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[2025] NSWCA 136
respondent. Appeal dismissed with costs; leave to cross-appeal granted; cross-appeal allowed with costs; the costs order varied by substituting $130,000 for $40,000.
The Court of Appeal upheld the finding that Margaret Chalik’s 2013 Will was invalid. It said the legal test was the common law test in Banks v Goodfellow, and that s 19(2) of the Succession Act did not replace that test because this was not a statutory will application. The judges considered the evidence as a whole, including clinical records, family evidence, expert evidence and the solicitor’s account. They also clarified that courts can explain procedure to people representing themselves, but are not responsible for running their cases or finding every argument for them. On costs, the Court decided that the $40,000 award did not sufficiently account for two settlement offers found to have been unreasonably rejected. It increased the amount payable to $130,000.
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2,233 words · generated 06/10/2026
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The dispute concerned the estate of Margaret Chalik and two wills. Her 1998 Will divided her estate equally between her sons, Gregory and Isaac. A later Will, executed in April 2013, left everything to Gregory and named him sole executor ([1], [8]-[9], [19]-[20]).
Gregory sought probate of the 2013 Will and, alternatively, family provision. Isaac disputed the Will’s validity. Following a six-day trial, the primary judge found that Margaret lacked testamentary capacity, did not know and approve the contents of the 2013 Will, and had been subject to Gregory’s undue influence. The judge admitted the 1998 Will to probate. She also rejected Gregory’s family provision claim, finding that the provision under the 1998 Will was adequate ([2], [36], [43], [50]-[51]).
The capacity evidence ranged across several years. Records from 2011 described confusion, memory problems and possible dementia. Records soon after the 2013 Will recorded declining cognition, poor short-term memory and likely dementia. There was also lay evidence of difficulty with day-to-day activities, including managing medication, food, personal care and finances ([11]-[17], [21]-[22]). At the first 2013 meeting, the solicitor, Mr Wermut, said Margaret could not answer why she was attending. He also described her as looking to Gregory for reassurance. He believed she was lucid and wanted Gregory to receive everything, but had not asked her to explain her understanding of the estate or test her ability to weigh her sons’ claims ([19], [37]).
The primary judge initially ordered each party to bear his own costs. After her retirement, Slattery J reconsidered costs in light of a Calderbank letter and formal offer of compromise that the primary judge had not known about. Slattery J ordered Gregory to pay Isaac $40,000, a sum below one quarter of Isaac’s disclosed costs ([4], [120]-[122]).
The Court of Appeal dismissed Gregory’s appeal, granted Isaac leave to cross-appeal, allowed that cross-appeal, and substituted $130,000 for the $40,000 costs award ([5], [118]-[119], [149]-[151]).
The Court first rejected the claim that Gregory had been denied procedural fairness because he did not understand that capacity was in issue. The pleadings disputed capacity, Gregory’s reply asserted that Margaret had capacity, and his opening and closing submissions addressed the issue. In oral argument he agreed that capacity was the central question at trial ([55]-[63]). The Court also noted the general principle that a party who participates in a case conducted on a particular basis without objection will not ordinarily be able to complain on appeal about a departure from the pleadings ([63]).
The Court rejected Gregory’s argument that dementia belonged only to a statutory criminal-law concept under the Mental Health and Cognitive Impairment Forensic Provisions Act 2020. A reference to dementia in that statute did not make dementia irrelevant to a civil assessment of testamentary capacity. The Court treated the clinical evidence as potentially relevant, not as automatically deciding the legal question ([54], [58]-[59]).
It also rejected the argument based on s 19(2) of the Succession Act. That provision lists information ordinarily required when a person seeks leave to apply for a court-authorised will under s 18. This case concerned whether a will already executed was valid, not an application for a statutory will. Section 19(2) did not displace Banks v Goodfellow, and the primary judge had applied that common law test ([73]-[80]).
On the evidence, the Court emphasised that testamentary capacity is a legal question decided by the judge on the whole of the evidence. Medical evidence may be highly relevant, but the legal criteria are not simply medical diagnoses. Equally, a solicitor’s view of capacity is evidence to be weighed, not a conclusive answer ([86]-[91], [94]-[100]). The trial judge had considered the solicitor’s evidence in detail. The absence of file notes, the failure to test Margaret’s understanding, the language used in the discussion, her uncertainty about why she was attending, and her apparent dependence on Gregory all informed the judge’s assessment ([37], [100], [102]).
The Court found no basis for appellate intervention in the primary judge’s overall conclusion. The finding drew on the clinical records, lay evidence, expert evidence and the solicitor’s account. The Court also applied appellate restraint to findings affected by credibility and reliability assessments made by the judge who heard the witnesses ([41], [100]-[107]).
On the role of courts towards self-represented litigants, the Court rejected the proposition that a court must ensure a litigant does not miss any right or legal argument because of limited legal skill. It accepted that courts may explain practice and procedure sufficiently to help ensure a fair trial, but stressed that they must preserve fairness to the represented opponent. A judge does not advise a litigant how to exercise rights, conduct the case on their behalf, or undertake a partisan review of unstructured submissions ([67]-[72]).
The costs cross-appeal turned on the two offers. The first, a Calderbank letter made before proceedings began, offered $20,000 in exchange for Gregory supporting the 1998 Will. The second was a formal offer in June 2022. Slattery J had found both unreasonably rejected, and that finding was not challenged ([131]-[133]). The Court explained that formal offers under UCPR r 42.15A can create a prima facie entitlement to indemnity costs if the rule’s requirements are met. A Calderbank offer does not create the same presumption, but its rejection remains a factor in the costs discretion and may be a strong factor ([136]-[137]).
The Court considered that Slattery J gave too little effect to those matters by describing their impact as “slight”. Isaac had succeeded on the central dispute about probate and the contested loan claims. Gregory’s family provision claim had been rejected as unreasonable because the 1998 Will adequately provided for him, and the Court found no suggestion that a costs order would make him impecunious ([146]-[148]). The Court therefore concluded that the $40,000 award did not adequately reflect the circumstances and increased it to $130,000, approximately 70 per cent of Isaac’s stated costs ([149]-[151]).
The judgment’s treatment of testamentary capacity was an application of existing law, not a replacement of it. The Court confirmed that Banks v Goodfellow remains the governing common law framework for assessing capacity in an ordinary probate dispute. Section 19(2) of the Succession Act has a different function: it identifies material relevant to an application for leave to seek an order for a statutory will under s 18. It is not a new substantive capacity test for deciding whether a deceased person’s executed will is valid ([75]-[80]).
The judgment also restated the role of evidence within that framework. Medical records and expert opinions can assist, but capacity remains a legal assessment based on the whole evidence. A solicitor’s observations matter, but their weight depends on such matters as the quality of the assessment, contemporaneous records, familiarity with the will-maker, the enquiries made, and any warning signs ([86]-[100]). The Court’s decision does not establish that a diagnosis of dementia necessarily invalidates a will. Rather, the condition and its effects are evidence to be assessed in context ([59], [86]-[90]).
The clearest clarification concerns self-represented litigants. The Court disapproved the statement in MTH v State of New South Wales that a judge had “an obligation to ensure” a litigant does not fail to claim rights or advance arguments because of lack of legal skill. It regarded that as too absolute. The judgment reconciles a court’s ability to explain procedure and promote a fair trial with its obligation not to become one party’s adviser or advocate ([67]-[72]).
On costs, the judgment did not remove the more liberal approach sometimes taken in family provision cases. It explained that the ordinary costs rule remains relevant, with room for the court to consider the overall justice of the case. But that approach does not mean that settlement offers can be given little weight, especially when two offers were unreasonably rejected and the principal litigation issues were resolved against the party rejecting them ([135]-[147]).
At [68], the Court said the idea of an “obligation to ensure” a self-represented party advances legal arguments “significantly overstates” the court’s responsibility. In plain English, a judge can explain how the proceeding works, but is not required to find and run every possible argument for a person without a lawyer.
At [70], the Court said a duty to provide procedural information is not a duty “to run the case” for the litigant. This is a boundary: reasonable procedural assistance is different from giving strategic or substantive legal advice.
At [80], the Court held that s 19(2) “was not relevant” to the primary judge’s consideration of capacity. In plain English, the statutory checklist for a proposed court-authorised will did not apply to the dispute about the validity of Margaret’s 2013 Will.
At [87], the Court adopted the explanation that Banks v Goodfellow’s criteria are matters for “commonsense judicial judgment on the basis of the whole of the evidence”. The point is that a diagnosis does not itself answer the legal question. The judge considers what the person could understand and weigh, using medical and non-medical evidence.
At [100], the Court agreed that it was difficult to see how the solicitor could have satisfied himself of capacity when Margaret could not explain why she was attending. This does not make that single answer a universal test. It explains why that fact, considered with the other evidence, mattered in this case.
At [147], the Court disagreed that the offers altered the costs landscape only “slightly”. In context, the unreasonably rejected formal offer and Calderbank letter called for substantially greater weight. The result was a higher costs award, not a general formula that all rejected offers produce the same amount.
The judgment is most directly relevant where a probate dispute challenges a will on testamentary-capacity grounds and one side argues that statutory provisions concerning statutory wills replace the common law test. It makes clear that the setting matters: s 19(2) was directed to a proposed will application under s 18, while this case concerned a will already made ([75]-[80]).
It is also relevant where a party relies heavily on either a clinician’s diagnosis or a solicitor’s impression. The judgment indicates that neither category is automatically decisive. The court examines the scope and timing of the evidence and whether the solicitor tested the will-maker’s understanding, alongside other records and witness evidence ([86]-[100]).
Its discussion of unrepresented parties is relevant where a litigant argues that the trial judge should have identified legal issues, corrected pleadings, or developed the party’s case. The judgment distinguishes procedural explanation from running the case, and also highlights the significance of whether the issue was actually pleaded and addressed at trial ([60]-[72]).
Finally, the costs discussion is relevant to litigation involving family provision issues where formal or Calderbank offers were made and rejected. It requires attention to the offer’s terms, the circumstances of rejection, the result achieved, and any evidence about the effect of a costs order. The decision does not make offers automatically determinative, but it rejects treating their proven unreasonable rejection as a marginal consideration in the circumstances before the Court ([131]-[151]).
The judgment is dated 19 June 2025. The material provided does not identify any later court decisions applying or interpreting Chalik v Chalik, so later treatment cannot be assessed from this source alone.
The judgment itself addresses earlier authority. It disapproves the formulation in MTH v State of New South Wales about an “obligation to ensure” that an unrepresented litigant advances rights or arguments. It explains that the formulation did not follow from Nobarani v Mariconte or the passage from Rajski v Scitec Corporation Pty Ltd cited there ([67]-[72]).
For testamentary capacity, the Court applied the existing Banks v Goodfellow approach and referred to Court of Appeal authorities including Photios v Photios, Lim v Lim and Anderson v Yongpairojwong ([79]-[80]). For settlement costs, it considered Bassett v Bassett and Haertsch v Whiteway (No 2), and explained why family provision considerations did not justify the costs outcome reached in this case ([121], [127], [145]-[147]). These are authorities the Court used; they are not subsequent treatment of Chalik.
The judgment leaves the precise amount of procedural assistance in a particular case to context. It says that unrepresented litigants should receive sufficient information about practice and procedure to support a fair trial, while cautioning against imbalance or judicial advice. It does not set a comprehensive checklist for every situation ([69]-[72]).
