Supreme Court New South Wales Medium Neutral Citation: Willcocks v Willcocks [2012] NSWSC 871 Hearing dates: 13 July 2012 Decision date: 13 July 2012 Jurisdiction: Equity Division - Duty List Before: White J Decision: 1. Refuse the application to extend the injunction made on 11 July 2012. 2. Order that order 1 made on 11 July 2012 be discharged. This order may be taken out forthwith. 3. Order that the plaintiff pay the first defendant's costs of the proceedings to date and order that those costs be assessed forthwith, and will be payable forthwith after agreement or assessment. Catchwords: PRACTICE AND PROCEDURE - interlocutory issues - injunctions - application for extension of injunction restraining registration of Transfer Severing Joint Tenancy - question as to capacity of defendant to sever joint tenancy - whether defendant acting under undue influence - evidence on application does not raise serious question to be tried - possibility of future application does not provide basis for continuing current injunction - as a person claiming adversely to the transfer the plaintiff does not have standing to challenge the transaction Legislation Cited: Real Property Act 1900 NSW Trustee and Guardian Act 2009 Cases Cited: Gibbons v Wright [1954] HCA 17; (1954) 91 CLR 423 Category: Interlocutory applications Parties: Glanville Arnim Willcocks (Plaintiff) Patricia Maude Willcocks (Defendant) Representation: Counsel: R Pearson (Plaintiff) P T Russell (Defendant) Solicitors: Kennedy & Cooke (Plaintiff) Andrew Warren Associates (Defendant) File Number(s): 2012/204043 Judgment 1HIS HONOUR: This is an application for the extension of an interlocutory injunction restraining the Registrar-General from registering an instrument of Transfer Severing Joint Tenancy. 2The plaintiff and the first defendant are husband and wife. The plaintiff is 88 and the first defendant is 80. They both reside in a nursing home. They are registered as the proprietors of a property in Narooma as joint tenants. 3On 4 June 2012 the first defendant signed a Transfer Severing Joint Tenancy pursuant to s 97 of the Real Property Act 1900. The joint tenancy will be severed on registration of that dealing. On 4 June 2012 the Registrar-General gave notice to the plaintiff that the dealing had been lodged and stated his intention to register it after 30 days, unless restrained. 4The plaintiff's case is that there is a serious question to be tried that his wife lacks the capacity to sever the joint tenancy and that she is acting under the influence of other persons who have become friends in recent years, who have provided assistance to her, and who have received financial assistance from her. 5An application has been made by a nephew of the plaintiff to the Guardianship Tribunal for the review of enduring powers of attorney given by the first defendant to those friends. 6There is evidence before me that raises questions as to the plaintiff's mental capacity. There is a letter to the Guardianship Tribunal from a treating doctor that the plaintiff has a delusional disorder concerning the family of her husband, that she displays poor decision-making skills and has diminished frontal lobe function. She is said to have views about her husband, the plaintiff, which I understand it would be said, were delusional. 7There are two principal questions. The first is whether or not there is any evidence on this application that raises a serious question to be tried that the first defendant does not have capacity to sever the joint tenancy. The second question is, even if the first defendant does not have that capacity, whether the plaintiff has standing to complain. 8The Transfer Severing Joint Tenancy was prepared by a solicitor, Mr Clarke, after consultation with the first defendant. He has deposed that during his conference with her, he formed the view that she had capacity and was not acting under the undue influence of any other person and that the questions she asked, and the explanations she gave to him of the nature and effect of the documents, led him to form the view that she had capacity. 9He was instructed to prepare not only the Transfer Severing Joint Tenancy, but also a new power of attorney and enduring guardianship, and a will. Mr Clarke has prepared an affidavit of the first defendant in which she deposes to her reasons for signing the documents. She says that the two individuals who are accused of exercising undue influence over her have done nothing of the kind and that they have been helpful to her in various ways. 10She is concerned about her financial position. She says that she and her husband have kept their assets separate for the most part, that her aged pension is not adequate to meeting monthly nursing home expenses, and that she needs to be able to deal with her assets, including the subject property. 11She deposes that she understands that unless the joint tenancy is severed, her interest will pass to her husband if she dies before him and that by severing the joint tenancy her half of the property would not pass to him if she dies before him, nor would his half pass to her if he dies before she does. She says that she is severing the joint tenancy because the plaintiff refuses to share other assets with her, and that by doing so she would further separate her legal and financial affairs from those of her husband, giving her greater financial independence. 