2. Wills

Under this heading I will cover the following topics: dispensing powers, rectification of wills and statutory wills. I will also mention the right to inspect wills.

2.1 Dispensing powers

From the mid 1970s, when South Australia first introduced one, powers to dispense with strict compliance in the area of wills formality have become part of the law in all states and territories.^[1] In New South Wales the dispensing power is now found in s 8 of the Succession Act 2006. They are generally quite straightforward now after over 20 years of experience with the power in NSW. In a paper given to the Society of Trusts and Estate Practitioners in late July this year, Hallen AsJ remarked that he considered the law to have developed to the point that ‘they now rarely progress to a contested hearing’.^[2] I will give you a couple of recent examples: Estate of Johnston [2010] NSWSC 382, Slattery J and National Australia Trustees Ltd v Fazey; Estate of Nancy Elaine Lees [2011] NSWSC 559, Windeyer J.

The requirements in s 8 are essentially those of the old s 18A of the WPAA. There must be a document which purports to state the testamentary intentions of the deceased and the Court must be satisfied that the deceased intended the document to form his or her will. The intention can be formed after the document was prepared.

Johnston concerned an unwitnessed testamentary document, headed ‘the Last Will and Testament’ etc. Throughout the document is described with the words ‘this my will’. He also prepared a ‘memorandum of wishes’ with respect to a trust. The testator spoke and gave instructions to his financial advisers to create the documents. On the day of execution a Mr Langsford was called in to witness the signing of the wills of Mr and Mrs Johnston. Mr Langsford witnessed the Memorandum of Wishes, but there were no witnesses to the will.

Slattery J compared the language of the old s 18A and s 8 and considered that there was no difference in the structure of them, so the old authorities were relevant.^[3] The key questions are, therefore, the same:

•  Is there a document? 
• Does the document embody the deceased’s testamentary intention? 
• Did the deceased intend the document, without more, to operate as a will or codicil?^[4]

The approach to be taken is also to be continued, namely, that the section ‘should not be applied with too stringent a requirement of proof that a propounded document otherwise clearly embodying the testamentary intentions of the deceased does constitute his will’.^[5]

In this case what was particularly telling was the ‘joint execution ceremony’, which was ‘difficult to explain … other than as to make their wills’.^[6]

The Lees case concerned a notepad. Mrs Lees made an appointment to see a lawyer, Mr Sharpe, about her will on 19 August 2009. She wrote a note to this effect on the notepad. On the same piece of paper she wrote notes about ‘My will’ with a page with a list of names of people who had written to her after her husband’s death. A separate page had a clear list of what she intended in her will, headed “Mr Sharpe—My Will”. On 16 August 2009 Mrs Lees was admitted to hospital. She had the notepad with her. A conversation is reported in which Mrs Lees said:

You have to make sure that you don’t tear any pages off it and it remains intact. These are my final wishes and you have to keep my appointment with the lawyer, David Sharpe, on Tuesday. …

You need to take the notebook to David on Tuesday and tell him that these are my final wishes. He will know what to do. You must keep my appointment.^[7]

Mrs Lees got progressively worse that day. By the evening another conversation is reported in which she said, ‘In my bag there is a notebook stating my wishes which must be carried out. This cannot be contested. I have made and appointment with David Sharpe, he is the solicitor I rang you about.’^[8]

The difficult issue in cases of draft wills, or notes for wills, such as these, is whether the deceased intended the document without more to form her will. As Windeyer J observed,

Great care must be taken in determining this question. Many people write out proposals for their wills on pieces of paper headed ‘will’ but often these are no more than present thoughts not testamentary intentions and certainly not intended to be wills.^[9]

Windeyer J considered that the document in question here was written as a list of instructions to her solicitor for the preparation of a new will. Mrs Lees was familiar with wills, as she had made one before, and she had made an appointment with her solicitor to make the new will. The note was addressed to him. Did this position change after that? When she knew she was not going to be leaving the hospital and was not going to be able to make the appointment with Sharpe, did her intentions with respect to the document change? Did it have the effect ‘of turning a document containing last wishes to be given to Mr Sharpe for his further attention into a document intended to be a will’?^[10]

Windeyer J took into account the fact that the document was not signed, although, as he observed, Mrs Lees may not have been able to sign at the relevant time. He concluded that when she said ‘in my bag there is a notebook stating my wishes which must be carried out. This cannot be contested’, she did at that stage have that intention.^[11]

2.2 Rectification

The power to rectify a will is now found in s 27, which provides that:

(1) The Court may make an order to rectify a will to carry out the intentions of the testator if the Court is satisfied that the will does not carry out the testator’s intentions because:

1. a clerical error was made, or
2. the will does not give effect to the testator’s instructions.