The judgment likewise does not prescribe a single evidentiary formula for testamentary capacity. It stresses that medical, expert, lay and solicitor evidence must be assessed in the particular case. How much weight each category receives remains dependent on the circumstances, including the quality and timing of the evidence ([86]-[100]).
The costs discussion leaves the assessment of appropriate costs to discretion. It explains why offers mattered in this case, including the formal offer’s presumptive consequences under the rule, but the final award was a broad-brush gross sum rather than a detailed assessment of each item of costs ([136]-[151]). The Court’s treatment therefore does not establish that a fixed proportion, such as 70 per cent, should ordinarily be awarded.
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Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: Chalik v Chalik [2025] NSWCA 136
Hearing dates: 10 June 2025
Date of orders: 19 June 2025
Decision date: 19 June 2025
Before: Bell CJ, Payne JA, Free JA
Decision: (1) Appeal dismissed with costs.
(2) Leave to cross-appeal granted.
(3) Cross-appeal allowed with costs.
(4) Vary Slattery J’s order of 9 August 2024 that “As between the plaintiff and the first defendant the plaintiff shall pay the first defendant’s costs of both these proceedings, which are fixed as a specified gross sum instead of assessed costs in the total sum of $40,000” by substituting $130,000 for $40,000.
Catchwords: APPEALS – Challenge to underlying findings of fact and credit-based findings – Where appellant unrepresented – Consideration of extent of court’s role in relation to unrepresented parties
SUCCESSION – Where probate not granted in respect of a 2013 Will – Where primary judge not satisfied that deceased had testamentary capacity at time of making of 2013 Will – Where clinical notes recorded cognitive defects both before and after execution of 2013 Will – Significance of such evidence – Where will witnessed by a solicitor – Where testatrix unaware about why she was attending solicitor’s office – Application of Banks v Goodfellow (1870) LR 5 QB 549
COSTS – Where family provision claim rejected on basis that 1998 Will provided adequately for the appellant – Where primary judge may have held differently if appellant ordered to pay costs – Where primary judge unaware of Calderbank offer and formal offer of compromise made well prior to trial – Where different judge revisited costs order following primary judge’s retirement – Where, notwithstanding holding that Calderbank offer and offer of compromise unreasonably rejected, respondent awarded less than one quarter of his costs – Whether exercise of discretion vitiated by error or otherwise miscarried – Relevance of notional “buffer” that had been referred to by primary judge
Legislation Cited: Civil Procedure Act 2005 (NSW) s 98(4)(c)
Evidence Act 1995 (NSW) ss 13, 32, 67, 140
Interpretation Act 1987 (NSW) s 42(1)
Limitation Act 1969 (NSW) s 14(1)(a)
Mental Health and Cognitive Impairment Forensic Provisions Act 2020 (NSW) s 5
Succession Act 2006 (NSW) ss 18, 19, 59
Supreme Court Rules 1970 (NSW) r 94
Uniform Civil Procedure Rules 2005 (NSW) rr 14.28, 42.15, 42.15A
Cases Cited: Anderson v Yongpairojwong [2024] NSWCA 220
Bailey v Maddock [2022] VSC 346
Banks v Goodfellow (1870) LR 5 QB 549
Banque Commerciale SA (En Liqn) v Akhil Holdings Ltd (1990) 169 CLR 279; [1990] HCA 11
Barton v Wright Hassall LLP [2018] UKSC 12; [2018] 1 WLR 1119
Bassett v Bassett [2021] NSWCA 320
Bauskis v Liew [2013] NSWCA 297
Betfair Pty Ltd v Racing New South Wales (2010) 189 FCR 356; [2010] FCAFC 133
Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34
Chant v Curcuruto [2021] NSWSC 751
Cheng v Motor Yacht Sales Australia Pty Ltd t/as The Boutique Boat Company (2022) 108 NSWLR 342; [2022] NSWCA 118
Cicek v Estate of late Solomon [2014] NSWCA 278
Coss v Norman (No 2) [2021] NSWSC 1490
Croft v Sanders [2019] NSWCA 303
Croghan v Blacktown City Council (2019) 100 NSWLR 757; [2019] NSWCA 248
Fox v Percy (2003) 214 CLR 118; [2003] HCA 22
Gooley v Gooley [2021] NSWSC 56
Gould v Mount Oxide Mines Ltd (in liq) (1916) 22 CLR 490; [1916] HCA 81
Haertsch v Whiteway (No 2) [2020] NSWCA 287
Hamod v State of New South Wales and Anor [2011] NSWCA 375
Houghton v Potts (No 3) [2023] NSWSC 69
Jae Kyung Lee v Bob Chae-Sang Cha [2008] NSWCA 13
Jeray v Blue Mountains City Council [2010] NSWCA 153
Leach v Nominal Defendant (QBE Insurance (Australia) Ltd) (No 2) [2014] NSWCA 391
Lee v Lee (2019) 266 CLR 129; [2019] HCA 28
Li v Tao (2023) 113 NSWLR 131; [2023] NSWCA 310
Lim v Lim [2023] NSWCA 84
Limberger v Limberger [2021] NSWSC 474
Maitland Hospital v Fisher (No 2) (1992) 27 NSWLR 721
Mendonca v Legal Services Commissioner [2020] NSWCA 84
Miwa Pty Ltd v Siantan Properties Pte Ltd (No 2) [2011] NSWCA 344
Mohareb v Saratoga Marine Pty Ltd [2020] NSWCA 235
Moleirinho v Talbot & Olivier Lawyers Pty Ltd [2014] WASCA 65
Morgan v Johnson (1998) 44 NSWLR 578
MTH v State of New South Wales [2025] NSWCA 122
Nitopi v Nitopi (2022) 109 NSWLR 390; [2022] NSWCA 162
Nobarani v Mariconte (2018) 265 CLR 236; [2018] HCA 36
Oliveira v Oliveira [2023] NSWSC 1130
Papantoniou v Foundouradakis [2023] NSWSC 1374
Photios v Photios [2019] NSWCA 158; (2019) 372 ALR 264
Porthouse v Bridge [2007] NSWSC 686
Rajski v Scitec Corporation Pty Ltd (Court of Appeal (NSW), 16 June 1986, unrep)
Re Fenwick; Application of JR Fenwick; Re Charles (2009) 76 NSWLR 22; [2009] NSWSC 530
Revie v Druitt [2005] NSWSC 902
Rowett v Westpac Banking Corp [1993] NSWCA 240
Ryan v Dalton [2017] NSWSC 1007
Snowy Mountains Grammar School Ltd v Adventurer AWD Pty Ltd [2022] NSWSC 53
Steinmetz v Shannon (2019) 99 NSWLR 687; [2019] NSWCA 114
Stewart v Atco Controls Pty Ltd (in liq) (No 2) (2014) 252 CLR 331; [2014] HCA 31
Stone v Braun [2015] WASCA 103
Theofanous v Aizen [2023] VSC 43
Valmont Interiors Pty Ltd v Giorgio Armani Australia Pty Ltd (No 3) [2021] NSWCA 160
Wild v Meduri [2023] NSWCA 230
Zerjavic v Chevron Australia Pty Ltd [2020] WASCA 40
Ziegler atf Doris Gayst Testamentary Trust v Cenric Group Pty Ltd [2020] NSWCA 85
Zorbas v Sidiropoulous (No 2) [2009] NSWCA 197
Texts Cited: N/A
Category: Principal judgment
Parties: Gregory Chalik (Appellant/Cross-Respondent)
Isaac Chalik (First Respondent/Cross-Appellant)
NSW Trustee and Guardian (Second Respondent)
Representation: Counsel:
Gregory Chalik (in-person)
N Allan (First Respondent/Cross-Appellant)
Solicitors:
Ziman & Ziman (First Respondent/Cross-Appellant)
File Number(s): 2024/94840; 2024/331006
Publication restriction: N/A
Decisions under appeal
[This headnote is not to be read as part of the judgment]
This appeal relates to a dispute over two wills created by Margaret Chalik (the deceased). The deceased’s penultimate will (the 1998 Will) split the estate equally between her sons, Gregory Chalik (the Appellant) and Isaac Chalik (the Respondent). The final will (the 2013 Will) left everything to the Appellant, and made him sole executor of the estate. The Appellant commenced proceedings to propound the 2013 Will and, among other claims, seek family provision.
Justice Henry (the primary judge) held that the deceased lacked testamentary capacity to make the 2013 Will, did not know and approve its contents, and was subject to the Appellant’s undue influence, having regard to various matters including: (i) clinical records predating and immediately post-dating the 2013 Will, which recorded the deceased’s deteriorating cognition and potential dementia; and (ii) evidence that the deceased could not answer why she was attending her solicitor’s office one week before the 2013 Will was made. The primary judge admitted the 1998 Will to probate, and held that it made adequate provision for the Appellant because, after making allowance for accommodation and other expenses, the Appellant would obtain a “buffer for contingencies in life” of $220,000 in addition to an interim distribution he had received of some $250,000.
The primary judge held that each party should bear his own costs. Following the primary judge’s retirement, the Respondent applied to vary the primary judge’s costs order. Justice Slattery held that the Appellant unreasonably rejected a Calderbank letter and formal offer of compromise. His Honour made a costs order of $40,000 against the Appellant, representing less than a quarter of the Respondent’s costs.
The Appellant challenged the primary judgment, and the finding that the deceased lacked capacity to execute the 2013 Will, and contended that the primary judge applied the incorrect test to determine testamentary capacity. The Respondent sought leave to appeal against Slattery J’s judgment.
The Court (Bell CJ, Payne JA, Free JA), dismissing the appeal and allowing the cross-appeal, held:
Gould v Mount Oxide Mines Ltd (in liq*)* (1916) 22 CLR 490; [1916] HCA 81; Banque Commerciale SA (En Liqn) v Akhil Holdings Ltd (1990) 169 CLR 279; [1990] HCA 11; Betfair Pty Ltd v Racing New South Wales (2010) 189 FCR 356; [2010] FCAFC 133; Cheng v Motor Yacht Sales Australia Pty Ltd t/as The Boutique Boat Company (2022) 108 NSWLR 342; [2022] NSWCA 118; Nitopi v Nitopi (2022) 109 NSWLR 390; [2022] NSWCA 162, cited.
Re Fenwick; Application of JR Fenwick; Re Charles (2009) 76 NSWLR 22; [2009] NSWSC 530; Photios v Photios (2019) 372 ALR 264; [2019] NSWCA 158; Lim v Lim [2023] NSWCA 84; Anderson v Yongpairojwong [2024] NSWCA 220, cited.
MTH v State of New South Wales [2025] NSWCA 122, disapproved.
Rajski v Scitec Corporation Pty Ltd (Court of Appeal (NSW), 16 June 1986, unrep); Nobarani v Mariconte (2018) 265 CLR 236; [2018] HCA 36; Bauskis v Liew [2013] NSWCA 297; Cicek v Estate of late Solomon [2014] NSWCA 278; Rowett v Westpac Banking Corp [1993] NSWCA 240; Mendonca v Legal Services Commissioner [2020] NSWCA 84, considered.
Jae Kyung Lee v Bob Chae-Sang Cha [2008] NSWCA 13; Jeray v Blue Mountains City Council [2010] NSWCA 153; Mohareb v Saratoga Marine Pty Ltd [2020] NSWCA 235; Barton v Wright Hassall LLP [2018] 1 WLR 1119; Hamod v State of New South Wales [2011] NSWCA 375; Moleirinho v Talbot & Olivier Lawyers Pty Ltd [2014] WASCA 65; Stone v Braun [2015] WASCA 103; Zerjavic v Chevron Australia Pty Ltd [2020] WASCA 40, cited.
