Application of J R Fenwickre 'Charles' (2009) 76 NSWLR 22
Judgment (3 paragraphs)
[1]
Solicitors: Unsworth Legal (plaintiff)
Keypoint Law (first defendant)
Benjamin & Robinson (second defendant)
File Number(s): 2017/163312
[2]
Judgment
On 31 May 2017 at 5:25 PM, I made an order under s 18 of the Succession Act 2006 (NSW) (the Act) that a will be authorised to be made on behalf of a 13-year-old child, in the form of a draft will that was initialled by me and dated that date.
As the subject of the application is a minor, I will anonymise the parties, and refer to the minor as N.
The summons seeking the order was filed on the same day at 10:43 AM, and the matter came before me, sitting as duty judge, during the course of the morning.
Most unfortunately, N has since birth suffered from a significant number of extreme physical disabilities that were caused by the circumstances of his birth, during which his brain was deprived of oxygen.
It is not necessary to relate the nature of N's physical disabilities in detail, and it is sufficient to say that the evidence clearly established that N lacks and always has lacked any semblance of practical testamentary capacity, as all parties to the proceedings accepted.
N fits within the category of "nil capacity case" as described by Palmer J in Re Fenwick; Application of J R Fenwick; re 'Charles' (2009) 76 NSWLR 22; [2009] NSWSC 530 at [171], where his Honour said:
[171] A search for any degree of subjective intention is impossible in a nil capacity case, where the person has been born with mental infirmity or has lost testamentary capacity well before ever being able to develop any notion of testamentary disposition. Nevertheless, the statutory will-making power is available in such a case: s 18(4) of the Succession Act.
Palmer J distinguished between three types of case where the Court may be asked to authorise the making of a will on behalf of a person who lacks testamentary capacity. He described the first as a "lost capacity case", where the person is an adult and has formed family and other personal relationships, and made a valid will, and has expressed some testamentary intention before losing capacity. The second is a "nil capacity case", such as the present, where the person has never had the mental capacity to form any testamentary intention. The third is a "pre-empted capacity case", where the person is still a minor, but has lost testamentary capacity after forming relationships and becoming capable of forming testamentary intentions.
I respectfully agree with the observation made by Lindsay J in Secretary, Department of Family & Community Services v K [2014] NSWSC 1065 at [76], that "these categories may provide useful insights into the operation of the Court's will-making power, but they should not be taken as a substitute for the text of the legislation itself". They may be helpful in assisting the Court to analyse what is involved in the exercise of the Court's jurisdiction, particularly the requirement in s 22(b) of the Act that the Court must refuse leave to make the application unless the Court is satisfied that the proposed will is, or is reasonably likely to be, one that would have been made by the person if he or she had testamentary capacity. The extent to which the person formed subjective emotional relationships, and developed an understanding of the effect of a will, and was able to form testamentary intentions, where that occurred, before the person became incapacitated, will naturally be important to the determination of what the person was reasonably likely to have done if not incapacitated.
The plaintiff, A Limited, was appointed to manage N's estate on 30 May 2009, by an order made in the Protective List of this Court. That followed the Court on 15 April 2008 approving the settlement of proceedings commenced on behalf of N, against the owner of the hospital at which he had been born, of a claim arising out of the circumstances of his birth, in which the hospital owner agreed to pay many millions of dollars.
The first defendant is N's mother, and the second defendant is N's father.
In the afternoon the Court received a brief written report dated 31 May 2017, from a senior staff specialist general paediatrician at Sydney Children's Hospital, concerning a medical procedure that was proposed to be undertaken in relation to N on the following day. The doctor concluded: "There is a risk that the procedure may trigger bleeding, infection and even result in death but we feel this is necessary to try and prevent N experiencing further bleeds in the future".
The Court was informed that N's condition was reasonably stable and that, if it remained stable, his operation may take place later in the day of 1 June 2017, but if his bleeding recurred, the procedure could be undertaken at any time on that day.
This, unfortunately, was not an isolated risk. The evidence suggests that N has had to be revived with some frequency, and on one occasion he was given little chance to live. N is at a relatively constant risk of death.
The evidence satisfied me that there was a real risk that N might die the following day. None of the parties suggested to the contrary.
The consequence was that, provided the Court was satisfied on the evidence that it should grant leave to make an application under s 19 of the Act, and that it had jurisdiction to make an order under s 18 of the Act, and that it was proper to do so, the Court would have to make an order on the day that the proceedings had been commenced, or risk the Court acting too late to authorise a will being made for N as contemplated by the Act.
The reason is that by virtue of s 18(3) of the Act, the Court can only make an order under the section if the person in respect of whom the application is made is alive when the order is made. Further, by virtue of s 23(1) of the Act, a will made by an order under s 18 is properly executed only if it is signed by the Registrar, and sub-s (2) authorises the Registrar to sign the will only if the person is alive at the time.
