Possession Proceedings Against Deceased Estates in Victoria

Where a registered proprietor of real property is deceased, in Victoria court proceedings may be commenced against the personal representative of the estate. The personal representative is identified by the grant of probate or letters of administration.

In some cases an estate does not have a personal representative appointed. This can be due to the estate not having many assets available for distribution. Can proceedings be commenced against an estate where no personal representative has been appointed? Yes it can.¹

In commencing court proceedings where there is no personal representative appointed, the practical question as to how such proceedings are served upon the defendant is raised.  It has been accepted practice in most Australian states for an application to be made with the Court for leave to proceed against the estate and within the application to simultaneously seek judgment.  The process in Victoria has not been as clear.

A recent decision in the Supreme Court of Victoria has clarified that it is appropriate to adopt a practice in line with rules of courts in other states of Australia.

Recent decision

In the recent matter of Australia and New Zealand Banking Group Limited v The Estate of Michael Charles Balding [2016] VSC 728 it was stated that the appropriate course to serve a deceased estate is to either:

• apply for the appointment of a person to represent the deceased estate pursuant to r 9.08(5)(a)(i) of the Supreme Court General Civil Procedure Rules 2005 (Vic) (Rules); or
• apply to proceed in the absence of a person to represent the estate of the deceased pursuant to r 16.03(1)(a) of the Rules.

The Court found that whilst a proceeding can be commenced against a deceased estate, for any steps to be taken in the proceeding, it was necessary that a ‘legal person’ be served.

Apply for the appointment of a person to represent the estate

Under this process a summons is filed seeking an order that a certain person be appointed to represent the estate. In this instance, the person to be appointed is to be served with the summons and is able to attend court to be heard on the matter.

It appears the appropriate person to be appointed as representative of deceased estate would be:

• in the case of where there is a Will but no probate has been granted, the executors named in the Will; or
• in the case of a person dying intestate, any person who has applied (albeit unsuccessfully) for Letters of Administration or, alternatively, the State Trustee.

Once appointed by a court, the identified person is then provided with notice of the proceeding and legal action would progress in the ordinary course.

Proceed in the absence of a person to represent the estate

Under this process a summons is filed seeking orders that the plaintiff be entitled to proceed with the legal proceeding without a personal representative being appointed.  The summons may also seek an order that judgment be granted simultaneously. As this process seeks to proceed in the absence of serving a personal representative of an estate, it is possible to seek judgment ex parte at the same time.

Where no person is found to be willing and able to act for the estate, judgment for possession may be obtained. This process is similar to that in the Australian Capital Territory, New South Wales, South Australia, Queensland and Western Australia.

Takeout

If a borrower has died and no legal personal representative has been appointed to the estate, a lender is not precluded from seeking a possession order from the courts.  The lack of probate or letters of administration does not impede a lender from proceeding with recovery action.

The process to be followed in this situation depends upon whether an interested person can be identified as being the appropriate person to be appointed the personal representative of the estate. If a person can be identified then a summons should be served upon them notifying them of the intention to ask to the court to appoint them as the personal representative of the estate. If no appropriate person can be identified, a summons seeking to proceed in the absence of a personal representative and obtain judgment in the absence of serving the defendant may be made.

To ensure the appropriate course of action is followed Gadens is able to assist clients in identifying the most efficient and productive way to proceed.

¹ A lenders cause of action under its loan agreement and mortgage survives against the deceased estate: s29 Administration and Probate Act 1958 (Vic).