Limberger v Limberger [2021] NSWSC 474; Oliveira v Oliveira [2023] NSWSC 1130; Steinmetz v Shannon (2019) 99 NSWLR 687; [2019] NSWCA 114; Porthouse v Bridge [2007] NSWSC 686; Papantoniou v Foundouradakis [2023] NSWSC 1374; Bassett v Bassett [2021] NSWCA 320; Coss v Norman (No 2) [2021] NSWSC 1490, considered.
THE COURT: This appeal relates to a dispute over two wills created by Margaret Chalik (the deceased). The deceased’s penultimate will (the 1998 Will) split the estate equally between her sons, Gregory Chalik (the Appellant) and Isaac Chalik (the Respondent). The final will (the 2013 Will) left everything to the Appellant, and made him sole executor of the estate.
The Appellant commenced proceedings, seeking to propound the 2013 Will and, in the alternative, claim family provision. After a hearing of six days, Justice Henry (the primary judge) held that the deceased did not have testamentary capacity when she made the 2013 Will, and admitted the 1998 Will to probate. The primary judge further concluded that the deceased’s own will was likely overborne by the Appellant and that she did not make a free and fully informed decision when she made the 2013 Will: PJ [349]. Her Honour also rejected the Appellant’s family provision claim, rejected his claim in relation to a debt asserted to be owed by the Respondent to the deceased’s estate in the sum of $150,000 and found that the Appellant owed $15,000 to the estate: Chalik v Chalik [2024] NSWSC 117 at [536(1)] (primary judgment or PJ).
The Appellant challenges these findings on appeal.
By application for leave to cross-appeal, the Respondent challenges costs orders made by Slattery J following the retirement of the primary judge. While her Honour had held that each party should bear their own costs from the amount to be received from the estate, the Respondent applied to re-open to draw attention to the fact of and rejection of a Calderbank letter and a formal offer of compromise issued prior to the commencement of proceedings and almost a year prior to the commencement of the hearing, respectively. Slattery J ordered that the Appellant pay the Respondent’s costs in the sum of $40,000, representing under a quarter of the Respondent’s disclosed costs and disbursements: Chalik v Chalik [2024] NSWSC 995 at [31(5)] (the costs judgment or CJ).
For the reasons which follow, the appeal should be dismissed, leave to cross-appeal should be granted and the cross-appeal allowed.
In 1995, the Appellant moved in to live with the deceased in her Bondi unit following the death of her husband, Roman Chalik: PJ [75]. The Appellant subsequently moved to the United States in May 2000, returning to Sydney in late 2002 to live with the deceased in her Bondi Unit: PJ [101], [109]. Soon after, the Appellant moved to Melbourne, and returned to live with his mother in July 2003: PJ [110]. He returned to Melbourne in October 2009 and then returned to Sydney just over two years later in September 2011: PJ [134].
On 31 August 1996, a “Deed of Loan” was signed by the deceased and the Respondent which contemplated that the deceased would loan $150,000 to the Respondent – to be repaid on 30 August 2016: PJ [79]-[81].
On 2 April 1997, the deceased made a will (the 1997 Will) which made the Appellant the sole beneficiary of the estate, and nominated the NSW Trustee as executor: PJ [86].
On 29 October 1998, the deceased created the 1998 Will, which split the estate equally between the Appellant and Respondent, and nominated the NSW Trustee as executor and trustee of the will: PJ [89]. There was no ultimate dispute at trial as to the 1998 Will’s validity: PJ [97].
In or about 2010, the deceased signed an agreement with a real estate agent to sell her Bondi unit. There was evidence which the primary judge accepted that the deceased, in 2010, told the Respondent that she had no recollection of signing the agreement and that she never wanted to sell the unit. The Respondent called the sales agency, told them his mother had memory issues and that the agreement was unenforceable and they never heard from the agency again: PJ [121].
On 30 August 2011, the deceased was admitted to St Vincent’s Hospital. Dr Day recorded that the deceased did not know why or how she arrived at the hospital. The notes described the deceased as rambling, presenting “acute confusion – worsening dementia” and had “deteriorating cognition (?dementia) over last 12-18 months”: PJ [124]-[126]. The notes also recorded a list of issues, which included: “Acute deterioration in mental state”; “long term deterioration in cognition?”; and “Dementia, depending on baseline ?”: PJ [126].
On 31 August 2011, the Appellant contacted JewishCare and referred the deceased: PJ [130]. JewishCare’s records from the conversation with the Appellant recorded that the deceased was missing taking her medication, left out of date food in the fridge, and required assistance with socialisation: PJ [131]. The deceased was referred for assessment and intervention to Ms Assia Zinder.
On 8 September 2011, Ms Zinder from JewishCare met with the deceased at her Bondi unit. JewishCare’s notes recorded that Ms Zinder explained to the Appellant that the deceased had issues with personal care, was repetitive, could not answer questions about what she ate or how she managed her daily life, and that there was rotting food in her unit: PJ [132].
“[The Respondent’s] evidence (which I accept) that in 2010 the deceased did not recall signing the agency agreement in relation to the sale of the Bondi Unit and had trouble dealing with her finances; the evidence from [the Appellant] and the notes from JewishCare about the physical and mental state of the deceased and the Bondi Unit in September 2011, which clearly demonstrate that the deceased had lost the capacity to manage day to day activities, such as personal grooming, cleaning, food preparation, paying bills and taking her medications, which must have occurred over a period of time; the August 2011 hospital records that refer to the deceased not knowing why she was there and how she was brought to the hospital, expressing paranoid ideation about her son and a friend wanting to harm and kill her and take her home away (this could be a reference to [the Respondent] and a nursing home or to [the Appellant] and the potential sale of the Bondi Unit), refusing treatment and absconding from the hospital; and Dr Opacic’s notes from September 2011, which refer to the deceased forgetting to take medications and forgetting things in the fridge, and repeating questions.”
Various clinical records created shortly after the 2013 Will was made suggested that the deceased had declining cognition and potential dementia:
on 30 April 2013, St Vincent’s Hospital records reported declining cognition (including that the deceased could not recall her own date of birth or address) and that her cooperation, insight and judgement were “severely impacted”: PJ [179];
on 1 May 2013, Ms Klahr from the Geriatric Flying Squad was referred by St Vincent’s emergency department to conduct a home visit for the deceased, and recorded that the deceased was repetitive and deferred to her son to answer questions. Ms Klahr’s initial assessment report also observed that the deceased was unwashed, unkempt and had grazes on her nose, chin, fingers and the palms of her hands: PJ [181];
on 2 May 2013, following the deceased’s admission to the War Memorial Hospital, records stated that she had cognitive impairment and presented with confusion and dementia, requiring formal diagnoses. The deceased stated that she was forgetting and losing her mind. The hospital’s notes stated that the Appellant described the deceased as having chronic and deteriorating dementia: PJ [182]-[184];
on 7 May 2013, War Memorial Hospital discharge records stated that “dementia is a likely diagnosis” and that the deceased had poor short term memory: PJ [185]. This view was repeated in separate clinical notes on 9 and 21 May 2013 respectively: PJ [186], [188]; and
on 21 May 2013, St Vincent’s Community Health service conducted an assessment of the deceased at her Bondi unit. While she knew her age and home address, she stated that the year was 1912, then 2012, and could not count back from 20 to 1, or recall her home address minutes later: PJ [188].
Around September 2013, the deceased purportedly typed and signed a letter in Russian (at the Appellant’s request) explaining the reasons (Statement of Reasons document) for giving the entire estate to the Appellant under the 2013 Will: PJ [190]. The reasons included that: (i) the Appellant helped with home loan repayments, to which the Respondent did not contribute; (ii) the Appellant cared for the deceased after her husband passed away; and (iii) the Respondent and his family infrequently visited the deceased: PJ [190]. The Appellant denied writing the letter: PJ [193]. The Respondent provided evidence that his mother never typed letters and the signature was not one that he recognised as his mother’s: PJ [194].
In either September or October 2013, Dr Opacic formally diagnosed the deceased with dementia, after administering a Mini-Mental State Examination (MMSE), giving a score of 22/30: PJ [195].
Between 5 and 11 September 2014, the Appellant transferred $25,000 from the deceased’s bank account to his own account, marked as “Mums Odessa trip”: PJ [206].
The primary judge held that the 2013 Will was invalid because the deceased lacked testamentary capacity, did not know and approve the contents of the will, and was subject to undue influence: PJ [329]. The primary judge was satisfied the deceased was suffering from a form of cognitive impairment, and that she would have been diagnosed with progressive dementia or Alzheimer’s disease if a formal assessment was made at the time of the making of the 2013 Will: PJ [312]. This conclusion was reached having regard to the various clinical records which identified cognitive impairment, many of which have been noted earlier in these reasons.
The primary judge closely analysed the evidence of Mr Wermut who was cross-examined at some length during the trial. Her Honour’s reasoning bears full reproduction, given the emphasis the Appellant placed on the significance of Mr Wermut’s evidence in this Court:
“[314] Mr Wermut’s evidence, as the recollections of the solicitor who prepared the 2013 Will and met with the deceased is material to determining the question of testamentary capacity.
[315] The issue I have in this case is that Mr Wermut had no file notes of his attendances with the deceased and his evidence about what happened was based sole[l]y on his recall of events nine or ten years prior. Further, the evidence he gave raises doubts, to my mind, as to whether the deceased did, in fact, have the capacity to recall, reflect and reason, in the sense that she had the cognitive capability to understand the extent of the property the subject of the 2013 Will and to comprehend and weigh up the moral claims of her potential beneficiaries.
[316] Mr Wermut said he had a conversation with the deceased of some minutes before discussing the will making and I have no doubt that Mr Wermut honestly and genuinely held the view that the deceased had testamentary capacity when she made the 2013 Will. However, with all due respect to Mr Wermut, it is difficult to see how he could have properly satisfied himself that the deceased had testamentary capacity when one of the first things she said to him was that she did not know why she was there. The fact that the deceased may have remembered why when prompted by Mr Wermut does not seem to me to be a satisfactory answer in the context where the deceased was elderly, he observed her to be not in robust health, that she lacked an agile mind, that she responded slowly and she would not engage when he attempted to ask questions about leaving [the Respondent] out of the 2013 Will. Further red flags are the fact they conversed in Yiddish, a language which was neither the deceased’s primary or secondary language (which were Russian and English) and Mr Wermut’s own Yiddish was “rusty”, and Mr Wermut had detected some unease and discomfort on the part of the deceased when he asked her to come in with him alone and she appeared to be dependent on [the Appellant] and looking for assurance from him.
[317] Mr Wermut did not ask the deceased about the value and extent of her estate and assumed she knew she owned the Bondi Unit based on a conversation with [the Appellant] some years prior. He could not, therefore, say what she knew about it.
[318] Mr Wermut did not ask the deceased questions to test her memory, her ability to recall and reflect on the claims on her estate or whether she had a previous will and if so, why she was changing it. Nor did he ask [the Appellant], who was her attorney and guardian and who had arranged the meeting, whether there was any reason to be concerned about capacity, including as a result of any diagnosis, behaviour, medication or the like (although one would expect that [the Appellant] would have said no).