The plaintiff had been preparing to make the application for some little time, and the affidavit sworn by the mother in support of the application was dated 18 May 2017. The application was commenced urgently because of a very recent event in which N had suffered bleeding in his lungs.
The solicitor for the plaintiff gave evidence that he informed the father on 30 May 2017 that he needed to send the father some papers, and was given the father's email address. A letter advising the father of the proposed application, together with the summons and the affidavits that were to be relied upon by the plaintiff, were sent to the father electronically at brief intervals after 5 PM on 30 May 2017.
During a telephone call at 6 PM on 30 May 2017, the father informed the plaintiff's solicitor of the name of his solicitors, and at 9:30 AM on 31 May 2017, the plaintiff's solicitor had a conversation with a solicitor at the firm nominated by the father about the application that would be made on that day.
The solicitor on behalf of the father briefed counsel to appear for him on the hearing. Counsel did not have adequate instructions, and was obliged to interview the father during the course of the day.
It is not necessary for the purpose of these reasons to canvas the relevant evidence in the mother's affidavit in detail. In short, she said that the father had never taken any real interest in N's welfare, the mother and father separated and the father essentially left the mother with the entire responsibility for providing for the extreme care needs of N, which was as is now commonly said, on a '24/7' basis. The mother said that the father had rarely seen N over the years, and had not provided for his needs in any real way.
The circumstances did not give the father any opportunity to consider his position, or to serve evidence in response to the mother's affidavit. Time was so short that the Court was obliged to give the father's counsel some time to confer with him, and then, relying upon s 21(b) of the Act, which authorises the Court, in considering an application for an order under s 18 of the Act, to inform itself of any matter in any manner it sees fit, to require counsel to inform the Court of the substance of the evidence that the father would have given if he had a proper opportunity to do so.
It is sufficient to record that the father's counsel did not say that the father contested the general thrust of the mother's evidence. The father, had he been given the opportunity, would have said that he provided more material and emotional support to N than the mother described, and further that his capacity to support N had been substantially restricted by the consequences of the marital breakdown and the collapse of the relationship between him and the mother. In essence, counsel for the father put to the Court that the father would have given evidence that the mother had overstated to some degree the reality of the father's alleged abandonment of N.
Not all of the settlement money paid to the plaintiff on N's behalf was retained in the hands of the plaintiff, as a substantial sum had been invested in a superannuation fund under the trusteeship of a commercial trustee. Upon N's death at any time, the trustee of the superannuation fund will have a power to determine how the assets in the fund should be applied. The hearing proceeded upon the basis that the trustee could exercise its discretion to transfer the assets to N's estate, or it could make transfers directly to persons identified in the trust deed, which could primarily include the mother and the father.
There was no evidence as to how the trustee of the superannuation fund might exercise its discretion, and in practical terms there could not be such evidence. I decided during the course of argument that the application before the Court strictly only related to the assets in N's estate, and that there was no basis upon which the Court in the circumstances could safely or properly take into account the possible fate of the assets held on behalf of N in the superannuation fund.
The assets in N's estate that were under the management of the plaintiff have a value of about $3.2 million, of which $1.5 million is represented by a house that is in N's name, and in which the mother and N's youngest siblings live, as well as N himself except for the frequent and extensive periods when N has been admitted to hospital.
N has six older siblings in all.
The plaintiff proposed a will that had been settled by counsel. It materially provided for the house and certain other property to be left solely to the mother, and then after the payment of debts and testamentary expenses, the residue of the estate was to be given as to half to the mother and as to the other half to the six siblings equally. The will contained provisions of a conventional nature providing for how the property would be shared in the event of early death of potential beneficiaries, but that detail is not material for present purposes. The draft will also nominated the plaintiff as executor.
The mother also proposed the will put before the Court by the plaintiff, but in addition she proposed an alternative will that contained the same dispositions as the plaintiff's will, but contained provisions that would result in the residue of the estate being held upon testamentary discretionary trusts. I decided in the course of argument that the Court should proceed upon the basis that the simpler will proposed by the plaintiff was the proper subject for the making of an order under s 18 of the Act, because the consequences of creating testamentary discretionary trusts were too complicated to consider in the time available to the Court to make its decision.
The effect of s 128 of the Act, given N's age and that he has no spouse or issue, is that if he were to die intestate the mother and the father would become entitled to the whole of his estate in equal shares.
As a practical matter, that would mean that each would receive about $1.6 million.
N's siblings would not be entitled to receive any part of his estate.
If the Court were to make an order under s 18 of the Act in the terms of the wills proposed by the plaintiff and the mother, the father would receive nothing.
