entitled to apply for family provision.^[75]

• The ACT Act does not refer to family provision at all.

Consultation

5.76 Professor Prue Vines observed that family provision provides a way for a person who is unable to inherit a share of an intestate estate through an offender to make a direct claim. However, she noted that deeming the offender to have died before the deceased person in these circumstances (as recommended above) will remove the need for their descendants to rely on family provision.^[76]

5.77 No one called for a strict disqualification without power of modification, as in New Zealand. The Probate and Property Section of the Commercial Bar Association said that it could lead to injustice:

Consistent with the view that strict application of the forfeiture rule has resulted in injustice and that there should be a legislative discretion as to whether to apply the rule, it follows that there could well be circumstances where a deceased had a moral responsibility to make provision for their unlawful killer – examples such as manslaughter involving low levels of moral culpability, suicide pacts, killings arising from family violence perpetrated by the victim, and negligent acts causing death.^[77]

5.78 Some of the roundtable participants did not consider that an offender should be disqualified from making a family provision application.^[78] The submission from State Trustees pointed out that a court weighing up the merits of the claim would take into account the fact that the applicant had unlawfully killed the deceased person. Any application in relation to the forfeiture rule could be dealt with at the same time as the family provision claim.^[79]

5.79 Broader support was expressed, at the roundtable and in submissions, for precluding a person to whom the rule applies from applying for family provision, but giving the court a discretion to modify this effect of the rule.^[80] This would be consistent with the NSW Act. Carolyn Sparke QC, for example, noted that:

It is likely that overlapping considerations will apply to modifying the rule as would apply in any provision application. A similar approach could be taken, that the default position is that a person who causes the unlawful death of another is precluded from making application for provision, unless modified by Court.^[81]

Proposed reform

5.80 The Commission considers that, where the forfeiture rule disentitles a person from receiving a benefit from a deceased person’s estate, that person should also be precluded from claiming family provision. However, this effect of the rule should be able to be modified by a forfeiture rule modification order under the proposed Forfeiture Act.

5.81 Currently, the forfeiture rule already appears to prevent an offender from making a family provision application. If a person who is responsible for the deceased person’s death does apply for family provision, the court will take the cause of death into account when considering the claim. It is reasonable to expect that the claim would be unlikely to succeed. However, this may not be clear to personal representatives of deceased estates, beneficiaries and other interested parties.

5.82 During its recent reference on succession laws, the Commission noted that many family provision claims that may not have succeeded at trial are settled.^[82] Unmeritorious claims are made in the expectation that the personal representative will settle rather than incur greater legal costs to the estate in proceeding to trial. Among the reasons for this practice are that the law does not limit who can apply and it is difficult for legal practitioners to advise their clients about the strength and validity of their claim. The Commission has recommended reforms to Part IV of the Administration and Probate Act to address these and other issues. As part of the consequential amendments to the legislation, it would be prudent to specify the effect of the forfeiture rule on family provision applications.

5.83 The proposed Forfeiture Act would then provide for the effect of the forfeiture rule on an offender’s eligibility to apply for family provision to be modified, by specifying that eligibility to make an application for family provision is a benefit that may be affected by a forfeiture rule modification order.^[83]

Recommendation

24 Part IV of the Administration and Probate Act 1958 (Vic) should be amended to disentitle persons to whom the forfeiture rule applies from making an application for family provision in respect of the deceased person’s estate.

Interests in property

Property owned in joint tenancy

5.84 Succession rights give beneficiaries an expectation of obtaining an interest in a property. In contrast, when the deceased and the offender are joint tenants, the offender already has a stake in, and existing rights over, the property. In a joint tenancy between two people, the surviving joint tenant’s existing rights are enlarged by the death of the other joint tenant, as the entirety of the property vests in the survivor through the right of survivorship. Where there are more than two joint tenants, a victim’s interest would ordinarily vest jointly in the survivors.

Current law

5.85 The approach preferred by Australian courts in determining ownership over a joint tenancy once the forfeiture rule applies is that taken in Rasmanis v Jurewitsch.^[84] In that case, the Supreme Court of New South Wales applied the forfeiture rule where there were two joint tenancies, for separate properties. The offender had held one property with the deceased person, and the second property with the deceased person and a third joint tenant.

5.86 When the offender and the deceased person are the only joint tenants, legal title in the property vests in the offender upon the death of the other joint tenant. A half interest in the property is then held on constructive trust by the offender for the benefit of the deceased person’s estate.^[85] The remaining half interest is held by the offender for his or her own benefit.

5.87 Should the representatives of the deceased person’s estate want to obtain access to their beneficial interest by selling the property but the offender will not agree to the sale, they may apply to the Victorian Civil and Administrative Tribunal for an order for sale under the Property Law Act 1958 (Vic).^[86]

5.88 Where more than two people own a property as joint tenants, then a severance in equity would be necessary. In Rasmanis v Jurewitsch, the court held that an equitable interest equivalent to the share of the deceased person vested in the innocent joint tenant so that the offender could never benefit from the deceased person’s share of the property if the surviving joint tenant predeceased the offender.

