Estate of S [2012] NSWSC 1281

Supreme Court New South Wales

Medium Neutral Citation: Estate of S [2012] NSWSC 1281 Hearing dates: 8 October 2012 Decision date: 08 October 2012 Jurisdiction: Equity Division - Probate List Before: Ward J Decision: Leave granted for making of application re statutory will. Orders made approving the terms of the will and for signing and sealing thereof. Catchwords: SUCCESSION - statutory wills - s 18 Succession Act - application for leave to make application heard with application for substantive relief - where testator lacks testamentary capacity - where proposed will is unexecuted - whether proposed will is one which the testator is reasonably likely to have made had she had testamentary capacity - consideration of actual, or reasonably likely, subjective intention of incapacitated person - HELD - leave granted - application granted Legislation Cited: Succession Act 2006 (NSW) Cases Cited: Re Fenwick (2009) 76 NSWLR 22 Re Will of Jane [2011] NSWSC 624 Texts Cited: N/A Category: Principal judgment Parties: L (Plaintiff) Representation: M K Meek SC (Plaintiff) Sharon Moss Legal (Plaintiff) File Number(s): 12/286437

Judgment 1HER HONOUR: In this proceeding, application was made by summons filed on 14 September 2012 for the making of a statutory will in relation to the estate of S. 2L, the daughter-in-law of S, seeks leave pursuant to s 19 of the Succession Act 2006 for the making of an application for an order under s 18 of the Succession Act for the alteration of a will made by S on 25 June 1955 and, if that leave be granted, seeks an order approving the terms of the will annexed to the Summons. 3S, who is aged 96 and suffering from dementia, resides in an aged care facility. In November 2010 the Guardianship Tribunal appointed S's daughter (D) and the plaintiff (L) as guardians and managers of S's estate. (The present application is brought by L with the support of D). As S is a person in respect of whom orders by the Guardianship Tribunal have been made, I have anonymised these reasons. 4I heard both the application for leave and the application for the substantive relief on 8 October 2012. I granted leave to make the application and made the orders sought. However, as the application had come before me in a busy Protective List, I indicated that I would later publish the reasons for my decision. These are those reasons. Background 5Briefly, by way of background, I note as follows. S was married to F, who predeceased her in 1982. They had two children, P, who died in 1994, and D. The plaintiff (L) was P's second wife and together they had one child, A1. (P had two children from a prior marriage, namely A2 and A3, both of whom are adults.) D has two children (K and SH). The approximate value of S's current estate is $776,000.00. 6S made a will on 25 June 1955 under which she appointed F her sole executor and beneficiary but, in the event that F did not survive her (which transpired to be the case), she appointed Permanent Trustee Co of New South Wales as executor and left her estate (after payment of debts, funeral and testamentary expenses) to such of her children as attained the age of 21 (and, if more than one, as tenants in common in equal shares). 7Accordingly, under the 1955 will, if D survived her mother, the whole of S's estate would be taken by D. (If D did not survive her mother then, on intestacy, a seemingly remote contingency given their respective ages, the five grandchildren would take the estate. Senior Counsel for the applicant, Mr Meek SC notes that each of the five grandchildren has been served with notification of the present application.) 8P died in 1994. In 1999, S instructed solicitors to draw up a new will and a power of attorney. In her affidavit, L gave evidence of discussions S had with her about the making of such a will and also of a power of attorney and such documents were in fact drawn up by a solicitor in Epping and sent to S (the unexecuted originals of those documents were tendered on the application before me). L gave evidence of a conversation with S from which it was L's understanding that S had executed the new will. 9In July 2010, by which time S was having difficulty living without assistance, L discovered that neither the will nor the power of attorney had been executed. Professor Ian Cameron, the staff specialist of the Rehabilitation and Aged Care Division of Northern Sydney Central Coast Area Health Service, formed the view at that time that S did not have the capacity to complete a power of attorney or change her will. 10L has not been able to establish that the 1999 draft will was executed in any form or that there is in existence any will other than the 1955. 11On 26 September 2010, D and L made a joint application to be appointed as guardians and financial managers for S and, at a hearing on 15 November 2010, the Guardianship Tribunal made those appointments. 12On the present application, L (with D's support) seeks that the Court approve a statutory will in the form of the 1999 draft will which had been prepared for S (under which L would be appointed as executrix; provision is made for legacies of $10,000 to each of A2 and A3; and the residue of S's estate would be left as to one-third to L and the remaining two-thirds to D). Issues 13Pursuant to s 18 of the Succession Act, the Court has power to make a will for a person who lacks testamentary capacity and who is alive at the time when the order is made (s 18(3)). Leave is required to make the application (s 19). (It is noted that the reason for the leave criteria was explained by Palmer J in Re Fenwick (2009) 76 NSWLR 22 as an to attempt to sift out baseless applications that are unlikely to succeed.) 