[319] Mr Wermut accepted what the deceased told him in “adamant terms” that she wanted everything to go to [the Appellant] and nothing to [the Respondent]. He said that she explained that she saw [the Respondent] rarely and [the Appellant] was the one who looked after her. However, that was the same reason he gave about why she had granted [the Appellant] the power of attorney in 2011. When this was raised with Mr Wermut in cross-examination, he said that his memories might have intermingled over the two periods of time, which raises some further doubts about the reliability of Mr Wermut’s recollection of what they discussed.
[320] Mr Wermut had dealt with the deceased 18 months prior and he says he concluded there were no difficulties with her capacity. However, considered objectively in light of the above matters, I am not persuaded that Mr Wermut’s evidence establishes that the deceased had testamentary capacity in the sense that she had the capacity to understand the extent of the property the subject of the will or to comprehend and weigh up the moral claims of both [the Appellant] and [the Respondent].
[321] I accept that the deceased was likely capable of understanding that she owned the Bondi Unit although I doubt that she had the capacity to understand the real value of her estate. Testamentary capacity does not require a testator to turn their mind to the exact extent of their property or know the precise value of an estate and this was a simple estate comprising of the Bondi unit and some cash in a bank account. However, the evidence that the deceased withdrew large sums of cash for no apparent reason, was very forgetful and confused and had trouble paying bills, suggests to me that she had little appreciation of the value of money and would be unlikely to have had the capacity to understand even the general extent and value of her estate that she could dispose of by her will.
[322] I consider it likely that the deceased was capable of understanding that she excluded [the Respondent] from her will when it was made in April 2013. However, the question is not whether she knew that matter but whether she was capable at that time of comprehending and appreciating (that is, weighing) the competing interests and potential claims on her estate and deliberately forming an intelligent purpose of excluding [the Respondent] from any share of her estate: Rofe at [140] and [146]; Re the Estate of Hodges Deceased; Shorter v Hodges (1988) 14 NSWLR 698 at 706.
[323] In this case, comprehending and weighing of [the Respondent’s] claim required the deceased to be able to weigh up and make a judgment about whether there was a reason to depart from her longstanding intention of sharing her estate equally between her two sons, as provided for in the 1998 Will. That would require the deceased to be able to mentally process and consider historical facts as well as recent events, such as whether, in fact, [the Respondent] was seeing her regularly or at all and the impact of [the Appellant] on that. Given that the deceased had lost insight into her own condition and care needs, her short-term memory loss meant she could no longer retain information and she had shown poor judgment and impulsivity in her conduct, it is difficult to see how she had the cognitive capability to recall, reflect and reason about those matters.”
The primary judge also had regard to, without placing decisive weight (PJ [288]) upon, the parties’ joint expert, Dr Jane Lonie (an experienced clinical neuropsychologist): PJ [324]. Dr Lonie’s evidence in her report and in cross-examination was that, at the time of making the 2013 Will, the deceased:
likely understood the nature and purpose of the will: PJ [267];
understood that her primary asset was her Bondi unit, but likely did not understand its value: PJ [268], [277(b)];
was mentally incapable of comprehending and appreciating her sons’ relative claims to the estate: PJ [269]; and
suffered risk factors of undue influence, such as her age, gender, cognitive limitations, mental illness, relative isolation and the Appellant’s apparent authority: PJ [274], [277(c)].
The primary judge also held that there were reasons to doubt whether the deceased knew and approved the terms of the 2013 Will, noting that the deceased’s cognitive impairment, the fact that the will was explained to her in Yiddish and that she did not read over the 2013 Will, and the Appellant’s involvement in making the will including arranging for the deceased to see Mr Wermut and attending the execution meeting, “are matters that excite suspicion in this case”: PJ [337].
In relation to the Statement of Reasons document of 17 September 2013, the primary judge found the Appellant’s evidence as to its creation to be inherently unlikely having regard to the objective evidence: PJ [46]. Later in her reasons, at PJ [327], the primary judge held that she did not consider that:
“the Sept 2013 Statement evidences that the deceased was capable of weighing the competing claims on her estate and forming an intelligent purpose of excluding [the Respondent] from her estate. I am simply unpersuaded by [the Appellant’s] evidence that the deceased played any part in the preparation of that document. In my view, the proposition that the deceased had the mental acuity to recall and reflect and also type that statement over a period of two to three weeks is inherently implausible, given the deceased could not remember to take her medications, could not recall why she was meeting with Mr Wermut on 17 April 2013, had engaged in a home visit on 1 May 2013 without her pants on (as recorded by Ms Klahr), regularly presented as confused and forgetful (as referred to in Dr Opacic’s and hospital notes and the lay evidence from [the Respondent], [the Appellant] and her grandsons), and by 21 May 2013, could not count back from 20 to 1, recall an address minutes later and initially gave the year as 1912 (then as 2012), and the deceased had not used a typewriter for about 35 years.”
More generally, the primary judge was critical of the Appellant’s evidence and its reliability. She pointed to his self-interest, adverse view about his brother’s entitlement to anything from their mother’s estate, inconsistencies in his evidence, the tailoring of aspects of his evidence and attempts to resile from aspects of his affidavit of 7 March 2023: PJ [45]-[48]. In making these adverse findings, the primary judge possessed all of the advantages of a judge at first instance referred to by the High Court in Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 at [29] (Fox v Percy) and Lee v Lee (2019) 266 CLR 129; [2019] HCA 28 at [55] (Lee). To the extent that the primary judge’s findings were influenced by assessments of credit (and there were many matters of disputed fact as between the brothers such as their competing perceptions of their mother’s capacity, and the extent of their respective involvement with her over time), the primary judge’s advantage presents a significant hurdle for the Appellant on appeal, especially given her Honour’s positive view as to the evidence of the Respondent as generally more consistent with the objective evidence and the corroboration of that evidence by his two sons, Richard and Nathan, whose evidence was described by the primary judge as credible: PJ [49].
The primary judge further held that the 2013 Will was the product of the Appellant’s undue influence over the deceased (PJ [349]), and that the deceased’s cognitive impairment was severe enough to compromise her day to day functioning, and that she was reliant upon the Appellant for care, rendering her “extremely vulnerable” to the Appellant’s influence: PJ [350]. Her Honour found that the Appellant likely initiated the making of the 2013 Will, and that, given the deceased’s cognitive impairment, it was unlikely that she would have instructed Mr Wermut to change her 1998 Will – other than by the Appellant’s insistence: PJ [352]. Furthermore, the primary judge found that the Appellant asserted a “moral command” over the deceased, as a consequence of which, “the deceased’s own will was likely overborne by Gregory and she did not make a free and fully informed decisions [sic] when she made the 2013 Will”: PJ [354]. Her Honour described this as representing “practical coercion”: PJ [354].
Consequently, her Honour held that the deceased did not have testamentary capacity when she executed the 2013 Will, and admitted the 1998 Will to probate: PJ [520]-[521].
The primary judge rejected the Appellant’s claims that the Respondent owed money to the deceased’s estate by virtue of a Deed of Loan, in the sum of $150,000; and a 2001 Repay Document, in the sum of $130,000.
In respect of the Deed of Loan, the primary judge held that the document was not enforceable as a deed because it was not witnessed: PJ [374]-[376]. The document was also unenforceable as a contract for want of consideration: PJ [379]. This is because her Honour was not persuaded that the deceased ever lent $150,000 to the Respondent: PJ [380]. Rather, as the Respondent deposed, the deed was signed close to the date of his wedding because the deceased and the Appellant wanted to protect the “family equity” in case of divorce: PJ [360].
In respect of the 2001 Repay Document, the primary judge found that there was a lack of objective evidence suggesting that the deceased ever paid $130,000 to the Respondent: PJ [381]. In any event, the claims under the Deed of Loan and 2001 Repay Document were statute barred (Limitation Act 1969 (NSW), s 14(1)(a)), and the latter claim was not pressed in the Third Amended Statement of Claim: PJ [107], [383].
Her Honour accepted the Respondent’s claim that the Appellant owed $15,000 to the deceased’s estate: PJ [391]. This was because, from 5 to 11 September 2014, the Appellant transferred $25,000 from the deceased’s bank account to his own account: PJ [388]. While he repaid $10,000 (PJ [389]), there remained $15,000 outstanding: PJ [391].
On 24 February 2022, Hallen J made an interim distribution order, advancing $250,000 from the deceased’s estate to the Appellant: PJ [418]. The Appellant sought further final provision on the basis that the 1998 Will provided that the deceased estate be shared equally between the Appellant and Respondent: PJ [394].
The value of the estate at the time of the primary judgment was $1,652,231.89, taking account of fees, interest, and adding back the $250,000 interim distribution to the Appellant: PJ [420]. Under the 1998 Will, the Respondent and Appellant would be entitled to receive $826,115.95 each: PJ [422]. However, having regard to the interim distribution and the $15,000 owed to the deceased’s estate (see [47]-[48] above), the Appellant would be entitled to receive a sum of $561,115.95: PJ [422].
The primary judge held that the 1998 Will made adequate provision for the Appellant, and that the deceased was not morally obliged to provide him a greater sum: PJ [513]. Her Honour had regard to various matters including:
the sum provided, while not large, was not insubstantial (PJ [514]);
the Appellant was unemployed (PJ [470]);
the Appellant, whilst caring for the deceased (PJ [457]), benefitted financially by living in the deceased’s Bondi unit rent-free (PJ [509]); and
the sum would enable the Appellant to obtain suitable accommodation in Tamworth (noting that he did not require acreage: PJ [450]), undertake dental treatment, acquire furniture and a car, and left a $220,000 buffer for contingencies in life which her Honour noted “he may use to set up a business if he desires” (PJ [514]); and
in relation to the so-called “buffer”, her Honour noted that the Appellant would have the figure of $220,000 “even assuming that he has already spent the entirety of the interim distribution made to him ($250,000) on his daily needs and his legal expenses” (PJ [514]).
Given her Honour’s assessment of the adequacy of the provision made for him in the 1998 Will in view of the size of the estate, the primary judge rejected the Appellant’s family provision claim: PJ [515]. At PJ [516]-[519], the primary judge held:
“[516] If I am wrong to conclude that adequate provision had not been made by the deceased’s 1998 Will for [the Appellant’s] proper maintenance and advancement in life, I would not have accepted that the amount of provision sought by [the Appellant], namely the entirety of the deceased’s estate, would be appropriate.
[517] In the event the 2013 Will is invalid (which is the circumstances on which [the Appellant’s] family provision claim is to be determined), I consider that for [the Appellant] to receive an additional amount of $826,115.95 (giving him over $1.6 million) is more than required for adequate provision for his proper maintenance and advancement in life. Nor do I consider that the circumstances of this case warrant [the Respondent] being excluded from the deceased’s estate entirely.
[518] In my view, if I am wrong, the better approach would be to allow [the Appellant] to retain the interim distribution of $250,000 and divide the remainder of the estate (of $1,402,231.89) in half, thereby providing [the Appellant] with total provision of $951,115.95 and [the Respondent] with around $700,000 before taking into account [the Respondent’s] legal costs.
[519] However, as I have explained, the better view is that [the Appellant’s] claim for further provision from the deceased’s estate should fail.”