5.89 For example, if there were five joint tenants and one of those joint tenants killed another, the interest of the deceased person would be held on trust for the benefit of the three remaining innocent joint tenants. The joint tenancy would remain between the offender and the innocent joint tenants over eighty per cent of the property (which excludes the interest of the victim). However, it is likely that any innocent joint tenants would no longer wish to continue as joint tenants with the offender. They would then have to take steps to effect a severance of the joint tenancy.

Problems with the current approach to ownership

5.90 A beneficial interest in a constructive trust cannot be reflected in the land titles register.^[87] Thus, either the deceased person’s estate or the innocent joint tenant(s), whichever takes the deceased person’s interest, would need to lodge a caveat to protect their interest in the property.^[88] A caveat notifies others of a pre-existing interest in the property so that subsequent buyers are aware of that interest. However, often executors and administrators of estates do not know to lodge a caveat to preserve their interest and, according to Land Victoria, a caveat does not guarantee the protection of an interest and can be removed from the register on application.^[89]

5.91 In the Deputy Registrar of Titles’ assessment, property in Victoria is rarely held by more than two joint tenants.^[90] When there are more than two joint tenants and the forfeiture rule applies, the deceased person’s interest in the property vests in the innocent joint tenants rather than in the deceased person’s estate. The estate receives nothing while the offender is able to retain enjoyment of their interest in the property.^[91] This outcome is reflective of the risk undertaken when entering into a joint tenancy arrangement yet could lead to a perception that the law is inconsistent, unnecessarily complex and unjust.

Reform options

5.92 At the Commission’s two roundtables, there were differing views among participants as to the best approach to determining the effect of the forfeiture rule on a joint tenancy.^[92] However, there was general agreement that the effect of the rule needs clarification.

5.93 Support was expressed for the current common law approach in submissions from the Property and Probate Section of the Commercial Bar Association and The Institute of Legal Executives (Victoria).^[93]

Property distributed as if owners were tenants in common

5.94 A number of other common law jurisdictions treat the property subject to the joint tenancy between the offender and the deceased person as if the owners were tenants in common. This was the dominant approach adopted by Australian courts prior to the decision in Rasmanis v Jurewitsch.

5.95 Under the Succession (Homicide) Act 2007 (NZ), a property owned as a joint tenancy between an offender, the deceased person and any other party devolves at the death of the deceased person as if the property were owned by each as tenants in common in equal shares.^[94] As a result, innocent joint tenants lose their right to take the deceased person’s interest by survivorship.

5.96 Under the Uniform Probate Code in the United States, a felonious and intentional killing severs the interests of the deceased person and the offender, transforming these interests into a tenancy in common in equal shares.^[95] This approach has been adopted in a number of United States jurisdictions, although not uniformly applied.^[96] In Florida, for example, the deceased person’s interest is severed and is distributed along with the rest of their assets. In Connecticut, the joint tenancy is converted into a tenancy in common between the offender and the deceased person but does not affect the interests of any other remaining joint tenants.

5.97 Land Victoria, State Trustees and Professor Prue Vines support the introduction of reforms to treat joint tenants as having been tenants in common when the forfeiture rule applies.^[97] Land Victoria suggested that this approach would address the uncertainty of title caused by the prohibition on recording notice of any trusts on the register. The Property and Probate Section of the Commercial Bar Association favoured the current common law approach but, in the alternative, would also support the introduction of legislation that would treat the joint tenants as tenants in common.^[98]

Offender deemed to have predeceased the deceased person

5.98 Legislation in Massachusetts and West Virginia provides that a person who kills their fellow joint tenant is treated as though they predeceased the deceased person.^[99] This approach would result in the deceased person’s estate receiving the entirety of the property if there were no other joint tenants. However, where there are multiple joint tenants, the deceased person’s estate would have no interest in the property, as it would vest in the surviving joint tenants through the right of survivorship.^[100] The offender would lose any interest in the property.

5.99 The Property and Probate Section of the Commercial Bar Association was opposed to any approach that results in stripping an offender of their assets.^[101] It was noted that the offender might require these assets when re-entering society upon their release from custody.

Proposed reforms

5.100 The Commission considers that an offender’s interest in a joint tenancy should be severed from that of the other joint tenants upon application of the forfeiture rule. When there are two joint tenants, this would result in the offender and the deceased person’s estate taking the property as tenants in common in equal shares. When there are more than two joint tenants, the joint tenancy would continue between any innocent joint tenants who would take the deceased person’s interest by survivorship, but the offender would hold their interest as a tenant in common.

5.101 There would be neither a gain nor a loss for any of the joint tenants. The advantages of the current common law approach would be preserved while the disadvantages would be addressed. The offender would be prevented from enlarging their share while not being stripped of their existing legal interest. The rights of any innocent joint tenants to take the deceased person’s interest by survivorship and to retain rights of survivorship among themselves would be untouched. Innocent joint tenants, who are unlikely to want to continue in a joint tenancy with the offender, would obtain an automatic severance of the joint tenancy with the offender and not be required to take further steps to achieve this outcome.

