A Sydney woman improperly obtained a $200,000 gift from her grandmother shortly before the 93-year-old’s death, a court has ruled, but she will still inherit a share of the sale proceeds of the $2.85 million family home.
In a decision handed down two days before Christmas, NSW Supreme Court Justice Michael Slattery said the granddaughter, 53, acted unconscionably in obtaining $202,247 from her grandmother in November 2021.
Her grandmother died three months later from pneumonitis related to COVID-19.
After her grandmother’s death, the woman filed court proceedings seeking a greater share of the estate. This was resisted by the executor of the estate, one of the deceased’s sons. The executor also filed a cross-claim seeking to have the $202,247 gift set aside.
The sum “represented the deceased’s then lifesavings”, Slattery said in his decision.
Slattery said the granddaughter, who is one of eight grandchildren and had been her grandmother’s carer, “took advantage of the deceased’s position of special disadvantage” and the transfer “should be set aside because of [her] ... unconscionable conduct in procuring it”.
The deceased made her final will in March 2021, splitting all of her assets including her home in northern Sydney and the $200,000 equally between her four children and her granddaughter.
The granddaughter was also given a first right to purchase the home, where she was living, if she paid 80 per cent of the market value to the four children. But she did not exercise that right and the home was sold this year for $2.85 million.
“The deceased’s mental acuity began to decline noticeably after the making of her final will,” the judge said.
In November 2021, during COVID-19 restrictions, the granddaughter accompanied her grandmother, who had an oxygen tank, to the bank.
The grandmother transferred $202,247 from a matured term deposit in her name into a term deposit account in her granddaughter’s name.
‘[The granddaughter’s] conduct in leaving the … property in the state that she did is thoroughly discreditable.’
Justice Michael Slattery
The lawyer who drafted the will was given “no prior notice” of the transfer, the judge said, but was told in December.
“From the evidence available, it is apparent that the deceased had considered gifting [her granddaughter] the term deposit but not including her in the will, but ultimately decided against that course,” the judge said.
The judge did not accept the grandmother “freely intended” her granddaughter to have the term deposit.
But Slattery said that if the granddaughter was forced “to repay it to the estate with interest and costs, she is likely to be left with very little with which she can make her way in life”.
“Moreover, had the $200,000 not been transferred, she would have been entitled to $40,000 of it anyway,” he said.
Ultimately, he made orders that $202,247 be deducted from her share of the estate, and that a further $55,000 be deducted because she had left the home in an “uninhabitable” condition that required rectification before the sale.
“Her conduct in leaving the … property in the state that she did is thoroughly discreditable,” he said.
Start the day with a summary of the day’s most important and interesting stories, analysis and insights. Sign up for our Morning Edition newsletter.