Australian Executor Trustees Limited v New [2026] VSC 421 (29 June 2026)

Australian Executor Trustees Limited v New [2026] VSC 421 (29 June 2026) AustLII Search Supreme Court of Victoria Search AustLII ▼ Search Options All databases This database only Full text Titles only Advanced Search… Search term: &times; Close About Contact Copyright & Usage Privacy Disclaimers Feedback Help Type Cases Jurisdiction Victoria Database Supreme Court of Victoria Year 2026 Citation [2026] VSC 421 All Databases Cases & Legislation Journals & Scholarship Law Reform Treaties Libraries Communities LawCite Australia CTH ACT NSW NT QLD SA TAS VIC WA New Zealand Specific Year Any 2015 Year Range 1970 2015 2015 2015 Apply --> Any Any 2026 --> Any 2015 2014 2013 --> Any 2015 2014 2013 --> Australian Executor Trustees Limited v New [2026] VSC 421 (29 June 2026) Last Updated: 29 June 2026 IN THE SUPREME COURT OF VICTORIA Not Restricted COMMON LAW DIVISION TRUSTS, EQUITY AND PROBATE LIST S ECI 2025 01481 BETWEEN: AUSTRALIAN EXECUTOR TRUSTEES LIMITED (ABN 84 007 869 794) in its capacity as executor of the Estate of Kenneth John Ryan Plaintiff v DARREN JOHN NEW in his capacity as executor of the Estate of Doreen Anne New First Defendant MORRIS LAWYERS PTY LTD (ACN 149 593 671) Second Defendant --- JUDGE : Goulden AsJ WHERE HELD : Melbourne DATE OF HEARING : 19 May 2026 DATE OF JUDGMENT : 29 June 2026 CASE MAY BE CITED AS : Australian Executor Trustees Limited v New MEDIUM NEUTRAL CITATION : [2026] VSC 421 --- WILLS AND ESTATES — Administration of estate — Failure by executor to distribute estate to one of the residuary beneficiaries — Funds equivalent to one‑quarter of net sale proceeds of sole asset of the estate held in controlled monies account by first defendant’s former solicitors — Orders made for executor to pay plaintiff its share of the estate — Orders for the payment of legacy interest and indemnity costs. Supreme Court (Administration and Probate) Rules 2023 — Administration and Probate Act 1958 , s 39B. --- APPEARANCES : Counsel Solicitors For the Plaintiff Mr J O’Halloran Hunt & Hunt The First Defendant in person No appearance for the Second Defendant Contents HER HONOUR: Introduction The plaintiff is the executor of the estate of the first defendant’s uncle, Kenneth John Ryan (‘Ryan estate’). The Ryan estate is a beneficiary of the estate of the first defendant’s mother, Doreen Anne New (‘New estate’). The plaintiff seeks to enforce payment of its entitlements from the New estate. The first defendant is the executor of the New estate. He is self‑represented in this proceeding. He has filed various affidavits and a written submission. Some of the affidavits have been filed in duplicate because he apprehended that they had not been accepted by the registry. Excluding their duplicates, the two affidavits the first defendant relies upon are: (a) his affidavit sworn on 22 April 2026, entitled ‘Affidavit of Verification — Administration Account’, with its Exhibit marked ‘A’, filed with the Court on 27 April 2026 (‘Account Verification affidavit’); and (b) his affidavit sworn on 22 April 2026, with its exhibit marked ‘DN–1’, filed with the Court on 23 April 2026 (‘Second affidavit’). The second defendant is a legal practice, which firm was previously engaged by the first defendant in connection with the administration of the New estate. The second defendant holds funds on behalf of the New estate in a controlled monies account (‘CMA’), and has been restrained from dealing with those funds pending the trial of the proceeding. [1] The plaintiff relies on the affidavit of Nicholas Donald McColl affirmed on 19 March 2025, and those of Helen Shaw Hodgins affirmed 19 May and 18 November 2025. The plaintiff seeks orders, amongst others, that: (a) the first defendant, in his capacity as executor, file a true and just account of his administration of the New estate within 28 days; [2] (b) following receipt of this account: (i) the second defendant pay to the plaintiff the entitlement due to the Ryan estate from the monies held by it in the CMA; and (ii) the first defendant pay interest on the legacy owing to the Ryan estate, in accordance with s 39B of the Administration and Probate Act 1958 (Vic) ( ‘A&P Act ’); and (c) the first defendant pay the plaintiff’s costs of and incidental to the proceeding on an indemnity basis, without recourse to the estate of the deceased. For the reasons that follow, I will make orders to enforce the will terms and so requiring the payment of the plaintiff’s entitlement to its one‑quarter share of the residue of the New estate. Factual background