5.102 This reform also addresses Land Victoria’s concern that a beneficial interest arising pursuant to a constructive trust lacks certainty under the current arrangements for land title registration. Treating the joint tenants as if they were tenants in common therefore has the additional advantage of creating greater certainty and reducing the need for litigation to determine property ownership.

Recommendation

25 The effect of section 50 of the Transfer of Land Act 1958 (Vic) should be amended to provide that, where a joint proprietor has been unlawfully killed (within the meaning of the Forfeiture Act) by another joint proprietor, the property shall devolve at the death of the victim as follows:

(aq) (a) where the offender and the victim were the only joint proprietors, as if the property were owned by each of them as tenants in common in equal shares

(ar) (b) where there were more than two joint proprietors, as if:

(i) the offender holds their interest as a tenant in common

(ii) the surviving innocent joint proprietor(s) take the victim’s interest by survivorship

(iii) as between the offender on the one hand and the innocent joint proprietors on the other hand, a tenancy in common exists

(iv) as between the innocent joint proprietors, a joint tenancy exists.

Other issues arising prior to a determination that the rule applies

Preservation of property

5.103 There may be a delay between the death of the deceased person and the application of the forfeiture rule upon the court determining responsibility for the death. This delay means there is a period of time in which an offender who jointly owned a property with the deceased person would be able to register as the sole owner and transfer the property to an innocent third party or use the property as security for a loan.

5.104 Normally, in order to prevent any dealings with land a person with an interest in the property would lodge a caveat.^[102] However, a caveat cannot be lodged in order to prevent the transfer of title by survivorship following the death of a joint tenant,^[103] and there remains doubt as to whether a deceased person’s estate would have an interest in land for the purposes of lodging a caveat.

5.105 It is the general practice of the Office of Public Prosecutions to freeze the assets of offenders once they have been charged with a homicide offence to preserve those assets for future claims for victim’s compensation.^[104] The offender may therefore not be able to dispose of the property pending a determination of their criminal responsibility by the court. However, this process will not assist in preserving the assets in cases where the offender has not been charged with an offence or has been acquitted.

5.106 New Zealand has a special caveat to prevent dealing with the land while the matter is determined,^[105] and Carolyn Sparke QC recommended that Victoria introduce a statutory caveat to preserve property interests. The Commission raised with Land Victoria the possibility of introducing a statutory caveat such as in New Zealand, but Land Victoria opposed the idea. It would not want to see a caveat that would normally not be recordable approved through legislation, and it would cause administrative difficulties.^[106]

5.107 Despite the concerns raised by Land Victoria, the Commission sees merit in creating standing for a legal personal representative to be able to prevent the transfer of title to the surviving joint tenant when the forfeiture rule might affect that person’s right to

take by survivorship. The Commission is confident that any administrative difficulties can be resolved.

5.108 Nevertheless, the Commission is not recommending any specific amendments to the Land Transfer Act. The forfeiture rule is rarely applied and legislative amendments for this specific purpose would be more appropriately considered as part of any broader property law reform process, which is beyond the scope of this review. This would ensure consistency in removing barriers to the preservation of different beneficial interests in property in Victoria.

5.109 If a surviving joint tenant is registered as the sole owner of a property and it is subsequently determined that the forfeiture rule applies, the Registrar of Titles should be empowered to rectify the Land Titles Register to reflect the consequences of the rule.

Recommendation

26 If an offender obtains registration by survivorship under section 50 of the Transfer of Land Act 1958 (Vic) before it becomes apparent that the forfeiture rule applies, the Registrar should be empowered to rectify the Register appropriately.

Offender’s access to property of the deceased person

5.110 Currently an offender is unable to access an inheritance prior to a determination of whether the forfeiture rule applies.^[107] However, an offender is able to access their existing legal interests in as far as such access is not restrained by court order.^[108]

5.111 Carolyn Sparke QC in her submission to this reference put the view that an offender should be allowed access to their potential inheritance or any joint assets to fund their defence.^[109]

5.112 The Commission does not recommend allowing an offender access to any benefits from the deceased person to pay legal costs for their defence. Should the forfeiture rule be found to apply, there would be little prospect of recovering the value of that interest.

5.113 The Commission considers such an outcome contrary to the public policy of the forfeiture rule as the offender would have obtained a benefit from the death of the deceased person. It would also be contrary to the interests of innocent third parties who would otherwise be entitled to that interest.

Acceleration of property entitlement

5.114 The forfeiture rule can affect a person’s benefit under a will even though they did not cause the will-maker’s death. This may occur where the offender is responsible for the death of another person who is not the will-maker or outright owner of a property but from whose death they would benefit. The deceased person may be someone else in a ‘chain of gifts’.^[110] For example, the deceased person and the offender might both be beneficiaries of a trust, where the deceased person’s entitlements under that trust would transfer to the offender. Alternatively, the deceased person might have a lifetime interest in a property that will vest in the offender upon the deceased person’s death.

