A battle of wills: lessons from the Hemmes dispute

John Hemmes had a “moral duty” to make provision for his son Edward Cameron, even though he had never acknowledged Edward as his son and had no relationship with him. In making its ruling, a court found that Cameron had grown up “without anything like the material support which he would have had had he been granted a share of the affluence which, it can reasonably be inferred, the deceased enjoyed throughout the years following the plaintiff’s [Cameron’] birth.”

The Supreme Court of New South Wales ruling, handed down last month, is one of a number of recent cases that have seen greater rights granted to de factos, step-children and unacknowledged children when it comes to disposing of deceased estates.

The trend is for de facto relationships to be treated in the same way as marriages, and for children such as Edward Cameron to be treated as “eligible applicants”.

“We are seeing changing familial values in Australia,” says Golnar Nekoee, an associate in the estate and business succession practice at BAL Lawyers. “The takeaway is that you may need to carefully consider children from a de facto partner when writing you will. If you are a child of such a relationship, take considered advice in relation to any potential claim.”

Hemmes, who had successful careers in fashion and hospitality, died in March 2015, aged 83, with an estate of a negative value of around $300,000. However, the estate did not include the family home and an interest in a self-managed super fund, which together were worth around $40 million.

Just before he died he transferred $5.7 million from a Swiss bank account into the names of two of his children, Bettina and Justin.

No provision was made in his will for his third child, Edward Cameron, which was from another relationship.

John Hemmes never acknowledged Cameron as his son. However, for 13 years he paid Edward Cameron’s mother periodic sums for child support, totalling around $300,000. Apart from this compulsory child support, the deceased did not pay anything to the plaintiff, or for his benefit, during his lifetime.

Cameron, aged 27, made a “notional estate” claim against the home and the SMSF, claiming $4.1 million.

The Court, supported his claim, holding that Cameron had been left without adequate provision from the estate or the notional estate of the deceased.

It held that “the plaintiff [Edward] was raised by his mother, without the benefit of any personal relationship with his father and without anything like the material support which he would have had had he been granted a share of the affluence which, it can reasonably be inferred, the deceased enjoyed throughout the years following the plaintiff’s birth.”

Cameron argued that $4.1 million was a reasonable amount to set him up in life.

The executor of Hemmes’ estate argued that the amount was excessive, amounting to a “wish list” that included money to establish a business and buy a home.

The court granted Cameron $1.75 million, taking into account the Hemmes’ “moral duty” to make provision for him, the size of the notional estate and Cameron’s aspirations.

The defendants argued that Hemmes made adequate provision for Cameron during his lifetime by making compulsory child support payments. They also argued that throughout his life Hemmes had no relationship with Cameron beyond “bare paternity”.

Finally, they argued that the plaintiff was “a heathy adult male who could, and should, be left to make his own way in life without provision being made for him beyond the child support payments.”

The court said Cameron bore the onus of establishing the claimed entitlement to family provision relief and “the mere fact of paternity” was not enough to justify a grant of family provision relief. Something more was required.

“The plaintiff [Cameron] was never really given a fair opportunity to engage socially with the deceased, despite his manifest desire for such an engagement. Towards the end of his life, when approached by the plaintiff, the deceased not only rebuffed him but sought to re-agitate the question of paternity determined two decades earlier by the Family Court.

“The plaintiff did not seek – but the deceased most assuredly did not hold out to the plaintiff any prospect of – material gain. The plaintiff sought but the deceased denied an opportunity to bond.

“The plaintiff is a young man, not yet established in the world. He has had to make his way in the world, so far as he has thus far done, without any love, support or encouragement ordinarily associated with a paternal relationship. He has had to labour, on the contrary, with rejection at the hands of a father whose wealth and prominence magnified the pain of parental rejection.”

“Neither a person guided by wisdom and justice, nor a person guided by current community standards, could reasonably conclude that the deceased’s bare payment of child support payments, under compulsion of law, has left the plaintiff with adequate provision.”

The court awarded $1.75 million and not $4.1 million because “although the plaintiff ought to be given a substantial award of provision from the deceased’s notional estate, he is not entitled to be established in accommodation beyond his and his fiancee’s reasonably foreseeable needs.”

Nekoee says a 2015 case, Blyth v Wilken, broke new ground when the court held de facto relationships on the same platform as marriages when it came to the interpretation of the will.

And last year, the Victorian Court of Appeal, in Scott-McKenzie v Bail, recognised that step-children of a de facto couple had the same rights as step-children of married couples for the purposes of family provision applications.