Obviously, these circumstances caused difficulty for the proper determination of the claim made in the summons having regard to accepted notions of due process.
While the plaintiff could possibly have commenced the proceedings by filing the summons earlier, there has been no suggestion that the plaintiff was at fault in failing to do so, as N's recent life-threatening episode was not expected. If the Court were to dither and not act upon the application, and N were to die during or as a result of the procedure intended to be implemented on 1 June 2017, then in reality N would have been denied his entitlement under the Act, and the Court would have failed to accord him the protection to which he is entitled. On the other hand, the Court must always strive to give all parties to proceedings a proper opportunity to be heard, and to put evidence before the Court. If the Court had made the orders sought by the plaintiff and the mother, the practical effect would have been that the father would have lost a potential right to receive $1.6 million, when he had been notified of the application on the day before, and his solicitor had been retained on the morning of the hearing.
During the course of the hearing, I made some observations to counsel and solicitor for the parties about the difficulty involved in the Court authorising the making of the will in the terms contended for by the plaintiff and the mother, which would exclude the father entirely from sharing in N's estate, in circumstances where he had been given virtually no proper opportunity to put a case to the contrary. I did not suggest an alternative draft will that made some provision for the father, but the way I expressed my concern probably conveyed to the parties that I might find it difficult in the circumstances to authorise the making of the will for N in the terms sought.
It was suggested by the parties that I should adjourn briefly, in order to enable the parties to confer in order to see whether a compromise could be reached that would enable the Court, in compliance with the requirements of the Act, to make an order under s 18 authorising the making of a will on behalf of N that would resolve the dispute between the parties.
After some time, I was informed that the parties had not been able to reach an agreement, but that they had agreed on a new form of wording for the proposed will, with certain omissions that were left for the determination of the Court.
The new proposed will retained a gift of property including the home to the mother, but added the father as a party to receive a share of the residue, although there were blanks in the place provided for the identification of the percentage to be received by the mother, the father and the six siblings (as to the siblings in equal shares between them).
The plaintiff and the father submitted to the Court that the blanks should be filled by inserting the percentages necessary to give a third of the residue of the estate to each of the mother and the father, and the final third should be shared equally between the siblings. Counsel for the plaintiff informed the Court that, in view of the urgency of the application, the plaintiff had taken this course so that it would appear to have been even-handed.
The mother submitted that the father should be given 5%, on the basis that the will as then made would be final, and the mother on the one hand and the siblings on the other would share the balance equally.
There was an additional term which gave the executor a discretion, if the trustee of the superannuation fund exercised its own discretion to pay assets in the superannuation fund directly to the mother or the father, to reduce the share of the estate received by the mother and father, as fully as was possible to ensure that the mother and the father received the amounts that they would receive by operation of the will. There may be some conceptual problems with this provision, but none of the parties suggested that it was inappropriate, and all agreed to it.
As I understood the course taken by all of the parties, none challenged the appropriateness of the Court authorising the making of a will for N, and they accepted the terms of the amended proposed will provided to the Court, but they differed as to the percentages that were appropriate to be inserted in the blanks, and left it to the Court to decide how the draft will should be completed.
The Court was faced with the need to deal with the following questions:
1. What was the appropriate course for the Court to take given the urgency of the application, the short notice given to the father, the contentious nature of the application, and the insufficiency of time for the Court to consider its judgment?
2. How was the Court required by the Act to proceed in a case where the plaintiff and the mother initially contended for one proposed will, but the form of the proposed will was amended by the parties in a way that the parties contended for different terms, and the determination of the content of crucial terms was left to the Court?
3. On what basis should the Court determine the terms that ought to be approved and be made the subject of an order authorising the making of a will for N on those terms?
The circumstances in which this matter came before the Court would in almost all other situations be appropriate for the making of interlocutory orders, and final orders at some later time on a fully contested basis. However, Part 2.2 Division 2 of the Act does not give the Court power to authorise the making of a will for a person without testamentary capacity on an interlocutory basis.
I determined that the only practical course that would enable the Court to exercise the jurisdiction given to it in s 18 of the Act, while still doing all that could be done to accord procedural fairness to all parties, was to take the following course.
As s 20(2) of the Act authorises the Court, on the hearing of an application for leave under s 19, to "revise the terms of any draft of the proposed will", it is within the Court's power to revise the amended draft will provided to the Court by the parties, to ensure that its terms are appropriate for approval by the Court under s 18 of the Act in the circumstances in which the Court is required to make its decision.
Section 20(2) of the Act uses the expression "the Court may revise the terms of any draft of the proposed will". This aspect of the Act is a remedial provision that should be given a liberal and purposive interpretation. The power is given to the Court. It is not limited to enabling the Court to accept revisions offered by the applicant or any other party. It permits the Court to decide upon a revision of the draft will that is to be the subject of leave under s 19 of the Act.