5.115 Justice Gzell in Batey v Potts^[111] stated that:

The public policy against benefiting from one’s crime is not limited to fixed categories. Nor does it focus upon the manner in which the felony results in benefit to the perpetrator.^[112]

5.116 The forfeiture rule will therefore apply to prevent these entitlements, which would not have gone to the offender but for the unlawful killing, from being transferred to the offender.

5.117 In Batey v Potts, the will-maker granted her husband a right to reside in the matrimonial home for the term of his life. Upon his death, the residential property was to be held on trust with the residue of her estate to pay the net income to her son until he turned 35 and thereafter to pay the capital and income to him. If that trust were to fail, then the property was to go to other relatives.

5.118 The son killed his father. The killing had the effect of accelerating his interest in the residential property under his mother’s will and it was the benefit of that acceleration that the forfeiture rule prevented.

5.119 The court found that in such circumstances the appropriate remedy is to deprive the killer of the enjoyment of their interest for the period of the victim’s life expectancy. However, the court used its discretion under the NSW Act to modify the effect of the rule.

5.120 In the Commission’s view, it is neither possible nor desirable to prescribe in legislation the effect of the rule in such rare cases. Should a similar case arise in Victoria, the discretion provided under the proposed Forfeiture Act would enable the court to modify the effect of the rule.

Other benefits

Non-estate assets

5.121 Apart from affecting an offender’s right to survivorship when they unlawfully kill another joint proprietor, the forfeiture rule will bar the offender from taking other benefits that do not fall within the deceased person’s estate.^[113]

5.122 Superannuation, life insurance and other financial services are regulated by Commonwealth legislation. However, modifications made to the common law by the proposed Forfeiture Act would have a broad effect on the disposition of these assets. Courts exercising federal jurisdiction in Victoria will apply the modified common law, including modifications to the forfeiture rule, where it is not inconsistent with Commonwealth legislation.^[114]

5.123 Other benefits that the offender may have stood to gain are rarer but will still be affected by the forfeiture rule. An example is a gift that the deceased person gave the offender in contemplation of death, which is governed by the common law.

5.124 Under the NZ Act, a person who has unlawfully killed the deceased person is explicitly disentitled to any property interests in the ‘non-probate assets’ of their victim.^[115] These include the nomination of a bank account or superannuation benefits, gifts the victim made in contemplation of death, trusts settled by the victim that were revocable by the victim in his or her lifetime, beneficial powers of appointment that were exercisable by the victim in his or her lifetime and joint tenancies. These assets, with the exception of joint tenancies, are distributed as though the offender had died before the deceased person.^[116]

5.125 In its consultation paper, the Commission sought submissions on how the forfeiture rule should apply to benefits that are not within the deceased person’s estate. The responses received said that the rule should apply consistently with benefits that are within the estate, as in the NZ Act.^[117] This would mean deeming the offender to have predeceased the deceased person.

5.126 Although the approach taken in New Zealand is simple and clear, the Commission has concluded that it would not be possible or prudent to include a similar provision in Victorian legislation. In Australia, the non-estate benefits that an offender would most likely stand to gain are regulated by the Commonwealth. The benefits over which Victoria has jurisdiction are less frequently encountered. Circumstances in which they arise are unusual and are better dealt with on a case-by-case basis than by a standard statutory response. An exception, discussed below, is the payment of defined benefits under state legislation.

5.127 Under the proposed Forfeiture Act, the court would have a discretion to modify the effect of the rule on non-estate benefits as well as those within the estate. This would be provided by the broad definition of property, entitlements and other benefits that may be affected by a forfeiture rule modification order (Recommendation 11). Non-estate benefits have been affected by the court in exercising its discretion under the NSW Act. In Re Fitter,^[118] Justice Lloyd ordered that benefits from the deceased person’s superannuation fund be held by the offenders on constructive trust for the deceased person’s sister.^[119] The validity of this order was not considered in a collateral proceeding, as the trustees of the superannuation account exercised their discretion not to pay once the forfeiture rule had been applied.^[120]

State superannuation schemes

5.128 Thousands of Victorians are members of defined benefit superannuation funds established by state legislation. Most are members of two major public sector funds:

• the Emergency Services Superannuation Scheme, which is for emergency services employees and is open to new members

• the State Superannuation Fund, which comprises the remaining members of a number of closed public sector schemes.^[121]

5.129 Both are administered by the Emergency Services Superannuation Board, which operates under its business name ESSSuper (Emergency Services and State Super). The funds are governed by the Emergency Services Superannuation Act 1986 (Vic); the State Superannuation Act 1988 (Vic); the State Employees Retirement Benefits Act 1979 (Vic); the Transport Superannuation Act 1988 (Vic).^[122]

5.130 ESSSuper currently provides benefits for around 145,000 members.^[123] As well as administering the Emergency Services Superannuation Scheme and the former funds

of the State Superannuation Fund, it administers the statutory defined benefit scheme

for members of Parliament under the Parliamentary Salaries and Superannuation Act
1968 (Vic).