At first blush, her Honour’s rejection of the Appellant’s family provision claim on the basis of the adequacy of provision for him in the 1998 Will is a little difficult to reconcile with what is stated in PJ [518]. It may be that the apparent tension is resolved once it is recognised that the Respondent’s costs of a six day trial were said to be $132,220 (PJ [532]) which would need to be added to the notional $700,000 referred to at PJ [518] and subtracted from the Appellant’s notional $951,000, effectively equalising the distribution of the estate. In any event it is clear enough from the context that the “better view” which ultimately prevailed is that described in PJ [519], and not PJ [518].
In what follows, the Appellant’s grounds of appeal, many of which overlapped and some of which were difficult to follow, are grouped together as coherently as those grounds permitted, and considered.
The Appellant contended that what he described as the Respondent’s “dementing” defence to the 2013 Will was invalid as it relied upon what he described as a criminal jurisdiction concept, namely dementia, which he maintained was inapplicable to civil probate proceedings. In this context, it emerged that the Appellant was referring to the Mental Health and Cognitive Impairment Forensic Provisions Act 2020 (NSW) (Mental Health Act) and to the definition of cognitive impairment in s 5 of that Act, subsection 2 of which identifies dementia as one of the conditions from which the statutory concept of cognitive impairment may arise.
In [2] of his Amended Defence, the Respondent did not admit the validity of the 2013 Will or that the 2013 Will was explained to the deceased “in a language which she understood or at all”, did not admit that she was capable of understanding it or any explanation of it, and did not admit that she was not unduly influenced by the Appellant in relation to it. Paragraph 2B of the Amended Defence provided that:
“At and about the time of making the 2013 will, Mrs Chalik:
2B.1. was physically vulnerable and prone to falling;
2B.2. was confused, dementing, suffering memory problems, otherwise mentally frail; and
2B.3. had a very poor command of the English language.”
“ii. Mrs Chalik was 76 years old when making the 2013 will. In May 2010 she entered into an irrational sale of her residence (with no place to go upon sale). She had been admitted to St Vincent's Hospital (SVH) in August 2011 with confusion and possible delirium, as well as paranoia (to do with a son and friend conspiring against her) and worsening dementia. In September 2011 she was admitted to SVH after exhibiting a delusion to train guards at a train station. In December 2011 she told a bank employee that her ‘son’ is reading her mail (CBA, file notes, 20/12/2011). In March 2012 her general practitioner recorded her as being cognitively impaired with problems answering simple questions (Opacic, Centrelink Medical Report).
iii. In 2013 Mrs Chalik repeatedly fell, including at McDonalds, which led to injuries including a broken arm. She was quite overweight. Hearing difficulties were recorded by SVH hospital staff. She had a limited social life, did not drive, and was restricted most of the time to short trips to and from her unit. In April 2013 the solicitor, Mr Wermut, found Mrs Chalik to be ‘not in the most robust of health’. In early May 2013 Waverley War Memorial Hospital recorded her depression, confusion and wandering. In September 2013 she supposedly took two weeks to type a single page of ‘reasons’ for her will. In 2014 she scored poorly on a mini-mental state examination (MMSE, 13/30). A SVH Community Health mental test score on 21 May ~ 2013 marked her as notionally 7/10 and borderline for cognitive impairment (but likely worse than 7/10, given the scoring errors in the sheet).
iv. On 21 December 2015 Mrs Chalik's general practitioner confirmed she had suffered mild to moderate dementia for three to four years. She scored poorly on a mini-mental state examination (MMSE, 21/30). On 4 January 2016 at attending geriatrician (A/Prof Nicholas Brennan) identified dementia which had become ‘more advanced’ over the preceding four to five years.
v. Mrs Chalik relied on a Russian interpreter during 2017 hearings in the NSW Civil & Administrative Tribunal relating to guardianship orders affecting her. Russian is identified as her language in SVH and Waverley War Memorial hospital notes dating to August 2011 and May 2013.
vA. In September 2011 Mrs Chalik's general practitioner, Dr Opacic, recorded her as having a history of being forgetful. A home visit by Ms Zinder from Jewish Care in that month found Mrs Chalik in an unkempt state, forgetful, repetitive, and in an unhygienic residence. Mrs Chalik was also confusing events in the 1990s with the present day (visiting Macquarie University).
vB. In late April and early May 2013 at St Vincents Hospital Ms Chalik was unsure if she was left- or right-handed; was agitated; refused medication and treatment for a fall; appeared unkempt with a history of deteriorating cognition; gave an unreal history of her daily living (denying previous falls and claiming to do all housework and look after her son); scored 8/10 on an abbreviated mental test score, indicating ‘mild’ cognitive impairment but that result then further qualified by the attending staff; was considered a ‘very vague historian’; was found to have a calcified meningioma (tumour) on the brain. In December 2014 Mrs Chalik’s neighbour reported her mental oddity to the strata manager, namely refusing to let the plaintiff's dog back into their apartment on the basis that it was not the plaintiff’s dog.”
The Appellant argued that the pleading should have been struck out pursuant to r 14.28(1) of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) for causing prejudice and delay. Furthermore, the Appellant contended that the primary judge “erroneously amended” the “dementing” pleading to “lack of testamentary capacity”, which was said to have given rise to procedural unfairness. Such arguments were directed to the primary judge’s references at PJ [7] and [14] to the fact that the Respondent “challenges the validity of the 2013 Will on various grounds, including lack of testamentary capacity”.
The Appellant’s arguments were misconceived as to the ability of the Respondent to raise the deceased’s dementia or deteriorating mental state in its Amended Defence and were without merit insofar as he claimed to have been denied procedural fairness. There was no basis for [2B] of the Amended Defence nor the particulars subjoined to it to have been struck out (even putting to one side the fact that was never sought).
As to the Appellant’s first point, the Appellant’s reliance on the Mental Health Act appeared to proceed on the flawed binary assumption that, because dementia was mentioned in s 5(2) of that Act, dementia could have no relevance to any legal question outside the operation of that Act. This was self-evidently wrong. Whether or not a testator has dementia at the time of executing a will, while not itself determinative, is routinely taken into account in assessing the testator’s legal capacity to execute a will: see, for example, Gooley v Gooley [2021] NSWSC 56 at [1136], [1142]-[1144].
As to the Appellant’s claim to have been the subject of procedural unfairness, it was clear beyond argument that the question of the deceased’s testamentary capacity was at all material times in issue, and that the Appellant well understood that fact. This may be understood from at least the following matters. First, [2.3] of the Reply pleaded that the deceased had testamentary capacity and understood the 2013 Will. Secondly, the Appellant’s opening outline of submissions before the primary judge acknowledged that the issues in dispute included the deceased’s testamentary capacity, and made positive arguments, relying upon Mr Wermut’s affidavits and Dr Lonie’s report, as to why the deceased had the requisite capacity. Thirdly, in closing submissions (which took the form of annotations to the Respondent’s closing submissions, differentiated by the use of blue font, and made at a time when the Appellant was representing himself), the Appellant advanced various counterarguments under the heading “The primary case: testamentary incapacity in 2013”, including that “there is no evidence adduced that poor physical health did, or even could have influenced testamentary capacity”.
Further, in the course of oral argument on appeal, the following exchange occurred:
“BELL CJ: … As I understand, it was clear between you and your brother in the argument before Henry J, the key issue was whether your late mother lacked capacity. Do you agree with that? That that was the key issue?
APPELLANT: Well it's kind of hard to get an idea from the judgment, but I will address, if you would like me to address that, I will address that now.
BELL CJ: It's a clear question. The judgment certainly suggests that that was the central, the first and central question.
APPELLANT: Yes.
BELL CJ: Do you agree that that was the first and central question?
APPELLANT: Yes.”
To the extent that the Appellant complained on appeal that the Respondent’s Defence was frivolous and an abuse of process insofar as it called into question the testamentary capacity of the deceased, it was plainly legitimate to do so, as the primary judge’s detailed and closely analysed judgment bore out. There was no obscurity or misunderstanding that that was the first and central question in the case, as the Appellant accepted in oral submissions.
Even if there were any merit in the Appellant’s pleading points (which there is not), if parties fight their cases in a manner that departs from the pleadings in a way that does not excite protestation at the time, that departure cannot generally be the subject of legitimate complaint on appeal: Gould v Mount Oxide Mines Ltd (in liq*)* (1916) 22 CLR 490 at 517; [1916] HCA 81; Banque Commerciale SA (En Liqn*) v Akhil Holdings Ltd* (1990) 169 CLR 279 at 286-7; [1990] HCA 11; Betfair Pty Ltd v Racing New South Wales (2010) 189 FCR 356; [2010] FCAFC 133 at [50]-[52]; Cheng v Motor Yacht Sales Australia Pty Ltd t/as The Boutique Boat Company (2022) 108 NSWLR 342; [2022] NSWCA 118 at [24]; Nitopi v Nitopi (2022) 109 NSWLR 390; [2022] NSWCA 162 at [102]-[104]. There was no objection of the kind sought to be raised on appeal in relation to any claimed departure from the pleadings and there was no merit to these grounds of appeal.
Insofar as ground 5 which was expressed as “Respondent’s 2B(2) plea lacked s 19(2) evidence”, for the reasons given at [73]-[80] below, s 19(2) of the Succession Act 2006 (NSW) (Succession Act) was not relevant. As far as the question whether there was evidentiary support for the primary judge’s conclusion as to the deceased’s lack of testamentary capacity, there was a wealth of such evidence, much of which has already been referred to in summary at [21] above.
Before leaving this topic, it should be noted that the Appellant pointed out that he was “appealing self-represented” and emphasised his status as a layperson. He had also represented himself in final submissions before the primary judge, having parted with his solicitor who represented him on the first three days of the trial. Mr Chalik presented as an articulate advocate. He answered “Absolutely” when it was put to him that he knew about Banks v Goodfellow (1870) LR 5 QB 549 (Banks v Goodfellow) and said that he had read it many times.
At one point in his oral submissions, the Appellant who, as has been seen, contended on appeal that parts of the Amended Defence should have been struck out at first instance on the basis that it was frivolous, said:
“I couldn't know that they were frivolous because I didn't know what the pleadings were supposed to be. That's why you hire a lawyer and that's why [you] get legal advice but I wasn't provided with that legal advice and the lawyer failed to do his duty and so did the Court because the Court should have made orders for the pleadings to be repleaded so I actually didn't know about lack of testamentary capacity until I saw the judgment.” (emphasis added).
“the primary judge had an obligation to ensure that the appellant did not, because of lack of legal skill, fail to claim rights or put forward legal arguments: Rajski v Scitec Corporation Pty Ltd (Court of Appeal (NSW), 16 June 1986, unrep) (Kirby P, Samuels and Mahoney JJA), cited with approval by the High Court in Nobarani v Mariconte (2018) 265 CLR 236; [2018] HCA 36 at [47].” (emphasis added)
“the absence of legal representation on one side ought not to induce a court to deprive the other side of one jot of its lawful entitlement ... An unrepresented party is as much subject to the rules as any other litigant. The court must be patient in explaining them and may be lenient in the standard of compliance which it exacts. But it must see that the rules are obeyed, subject to any proper exceptions. To do otherwise, or to regard a litigant in person as enjoying a privileged status, would be quite unfair to the represented opponent.”