In Re Will of Jane [2011] NSWSC 624, Hallen AsJ (as his Honour then was) said the following concerning the effect of s 20(2) of the Act:
[63] Without limiting the action the court may take in hearing the application for leave, the court may revise the terms of any draft of the proposed will, alteration or revocation for which the court's approval is sought: s 20(2). Therefore, if the proposed statutory will fundamentally fulfils the requirements of the section, but requires adjustments, the court may make such adjustments by modifying, redrafting or altering its terms.
…
[68] To be satisfied requires the court to assess the terms of the proposed statutory will, whilst retaining, under s 20, the power to revise those terms in order to perfect its conformity with the incapacitated person's reasonably likely testamentary intentions. It would appear to demand a degree of precision about the actual, or reasonably likely, intentions of the person lacking capacity and that what is proposed reflects those intentions.
His Honour's language supports the conclusion that the Court may initiate or decide the terms of the revision.
I note that in Secretary, Department of Family & Community Services v K (above) at [50], Lindsay J said that, having reviewed the evidence and the will that had been proposed for his approval, he prepared for consideration of the parties an alternative form of draft will. The new draft involved a substantial change, as the original divided the estate between the incapacitated person's foster parents and two children' hospitals, and the draft prepared by his Honour divided the estate equally between the foster parents and the mother. I agree that the course taken by Lindsay J was authorised by the Act, and is an appropriate course for the Court to take at the stage of considering whether leave to make an application under s 18 of the Act should be granted, as it will further the statuary purpose for the Court to align the terms of the proposed will the subject of the application to a will that the Court may be prepared to approve under s 18 of the Act.
In the present case I did not prepare the terms of the alternative proposed will myself, but it is likely that I prompted the parties to do so by reason of the comments that I made to which I have referred above. It is probably true that I gave the parties some guidance as to the terms of a will that I might be prepared to authorise be made on N's behalf in the circumstances. Further, the new form of proposed will contained crucial blanks relevant to the proportions in which the suggested beneficiaries would share in N's estate, so the parties expected the Court to be the author of the final revision of the proposed will.
The Court is also given power in s 18(5) of the Act, in making an order under s 18, to "give any necessary related orders or directions". I took the view that this statutory power enabled the Court to make an order under s 18(1) on 31 May 2017, on the basis of the information that was then before the Court, so that a will could be made for N before he was subjected to the medical procedure due to be undertaken on 1 June 2017. However, the Court may also order that the making of that will did not exhaust the claim for relief in the summons, and the Court may give directions for the service of further evidence, and the fixing of a hearing as soon as possible for a further application for the exercise of the Court's power under s 18(1) of the Act.
The availability of that course depends upon whether the orders and directions are "necessary" within the meaning of s 18(5) of the Act. That word should not be given a restrictive meaning. The issue of whether the orders and directions preserving the summons and making provision for a new hearing to determine whether a further and different will should be authorised to be made for N should not be considered in isolation from the circumstances in which the Court made the order authorising the making of the first will. Where the court must deal with a profound need for expedition, there is plainly the risk that the Court will authorise the making of a will that is not the most appropriate one, but also a risk that if it declines to act the Court will deny the incapacitated person the benefit of the rights created by the statute. In a real way it was necessary for the Court to exercise its jurisdiction urgently, and in my view it was equally necessary for the Court to ensure that the exercise of its discretion was revisited to ensure that ultimately its jurisdiction to authorise a will to be made for N was properly exercised after due consideration.
I note that the extensive ambit of the power in s 18(5) of the Act is demonstrated by the decision of Lindsay J in Re Estate of Scott [2014] NSWSC 465, where his Honour held that the provision enabled the Court to grant probate of a will authorised to be made under s 18 of the Act in a case where the will had not been signed by the Registrar in compliance with the provisions of the Act to which I have referred above.
I advised the parties of the course that I proposed to take, heard submissions from the parties, and then, in brief ex tempore reasons given on 31 May 2017, determined that the appropriate percentage to be inserted in relation to the gift to the father was 15%. That had the effect that the mother would receive 42.5%, and the siblings would share equally in the remaining 42.5%.
I do not propose to expand at length upon the reasons given in the ex tempore judgment for determining these percentages. It is sufficient to say that I made an evaluative and intuitive judgment as to what I thought objectively N would reasonably have decided, had he been capable of doing so, as to the appropriate shares in his estate to be received by the members of his family. In doing that I balanced the considerations that led Palmer J in AB v CB [2009] NSWSC 680 to exclude the teenager's estranged father from participation in the estate, against those that led the same judge in Re Elayoubi [2010] NSWSC 1004 to include a provision for the estranged father. I also recognised the force of the observation made by Lindsay J in Secretary, Department of Family & Community Services v K (above), at [81], where he said that the "Court must be careful not to be overly judgmental about personal faults within a family, and how such faults may impact on family relationships". I acknowledged, however, that I did so having made allowance for the fact that the father had not had an opportunity to put any evidence before the Court, and that there is always a danger in the Court acting solely upon the evidence of one party to a failed marriage concerning the conduct of the other party.