Doreen Anne New died on 13 October 2021, leaving a will dated 30 August 2017. Her will appointed her son, the first defendant, and her brother, Kenneth Ryan, as executors. The will provided for her estate to be distributed, after payment of all debts and expenses, as follows: (a) one half to the first defendant; (b) one‑quarter to her brother (provided he survived the deceased by more than 30 days, which he did); and (c) one‑quarter to her sister, Carmel Phillips (now also deceased). The first defendant obtained a grant of probate on 12 September 2022. Mr Ryan died on 21 November 2021, leaving his own will, dated 22 May 2021. By clause 6 of Mr Ryan’s will, his entire estate (after payment of liabilities and expenses) is to be paid to the Catholic Archbishop’s Charitable Fund (‘Fund’). The practical effect of the operation of the wills of Ms New and Mr Ryan is, therefore, that one‑quarter of the New estate will pass through Mr Ryan’s estate and be paid to his nominated beneficiary, being the Fund. For reasons elucidated below, the fact that a charitable fund operated by the Catholic Church will receive one‑quarter of Ms New’s estate informs, in part, the first defendant’s opposition to paying that entitlement to the plaintiff. The only asset of the New estate, as disclosed in the inventory, was the deceased’s property at 476 Bluff Road, Hampton, Victoria, 3188. [3] The defendant sold the property, in his capacity as executor, on 9 June 2023. The net proceeds of the sale, being $1,118,004.38, [4] were deposited into the second defendant’s trust account in relation to the New estate upon settlement of the sale on 7 December 2023. The first defendant has exhibited statements from the second defendant’s trust account and the CMA for the New estate. [5] Those statements record that various distributions have been made to the first defendant, and Mr Brendan Phillips and Ms Michelle Phillips, who are the children of Ms New’s deceased sister, Carmel. The distributions shown in the bank statements are as follows. (a) Distributions to the first defendant from the second defendant’s trust account: (b) Distributions to Brendan and Michelle Phillips from the second defendant’s trust account: The total value of those distributions appears to approximate the value of the entitlements of the first defendant, being 50% of the net proceeds of sale, and the estate of Ms Phillips, being 25% of the net proceeds of sale. The plaintiff, in its capacity as executor of the Ryan estate, was first informed about the New estate, and the Ryan estate’s entitlements thereunder, in May 2024. Between mid‑2024 and the commencement of this proceeding, the plaintiff engaged in correspondence with the first defendant about the Ryan estate’s entitlements. In that correspondence, the first defendant foreshadowed bringing a testator’s family maintenance claim against the New estate, and also sought to secure the Fund’s agreement to disclaim the Ryan estate’s interest in the New estate. The plaintiff commenced the proceeding on 20 March 2025. On 19 May 2026, the second defendant provided a copy of the bank statement for the CMA it maintains in relation to the New estate, following a request from the Court that same date. That statement shows the balance, as at 1 May 2026, as being $318,915.19 (inclusive of interest). Relevant legal principles Duty to account, duty of administration The first defendant, as the executor of the New estate, has a fiduciary duty to account to the beneficiaries, and also undertook to the Court to do so when he obtained the grant. [6] When provided, an account must be sufficiently accurate, unambiguous, clear and distinct so as to provide the beneficiaries with sufficient information to inform them as to the state of the administration. [7] An account is particularly important to permit determination of the precise quantum of gifts of residue — it being impossible to know what those gifts will be until the administration is carried out and accounted for, including the payment of debts, funeral and other testamentary expenses. The first defendant, as executor, also has a duty to ‘administer the estate in accordance with the will and, subject to the provisions of the will, to act in the best interests of the beneficiaries’. [8] This requires the calling in of the estate assets, payment of any legitimate liabilities, and then a distribution of the estate in accordance with the will. Legacy interest The plaintiff seeks legacy interest on its unpaid entitlement of one‑quarter of the residue of the New estate. In Mitchell v McLear , [9] this Court awarded