(2) A person who wishes to make an application for an order under this section must apply to the Court within 12 months after the date of the death of the testator.

This provision constitutes what the National Committee described as ‘the middle ground’^[12]—between the broad provision in the ACT, permitting the court to rectify a will to accord with the ‘probable intentions’ of the testator;^[13] and the Queensland provision, which was confined to cases where material was ‘accidentally or inadvertently omitted from the will’.^[14] For New South Wales, however, this provision actually winds back the rectification power previously in place. The old provision—s 29A of the Wills, Probate and Administration Act 1898—went beyond cases where the will does not give effect to the testator’s instructions, to cases where the will did not give effect to the testator’s intentions. The model clause is much narrower, confining the cases of failure to give effect to intentions only to where there was a clerical error or a failure to give effect to instructions (ie that instructions must have been given in the first place). Although it remains to be seen whether this difference is more apparent than real, there would clearly be a difference in the context of homemade wills, where there are no instructions to rectify.

In Estate of Davis; Application of May [2010] NSWSC 989, Palmer J held in a very brief ex tempore judgment that the testator’s intention ‘clearly miscarried by a typographical error when the will was finally prepared’. The case concerned the will of the late Mary Juletta Davis. The affidavit of the solicitor who took instructions for the will and drafted it revealed ‘the clearest case of error in complying with the intentions of the deceased’.

It is very clear from that affidavit that the deceased intended to divide her residuary estate into six portions and that one of those portions was to go to her son, Justin, and his then wife, jointly. That intention clearly miscarried by a typographical error when the will was finally prepared because Justin’s name was included twice. The error was not detected by the solicitor prior to the execution of the will by the deceased.^[15]

The Plaintiff sought rectification by the deletion of the name of Mr Justin Davis from this clause. That rectification would have the effect of dividing the estate into six, rather than seven, parts, and the last of the six parts would be given to Mr Justin Davis jointly with his then wife. It was easily sorted. There was clearly a ‘clerical error’ within s 27(1)(a).

In Estate of Betty Tait; Vesco v Bannister [2010] NSWSC 1274 other problems arose. The case concerned Betty Tait’s will, executed on 30 October 2007. One gift to her daughter, Sandra Vescio, included ‘my entire interest and estate in my home known as 11 Grevillea Street, Collaroy Plateau together with all the furniture and contents therein’. Sandra sought to have this rectified to ‘my entire interest and estate in my home at the time of my death including any accommodation bond refund from a retirement unit’.

The problem on the facts was ademption—that the will as drafted did not take into account changes in the property that might occur. It’s in the list of things to look out for in ‘Will-drafting 101’. The testator might have been quite clear, that it was that property, but it’s the kind of thing that needs to be explored in taking instructions. Sandra obviously wants the effect of the gift by a transposition to the equivalent asset at the date of her mother’s death. Can rectification get her there?

It was not a typographical error. But was it not giving effect to the testator’s ‘instructions’? Barrett J made a number of observations about s 27. First, because of the reference to ‘instructions’ it seemed to follow that s 27(1)(b) ‘cannot apply to a will composed and written by the testator personally’.^[16] In this case the will was drawn by a solicitor and there is evidence about the communication of instructions, ‘in the sense of expression by her of her wishes as to how her estate should be disposed of by the will the solicitor was asked to prepare’.^[17] What then of the relationship to ‘intentions’?

Having ascertained ‘the testator’s instructions, the court must construe the will as executed and compare its effect, according to its proper construction, with those ‘instructions … . Only if some discrepancy appears can an order be made under s 27; and the only permissible order is one that causes the will to be in a form that carries out the testator’s ‘intentions’.