I then made the following orders:
1. Pursuant to s 19 of the Succession Act 2006 (NSW) (the Act) leave be granted to the plaintiff to make an application to the Court for an order under s 18 of the Act.
2. Pursuant to s 18 of the Act a will be authorised to be made on behalf of [N] in the form which is initialled by Robb J and dated today's date.
3. Order that a Registrar be authorised and directed to sign and seal with the seal of the Court pursuant to s 23 of the Act the will that has been initialled by Robb J and dated today's date.
4. Order that these orders be entered forthwith.
5. Note that these orders have been made at 5:25 pm on 31 May 2017.
6. Note that these orders are made on the basis that they do not exhaust the claim by the plaintiff in the summons for the authorisation of a will to be made on behalf of [N] with the intent that as soon as the directions of the Court and the availability of the Court permit the plaintiff and the other parties will have an opportunity to seek or to defend the relief sought in the summons filed 31 May 2017 as if the orders made today were of an interlocutory nature.
7. Reserve costs.
8. Stand the proceedings over to Thursday 1 June 2017 at 10:00am before the duty judge for the purpose of making ancillary orders and directions for the future conduct of the proceedings.
On 1 June 2017, I made a number of consequential orders, including orders for the parties to file further evidence, and that a date for a final hearing would be fixed after consultation with the Protective List Judge and the solicitors for the parties.
It is appropriate that I make a number of further observations in explanation of the course that I have taken in this matter.
As I have noted above, the Act does not provide for any mechanism for a will to be authorised by the Court on an interlocutory basis. It could hardly be otherwise as, if the person on whose behalf the will is made were to die before a final hearing could take place, the supposedly interlocutory will would necessarily become final. That would be so unless the Act was amended in a way that empowered the Court, having authorised a will for a person on an interlocutory basis, to retrospectively adjust the terms of that will after the person has died.
Not only is the Court not given any power to make any interlocutory order, it is not given a power to act on a basis that is equivalent to the basis upon which the Court ordinarily makes interlocutory orders. That is, the Court cannot act on the basis of serious questions to be tried or prima face cases, or the balance of convenience.
The Court can only authorise a will under s 18(1) of the Act if it has first granted leave under s 19, and all of the essential requirements for the giving of the authorisation to make the will contained in the statute have been satisfied.
As a result of the unfortunate extremity of N's circumstances, there was no basis for doubt that most of the requirements were satisfied. The evidence upon which the plaintiff relied, which included the affidavit referred to above sworn by the mother, sufficiently provided the Court with the information required by s 19 of the Act for the purposes of the application for leave to make an application to the Court for an order under s 18 of the Act.
Of the pre-conditions for the making of an order under s 18 contained in s 22, it was clear that N was incapable of making a will (par (a)). I was satisfied that it was appropriate for an order to be made under s 18 (par (c)). Albeit that the application had been made on an urgent basis, it was similar to other applications that have been made to the Court, in which the Court has exercised its statutory power to make a will on behalf of an incapacitated child: see for example, AB v CB (above) and Re Elayoubi (above).
I was satisfied that the plaintiff was an appropriate person to make the application, as is required by par (d). In this regard, Hallen AsJ said in Re Will of Jane (above):
[89] In South Australia, where the equivalent section provides that "any" person may make an application, it has been said, in Jeavons v Chapman (No 2) [2009] SASC 3 at [30], that:
[S]olicitors, social workers and health care workers who may be closely involved with the person should be entitled to make applications. The Protective Commissioner who may already be managing the person's financial affairs should also be entitled to make an application.
These considerations should extend to the plaintiff, who has been appointed by the Court to manage N's financial affairs. In any event, the plaintiff's application was initially supported by the mother, who is plainly on the evidence the most appropriate person to make the application.
Section 22(e) of the Act requires the Court to refuse leave to make an application, unless it is satisfied that 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. That provision extended to the father. If adequate steps had not been taken to allow representation by the father, then the Court could not have granted leave. I was satisfied that adequate steps had been taken to allow representation by the father, as he was in fact represented, although as I have explained I was most concerned by procedural fairness issues. In my view, the most difficult question that arose in the application of s 22 of the Act was that set out in sub-par (b), which requires the Court to refuse leave to make the application unless it is satisfied that "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".
This problem becomes stark for a court in the position that this Court was in on 31 May 2017, when it contemplated the percentages that N may have decided were appropriate for the division of his estate between the members of his family.