legacy interest upon a gift of one‑quarter of residue that remained unpaid for over 10 years. The plaintiff is entitled to legacy interest under s 39B of the A&P Act , which provides that: (3) A beneficiary entitled to a pecuniary legacy is entitled to interest on that legacy or any part of it that is not paid to the beneficiary within 12 months of the date of the deceased’s death for the period that it remains unpaid calculated after that 12 month period at the legacy interest rate. [10] For the purposes of this section, ‘legacy interest rate’ means the rate that is 2% above the cash rate last published by the Reserve Bank of Australia before 1 January in the calendar year in which interest begins to accrue. [11] The legacy interest rate in this case is 2.1% per annum [12] and legacy interest began to accrue from 13 October 2022. [13] The first defendant’s attempt to provide an administration account By the Verification Account affidavit, the first defendant has attempted to provide an administration account for the New estate. That account is blank, other than: (a) under ‘Part C: Portion of estate distributed in specie’, where it states ‘[s]ee exhibit A — Derek Phillips and Brendan Phillips’; [14] and (b) under ‘Part D: Portion of the estate retained or remaining uncollected’, where it states ‘$305,348.14’. [15] The documents attached as Exhibit A are the bank statements for the trust account and the CMA maintained by the second defendant in relation to the New estate. In his submissions, the defendant said, about the administration account he provided, that he ‘did not obviously understand how to do that properly’. [16] He explained that he no longer has records of some of the expenses he incurred, like the funeral expenses, to be able to put it together. He said he thought the bank statements ‘would have covered what was requested’. [17] When the Court suggested that the first defendant might need to engage assistance to complete the task, the first defendant stated: I’ve got about $1,200 left in the bank ... I can’t afford a solicitor. ... You know, this has almost bankrupted me. [18] The first defendant later submitted that he had presumed the value of the unpaid entitlement could be ‘deducted from the will’. [19] He later elaborated: You know, I received half, my cousins received a quarter, and there’s a quarter left in the trust account, which from my understanding, without interest is about $304,000. That’s a quarter of 1.25 million, so ... [20] The administration account provided by the first defendant is undoubtedly deficient. However, at least at this time, the first defendant is unable to prepare one in the form required without assistance, and he lacks the financial resources to engage such assistance. Having heard about the first defendant’s difficulties, the unlikelihood of an accurate administration account being prepared and provided, and that the first defendant retained what he believed was one‑quarter of the residue estate in the second defendant’s CMA, the plaintiff indicated that it would not press its request for an administration account to be delivered if the Court considered it appropriate to order that the balance of the monies in the CMA be paid to the plaintiff in satisfaction of its entitlements against the New estate. Whether the Court can so order first requires consideration of the claims made by the first defendant in his ‘defence’ of the proceeding, to which I will now turn. The first defendant’s ‘defences’ to the claim for payment of the unpaid legacy By his submissions, the first defendant raises at least two ‘defences’ based upon which he submits he has the right to retain the remaining quarter of the residue of his mother’s estate. He also claims to be entitled to damages. The defences described in the submissions are, briefly stated: (a) an estoppel, because his mother agreed to change her will in 2019, after discussing with the first defendant that Mr Ryan, who had been moved to aged care and had sold his house for $1.4 million, no longer needed her financial support and should be removed as a beneficiary; (b) an estoppel against the Fund, as beneficiary of his uncle’s estate, who he alleges had agreed to disclaim its interest in the New estate. The first defendant’s submissions do not refer to a family provision claim, but such a claim has been foreshadowed previously in the Court and in correspondence by the first defendant. Each of these so‑called ‘defences’ is actually a claim in its own right, which the first defendant would have to raise by commencing his own proceeding. For example, a proceeding