5.131 ESSSuper is also responsible for paying defined pensions to a number of former office holders entitled by statute to receive them. Defined pensions have specifically been created by statute for the following office holders:

• the Governor^[124]

• Judges of the Supreme^[125] and County Courts^[126]

• the Chief Magistrate^[127]

• the Director of Public Prosecutions^[128]

• the Chief Crown Prosecutor and Senior Crown Prosecutors^[129]

• the Solicitor-General^[130]

• the Commissioner of the Independent Broad-based Anti-corruption Commission^[131]

• the Victorian Inspector.^[132]

5.132 The Commission consulted ESSSuper about whether it would be useful to set out the effect of the forfeiture rule in legislation and, in particular, to deem that a person who is responsible for unlawfully killing a fund member died before the fund member. ESSSuper expressed support for any moves to clarify the effect of the rule, noting that it would require legislative amendments. It added that:

We note that any change would have to take into account the practical considerations, for example, where does the onus of proof sit? As a trustee, we often do not know about any other circumstances. We would be concerned if an onerous level of investigation was placed upon the trustee or some other form of administrative burden was placed upon us.^[133]

5.133 The Commission considers that a deeming provision would clarify the effect of the rule and not add to the obligations that already exist at common law.

Recommendation

27 Payments that would have been made to a person who is responsible for unlawfully killing a person who is a member of a state statutory defined benefit superannuation scheme or who otherwise has pension entitlements under state legislation should be redirected as if that person had died before the victim.

Victim compensation

5.134 The Commissioner for Children and Young People has brought to the Commission’s attention instances in which a parent who has allegedly caused their child to sustain serious injury through abuse or neglect has, upon the child’s death some time later, received the balance of any compensation payment that the child received for the injury.

One of the issues in this process is that the child dies intestate (without a will) as he/she is unlikely to have capacity to make a will or express their own wishes. In addition, the child may have been removed from the care of his/her parents and placed under the guardianship of the Department of Human Services (DHS) and/or have been cared for by foster, permanent or kinship carers, and had little contact with his/her parents prior to their death.^[134]

5.135 The Commissioner for Children and Young People has called for an examination of the application of the forfeiture rule to the estates of children whose deaths are connected to abuse or neglect by a parent.

5.136 This issue was also raised by the New South Wales Public Trustee (now the New South Wales Trustee and Guardian) in 2002 in response to a review of the NSW Act by the New South Wales Attorney-General’s Department.^[135] In that review, the New South Wales Public Trustee suggested it may be desirable to extend the operation of the forfeiture rule to include depriving a parent of a benefit from an estate where that benefit arises from an unlawful action that did not result in the immediate death of the deceased. The Department dismissed the idea as it considered the scenario unlikely to occur.^[136]

5.137 The forfeiture rule would prevent a parent from inheriting any assets of the child, including criminal injuries compensation, where the parent’s abuse or neglect caused the death of the child and amounted to an unlawful killing. However, where the death did not result from the parent’s unlawful actions but from some other cause, the forfeiture rule would not apply.

5.138 In the situation where an award of monetary compensation to a child for injury unlawfully caused by a parent has been made, and later the child dies from some other cause, the Commission considers it inappropriate that the award of monetary compensation should flow to the offending parent through the child’s intestacy. In such circumstances, it would appear just that the monetary award should flow on intestacy as if the non-innocent parent had predeceased the child.

5.139 The Commissioner for Children and Young People put forward possible solutions. They are directed to ensuring that a will is made on the child’s behalf by the processes available under Part 3 of the Wills Act 1997 (Vic), and ensuring better oversight of the payment of the balance of the money on the child’s death.

5.140 This is a matter beyond the terms of reference of this review. It is a matter small in compass but morally significant and is one which government could address directly, including in ways identified by the Commissioner for Children and Young People in his submission to the Commission.

1. ‘Offender’ in this report refers to a person who unlawfully kills another, whether or not they are convicted of an offence.

   ↑

2. Andrew Hemming, ‘Killing the Goose and Keeping the Golden Nest Egg’ (2008) 8 Queensland University of Technology Law and Justice Journal 342, 354.

   ↑

3. Administration and Probate Act 1958 (Vic) s 18. A grant of probate provides certainty that the appointed person is authorised to administer the estate.

   ↑

4. See, eg, Re Pedersen (Unreported, Supreme Court of New South Wales, Holland J, 17 June 1977); Re Weinstock [2007] NSWSC 193 (12 March 2007).

   ↑

5. [1911] P 108.

   ↑

6. Ibid 112.

   ↑

7. Court of Probate Act 1857 (UK) 20 & 21 Vict, c 77, s 73.

   ↑

8. [1968] P 302. The court relied on s 162 of the Supreme Court of Judicature (Consolidation) Act 1925 (UK) 15 & 16 Geo 5, c 49.

   ↑

9. Re Pedersen (Unreported, Supreme Court of New South Wales, Holland J, 17 June 1977) 2–3.

   ↑

10. For discussion of the court’s power to bypass the will-maker’s appointment, see Re Pedersen (Unreported, Supreme Court of New South Wales, Holland J, 17 June 1977). See also Bar-Mordecai v Rotman (Unreported, Supreme Court of New South Wales, Einstein J, 4 September 1998).

