Family Provision Claims and Moral Duty for Adult Children

The recent decision in Cotter v Tomassini highlights the complex interplay between estranged family relationships, discretionary trusts, and family provision claims brought under succession legislation. Although this matter was heard under Victorian legislation, the principles examined by the Court offer relevant guidance for estate disputes in New South Wales particularly in matters involving adult children, blended families, and discretionary trust structures.

Background: A Daughter Left Out of a $6M Estate

Jacqueline Cotter commenced proceedings seeking provision from the estate of her late father, Ian Cotter, who passed away in October 2019. At the time of his death, Ian's estate was valued at just over $6 million. Despite being Ian's only child from a long marriage to Maria Cotter, Jacqueline was left entirely out of her father’s Will. Instead, the entirety of Ian’s residuary estate was left to Gi Mi Kim, a woman with whom Ian had been in a long-term intimate relationship. Ms Kim also received substantial gifts during Ian's lifetime, including his superannuation death benefit.

Ian expressly excluded Jacqueline in his Will, stating:

“... it is my understanding and belief that my said wife has made adequate provision for her in her Will from the substantial assets that my wife has acquired from me during my lifetime.”

This formed the crux of the defence to the claim that Jacqueline’s mother, Maria, had received the bulk of Ian’s wealth through a binding financial agreement (BFA) prior to his death, and that Jacqueline stood to benefit indirectly through Maria’s estate.

The Family Dynamics

The case exposed a deeply fractured family history. Ian and Maria Cotter’s marriage, though lasting decades, was marred by infidelity on both sides. Notably, Ian had engaged in numerous extramarital affairs, including one that led to the birth of another daughter, Karly Doyle, whose existence was only revealed in 2017, a disclosure that led to a complete breakdown in the relationship between Ian and both Maria and Jacqueline.

In 2017, Maria and Ian separated and later entered into a BFA under the Family Law Act 1975 (Cth). That agreement resulted in Maria receiving approximately 81% of the matrimonial asset pool valued at more than $40 million. Ian retained approximately $9 million in assets, some of which formed the estate in dispute.

The Legal Framework: Moral Duty and “Proper Maintenance and Support”

Jacqueline’s claim was brought under Part IV of the Administration and Probate Act 1958 (Vic)—the equivalent in NSW being Chapter 3 of the Succession Act 2006 (NSW).

The Court needed to consider:

• Whether Ian had a moral duty to make provision for Jacqueline.

• Whether the Will failed to make adequate provision for her proper maintenance and support.

• If so, what provision, if any, should be made?

The Court reiterated the key principle that freedom of testation the right of an individual to leave their estate as they see fit is balanced against moral obligations owed to certain family members. In the case of adult children, the High Court has consistently recognised that a parent’s moral duty may extend to ensuring a reasonable buffer or support against life’s contingencies, even if the child is financially independent.

The Role of Discretionary Trusts

A significant complexity in this case was the existence of several family trusts. Notably, Maria gained control of the Ian Cotter Family Trust and other related entities after the separation.

While Jacqueline was technically a beneficiary of some of these trusts, she had never received any distributions, and her later requests were rejected by Maria in writing. Maria’s refusal was unequivocal:

“You are not to expect any help under any circumstance from me.”

This evidence was key. The defendant, the executor of Ian’s estate, argued that Jacqueline could — and should — have sought provision from these trusts. The plaintiff countered that she was unwilling to litigate against her mother and risk being evicted from the family home where she resided.

Ultimately, the Court accepted that Maria’s control of the trusts did not amount to reliable or secure provision for Jacqueline. Maria had no comprehension of her role as trustee and was guided entirely by her accountant. Importantly, the Court found that Maria had predetermined not to assist her daughter, despite the trustee's obligations to consider all beneficiaries.

This finding supported the view that Ian’s assumption — that Maria would provide for Jacqueline — was misguided.

Estrangement and Conduct

The defendant relied on the fractured relationship between Ian and Jacqueline as justification for her exclusion. Indeed, evidence showed that communications between them in the final years were marred by hostility. However, the Court confirmed that estrangement alone does not extinguish a testator’s moral duty.

Quoting Hallen J in Walsh v Walsh:

“The mere fact of estrangement between a parent and child, on its own, should not ordinarily preclude the child from satisfying the jurisdictional requirement for provision.”

Jacqueline’s conduct, including the admitted appropriation of $15,000 from Ian during his illness (which she later repaid), was not sufficient to disqualify her from entitlement. The Court took a holistic view of her circumstances, including her ongoing financial vulnerability and the lack of any security over trust income.

The Court’s Decision: Provision Granted

The Court found that:

• Ian did have a moral duty to make provision for Jacqueline.

• The Will failed to make adequate provision.

• The assertion that Maria would provide for Jacqueline was based on a false premise.

Despite Jacqueline earning a reasonable income, she had limited savings, no superannuation, and an unstable living arrangement. The Court concluded that provision was necessary to ensure her proper maintenance and support, particularly given the size of the estate and the absence of other competing claims.

Ultimately, the Court awarded Jacqueline $1.8 million, striking a balance between her needs and the testator’s intentions.

Key Takeaways for NSW Estate Disputes

Although this case was determined under Victorian legislation, the principles around moral duty, discretionary trusts, and estrangement are equally applicable in New South Wales. Key points include:

• Adult children can succeed in family provision claims, particularly where they face financial uncertainty and were excluded from a substantial estate.

• Discretionary trusts controlled by estranged family members are not a reliable substitute for direct provision under a Will — especially if the trustee refuses to act in good faith.

• Testators should not assume future third-party provision (e.g., from an ex-spouse) will fulfil their own legal obligations.

• Estrangement must be carefully examined. It does not remove moral duty unless the child’s conduct was so severe as to justify total exclusion.

Best Practices for Estate Planning

This case reinforces the importance of careful estate planning and the need for:

• Clear and contemporaneous documentation explaining any exclusion of family members.

• Independent control of discretionary trusts, with trustees who understand and are willing to discharge their duties.

• Reviewing the impact of family law settlements on estate planning decisions.

If you are considering excluding an adult child from your Will or relying on trust structures to provide for beneficiaries, it is critical to obtain independent legal advice to avoid costly litigation and unintended outcomes.