14In uncontested cases or relatively straightforward cases, on the hearing of the leave application, the Court may deal first with the leave application and then proceed immediately to deal with the matter as a final hearing (as I did). Section 21 provides that, on an application under s 18, the Court can inform itself in a number of different ways and it is not bound by the rules of evidence. 15Senior Counsel for the plaintiff (Mr Meek SC) submitted that the real issue in dispute in the present case is whether I am satisfied that the proposed will is reasonably likely to be one that would have been made by S if she did have testamentary capacity (referring to s 22(b) of the Succession Act 2006), this being a case in which it is clear that S has lost capacity to alter the earlier testamentary dispositions made by her. 16In Re Fenwick Palmer J considered the meaning of the words "reasonably likely" in s 22(b) of the Act, saying from [151]: "Reasonably" can, of course, mean "in accordance with reason", as in the phrase "acting reasonably in all the circumstances". It can also be used to lessen the intensity of an adjective. For example, if I were asked: "Is this action necessary", the answer "it is necessary" would be stronger than "it is reasonably necessary". The second answer conveys that there is some latitude, or margin of judgment, available whereas the first answer does not. In the same way, if the Court were required to find whether a certain result is "likely" for the purposes of s 22(b), it would have to make its judgment in a "yes or no" or "black or white" fashion. However, if the Court were asked whether the result is "reasonably likely", it does not have to be persuaded of likelihood to the same degree. It may answer "yes" if it considers that there is a fairly good chance that the result is likely. Alternatively, it may answer "yes" if it recognises that other reasonable people could regard the result as likely, even if the Court itself would differ. Thus "reasonably likely" can mean "a fairly good chance that it is likely" or "some reasonable people could think that it is likely" or "some reasonable people could think that there is a fairly good chance that it is likely". Such are the nuances of the English language. As I have observed, I think that "reasonably likely" must be understood in one or other of its nuances in different applications of s 22(b).... 17As to the question of intention in a "lost capacity", at [154] Palmer J observed that: The easiest case is a lost capacity case where the incapacitated person is adult, has formed family and other personal relationships, has made a valid will before testamentary incapacity occurred, and is now said to have expressed some testamentary intention in relation to the circumstances sufficient to warrant an application for a statutory codicil or new will. 18His Honour noted that in those circumstances the Court must first be satisfied that the proposed will or codicil truly implements what the applicant claims the incapacitated person wishes to do and that the task "is one of fact finding: has the incapacitated person actually stated or otherwise manifested a particular testamentary intention or has such an intention been attributed to him or her by others on the basis of inference, likelihood or mere wishful thinking?" At [156], his Honour said: The evidence is likely to be on affidavit, at least in the first instance. There will be some cases in which the affidavit evidence is so clear and convincing that the Court will be satisfied at once that the incapacitated person has indeed expressed the intention reflected in the proposed will or codicil. In other cases, the Court will bear in mind that evidence on affidavit is easily moulded by the drafter and may give an impression which the Court would not receive if it saw and heard the deponent in person. Accordingly, where the affidavit evidence taken as a whole is not clear and convincing that the incapacitated person has actually expressed the testamentary wish contained in the proposed will or codicil, the Court should avail itself of the power under s 21(b) and s 21(c) to see and hear the incapacitated person to verify the wish ascribed in the affidavit evidence. 19His Honour went on to note that the next question (if the Court is satisfied that the proposed will or codicil expresses the present actual intention of the incapacitated person) is as to whether that intention would have been carried into testamentary effect by the person if he or she did have testamentary capacity (a question that his Honour considered might pose little difficulty if the person's testamentary capacity fell only a little short of having testamentary capacity but might not be so easy if the testamentary intention expressed by the incapacitated person were the result of delusions about the natural objects of his or her testamentary bounty). At [158]-[159], his Honour said: In short, the Court should be conscious that there are two questions involved in a case of alleged actual intention under s 22(b): has the incapacitated person actually expressed the intention attributed; would the person have held that intention if possessed of testamentary capacity? There is another question also: is the expressed intention the product of the incapacitated person's free choice, or has some undue pressure or influence been applied? However, this question is better considered, I think, under s 22(c), to which I will come shortly. 