    ↑

11. Correspondence with the Registrar of Probates, 7 March 2014.

    ↑

12. Dimos v Skaftouros (2004) 9 VR 584, 593.

    ↑

13. The breadth of discretion afforded by s 34(1)(c) is explored fully by President Winneke in Dimos v Skaftouros (2004) 9 VR 584, 586–93. President Winneke clarified that the provision should not be interpreted narrowly when considering an executor’s conduct after a grant of probate has been made. He did not address whether it applied to conduct before the grant was made but nor did he rule it out. He said (at 593) ‘It is unnecessary, and I think unhelpful, for this court to seek to exhaustively state the limits of the court’s discretionary power to remove executors.’

    ↑

14. Administration and Probate Act 1958 (Vic) ss 15, 26, 34(1). The estate of a person who dies without leaving a will is administered by State Trustees until a grant of administration is made: s 19.

    ↑

15. Ibid s 22(1).

    ↑

16. Administration and Probate Act 1929 (ACT) s 12; Administration and Probate Act 1989 (NSW) s 63; Administration and Probate Act 1969 (NT) s 22(1); Supreme Court of South Australia, The Probate Rules 2004, 1 April 2014, r 30.

    ↑

17. Re Slattery (1909) 9 SR (NSW) 577 (6 September 1909).

    ↑

18. [1911] P 108.

    ↑

19. If an offender applies for a grant of administration, an objector could lodge a caveat against the grant being made. The court rules specify a non-exhaustive list of possible grounds for caveats, including that the proposed administrator is disqualified. The Commission’s recommendations would disqualify a convicted offender from applying, but not someone who is only suspected of an unlawful killing. The caveators would need to make other grounds: Administration and Probate Act 1958 (Vic) s 58; Supreme Court (Administration and Probate) Rules 2004 (Vic) r 8.06(2). Note that a caveat may be lodged against making a grant of probate to an executor but the possible grounds listed in the rules do not include disqualification: Supreme Court (Administration and Probate) Rules 2004 (Vic) r 8.06(1).

    ↑

20. Administration and Probate Act 1958 (Vic) s 34(1).

    ↑

21. New South Wales Law Reform Commission, Uniform Succession Laws: Administration of Estates of Deceased Persons, Report No 124 (2009) 92. The National Committee guided a national project to develop uniform succession law and practice across Australia.

    ↑

22. New South Wales Law Reform Commission, above n 21.

    ↑

23. Ken Mackie, ‘The Forfeiture Rule: The Destination of Property Interests on Homicide’ (1997) 2 Newcastle Law Review 30, 33.

    ↑

24. Law Commission (England and Wales), The Forfeiture Rule and the Law of Succession, Report No 295 (2005) 28; ibid.

    ↑

25. See Perrin v Morgan (1943) AC 399; Re McIlrath [1959] VR 720, 724.

    ↑

26. Ekert v Mereider (1993) 32 NSWLR 729 (Windeyer J); Ken Mackie, above n 23, 35.

    ↑

27. Law Commission (England and Wales), above n 24; Ken Mackie, above n 23.

    ↑

28. [1978] WAR 144.

    ↑

29. Ken Mackie, above n 23, 36; Charles Rowland, ‘The Construction or Rectification of Wills to Take Account of Unforeseen Circumstances Affecting their Operation: Part I ’ (1993) 1 Australian Property Law Journal 87, 113.

    ↑

30. Re Barrowcliff [1927] SASR 147.

    ↑

31. Re Keid [1980] Qd R 610.

    ↑

32. Public Trustee v Hayles (1993) 33 NSWLR 154.

    ↑

33. Ibid.

    ↑

34. Submission 17 (Carolyn Sparke QC).

    ↑

35. Wills Act 1997 (Vic) s 45.

    ↑

36. Helton v Allen (1940) 63 CLR 691; Re Sangal [1921] VLR 355.

    ↑

37. Administration and Probate Act 1958 (Vic) s 52(f).

    ↑

38. [2001] Ch 568.

    ↑

39. Law Commission (England and Wales), above n 24, 2.

    ↑

40. Ibid.

    ↑

41. Ken Mackie, above n 23, 32.

    ↑

42. New South Wales Law Reform Commission, above n 21, 210.

    ↑

43. Succession Act 2006 (NSW) s 139(b); Intestacy Act 2010 (Tas) s 40(b).

    ↑

44. Estates of Deceased Persons (Forfeiture Rule and Law of Succession) Act 2011 (UK) c 7, s 1 (inserting s 46A into the Administration of Estates Act 1925 (UK) 15 & 16 Geo 5, c 23), s 2 (inserting s 33A of the Wills Act 1837 (UK) 7 Will 4 & 1 Vic, c 26).

    ↑

45. Succession (Homicide) Act 2007 (NZ) s 7(3); American Law Institute, Restatement (Third) of Property: Wills and Other Donative Transfers (2003) § 8.4 cmt (k).