to seek revocation of the grant and/or rectification of the will, or to pursue a claim to enforce a variation to the will, in accordance with an agreement with the Fund or based upon an estoppel, or to bring a testator’s family maintenance claim. He hasn’t pursued any of these claims in a separate proceeding, and would encounter very significant challenges in doing so, including: (a) being out of time to commence a family provision claim; (b) having sought to prove his mother’s will by applying for and obtaining a grant of probate, he would be hard‑pressed to bring a proceeding which contends the will was not in the terms he proved; and (c) although the first defendant did approach the Fund, being the beneficiary of the Ryan estate, to seek its agreement to disclaim the Ryan estate’s interest in his mother’s estate, there is no evidence of any actual variation to the will by way of disclaimer or otherwise, nor has the defendant adduced any evidence of a promise to do so. The first defendant strongly believes the Fund, as the beneficiary of the Ryan estate, should not be entitled to any money from his mother’s estate. He had hoped he could raise the above matters by way of defence to the plaintiff’s claimed relief. He explained his position as follows: I was hoping it would be dealt with today because I’m about to be homeless. I mean, look, I know I’m being — look, I honestly think they’ve got no right to that money whatsoever. They did absolutely nothing for my mother and I cared for her for 17 years, you know. This word ‘entitlement’, it does annoy me quite a lot, I have to admit. I know — I know it’s official terminology but, as far as I see it, they’re entitled to nothing. ... They did nothing for my mother. It was her house. They’ve already got almost 1.8 million from my uncle and they are one of the richest organisations in Victoria. And I’ve got about $1,200 left because of their refusal to follow through on what two of their people said that they would do. I understand promissory estoppel was used as a sword so — in Victoria as — New South Wales, it’s different. In Victoria it’s a cause of action. So I don’t know what else I can say, Your Honour, but I think my emails clearly show that they did agree to sign this thing, you know. It would have been nice to have got it in writing from them but that — it just didn’t happen. ... And yes, it has caused me a lot of detriment, actually. I’ve — my health’s suffered because of this. Yeah, and what was [unconscionability]. [21] I accept that he was motivated to, and did, approach the Fund in order to try to secure its agreement to disclaim its indirect interest in his mother’s estate. The emails exhibited to his Second affidavit reveal those efforts. However, as he acknowledges, the Fund never signed any document in order to disclaim its interest and, in my view, though the claim has not properly been raised for the Court’s consideration, the emails he exhibits to his affidavit do not reveal any promise that it would do so. None of the identified claims or defences can be properly raised in this proceeding. Regardless, none of the matters raised provide a lawful justification for failing to pay the plaintiff’s entitlement in accordance with the will. Disposition The terms of Ms New’s will are clear — the Ryan estate is entitled to a one‑quarter share of the residuary estate. The first defendant called in the assets of the Estate, but he has refused to make any distribution to the plaintiff, despite repeated requests that he do so prior to the commencement of the proceeding. Although he has explained the reasons why he does not believe the plaintiff should be paid the one‑quarter share of his mother’s estate, and although his financial circumstances and potential homelessness are alarming, unfortunately, neither circumstance, though extremely dire, provides a lawful justification for his failure to make the distribution. Given his impecuniosity and lack of experience and expertise, I accept that the first defendant will be unable to deliver a compliant administration account, and so there is no utility in ordering him to do so. Also, having reviewed the trust account and CMA statements exhibited to the Verification Account affidavit, together with the latest statement provided by the second defendant on 19 May, I am satisfied that the sum presently held in the CMA is equivalent to the plaintiff’s one‑quarter entitlement to the net proceeds of sale of the sole asset of the estate, together with a portion of its entitlement to legacy interest calculated since October 2022. [22] Therefore, I accept