Palmer J in Re Fenwick (above) had the following to say about the determination of the intention of the incapacitated person in a nil capacity case:
[171] A search for any degree of subjective intention is impossible in a nil capacity case, where the person has been born with mental infirmity or has lost testamentary capacity well before ever being able to develop any notion of testamentary disposition. Nevertheless, the statutory will-making power is available in such a case: s 18(4).
[172] As, in the absence of a statutory will, the person in a nil capacity case must inevitably die intestate, I do not think that the court starts with the meaningless question: would this particular person have chosen to make a will if he or she had attained testamentary capacity? Rather, I think that the court must start from the position that, if there are assets of any significance in the minor's estate, it should authorise some kind of statutory will unless it is satisfied that what would occur on intestacy would provide adequately for all the reasonable claims on the estate.
[173] Is that position justified by the words of s 22(b)? I think that the justification is to be found in the elastic phrase "reasonably likely". In a nil capacity case, where there cannot be any meaningful search for actual or likely subjective intention, the court of necessity must make objective assessments of likelihood. The court can take notice of the fact that people in our society who have assets of any worth and who have a family and other relationships usually choose to make wills rather than die intestate. In my opinion, the court can be satisfied by reference to common experience that if the incapacitated minor had attained testamentary capacity and had assets of any significant worth, then it is reasonably likely - in the sense of a fairly good chance - that, in common with most people, he or she would have chosen to make a will.
[174] The next question is: is it reasonably likely that the incapacitated minor would have made the will now proposed? In order to answer this question, Hoffmann J in Re C had to envisage a fictitious person, somehow resembling the actual patient, while, in truth, applying the court's objective assessment of what a reasonable person would do in the circumstances. In my opinion, to perpetuate such a fiction in applying s 22(b) in a nil capacity case is neither necessary nor desirable.
[175] The fiction is undesirable because legal fictions usually distort, rather than clarify, what the court is actually doing. As was said by Crennan J (with whom Gleeson CJ, Gummow and Heydon JJ agreed) in Harriton v Stephens (2006) 226 CLR 52, at [269]: The common law is hostile to the creation of new legal fictions and the use of legal fictions concealing unexpressed considerations of social policy has been deprecated.
See also per Gummow J in Scott v Davis (2000) 204 CLR 333, at [128] and [265], and in Pyrenees Shire Council v Day (1998) 192 CLR 330, at [163]. If that approach had been taken to the development of the law of statutory wills in the United Kingdom, the fictions proposed in Re D (J) and Re C would have been discarded. In my opinion, the law of statutory wills in Australia should be developed in a way which justifies a result by a transparent process of reasoning founded upon reality, not upon contra-factual assumptions.
[176] More importantly, however, the fiction is unnecessary because the words of s 22(b) can be applied sensibly and pragmatically without it. Whether a proposed will is "reasonably likely" to have been made by a person who never had, and never will have, the smallest capacity to form testamentary intentions may be answered only in the sense, discussed above: "is there a fairly good chance that a reasonable person, faced with the circumstances of the incapacitated minor, would make such a testamentary provision?" In my opinion, in a nil capacity case, as distinct from a lost capacity case, this is the question which the words "reasonably likely" in s 22(b) require the court to answer. The considerations involved in the question are entirely objective.
His Honour concluded, at [176], that the use in s 22(b) of the words "reasonably likely" requires the Court to examine all objective considerations to answer the question: "is there a fairly good chance that a reasonable person, faced with the circumstances of the incapacitated minor, would make such a testamentary provision?"
A superficial consideration of the reasoning by which Palmer J determined this and a number of other cases might wrongly suggest that his Honour treated the provision in s 22(b) of the Act as a normative basis for the Court to decide to authorise the making of the proposed will; that is, that if it was established that it was reasonably likely that the incapacitated person would have made a will, and that it is reasonably likely that the terms of the will would have been as proposed, the Court should proceed to authorise the making of that will.
In Re Fenwick, after an exhaustive analysis of the law concerning the making of statutory wills, which his Honour humbly described at [200] as a "useful general preamble", Palmer J then decided each of the two separate cases that were the subject of the judgment. In the Fenwick case his Honour first decided, at [214], that it was reasonably likely, in the sense that there was a fairly good chance, that the incapacitated person would have made a will rather than have left his estate to be distributed on intestacy. He then held, at [215], that it was reasonably likely, in the sense that there was a fairly good chance, that the incapacitated person would have selected the beneficiaries that were the subject of the proposed will and would have made gifts to them as proposed. Palmer J then satisfied himself that the other requirements of s 22 of the Act had been established, and made the order under s 18.