It follows that the court must also make findings about the ‘intentions’ of the testator—necessarily, of course, the ‘intentions’ existing when the will was made. It is those ‘intentions’ that any rectifying order must reflect. Although the legislation does not expressly say so, it must, I think, be inferred that the ‘intentions’ of the testator correspond, as to content, with the ‘testator’s instructions’. I say this because, in the ordinary course, a testator’s intention is that his will should implement the instructions he gives for its preparation. It is with that intention that s 27(1)(b) is concerned.^[18]

The focus was therefore upon the instructions and the notes of these in the file of the solicitor who prepared the will. Barrett J identified one passage of key relevance in a note dated six days before the will was executed: ‘If the house has been sold to fund a retirement unit, then the residue is to be divided’. There was also an undated note in the file to the effect that ‘Name down for Anglicare unit at Warriewood’ and notes of the deceased’s wish to benefit Sandra more than her son, Christopher. What was not clear from the notes was ‘the fate or destination of the contemplated retirement unit itself’, although a range of possibilities presented themselves.

There was also other evidence to consider. When the Grevillea St property was sold, the same solicitor acted. He recorded in notes at the time that the will needed to be changed respecting the property. A new will was prepared in May 2009 changing the reference to the house to ‘all of the monies which will be refunded from RSL Lifecare for the residency agreement that I am a party to for Villa 1 …’. The testator was very ill and died without executing this new will.

Barrett J considered the instructions given at the time of the first will and concluded that they had dealt expressly with the disposition of any residue or balance remaining after the sale of the Grevillea St property and its replacement in the form of a retirement unit. The inference was that any replacement was ‘to be treated in the same way as that house’.

The inference to this effect is strengthened by the fact that, after completion of the transactions of early 2009, there was express reference by the deceased to a need to make specific provision regarding the replacement or substitute and thereby to make explicit what was already implicitly part of the deceased’s intentions at the time she made her will.^[19]

The order made was not in the precise form sought. Barrett J ordered that the will be rectified by adding to the relevant clause concerning the Grevillea St property ‘(or in any retirement unit acquired with proceeds of the sale of that home, whatever may be the form of ownership of that unit)’.

What is interesting about this judgment is that what became crucial was evidence of transactions after the date of the will and the terms of a subsequent will, which were admitted to assist in finding the intentions of the testator with respect to the original will. This looks to be a bit of a stretch, but it did bridge some of the gap in the alteration of the legislation effected by the 2006 Act.

From a practitioner’s point of view the case reiterates the importance of keeping clear notes of instructions, as they may be called upon to assist in explaining aspects of the will and are clearly admissible in a rectification matter. The case is also important in reminding us about the need to think carefully about changes in property and also the possibility of beneficiaries predeceasing the testator—and to build this into the drafting.

2.3 Wills for those lacking capacity

New South Wales already included the jurisdiction to make a will for a minor, now in
ss 16–17 of the Succession Act, based on the minor’s understanding of the proposed will, but the new statutory will provision goes much further, allowing the court to make a will for a person who has no understanding at all.^[20] Such a power was introduced in the United Kingdom in 1969—through an amendment to the mental health legislation^[21]—sitting within the overall parens patriae jurisdiction of the court and as part of the regime for the protection and management of the property and affairs of persons under disability. I refer you to a study I made of the background to the introduction of the provision and its application in Australia, published in the University of New South Wales Law Journal in 2009.^[22]

Under s 22 of the Succession Act, the court needs to be satisfied that:

(a) there is reason to believe that the person in relation to whom the order is sought is, or is reasonably likely to be, incapable of making a will, and

(b) the proposed will, alteration or revocation is, or is reasonably likely to be, one that would have been made by the person if he or she had testamentary capacity, and

(c) it is or may be appropriate for the order to be made, and

(d) the applicant for leave is an appropriate person to make the application, and

(e) adequate steps have been taken to allow representation of all persons with a legitimate interest in the application, including persons who have reason to expect a gift or benefit from the estate of the person in relation to whom the order is sought.

The key passage is that the will is one that would have been made or is reasonably likely to have been made—s 22(b).