20The second kind of lost capacity case identified by his Honour was (at [160]) where an adult with established family or other personal relationships has made a valid will but, since losing testamentary capacity, has not expressed, or is incapable of expressing, any testamentary intention to deal with changed circumstances, such as, the birth of a child or the death of a beneficiary under the existing will. His Honour said (at [161]-[162]) that: In such a case the Court may be satisfied as to what the incapacitated person is "reasonably likely" to have done, in the light of what is known of his or her relationships, history, personality and the size of the estate. The previous will may give a very good indication of the incapacitated person's testamentary choices and preferences such as to provide evidence of what it is likely he or she would now do in the changed circumstances. For example, the will, coupled with family history, may show that it would be highly unlikely that the incapacitated person would have intended failure of a residuary bequest to create an intestacy because intestacy would benefit relatives with whom the person was not on good terms. In such a case, the Court would be satisfied that the incapacitated person would likely have made another residuary bequest; the question then is: does the proposed codicil confer the bequest on a person or charity whom or which the incapacitated person is reasonably likely to have chosen? 21His Honour emphasised (at [170]) that in a lost capacity case the Court's concern under s 22(b) is with the actual, or reasonably likely, subjective intention of the incapacitated person. To similar effect is the discussion by Hallen AsJ in Re Will of Jane [2011] NSWSC 624 at [73]-[81] in which his Honour applied the reasoning in Re Fenwick (at [155]) and said (at [76], [78]-[81]): If an actual intention cannot be established, the sub-section speaks in the chameleon-like language of reasonable likelihood. The degree of satisfaction that the phrase "reasonably likely" contemplates is difficult to discern. The phrase has a different connotation from the single word "likely". The qualifying adverb "reasonably" requires that the word "likely" be given a meaning less definite than "probable". It is that word ("reasonably") which governs the standard of likelihood. It lessens the intensity of the word "likely". In other words, quantitative guidance is suggested by the word "reasonably" whilst the word "likely" requires a qualitative judgment. ... The Shorter Oxford English Dictionary defines "reasonably" as "sufficiently, fairly". Although the context being considered was very different to the present, the observations of the Victorian Full Court concerning the phrase "reasonably likely" in Department of Agriculture and Rural Affairs v Binnie [1989] VR 836 are useful. Marks J said of the phrase "reasonably likely", at 842: The expression "reasonably likely" is substantially idiomatic, its meaning not necessarily unlocked by close dissection. In its ordinary use, it speaks of a chance of an event occurring or not occurring which is real - not fanciful or remote. It does not refer to a chance which is more likely than not to occur, that is, one which is "odds on", or where between nil and certainty it should be placed. A chance which in common parlance is described as "reasonable" is one that is "fair", "sufficient" or "worth noting". It is not inapt to attribute such meaning to the expression in s 31(1) of the Act. More recently, in Sportsbet Pty Ltd v New South Wales (No 9) [2010] FCA 31, Perram J when considering whether documents should be produced under a notice to produce, at [4], said: [4] Reasonable likelihood is a different concept to reasonable possibility and, to my mind, connotes a degree of certainty ... that travels beyond the merely conjectural. Whether the proposed statutory will is "reasonably likely" must be derived from all relevant evidence and information as may be available concerning the actual intentions, attitudes and predispositions of the person in the past, by reference to what is known of his, or her, relationships, history, personality and the size of the estate. Thus, it seems, what is required is to establish the chance of an event occurring (the proposed will is one that is, or would have been reasonably likely to have been, made by the incapable person, if he, or she, had testamentary capacity) that is above mere possibility, but not so high as to be more likely than not. In other words, more is required than mere assertion, suspicion, or conjecture. 22In the present case, there is evidence of the testamentary intention of S as at the time she instructed her solicitor to draft a new will both in the form of the draft will that was prepared for her and in the evidence of the conversations she had with L at the time. There is nothing to suggest that the documents prepared in 1999 were not executed because of some change of intention on S's part. L has deposed that S has been always a very private person and did not like to discuss her finances or general affairs with anyone ([6] of L's October affidavit). 