    ↑

46. Consultations 5 (Roundtable 1); 7 (Supreme Court of New South Wales—Judges); 15 (Supreme Court of Victoria—Judges); 16 (Roundtable 2). Submissions 1 (Professor Prue Vines); 9 (State Trustees); 14 (Property and Probate Section of the Commercial Bar Association); 17 (Carolyn Sparke QC).

    ↑

47. Submission 14 (Property and Probate Section of the Commercial Bar Association).

    ↑

48. Submission 8 (Crime Victims Support Association).

    ↑

49. Ibid.

    ↑

50. Callie Kramer, ‘Guilty by Association: Inadequacies in the Uniform Probate Code Slayer Statute’ (2003) 19 New York Law School Journal of Human Rights 697, 716.

    ↑

51. Submission 16 (The Institute of Legal Executives (Victoria)).

    ↑

52. Ibid.

    ↑

53. Consultation 7 (Supreme Court of New South Wales—Judges).

    ↑

54. Submission 17 (Carolyn Sparke QC).

    ↑

55. Wills Act 1997 (Vic) s 31.

    ↑

56. Charles Rowland, above n 29, 91.

    ↑

57. Ibid 87; Charles Rowland, ‘The Construction or Rectification of Wills to take Account of Unforeseen Circumstances Affecting their Operation: Part II’ (1993) 1 Australian Property Law Journal 193.

    ↑

58. Wills Act 1968 (ACT) s 12A.

    ↑

59. National Committee for Uniform Succession Laws, Consolidated Report to the Standing Committee of Attorneys-General on the Law of Wills, Queensland Law Reform Commission Miscellaneous Paper 29 (1997) 59–61.

    ↑

60. National Committee for Uniform Succession Laws, Uniform Succession Laws for Australian States and Territories: First Issues Paper: The Law of Wills, Queensland Law Reform Commission Working Paper 46 (1994) 44–5.

    ↑

61. Submission 16 (The Institute of Legal Executives (Victoria)).

    ↑

62. Submission 1 (Professor Prue Vines).

    ↑

63. Law Commission (England and Wales), above n 24, 30.

    ↑

64. Administration of Estates Act 1925 (UK) s 46A 15 & 16 Geo 5, c 23; Wills Act 1837 (UK) s 33A 7 Will 4 & 1 Vic, c 26.

    ↑

65. Administration and Probate Act 1958 (Vic) s 91(1).

    ↑

66. Ibid s 91(4).

    ↑

67. [1985] Ch 22.

    ↑

68. Ibid 27.

    ↑

69. (1994) 35 NSWLR 182.

    ↑

70. Ibid 186–7.

    ↑

71. [1985] 1 Ch 22, 27–8.

    ↑

72. Administration and Probate Act 1958 (Vic) s 91(4)(o).

    ↑

73. Forfeiture Act 1982 (UK) c 34, s 3(2)(a).

    ↑

74. The NSW Act provides that, if the forfeiture rule precludes a person from obtaining a benefit, an application can be made for an order modifying the effect of the rule. The definition of ‘benefit’ includes ‘any entitlement under Chapter 3 of the Succession Act 2006 (NSW)’. Chapter 3 of that Act deals with family provision: Forfeiture Act 1995 (NSW) ss 3, 5(1).

    ↑

75. Succession (Homicide) Act 2007 (NZ) s 9.

    ↑

76. Submission 1 (Professor Prue Vines).

    ↑

77. Submission 14 (Property and Probate Section of the Commercial Bar Association).

    ↑

78. Consultation 16 (Roundtable 2).

    ↑

79. Submission 9 (State Trustees).

    ↑

80. Submissions 14 (Probate and Property Section of the Commercial Bar Association); 16 (The Institute of Legal Executives (Victoria)); 17 (Carolyn Sparke QC). Consultation 15 (Supreme Court of Victoria—Judges).

    ↑

81. Submission 17 (Carolyn Sparke QC).

    ↑

82. Victorian Law Reform Commission, Succession Laws, Report No 26 (2013) 99.

    ↑

83. Recommendation 11.

    ↑

84. [1970] 1 NSWR 650.

    ↑

85. Ibid.

    ↑

86. Property Law Act 1958 (Vic), pt IV.

    ↑

87. Transfer of Land Act 1958 (Vic) s 37. However, trusts may be declared by any document and an attested copy deposited with the Registrar, and the Registrar may protect the rights of the beneficiaries in any way the Registrar deems advisable: s 37.

    ↑

88. Ibid ss 58, 59.

    ↑

89. Ibid s 89A; Submission 12 (Land Victoria).

    ↑

90. Consultation 16 (Roundtable 2).

    ↑

91. John Tarrant, ‘Unlawful Killing of a Joint Tenant’ (2008) 15 Australian Property Law Journal 224, 236.

    ↑

92. Consultations 5 (Roundtable 1); 16 (Roundtable 2).

    ↑

93. Submissions 14 (Property and Probate Section of the Commercial Bar Association); 16 (The Institute of Legal Executives (Victoria)).