In New South Wales, Palmer J provided an excellent foundation for the application of the statutory will provisions in his landmark decision in Re Fenwick; Application of Fenwick & Re Charles [2009] NSWSC 530. (I talked about this case last year). Palmer J distinguished between three categories of people on whose behalf an application for a statutory will might be made:

•  adults with prior testamentary capacity (‘lost capacity’ cases)
• persons who have never obtained testamentary capacity (‘nil capacity’ cases)
• minors with prior testamentary capacity (‘pre-empted capacity’ cases).^[23]

The differences between the jurisdictions are irrelevant in cases where a person never had capacity. In categories of ‘lost capacity’ there may be well be differences. For New South Wales, Palmer J suggested that the question to ask is whether there is ‘a fairly good chance’ that the proposed will would represent the actual intentions of the person in question if the person were now of testamentary capacity and aware of the circumstances.^[24] In a case where a person has made a valid will but, since lost it:

… 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?^[25]

In contrast, where the person never made a will:

… the Court ought not to start with a presumed intention against intestacy. The Court must be satisfied by the evidence that it is “reasonably likely”— in the sense of “a fairly good chance”— that the person would have made a will at some time or other, had not testamentary incapacity supervened.^[26] …

The point I wish to make is that in a lost capacity case where no will has ever been made, there will generally be some evidence which, even though it may be slight, will satisfy the Court that there is a fairly good chance that the incapacitated person either intended at some stage to make a will or else intended to die intestate. In the latter case, of course, the Court will not approve a statutory will. If there is insufficient evidence for the Court to form any view one way or the other, then the applicant will have failed to discharge the burden of proof which he or she bears under s 22(b) and the application must be dismissed.

In summary, 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. ^[27]

Re Will of Jane [2011] NSWSC 624 is an example of ‘lost capacity’. The relevant person, dubbed ‘Jane’ in the case, suffered dementia. She had made wills before and has three children, benefited equally under the last relevant will as they would also if she were to die intestate. The report occupies some 74 pages. It is carefully analysed and presented by Hallen AsJ, so provides an instructive example of how these matters are considered under the relevant sections.

Jane’s son sought the making of a statutory will for his mother, in terms which appointed the Public Trustee as executor and left the whole estate to the son absolutely. If he were not to survive his mother, there was proposed a substitutional gift to three charities.^[28] The estate at the time of the application was about $2 million. The plaintiff was born in 1962. He and his father cared for his mother, and he continued to do so after his father’s death in 2007. From the end of 2008 Jane was in a nursing home. She is now 86.

The plaintiff’s siblings oppose the application. I will leave you to read through the tortured details yourself. Suffice it to say that the application was dismissed. A key message is that ‘[i]t is a serious matter for the Court to appropriate to itself the will-making power of the citizen’.^[29]

Hallen AsJ provides a succinct analysis of the relevant law, referring extensively to Re Fenwick. In describing the statutory prerequisite for the making of the statutory will, he said:

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 ‘likely’ requires a qualitative judgment.^[30]

So, what if you can find a number of possibilities of testamentary plans for the relevant person, based on previous wills and whatever other evidence can be drawn together?

The question is not whether he, nor she, would likely have preferred the proposed statutory will to intestacy, or to his or her prior will. Nor is it whether the proposed statutory will is one of a number of possible proposed wills, all of which might be equally likely to be one that he, or she, may have made if he, or she, had testamentary capacity. If the proposed statutory will does no more than reflect one of a number of other possible dispositions … the requirements of s 22(b) will not be satisfied since it would not be ‘reasonably likely’ to be a will that he, or she, would have made had he, or she, had testamentary capacity.^[31]

One matter of concern in this case was also that the plaintiff was the sole beneficiary under the proposed will. Hallen AsJ pointed to the approach in probate matters in such circumstances:

In probate suits, where there is an issue about the validity of a will, the court regards as a circumstance exciting suspicion, a will prepared by a person who takes a benefit under it, or if the beneficiary is instrumental in having it prepared, and calls for the vigilant and anxious examination of the evidence as to the testator’s appreciation and approval of the contents of the will.^[32]

He also noted that s 22(b) has a countervailing requirement that the court be satisfied that the proposed will is really one that the person would have been likely to make. This suggests similarly ‘a vigilant and anxious examination of the evidence as to the incapable person’s actual, or reasonably likely, intentions’.^[33]

In finding against the plaintiff, Hallen AsJ noted the following:

• the plaintiff’s evidence is inconsistent with a proposed will that excludes his siblings;
• Jane’s prior will, dated 1962, was never altered, despite ample opportunity to do so;
• the 1962 will clearly indicated an intention to benefit her children equally;
• the plaintiff received significant financial benefits from his parents, which was invested in a business;
• the plaintiff received about $400,000 in challenging his father’s will, which otherwise would have gone to his mother;
• there was no ‘objectively provable evidence’ of any disentitling conduct on the part of the plaintiff’s siblings ‘that would lead to the conclusion that Jane would wish to reduce her, or his, equal share of her estate’.^[34]

What is really sad about this case is the costs. There were several claims against the plaintiff as well as his claims against his father’s estate and the present application for the statutory will. All of this has a significant toll on any available estate now, or in the future.