the plaintiff’s submission that it is appropriate, in all the circumstances, to order that the amount of $318,915.19, and any further accrued interest currently held in the CMA maintained by the second defendant, should be paid to the plaintiff in fulfilment of its entitlements in respect of the New estate (less a small sum on account of outstanding costs owed to the second defendant). [23] Legacy interest The plaintiff is entitled to legacy interest, under s 39B of the A&P Act , on its unpaid entitlement, which interest is to be calculated at the legacy interest rate from the date that is 12 months from the date of death until the date of judgment. As noted above, assuming one‑quarter of the net proceeds of sale to be $304,000, then some of that legacy interest will be paid by reason of the payment of the whole of the balance of the CMA to the plaintiff. Costs The plaintiff seeks indemnity costs on the basis that the first defendant has breached his fiduciary duties as executor by failing to account to the plaintiff and failing to pay the plaintiff’s entitlement in the New estate. An award of indemnity costs is appropriate in the circumstances, although whether the plaintiff will ever be able to enforce its costs award (or the additional entitlement to legacy interest) must be doubted. Conclusion For the reasons above, I will order as follows: (a) The second defendant pay to itself the sum of $750.00, in respect of its legal fees unpaid by the New estate. (b) After payment of the amount provided in (a), the second defendant pay to the plaintiff the monies comprising the balance of the CMA in fulfilment of its entitlement as a beneficiary of the New estate and in payment of some of the legacy interest payable pursuant to paragraph (c) below. (c) pursuant to s 39B of the A&P Act , the first defendant pay to the plaintiff interest on the amount of the Ryan estate’s entitlement at the legacy interest rate from 13 October 2022 to the date of payment. (d) The first defendant pay the plaintiff’s costs of and incidental to the proceeding on an indemnity basis, without recourse to the New estate, such costs to be agreed or taxed in default of agreement. (e) The first defendant is to bear his own costs of and incidental to the proceeding, without any recourse to the New estate. --- [1] Orders of O’Meara J made 17 September 2025. [2] In the form 3–6AA of the Supreme Court (Administration and Probate) Rules 2023 (Vic). [3] More particularly described as the land comprising Certificate of Title Volume 8727 Folio 122. [4] The sale price as disclosed in Exhibit P1, tendered at trial, was $1.25 million. The net proceeds include payments made at settlement. [5] Verification Account affidavit, Exhibit A. [6] Supreme Court (Administration and Probate) Rules 2023 , r 2.04. [7] Mitchell v McLear [2020] VSC 25 , [13] (‘ Mitchell ’). [8] Skaftouros v Dimos [2002] VSC 198 , [15]. [9] Mitchell , [23]. [10] A&P Act , s 39B(3). [11] Ibid s 3(1). [12] The cash rate published by the Reserve Bank on 8 December 2021 was 0.10% (see Reserve Bank of Australia, ‘Cash rate target — the key monetary policy decision’, <https://www.rba.gov.au/‌cash‑rate‑target‑overview.html>), meaning the legacy interest rate is 2.1%. [13] Under s 39B(3), interest is taken to accrue from the end of the period of 12 months following Ms New’s death on 13 October 2021. [14] Verification Account affidavit, Exhibit ‘A’, Administration Account. [15] Ibid. [16] Transcript of Proceedings, Australian Executor Trustees v New [2026] VSC 421 (Supreme Court of Victoria, S ECI 2025 01481, 19 May 2026) T23.11–T23.12 (‘Transcript’). [17] Ibid T23.18–T23.21. [18] Ibid T26.17–T26.20. [19] Ibid T27.09–T27.10. [20] Ibid T27.27–T27.30. [21] Transcript T37.02–T37.26. [22] Assuming net sale proceeds payable to the plaintiff of $304,000, then the amount due now, with the addition of legacy interest, would be about $328,000. There is 318,915.19 in the account. [23] The second defendant is owed $750.00, which sum the plaintiff consents to being deducted in payment of the second defendant’s unpaid fees prior to payment of the remaining monies to the plaintiff (see Transcript T12.21–T12.23). Print Print (pretty) Print (eco-friendly) Download RTF format (407 KB) Signed PDF/A format Cited By LawCite records NoteUp references NoteUp references Join the discussion Tweet this page Follow @AustLII on Twitter Recent tweets about AustLII --> All Databases Cases & Legislation Journals & Scholarships Treaties Libraries LawCite --> About Copyright & Usage Privacy Disclaimers Help http://www.austlii.edu.au/au/cases/vic/VSC/2026/421.html