The second proceedings concerned an incapacitated person called 'Charles'. Palmer J held, at [250], that it was reasonably likely that Charles would have made a will, and then, at [251], his Honour addressed the "next question", being whether there was a fairly good chance that a reasonable person in Charles' circumstances would have made a will in favour of the beneficiaries as in the proposed will. Note that the question was not framed in terms of whether Charles would have made the will, but whether he would have made a will. Palmer J found, at [255], that he was satisfied that not only was it reasonably likely, but it was highly probable, that Charles would have bequeathed his estate as provided for in the proposed will. Again, Palmer J satisfied himself that the remainder of the conditions in s 22 of the Act had been satisfied, and authorised that the will be made for Charles in the terms of the proposed will.
In AB v CB (above), Palmer J found at [41] that there was "a fairly good chance" that the proposed will would represent the actual intentions of the incapacitated person if she had testamentary capacity. His Honour concluded, at [46], that he was "persuaded that the proposed will is one that CB is reasonably likely to have made".
Arguably, Palmer J adopted the same approach in Re Estate of Crawley [2010] NSWSC 618, and Re Sultana [2010] NSWSC 915 (both of which were brief judgments, and the last mentioned ex tempore).
When these decisions are considered carefully, however, in my view it becomes clear that Palmer J did not approach the question of whether the Court should authorise the making of a statutory will on the basis that there was a rule that the Court should do so if the proposed will was one that it was reasonably likely, in an objective sense, that the incapacitated person would have made if that person had testamentary capacity. The better explanation of the approach adopted by Palmer J is that the cases that he decided were relatively uncontroversial, and a consideration of whether or not it was reasonably likely that the incapacitated person would have made a will in terms of the proposed will was a satisfactory proxy for all the considerations that in theory may arise when the Court exercises its power in s 18 of the Act to authorise the making of a statutory will.
The truth of this proposition appears clearly from Palmer J's reasoning concerning the case of Charles in Re Fenwick where, at [254], his Honour was considering the position of a carer who had cared for Charles with singular devotion, but had expressly disavowed any wish to share in Charles' estate. Palmer J said: "But for her express disavowal, I would have required some provision to be made for her in Charles' statutory will". That makes it clear that Palmer J appreciated that in an appropriate case the Court's powers under ss 18 and 19 of the Act extended to the Court requiring that the proposed will be amended to contain a provision that the Court thought was objectively reasonably likely to have been included by the incapacitated person, but which was not included in the proposed will.
Furthermore, Palmer J considered what was meant by the requirement in s 22(c) of the Act that "it is or may be appropriate for the order to be made" at [189] to [199]. At [193], his Honour interpreted the requirement in s 19(2)(i) of the Act, that in applying for leave under that section the applicant ordinarily must give the Court any evidence available of the likelihood of an application being made under Chapter 3 of the Act for a family provision order in respect of the estate of the incapacitated person, as having the effect that s 19(2)(i) "requires the Court to consider whether the proposed statutory will would accommodate a person who would have a successful claim under the family provision legislation". That is, Palmer J interpreted the effect of the applicant being required to provide information to the Court, concerning the likelihood of an application being made for a family provision order, as being to require the Court to consider whether the proposed will would accommodate any possible family provision claim. Palmer J then considered the circumstances in which it might be appropriate for the Court to consider a "putative family provision claim at the time of hearing the statutory will application": see [196]. Palmer J contemplated, at [195], that there would "inevitably" be applications for statutory wills in which there was a contest between the applicant and others seeking family provision, where the Court would effectively decide upon the appropriate terms to be included in the statutory will in a way that would pre-empt any later claims for statutory provision out of the incapacitated person's estate.
That is not an issue that arises in the present case, but it serves to demonstrate how Palmer J was well aware that, in exercising the jurisdiction in s 18 of the Act, there would be cases when the Court would be required to go far beyond being satisfied that the proposed will was reasonably likely to be one that would have been made by the incapacitated person.
The terms of s 22 of the Act establish a number of pre-conditions that must be satisfied before the Court may exercise the power granted by s 18 of the Act. Section 22 commences with the words: "The Court must refuse leave to make an application for an order under section 18 unless the Court is satisfied that" the criteria in pars (a) to (e) have been established.
Under par (b), if the Court is not satisfied that it is reasonably likely that the incapacitated person would have made the proposed will, the Court must refuse leave under s 19. It does not follow that if par (b) is satisfied, the Court must grant leave, or authorise a will in terms of the proposed will. This is unsurprising, as there may be a number of people who could satisfy the Court that they are appropriate applicants for the purposes of s 22(b), and those persons may have different interests, and may propose different wills. If the issue in s 22(b) is whether it is objectively reasonably likely that the proposed will is "one" that would have been made by the incapacitated person, that test may be satisfied if the proposed will is one of many that the incapacitated person could reasonably have made. Section 22(b) does not require that the proposed will be the one that it is most likely that the incapacitated person would have made. It would have been entirely unsatisfactory if the Court had been required to authorise the making of a will simply because it was within the range of what the incapacitated person could reasonably have made, and was proposed by one of a number of appropriate applicants who had different interests in the terms of the statutory will.