Re DH: Application by JE and SM [2011] ACTSC 69 is the first example of use of power in the ACT. The application concerned a man in his late sixties. He never married, nor had any children. In 1990 he commenced a de facto relationship with the applicant, a woman a few years younger than he and with three children. They had been living together for not much more than a year when he had a heart attack while jogging, aged 50, resulting in permanent brain damage.^[35] He had retired from the public service and was managing some rental properties that he owned. For the next twelve years the respondent cared for him. They would most likely have married were it not for his accident.

As noted by Master Harper:

he became incapable of managing his personal and financial affairs, with no decision-making capability. He has a complete lack of understanding of the value of his assets, no knowledge of any relatives, and a complete inability to comprehend future events or possibilities.^[36]

For the last seven years he was in a secure dementia ward, where the applicant visits him. The present application concerns a statutory will in her favour, appointing the applicant and her daughter as executors, and leaving the estate to the applicant, or, if she fails to survive him, to her children in equal shares with gifts over to her grandchildren if any of her children not survive him.

The applicant engaged a genealogist in England, as the applicant was born in the UK, migrating to Australia in 1964, to construct a family tree. No living relatives who might take on intestacy were found.

Master Harper concluded that, if the respondent had had capacity, he would have made a will in favour of the applicant.

If such a case were to arise in New South Wales, while the applicant would likely to be able to claim as the next of kin and entitled to the whole estate on that basis, the making of the statutory will certainly simplifies matters. The need to make out her claim as a de facto spouse; to undertake lengthy searches for next of kin; and, if there are other relevant kin to obtain their consent to the appointment of the applicant as administrator, all takes time. And time costs money in estate terms. The granting of an application for a statutory will is very ‘tidy’ in such contexts as these and certainly to be commended as an estate planning strategy.

2.4 Right to inspect wills

Section 54 of the Succession Act 2006 sets out the right of certain persons to be able to see a will, including a revoked will, a document purporting to be a will, as well as a copy of a will. Section 54(2) provides that:

A person who has possession or control of a will of a deceased person must allow any one or more of the following persons to inspect or be given copies of the will (at their own expense):

(a) any person named or referred to in the will, whether as a beneficiary or not,

(b) any person named or referred to in an earlier will as a beneficiary of the deceased person,

(c) the surviving spouse, de facto partner (whether of the same or the opposite sex) or children of the deceased person,

(d) a parent or guardian of the deceased person,

(e) any person who would be entitled to a share of the estate of the deceased person if the deceased person had died intestate,

(f) any parent or guardian of a minor referred to in the will or who would be entitled to a share of the estate of the testator if the testator had died intestate,

(g) any person (including a creditor) who has or may have a claim at law or in equity against the estate of the deceased person,

(h) any person committed with the management of the deceased person’s estate under the Protected Estates Act 1983 immediately before the death of the deceased person,

(i) any attorney under an enduring power of attorney made by the deceased person,

(j) any person belonging to a class of persons prescribed by the regulations.

The section is mandatory in its terms, so, for example, even if an executor or administrator does not want a person to see the will, the person having possession or control of the will must oblige. While there is no penalty set out in the Act, s 54(3) states that a person who has possession or control of a will of a deceased person must produce it in a court if the court requires the person to do so. So if a person refuses to provide the copy and the person who wants it applies to the court to force this outcome, the person withholding the will may have to pay costs.

In a paper prepared by Therese Catanzariti in March this year, she made the following constructive suggestion in relation to responding to requests to see clients’ wills under s 54:

It may be prudent for persons who hold their client’s wills to set up a process to confirm that a person applying for inspection of a deceased client’s will is entitled to do so – for example, requiring the person to produce identification such as a drivers licence, birth certificate or passport, and requiring the person to sign a statutory declaration confirming that they are a person entitled to inspect the will.^[37]