23At the time of the 1955 will, none of P's children had been born. It is by no means implausible that on P's death S would have given consideration as to whether there should be a change to her will to make provision for P's family. L's evidence is to the effect that, both throughout L's marriage to P and since his death, S was had a close relationship with L and A1 (as well as a close relationship with D's children, SH and K). In the period from about mid 2010 until S's admission to the aged care facility, L became S's primary carer. L gave evidence that on occasions S had given L small sums of money to help pay for things such as A1's school fees and L's living costs (and had also given money to D to help her) ([32] of L's September affidavit). 24L does not believe that S would have intended that either A1 or she would receive nothing from her estate ([40]). That, of itself, might not be sufficient to amount to evidence of S's subjective intention. However, it provides a sufficient basis to conclude that it is reasonably unlikely that S (having instructed a solicitor to prepare the 1999 will) had changed her mind from that reflected in the 1999 draft will. 25L's evidence is that in 1999 S asked L if she would be executor of her will and also her power of attorney ([28] of L's September affidavit), which is consistent with the terms of the documents drafted by S's solicitor, and that S said that she was going to see the solicitor to have this sorted out. By letter dated 30 September 1999, the solicitor forwarded copies of the draft will and power of attorney to S. L has further deposed that in about November 1999 S indicated to her that she had a new will and power of attorney drawn up and that they were in the back room and that S had said to her: I have included you in the will, but [D] gets most of it. and that S also said to her "It's all okay now. It's all done." ([8] of L's October affidavit). (Although on the original unexecuted will there is a line that runs across part of the specific legacy clause in the draft will, L's evidence is that she has no idea how that came to be. It looks to me likely to have been an accidental pen mark on the document (rather than an intentional deletion of the clause). There is nothing in the evidence to suggest that S would not particularly have wished to provide the relatively small legacies for A2 and A3 in that clause. L has deposed that on a number of occasions S had said to her that she wished to leave some of her estate to her grandchildren ([32] of L's September affidavit). L believes that S wanted to provide for A2 and A3 because P had already died and that she wanted to assist L ([32] of L's September affidavit). 26L does not know why S did not execute the 1999 will and power of attorney documents. Based on her discussions with S, L believes that S thought she had in fact finalised the will and power of attorney documents. 27It is submitted by Mr Meek, and I accept, that the conversations that gave rise to S consulting a solicitor in order to prepare a will in 1999, taken with the draft of the will and the subsequent conversations S had with L, disclose an intention upon which the Court can proceed as being reasonably likely to have been S's intent to make a will in terms of the draft of the 1999 will. 28D has given evidence that she regards the 1999 will as being in effect the wishes of S. She consents to the application. 29I consider that the evidence establishes that S had reason to change the 1955 will after the death of her son; that S had a good relationship with L; and that S wished to provide for L (and to provide small legacies for each of A2 and A3). I accept the evidence establishes that S had indicated a settled intention to provide for L and there is no reason to think that S did not continue to hold that intention until she lost testamentary capacity. There is certainly nothing to suggest any break in the relationship between S and L after 1999 which would indicate that S's intention to provide for L in the terms of the 1999 will had changed. 30I was therefore satisfied that this was a case where it was reasonably likely that the 1999 unexecuted will was one that would have been made by S had she not lost testamentary capacity (and that it is reasonably likely that S's subjective intention up until she lost testamentary capacity was to make provision for L in accordance with the terms of that will). Accordingly, I granted leave under s 19 and, having been satisfied as to the substance of the application, I then approved the terms of the proposed will pursuant to the power under s 18 of the Act. 31For the above reasons, I ordered pursuant to s 19 of the Succession Act 2006 that leave be granted to L to make an application under s 18 of the Act and I ordered under s 18 that the terms of the will of S, as set out in annexure A to the summons filed on 14 September 2012 in these proceedings, be approved. I further ordered, pursuant to s 23 of the Act, that the Registrar be authorised to sign and seal the will with the seal of the Court; that a copy of the signed and sealed be provided to the plaintiff; and that the signed and sealed will be deposited with the registry. I ordered that the costs of these proceedings be paid out of the estate of S on a solicitor/client basis.