Section 18 of the Act is the primary source of the Court's power to authorise the making of a will for an incapacitated person. The use of the word "may" in sub-s (1) clearly shows that the power is discretionary.
In my view, the requirement in s 18 (1)(a) that the statutory will be "in specific terms approved by the Court", when read with the power granted to the Court by s 20(2) of the Act, on an application for leave under s 19, to "revise the terms of any draft of the proposed will", gives the Court ample power to determine the specific terms of the will that ought to be approved and authorised. I agree with the views expressed by Lindsay J in Secretary, Department of Family & Community Services v K (above) at [70] and [71] concerning the text of the Act conferring "broad discretions". In particular, I agree with the following statement made by his Honour:
[64] Even though ss 19(2) and 22 contain lists which provide guidance for decision-making upon an application for leave to apply for a statutory will (s 19(1)) and upon an application for a statutory will (s 18), the criteria laid down by the Act are expressed at such a level of generality that the broad, discretionary value judgments required to be made by the court must take their colour from the subject matter, scope and purpose of the legislation: Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 493 at 505; Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal (2012) 246 CLR 379 at 401 [42].
Ultimately, the Court must be guided by the circumstance that the statutory jurisdiction created by Part 2.2 Division 2 of the Act is part of the Court's protective jurisdiction. As Lindsay J further said in Secretary, Department of Family & Community Services v K (above):
[58] Upon its proper construction, the legislation conferring the court's jurisdiction to authorise a will to be made on behalf of a minor lacking testamentary capacity is informed by the protective jurisdiction exercised by the court over the person on whose behalf a will is sought to be made: Cf, AB v CB [2009] NSWSC 680 at [5]-[6].
[59] The historical foundations of the court's jurisdiction over children and its jurisdiction over the mentally incompetent are different, but the principles governing both heads of jurisdiction have been assimilated in modern law: Re Eve (1986) 31 DLR (4th) 1 at 13 et seq; [1986] 2 RCS 388 at 407 et seq, approved in Secretary, Department of Health and Community Services v JWB and SMB ("Marion's Case") (1992) 175 CLR 218 at 258-259.
[60] The court's jurisdiction is purposive; the purpose being, at its highest level of abstraction, protection of a person (such as, in the present proceedings, C, in need of protection.
[61] So grounded, the jurisdiction is broad in scope and flexible in nature. Its guiding principle is that whatever is done, or not done, for or on behalf of a person in need of protection must be for the benefit, and in the interests, of that person.
[62] On an application for a statutory will, there is ample scope for that guiding principle to inform the court's decision making.
As I have said above, the most difficult question faced by the Court in this case was to determine the terms of the statutory will, which involved the Court in approving a revised draft agreed by the parties, and determining the percentages that had been left blank by the parties concerning how the residue of N's estate should be divided. In the light of the principles considered above, in my view the following statement made by Hallen AsJ in Re Will of Jane expresses the primary objective of that exercise:
[73] The court's concern under s 22(b) is with the actual, or reasonably likely, subjective intention of the person lacking capacity. It is the specific individual person who is, or is reasonably likely to be incapable of making a will, that must be considered. It is not an objective, or hypothetical, person who is considered. The jurisdiction of the court is, so far as is possible, to make a statutory will in the terms in which a will would have been made by that person if the person had testamentary capacity at the time of the hearing of the application.
That is what I attempted to achieve in my ex tempore judgment, but it was a decision made difficult by the paucity of the evidence and the absence of time for a considered deliberation.
As a final matter, I should record that the requirement that the statutory will be signed by a Registrar and sealed with the seal of the Court may create practical difficulties: see ss 23(1)(b) of the Act. Lindsay J in Re Estate of Scott (above) had to deal with the problem where the applicant for the making of the statutory will had omitted to cause the will to be signed by a Registrar and sealed by the Court. Where there is real urgency arising out of the possible imminence of the death of the incapacitated person, the need for the availability of a Registrar to sign the statutory will may be problematic. As I have recorded above, the orders in this case were made at 5:25 PM. When my associate tried to ensure the availability of a Registrar in anticipation that I would make an order under s 18 of the Act, after the close of the Registry for business, problems emerged that led to the Principal Registrar of the Supreme Court making himself available, and sitting in the back of the court, so that he could carry out the necessary formalities in a timely way. It would be better if the Act permitted the Court, in an urgent case, simply to make the order and seal it, which the judge is able to do, or if need be, for the judge to sign and seal the will.
[3]
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Decision last updated: 08 June 2017