The question of the extent, if any, of assistance which a trial judge or appellate court should afford to an unrepresented litigant in civil proceedings is nuanced and has been the subject of many intermediate appellate judgments of this Court since Rajski was decided almost 40 years ago. Those decisions have emphasised that an unrepresented litigant should be provided with sufficient information about the practice and procedure of the court to ensure a fair trial takes place: see, for example, Jae Kyung Lee v Bob Chae-Sang Cha [2008] NSWCA 13 at [48]; Jeray v Blue Mountains City Council [2010] NSWCA 153 at [14]. Even then, care must be taken not to disturb the balance which the rules of practice and procedure are designed to afford both parties: Mohareb v Saratoga Marine Pty Ltd [2020] NSWCA 235 at [39], citing Barton v Wright Hassall LLP [2018] UKSC 12; [2018] 1 WLR 1119 at [18] per Lord Sumption.
In Bauskis v Liew [2013] NSWCA 297 at [69], Gleeson JA (Beazley P and Barrett JA agreeing) noted that the duty of a trial judge to assist an unrepresented litigant “does not extend to advising the litigant as to how his or her rights should be exercised. That is, it is not the function of the court to give judicial advice to, or conduct the case on behalf of, the unrepresented litigant”. In Cicek v Estate of late Solomon [2014] NSWCA 278 at [130], Ward JA (Meagher and Barrett JA agreeing) held that none of the cases her Honour had reviewed:
“suggests that the primary judge in the present case had a duty to advise the appellants as to the inadequacies in their evidence having regard to the pleaded case or to adjourn the proceedings in order to permit them further time to re-plead their case in order for it to accord with the statement being made from the bar table as to the forgery complaints. A duty to provide information in order to attempt to overcome the procedural disadvantages faced by a self-represented litigant is not a duty to run the case for him or her.”
“Nevertheless, the role of a judge in a civil case is not to actively assist one party against the other; to advise one party against the other; or in any way to act as the legal adviser or the legal representative for that party even if that party is unrepresented. The role of the judge in a civil case in our system is to act as the umpire and he or she has no active role such as may occur under our system in criminal proceedings where a citizen is facing the State as prosecutor, and the judge has a proper role in protecting the accused, especially an unrepresented accused. Civil cases involve citizen (corporate or otherwise) against citizen, and the judge's role, as I have said, is that of an umpire.”
The Appellant made numerous references in his written and oral submissions to s 19(2)(b) of the Succession Act, submitting that the primary judge erred by failing to apply, or alternatively misapplying, the section when assessing the deceased’s testamentary capacity. The Appellant contended that s 19(2) constitutes the “necessary statutory evidence to establish” a lack of testamentary capacity.
What was meant by “the necessary statutory evidence” was not made clear although, as emerged in his oral address, it appeared that he was submitting that s 19(2), because it referred to testamentary capacity, meant that common law cases such as Banks v Goodfellow and the myriad cases that have applied it, had no continuing relevance in cases conducted after the commencement of the Succession Act.
Section 19(2) of the Succession Act lists the information which must be provided to the Court where an application is made under s 18 of the Act. Section 18 relates to the Court’s power to make an order authorising a will to be made or altered on behalf of a person who lacks testamentary capacity: Succession Act, s 18(1)(a). Section 19 of the Succession Act provides:
“19 Information required in support of application for leave
(1) A person must obtain the leave of the Court to make an application to the Court for an order under section 18.
(2) In applying for leave, the person must (unless the Court otherwise directs) give the Court the following information—
(a) a written statement of the general nature of the application and the reasons for making it,
(b) satisfactory evidence of the lack of testamentary capacity of the person in relation to whom an order under section 18 is sought,
(c) a reasonable estimate, formed from the evidence available to the applicant, of the size and character of the estate of the person in relation to whom an order under section 18 is sought,
(d) a draft of the proposed will, alteration or revocation for which the applicant is seeking the Court’s approval,
(e) any evidence available to the applicant of the person’s wishes,
(f) any evidence available to the applicant of the likelihood of the person acquiring or regaining testamentary capacity,
(g) any evidence available to the applicant of the terms of any will previously made by the person,
(h) any evidence available to the applicant, or that can be discovered with reasonable diligence, of any persons who might be entitled to claim on the intestacy of the person,
(i) any evidence available to the applicant of the likelihood of an application being made under Chapter 3 of this Act in respect of the property of the person,
(j) any evidence available to the applicant, or that can be discovered with reasonable diligence, of the circumstances of any person for whom provision might reasonably be expected to be made by will by the person,
(k) any evidence available to the applicant of a gift for a charitable or other purpose that the person might reasonably be expected to make by will,
(l) any other facts of which the applicant is aware that are relevant to the application.”
The Appellant submitted that the passage of s 19(2) of the Succession Act was in effect a statutory replacement or modification of Banks v Goodfellow just as s 140(2) of the Evidence Act 1995 (NSW) (Evidence Act) was a statutory replacement of the common law rule in Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34. He acknowledged that the courts had for many years since the passage of s 19 of the Succession Act continued to apply Banks v Goodfellow but submitted, ambitiously, that they had been wrong to do so. The Appellant in this context also sought to rely upon s 42(1) of the Interpretation Act 1987 (NSW) (Interpretation Act) and r 94 of the Supreme Court Rules 1970 (NSW) (Supreme Court Rules) but in a way which, with respect, was not possible to follow or understand.
As with his reliance on the Mental Health Act (see [59] above), the Appellant’s reliance upon s 19(2) of the Succession Act, s 42 of the Interpretation Act and his related submission in relation to Banks v Goodfellow, was wholly misplaced. Furthermore, and as the Respondent submitted (and the Appellant in fact accepted), the argument based upon ss 18 or 19 of the Succession Act, s 42 of the Interpretation Act and r 94 of the Supreme Court Rules was not advanced at first instance.
This case was not concerned with an application under s 18 of the Succession Act. Nor did the proceedings engage r 94 of the Supreme Court Rules, which outlines the general functions of the registrar – making oblique reference to the Succession Act. In any event, apart from the reference in s 19(2)(b) to “satisfactory evidence of the lack of testamentary capacity of the person in relation to whom an order under section 18 is sought”, s 19 in fact offers no guidance as to what would constitute such satisfactory evidence. It is in the vast body of case law that guidance is to be found as to what evidence may be relevant to establishing the existence or absence of testamentary capacity.
Section 19(2) of the Succession Act provides a non-exhaustive checklist of what the Court will normally require before granting leave under s 19(1) to make an application to the Court for an order under s 18 of the Act: Re Fenwick; Application of JR Fenwick; Re Charles (2009) 76 NSWLR 22; [2009] NSWSC 530 at [123] (Fenwick). Referring to s 19(2)(b), Palmer J said that “[a]s to the lack of testamentary capacity, the test is, obviously, that enunciated in Banks v Goodfellow” and that, absent urgency or some other compelling reason, an applicant for leave “should provide the best evidence available in the circumstances as to lack of testamentary capacity”: at [126].
The Appellant, by ground 4 of his Further Amended Notice of Appeal, argued that the primary judge erred in admitting the 30 August 2011 clinical note of Dr Day which included the notation “?dementia” in relation to the deceased.
The terms of the clinical record were as follows:
“Pt confused at time of interview.
Cannot remember why she was brought to hospital or how.
Very distressing – paranoid re: friend and son colluding to harm her/take her home away.
‘They want to kill me’.
Denying any symptoms, however states she feels awful + is sick.
D/W son over the phone, states Mo went to the GP.
This am re: SOB. Then was speaking to other son in Melbourne on the phone who was concerned about his Mother + called the ambulance.
B/G – recurrent UTI
HTN
Asthma
Deteriorating cognition (?dementia) over last 12-18 months
Family considering placement or home services for pt. Pt resisting.”
“[293] As to the matters [the Appellant] raised about Dr Lonie’s Report and the medical evidence, he submitted that Dr Lonie fixed on a doctor’s note written during the deceased’s August 2011 hospital admission as the earliest medical evidence of dementia, which recounted confusion, distress, poor memory and paranoia on the part of the deceased and noted “Deteriorating cognition (?dementia) over last 12-18 months” and “Long term deterioration in cognition? dementia". [the Appellant]argues the observed symptoms may well have been caused by a urinary tract infection (UTI) and queries how the treating doctor could have known the deceased’s mental state was “deteriorating”, given the doctor had never observed the deceased before. The source for this observation, [the Appellant] suggests, must have been [the Respondent], who [the Appellant] accuses of trying to have his mother diagnosed with dementia so he could take control of her finances. He also says that confusion is a well-known symptom of a UTI.
[294] I am not persuaded by those submissions. Leaving to one side that [the Appellant’s] submission about the symptomatic effects of a UTI was unsupported by medical evidence, I have seen nothing to suggest that [the Respondent] was trying to control the deceased’s finances in 2011 or later. To the contrary, the evidence indicates that [the Appellant] obtained the deceased’s power of attorney in 2010 and was accessing the deceased’s bank accounts from that time.
[295] I accept that the hospital records indicate that [the Respondent] told hospital staff that the deceased’s cognitive function had been deteriorating over the past 12 – 18 months. Nevertheless, in my view, [the Respondent’s] comments and the hospital records which refer to the deceased’s dementia and cognitive decline are supported by the lay evidence about the deceased during 2010 and 2011 which, overall, satisfies me that the deceased’s cognitive capacity was impaired by September 2011…
…
[297] … Noting that [the Appellant’s] own evidence accepted that the deceased had dementia by October 2013, in my view, the background facts outlined above, which are based on both lay evidence and medical records, provide a significant body of evidence that supports a diagnosis of progressive dementia.”
The Appellant contended that the medical note was irrelevant to the deceased’s capacity to give instructions to Mr Wermut on 17 April 2013, that it was hearsay evidence and was influenced by an allegedly fraudulent misrepresentation made by the Respondent to Dr Day. The 2011 medical note was said to be irrelevant as it was unrelated to the deceased’s capacity give instructions in April 2013.
The note was plainly relevant as part of the overall corpus of medical evidence that was admitted and which bore upon the ultimate question of the deceased’s testamentary capacity. Indeed the note was referred to in the instructions to the jointly appointed Court expert, Dr Lonie. The Appellant’s argument appeared to be influenced by a misconception that, because the question of testamentary capacity is a legal question as opposed to a medical one (which correctly reflects well-established principle: see, for example, Zorbas v Sidiropoulous (No 2) [2009] NSWCA 197 at [65] (Zorbas), Croft v Sanders [2019] NSWCA 303 at [24]), medical evidence is not relevant to the question of testamentary capacity. This binary position, which was also reflected in ground 6 of the Further Amended Notice of Appeal, is not correct.
In Zorbas at [65], in a passage that has been cited on many occasions, Hodgson JA (with whom Young JA and Bergin CJ in Eq agreed) observed:
“The criteria in Banks v Goodfellow are not matters that are directly medical questions, in the way that a question whether a person is suffering from cancer is a medical question. They are matters for commonsense judicial judgment on the basis of the whole of the evidence. Medical evidence as to the medical condition of a deceased may of course be highly relevant, and may sometimes directly support or deny a capacity in the deceased to have understanding of the matters in the Banks v Goodfellow criteria.”
“… lay evidence of the activities, conversations, family circumstances and relationships of the deceased and evidence from doctors, often general practitioners who were treating doctors during the lifetime of the deceased, usually is of far more value than reports of expert specialist medical practitioners who have never seen the deceased.”