    ↑

94. Succession (Homicide) Act 2007 (NZ) s 8(3).

    ↑

95. UPC § 2-803(c)(2) (2010).

    ↑

96. American Law Institute, Restatement (Third) of Restitution and Unjust Enrichment (2011) § 45, reporter’s note (h). Statutes taking this approach include: Iowa Code §633.535(2) (2013) (as interpreted by the Supreme Court of Iowa in In re estate of Thomann 649 NW 2d 1 (Iowa, 2002)); Ala Code § 43-8-253(b) (2013); Cal Prob Code § 251 (LexisNexis 2014); Conn Gen Stat § 45a-447(a)(3) (2013); Fla Stat § 732.802(2) (2013); Nev Rev Stat Ann § 41B.320(2)(a) (2013).

    ↑

97. Submissions 1 (Professor Prue Vines); 9 (State Trustees); 12 (Land Victoria).

    ↑

98. Submission 14 (Property and Probate Section of the Commercial Bar Association).

    ↑

99. John Tarrant, above n 91, 230; W Va Code § 42-4-2 (2013) (as interpreted in Lakatos v Billotti 509 SE 2d 594 (W Va, 1998)); Robert F Hennessy, ‘Property Note—The Limits of Equity: Forfeiture, Double Jeopardy, and the Massachusetts “Slayer Statute”’ (2009) 31 Western New England Law Review 159, 160; Mass Gen Laws ch 265 § 46 (2013).

    ↑

100. Law Commission (England and Wales), above n 24, 33.

     ↑

101. Submission 14 (Property and Probate Section of the Commercial Bar Association).

     ↑

102. Transfer of Land Act 1958 (Vic) s 89.

     ↑

103. Ibid s 50.

     ↑

104. Consultation 17 (Office of Public Prosecutions).

     ↑

105. Succession (Homicide) Act 2007 (NZ) s 13.

     ↑

106. Correspondence with Deputy Registrar of Titles, 6 June 2014.

     ↑

107. Gonzales v Claridades (2003) 58 NSWLR 211.

     ↑

108. Ryan v Ryan [2012] NSWSC 636 (8 June 2012).

     ↑

109. Submission 17 (Carolyn Sparke QC).

     ↑

110. Rosalind Croucher and Prue Vines, Succession: Families, Property and Death (LexisNexis Butterworths, 4th ed, 2013), 544.

     ↑

111. (2004) 61 NSWLR 274.

     ↑

112. Ibid 278 [21].

     ↑

113. Cleaver v Mutual Reserve Fund Life Association [1892] 1 QB 147; Re Field and the Commonwealth of Australia (1983) 5 ALD 571, 574–5; R v National Insurance Commissioner, Ex parte Connor [1981] 1 QB 758.

     ↑

114. Judiciary Act 1903 (Cth) s 80.

     ↑

115. Succession (Homicide) Act 2007 (NZ) s 8(1).

     ↑

116. Ibid s 8(2).

     ↑

117. Submissions 1 (Professor Prue Vines); 16 (The Institute of Legal Executives (Victoria)).

     ↑

118. Re Fitter; Public Trustee v Fitter [2005] NSWSC 1188 (24 November 2005).

     ↑

119. In this case, the forfeiture rule did not apply at common law because the persons responsible for the killing had been found not guilty by reason of mental illness. Justice Lloyd exercised the court’s discretion under s 11 of the NSW Act to apply the forfeiture rule to prevent them from benefiting from the deceased person’s estate, interest in a joint tenancy, and proceeds of a superannuation policy.

     ↑

120. See Fitter v Public Trustee [2007] NSWSC 1487(13 December 2007).

     ↑

121. The Original Scheme; the Revised Scheme; the New Scheme; the State Employees Retirement Benefits Scheme; the Transport Scheme; the Metropolitan Transit Authority Superannuation Scheme; and the Melbourne Water Corporation Employees Superannuation Scheme.

     ↑

122. ESSSuper, Annual Report 2013 (2013) 4.

     ↑

123. Ibid.

     ↑

124. Constitution Act 1975 (Vic).

     ↑

125. Ibid; Supreme Court Act 1986 (Vic).

     ↑

126. County Court Act 1958 (Vic).

     ↑

127. Magistrates’ Court Act 1989 (Vic).

     ↑

128. Constitution Act 1975 (Vic).

     ↑

129. Public Prosecutions Act 1994 (Vic).

     ↑

130. Attorney-General and Solicitor-General Act 1972 (Vic).

     ↑

131. Independent Broad-based Anti-Corruption Commission Act 2011 (Vic).

     ↑

132. Victorian Inspectorate Act 2011 (Vic).

     ↑

133. Correspondence with Chris Tay, Manager Legal Services, Emergency Services and State Super, 13 June 2014.

     ↑

134. Submission 15 (Commission for Children and Young People).

     ↑

135. New South Wales, Report on the Review of the Forfeiture Act 1995: New South Wales Attorney-General’s Department, Parliamentary Paper No 72 (2002) 8.

     ↑

136. Ibid.

     ↑