12As this is an interlocutory application, none of this evidence has been tested. 13For the first defendant to have capacity to sever the joint tenancy, she would have to be capable of understanding that by executing and then registering the Transfer Severing Joint Tenancy, she would not become entitled to the whole of the property if her husband predeceases her, and that her husband would not become entitled to the whole of the property if she predeceases him, but that her half share of the property would pass to her estate if she still owns her share at her death (Gibbons v Wright [1954] HCA 17; (1954) 91 CLR 423 at 438-439). 14The evidence that the first defendant may suffer delusions in some respects is not evidence that she is not capable of that understanding. The only evidence on this application as to her capacity to understand the effect of the dealing is her evidence and that of her solicitor, which is strongly supportive of her having capacity. 15In any event, if she lacks capacity, the plaintiff does not have standing to challenge the transaction. 16In Gibbons v Wright land, including land held under the Real Property Act, was held by three persons as joint tenants. Two of them, being sisters, executed a memorandum of transfer that was subsequently registered, whereby each transferred to the other her one-third share in the joint tenancy in consideration of a similar transfer by the other to her. The High Court said that if these instruments took effect according to their terms, they were effectual to sever the tenancy and would cause the land to be vested in three persons as tenants in common (at 435-436). The two sisters died and the surviving co-owner, being the widow of their brother, claimed that she was entitled to the whole of the property because they lacked capacity when they executed the transfers. It was found that they did lack that capacity. Nonetheless, the High Court held that the transfers were not void, but voidable, and it was not open to other persons, such as one claiming adversely to the party lacking capacity, to set aside the transfers. Such transfers could be voidable by the transferors or their representatives, but not by a person claiming adversely to them (at 439-449). 17In the present case the plaintiff is in the same position as was the plaintiff in Gibbons v Wright, even if at a final hearing he established a lack of capacity on the first defendant's part. 18For the reasons I have given, the evidence on this application does not raise a serious question to be tried that there was such a lack of capacity. But even if that hurdle were overcome, it seems to me that the plaintiff would have to fail. 19A question was raised in the course of argument as to the possibility that an application might be made for the appointment of a financial manager to the estate of the first defendant. No such application has been made to the Guardianship Tribunal. If a financial manager were appointed, then the power of the first defendant to deal with her property would be suspended (NSW Trustee and Guardian Act 2009, s 71(1)). 20The possibility of such a future application does not provide a proper basis for continuing the current injunction against registration of the Transfer Severing Joint Tenancy. First, it appears that the first defendant has done all that is necessary on her part to complete the severance of the joint tenancy, in that she has signed the dealing, apparently in registrable form, and it has been lodged for registration. I doubt that the appointment of a financial manager could itself be a proper basis for restraining the Registrar-General from proceeding to register the dealing. That is particularly so, given that different questions of capacity arise on an appointment of a financial manager than arise on the question of the first defendant's capacity to sever the joint tenancy. A person may be incapable of managing his or her own affairs, yet be able to understand the general purport of the instrument. 21However, these questions do not arise because there is no application before the Tribunal or before the Court for the appointment of a financial manager to the first defendant's estate. Hence, no question arises of preserving the subject matter of any such application. Nor is the severance of the joint tenancy by itself necessarily disadvantageous to either party. It is not known which of the plaintiff or the first defendant is likely to survive the other. 22Even if the question of the balance of convenience had arisen, which it does not, I do not think the balance of convenience would favour continuance of the injunction. 23For these reasons I refuse the application to extend the injunction made on 11 July 2012. 24I order that order 1 made on 11 July 2012 be discharged. This order may be taken out forthwith. 25I order that the plaintiff pay the first defendant's costs of the proceedings to date and order that those costs be assessed forthwith, and will be payable forthwith after agreement or assessment. 26Stand over to the Registrar's list on 27 July 2012. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 02 August 2012