“[127] The best evidence will always be that of a specialist professional, for example, a psychiatrist, consultant physician or clinical psychologist, who has recently examined the incapacitated person and who expresses an opinion in a report which complies with the expert witness rules of court. The report should state the testing which has been carried out and should give a conclusion by express reference to each of the elements of testamentary capacity enunciated in Banks v Goodfellow. The latter requirement is unnecessary, of course, if it is a nil capacity case in which brain injury at an early age has rendered the patient incapable of ever developing adult cognitive faculties.
[128] The next best evidence — which will suffice if there is insufficient time for the report of a specialist — is that of the patient's treating general practitioner. Again, the report should explicitly refer to the elements of testamentary capacity enumerated in Banks v Goodfellow, except in the kind of nil capacity case to which I have referred.”
Of course, in cases where a testator’s testamentary capacity is only an issue after their death, a specialist expert will invariably not have had the opportunity of examining the deceased whilst alive (unless they were a treating specialist) and must necessarily draw on underlying medical records, as was done, for example, in Wild v Meduri. The significance of expert evidence will vary with the facts of each case: see, for example, Anderson at [87]-[103], [138]-[145].
Just as medical evidence will not be determinative, the same may be said of evidence of a solicitor who witnessed the execution of the disputed will. This is discussed in more detail in the context of Mr Wermut’s evidence at [94]-[102] below.
As to the suggestion that what the Respondent is recorded as having told Dr Day was fraudulent, this submission must be rejected as it was by the primary judge. It was not put to the Respondent in cross-examination, and no proper basis was advanced in support of this characterisation. What Dr Day recorded in the note reproduced at [83] above was a reference to a son responding to a doctor’s inquiry about his mother’s medical history and condition more than a decade prior to her death, just as the note in question recorded that the doctor had also spoken to the Appellant. That what the note recorded did not support the Appellant’s argument as to his late mother’s testamentary capacity did not warrant or justify its characterisation as fraudulent in his submissions.
Nor did the note constitute inadmissible hearsay evidence. The Respondent gave evidence and was able to be cross-examined about what was attributed to him in the doctor’s note, but he was not so cross-examined. The Respondent also issued a hearsay notice in advance of the trial under s 67 of the Evidence Act, notifying intended reliance on the note.
By ground 7, the Appellant contended that the primary judge erred in rejecting Mr Wermut’s evidence, despite him being the “only and most reliable and relevant witness”. Mr Wermut was not the only relevant witness. This characterisation was reflective of the Appellant’s rigid (and incorrect) view that, because the question of testamentary capacity was a legal one, medical and other evidence was not relevant to that question. The reasons for why this understanding was wrong have already been explained.
The primary judge’s detailed reasons for treating Mr Wermut’s evidence in the way that her Honour did have been set out in full at [37] above.
That the evidence of a solicitor is not determinative but a matter of weight may be seen in any number of cases. In Chant v Curcuruto [2021] NSWSC 751 at [749] (Chant), for example, Hallen J held that:
“The weight to be given to the solicitor’s evidence will depend on her, or his, experience, training, and understanding of the test of testamentary capacity; her or his, ability to make an assessment of capacity, taken with the quality of the assessment made as appears from any contemporaneous notes and records; her or his, knowledge of, and familiarity, with the will-maker, including the age and state of health of the will-maker; and her or his, independence; the will-maker’s presentation to the solicitor, and whether there are any red flags suggesting a possible challenge to capacity. It will also depend on the level of enquiry and discussion on the part of the lawyer of, and with, the deceased…”
See also, for example, Bailey v Maddock [2022] VSC 346 at [66]; Theofanous v Aizen [2023] VSC 43 at [70].
“[750] there were a number of red flags including the fact that both Ken and Irene had each recently received medical attention; that medical reports had been provided that raised significant questions about the capacity of each of them; where an independent expert to consider his, and her, capacity had been foreshadowed but was not proceeded with; that neither Ken nor Irene was an existing client of the firm at which Ms Blackadder was employed; that at least some instructions were being provided by one or both of the sole substitute beneficiaries; and where each of Ken and Irene was making a significant change to his, or her, will in appointing Jeffrey, who had never been a beneficiary, as a beneficiary in circumstances where the contents of the earlier Wills had not been considered in any material way
[751] It is difficult to accept that Ms Blackadder sufficiently considered these red flags. …
[757] Having carried out the holistic assessment of the evidence, I am satisfied that Karen and Jeffrey have not satisfactorily shown that each of Ken and Irene had testamentary capacity at the time the 2017 Will was executed. Taking into account all of the evidence in the case, including, naturally, the evidence of Ms Blackadder, I am not satisfied that, in relation to the 2017 Will of each of Ken and Irene, that it is the Will of a capable will-maker. The cognitive deficiencies of each were largely detectable and had been detected. I am left with a significant residual doubt and accordingly I am unable to be satisfied that each 2017 Will is a valid Will.”
“While the Court readily accepts that Ms Dalton was careful in taking her instructions, her evidence does not decisively outweigh the other evidence. This is because while it demonstrates that Frank was able to give her instructions, it does not show that the she took those instructions at the time the 2013 Will was executed in a way that would have dispelled the doubt created by all the other evidence about Frank’s mental state.”
“Limited significance should be given to Mr Lee’s assessment when he made no particular effort to test or assess her capacity (and we do not know anything of the condition of Mr Lee’s mother). Yet that does not mean his view is of no weight. Taken with all the evidence above, Mr Lee’s own observation lends some limited support to a finding of capacity.”
No basis was established to reject the primary judge’s careful findings with regard to Mr Wermut’s evidence. We agree entirely with her Honour’s observation that it is difficult to see how he could have properly satisfied himself that the deceased had testamentary capacity when one of the first things she said to him was that she did not know why she was there: PJ [316].
Further, in dealing with the undue influence case, her Honour formed “the strong impression” that whatever the deceased said to Mr Wermut, however “fixed and firm” her views may have appeared to him, “did not represent her own free and independent decision”: PJ [352]. This conclusion was plainly open to the primary judge and was “likely to have been affected by impressions about the credibility and reliability of witnesses formed by [her Honour] as a result of seeing and hearing them give their evidence”: Li v Tao (2023) 113 NSWLR 131; [2023] NSWCA 310 at [34]. Her Honour’s conclusion, as with her other findings, were scarcely “glaringly improbable” or “contrary to compelling inferences” so as to warrant appellate intervention: Fox v Percy at [29]; Lee at [55].
The Appellant submitted that Mr Wermut could draw upon his interaction with the Appellant a number of years prior to 2011 for the purposes of satisfying himself as to the deceased’s testamentary capacity. That submission overlooked the fact that the question of testamentary capacity must be determined as at the date of the execution of the will, and a solicitor cannot rely upon the way a testator may have presented a number of years earlier to satisfy him or herself as to the testator’s capacity at the time of execution. Indeed, under cross-examination, Mr Wermut candidly accepted that in giving answers about his perceptions of the deceased’s mental capacity, he may have conflated the two meetings in April 2013 with a meeting in 2011, where the deceased granted the Appellant a power of attorney: PJ [319].
Ground 8 of the Further Amended Notice of Appeal, with respect to the Appellant, is very difficult to understand. It was to the effect that “Henry J erred in law by excluding s 32 Evidence Act 1995 (NSW) which governs testatrix’s revived memory, claiming it as indicator of ‘lack of testamentary capacity’ [295] and dismissing solicitor’s recollection”. Section 32 of the Evidence Act is concerned with attempts to revive the memory of a witness in court. The testatrix was dead and self-evidently not giving any evidence in Court. Section 32 was not raised in the course of the trial and was not relevantly applied by the primary judge at all.
The Appellant also asserted by ground 9 that the primary judge erred in considering Dr Lonie’s report because “she was not an impressive witness”; did “not clearly articulate her reasons”; did “not apply scientific methodology to the MMSE scores”; and failed to comply with the expert witness code of conduct because there was no cl 3(1)(i) declaration included in the report. Such a declaration confirms that the expert made all inquiries which the expert believed were desirable and appropriate.
“Dr Lonie was an impressive witness. She maintained her opinions in cross-examination and clearly articulated her reasons for them. I deal further with Dr Lonie’s report later in these reasons. At this stage, I simply note that I have seen no basis for [the Appellant’s] submission suggesting that Dr Lonie was asked and agreed to write an unscientific report and her remuneration was based on convincing the Court that the deceased lacked testamentary capacity when the 2013 Will was executed and reject that submission. I have no reason to doubt that Dr Lonie complied with the Expert Witness Code of Conduct in Schedule 7 of Uniform Civil Procedure Rules 2005 (NSW) (UCPR) that she had read and agreed to bound by, and that she provided her expert opinion acting as an impartial witness based on her assessment of all of the evidence provided to her. There was also no foundation for [the Appellant’s] submission that Dr Lonie’s evidence is inadmissible because the notice of the half-paid report fee to Mr Ziman was received 14 days after the hearing and I reject that submission also.”
The Appellant contended that the primary judge erred in finding that the 1998 Will was valid on the basis that: (i) the deceased did not understand the law relating to wills at the time of making the 1998 Will; and (ii) her Honour upheld the 1998 Will in the absence of evidence adduced pursuant to s 19(2) of the Succession Act. The second contention can be dismissed for the reasons outlined above at [73]-[80].
The Respondent argued that there was no challenge to the validity of the 1998 Will at trial. Rather, as the primary judge held at PJ [17]:
“During the course of the hearing, [the Appellant’s] solicitor, Mr Adamson, did not press [the Appellant’s] alternative claim for probate in relation to the 1997 will. He also accepted that the 1998 Will was a valid and binding will when it was made but contended it had been revoked by the 2013 Will.”
“The plaintiff suggests that the Court should not be satisfied that the 1998 Will was the product of a free and capable testator and that in fact was influenced by the first defendant in the making. The challenge to Margaret’s 2013 Will should be dismissed, and the 2013 Will should be admitted to probate in solemn form.”
“HER HONOUR: … So, if the [2013] will is not valid, do you accept - let’s assume that it’s not valid because of lack of testamentary capacity or undue influence. What is the position then? Do you accept the 1998 is valid?
ADAMSON: Well, no, we’re making a family provision claim.
HER HONOUR: No, no, I’m not asking about family provision. I’m asking about what will. Do you accept that the 1998 is a valid testamentary instrument?
ADAMSON: No, but I'm not sure it makes much difference because if it's a case on intestacy, then the starting point is 50/50, the same.
HER HONOUR: Well, I wanted to ask about that because there's no evidence from anybody about the 1998 will in terms of either due execution, is there; there's no witness--
ADAMSON: Lidia.
HER HONOUR: --a testing witness.
ALLAN: Ms Zin is one of the witnesses.
HER HONOUR: Really?
ALLAN: And she's going to be called.
HER HONOUR: Thank you. I hadn't appreciated that. So that's to establish the validity of the 1998 will. Yes.
ADAMSON: Her affidavit's in there.
HER HONOUR: And then the question is family provision. And as I understand it, your client wants the whole of the estate.
ADAMSON: I think he's entitled to the whole, yes.”
“HER HONOUR: … If the 1998 will - well, if the 2013 will is not held to be valid, Mr Adamson, are you challenging the 1998 will?
ADAMSON: No, your Honour.
HER HONOUR: Right, so you accept that it’s a valid and binding will?
ADAMSON: Yes, your Honour.”
The primary judge was fully entitled to proceed on the basis of what she had been told by Mr Adamson and was entirely correct in her statement at PJ [17], extracted above at [109].
It should be observed at this point that, in the course of his oral submissions in this Court, the Appellant, who represented himself, made a number of complaints about his former legal representative who appears to have ceased acting for him at some stage after the third day of the trial on 27 April 2023. The trial resumed for closing submissions which were heard on 24 May, 6 and 26 July 2023. These complaints were not relevant to the issues before the Court. The Appellant was bound by the actions of his legal representative in the proceedings and the Court is entitled to proceed on the basis that the legal representative was acting on the basis of instructions. Any issue the Appellant has with his former legal representative has not properly been raised before this Court.
The Appellant argued that the primary judge erred in failing to find that the Respondent breached his fiduciary duty by concealing from the Court a debt in the form of the 2001 Repay Document. The concealment was said to have occurred due to the Respondent omitting to mention in his defence that he had failed to repay the debt recorded in the 2001 Repay Document.
The Respondent contended that no argument based upon a breach of fiduciary duty was advanced at first instance, and it was inappropriate to advance it on appeal. That submission is undoubtedly correct and must be accepted.
Furthermore, the 2001 Repay Document was found by the primary judge to not be binding on the Respondent, and the Appellant was statute barred from relying upon it.
For the foregoing reasons, the Appellant’s appeal must be dismissed. In doing so, it may also be noted that, except possibly insofar as they included challenges to findings of fact, none of the Appellant’s grounds of appeal, as we understood them, entailed a challenge to the primary judge’s finding that the validity of the 2013 Will was impugned by her Honour’s finding of undue influence. Those findings would have had to be successfully challenged to result in the appeal being upheld even if other grounds of appeal had succeeded.
The Appellant should pay the Respondent’s costs of the appeal.
“The learned primary judge erred in the exercise of his discretion to award a fixed sum of $40,000 to the applicant:
a. in misunderstanding the nature of the funds available to satisfy an order for costs;
b. in not taking into account the costs principles associated with family provision claims that were relevant;
c. in mistaking the fact that a greater sum of $90,000 would not have affected the balance thought to be struck between the parties' interests; and
d. in awarding a fixed sum of $40,000 that had no clear reasoned expression.”
“If [the Respondent] were to receive an order that [the Appellant] pays [the Respondent’s] costs out of [the Appellant’s] entitlement in the estate, it would reduce the value of [the Appellant’s] entitlement from the deceased’s estate by an amount that would have impacted my ultimate decision, given it would have reduced the buffer for contingencies by half.”
This Court in Bassett v Bassett [2021] NSWCA 320 (Bassett) observed that “it seems erroneous to take into account the potential impact of an adverse costs order to a party… where it is common experience that offers of compromise, which the UCPR positively encourages, are made and can have significant financial consequences, even for successful parties as was so in the present case”: at [121]. The rationale for generally precluding consideration of potential costs consequences when determining the appropriate amount of provision is that it involves “taking account of something that was not in fact known at the time of the final order”, being the parties’ costs liabilities, contrary to s 59(2) of the Succession Act: Bassett at [119] (see generally at [117]-[123]).
On 9 August 2024, Slattery J varied the primary judge’s costs order, and made a gross sum costs order that the Appellant pay the Respondent’s costs in the sum of $40,000: CJ [55(1)]. This sum represented less than a quarter of the Respondent’s disclosed costs and disbursements. His Honour noted that the primary judge’s concerns about making a costs order against the Appellant (PJ [533]) remained “potent” but needed to be weighed against new information concerning offers of compromise, of which the primary judge was unaware: CJ [48].
The primary judge’s reference in PJ [533] to a “buffer for contingencies in life” was a reference back to PJ [513]-[515] where her Honour, in rejecting the Appellant’s family provision claim, said:
“[513] In this case, I am not persuaded that the deceased was morally obliged or required by community standards to provide more to [the Appellant] than she did by way of her testamentary disposition under the 1998 Will having regard to the circumstances of the case as at the date of the hearing, particularly those matters referred to at [509] and [510] above. In coming to that conclusion, I take into account the size of the deceased’s estate and the legacy [the Appellant] will receive.
[514] This is not a case where [the Appellant] has been left nothing and the size of the estate, while not large, is not insubstantial. The provision made for [the Appellant], which is estimated to be $826,115.95, should provide him with sufficient funds to buy suitable accommodation in Tamworth mortgage-free, undertake his dental treatment, acquire furniture, a ride-on mower and a later model second hand car and leave him with a buffer for contingencies in life (which he may use to set up a business if he desires) of around $220,000, even assuming that he has already spent the entirely of the interim distribution made to him ($250,000) on his daily needs and his legal expenses. (This calculation assumes [the Appellant] spends $300,000 on a house, $3000 on dental care, $5,000 of a ride on mower, $10,000 on furniture and $20,000 on a later model second hand car and returns $15,000 to the estate).
[515] Having regards to all the facts known at the date of the hearing of the application, I consider that the provision made for [the Appellant] under the 1998 Will is adequate provision for [the Appellant’s] proper maintenance and advancement in life.”
It is not uncommon for judges, in family provision cases, to refer to a buffer for contingencies: see, for example, Limberger v Limberger [2021] NSWSC 474 at [473(c)] in which Hallen J held that “where a child, even an adult child, falls on hard times and where there are assets available, then the community may expect parents to provide a buffer against contingencies”. Such a buffer, in the “absence of specific potentialities being established by proper evidence”, generally reflects a relatively modest sum which is “rarely in six figures”: Oliveira v Oliveira [2023] NSWSC 1130 at [12]; Steinmetz v Shannon (2019) 99 NSWLR 687; [2019] NSWCA 114 at [101]. A “buffer” is not a term of art. It may simply be understood as part of an award for provision which the recipient is at liberty to spend or retain in the event of contingencies: see, for example, Porthouse v Bridge [2007] NSWSC 686 at [33]; see also Papantoniou v Foundouradakis [2023] NSWSC 1374 at [267].
What her Honour was doing in [514] was not determining a claim for family provision per se but, rather, noting what the Appellant had been left as a result of the 1998 Will and the size of the estate in light of what he had identified as his future needs. Her Honour identified that after specified needs had been taken into account, the Appellant had the benefit of the $250,000 the subject of the interim distribution as well as a further $220,000. Her Honour noted that the Appellant may choose to use part of this to establish a business. That would be a matter for the Appellant, just as it was a matter for the Appellant to choose to use his funds to pursue litigation against his brother.
It is important to note that the primary judge’s observations at PJ [533] were made without knowledge of a Calderbank offer which had been made prior to the commencement of proceedings and a formal offer of compromise which had been made almost a year before the trial commenced. Whether her Honour would have indicated the impact of an adverse costs order in the way she did in PJ [533] had she known of such offers and their rejection is a matter of speculation but, given the discretionary nature of the power to award costs, it is highly likely that the rejection of the offers would have been material.
In Bassett, this Court observed at [198] that:
“Whether the adverse impact of legal costs or potential costs liabilities should be taken into account in assessing the needs and financial circumstances of particular beneficiaries and/or any applicant for orders under s 59 of the Succession Act is ultimately a discretionary matter; the factors specified in s 60(2) are all matters which the Court may consider. It may be doubted whether a “wise and just testator” … in whose shoes the Court notionally stands in considering questions of adequate provision for proper maintenance of an eligible applicant, would self-evidently look favourably upon an adult child whose own financial position has been diminished by the unsuccessful pursuit of his or her siblings in expensive legal proceedings in relation to the estate.”
The Court held that it was not “appropriate to place significant weight on the impact of legal costs in re-assessing [the unsuccessful plaintiff’s] family provision claim” because, amongst other reasons, the “claim was a deliberate choice and he must have been aware of the likely costs consequences of pursuing and losing that claim”: at [199]-[200]. Those observations may well be thought to be a fortiori in circumstances where the claimant for family provision had rejected reasonable offers of compromise.
“[22] [The plaintiff’s] application was not so much one for maintenance as it was for advancement. That, I think, means that the fact that an adverse costs order may eat into [the plaintiff’s] provision must be a consideration of lesser weight…
[28] While the will provided for [the plaintiff] to receive a substantial benefit, and to that extent is consistent with an intention that [the plaintiff] be well looked after, the deceased equally wished to confer a substantial benefit (indeed, on the figures, a more substantial benefit) on [the defendant]. There is nothing to show that the deceased would have approved, in the events which have happened, of her benefit being eroded by costs for which [the plaintiff] is prima facie liable as a result of his unsuccessful challenge.”
The primary judge’s observation at PJ [533], reproduced at [121] above, and the reference to the impact of a costs award on her “ultimate decision” appears to be a reference to her Honour’s decision to reject the Appellant’s family provision claim. In other words, her Honour appears to have been saying that a potential liability for costs would mean that the availability to the Appellant of discretionary spending money – what her Honour referred to as a buffer – would be reduced. This observation of her Honour was central to Slattery J’s decision to depart from the usual consequences of an unreasonable rejection of informal and formal offers to compromise proceedings.
Before turning to his Honour’s reasoning, it is necessary to turn to the terms of the offers of compromise and to notice the important policy considerations that inform the usual consequences attending the unreasonable rejection of such offers.
The Respondent made two offers to resolve the dispute, one made in September 2021 and a second in June 2022, some 10 months before the commencement of the trial. Slattery J held that these were unreasonably rejected by the Appellant: CJ [42], [47], [50]. No challenge was made to this finding.
The first was a Calderbank letter dated 17 September 2021, issued prior to the commencement of proceedings, in which the Respondent’s solicitors “clearly explained” that the deceased lacked testamentary capacity, and that the deceased’s capacity was vitiated by the Appellant’s undue influence: CJ [17], [41]. The letter offered $20,000 in exchange for the Appellant supporting the 1998 Will, but was rejected by the Appellant: CJ [17]. Slattery J held at CJ [42] that:
“It was unreasonable of [the Appellant] not to accept the Calderbank letter. Although it was issued before the proceedings were commenced [the Appellant] was well aware of and closely involved in the events that weighed in Henry J’s consideration against admitting the 2013 will to probate. The offer represented a genuine compromise given the limited options in probate proceedings and was open for 21 days, yet [the Appellant] went ahead and commenced the proceedings, thereby causing both parties to incur the very substantial costs of these proceedings. Subject to the considerations discussed below, the Calderbank letter should be given effect.”
“[The Appellant] cannot establish that it was not unreasonable for him to reject this offer of compromise. By the time the offer was made all the relevant evidence was filed including the expert evidence of Dr Lonie. [The Appellant] was given ample time to consider the offer, which represented a genuine compromise by abandoning the cross-claim. And in the result, [the Appellant] obtained an order that was no more favourable to him than the terms of the offer the offer made by [the Respondent]. Subject to the considerations below, this offer of compromise should also be given effect.”
Slattery J used the language of UCPR r 42.15 (see CJ [43]), however it may be that the appropriate reference was UCPR r 42.15A because it was the Respondent who obtained judgment, and so the question should have been whether the judgment obtained by the Respondent was no less favourable than the offers made. Nothing in substance turns on this matter.
The costs consequences for rejection of offers of compromise and Calderbank letters are well-established. The purpose for the rules concerning offers of compromise and Calderbank letters include (Maitland Hospital v Fisher (No 2) (1992) 27 NSWLR 721 at 724):
“1. To encourage the saving of private costs and the avoidance of the inherent risks, delays and uncertainties of litigation by promoting early offers of compromise by defendants which amount to a realistic assessment of the plaintiff's real claim which can be placed before its opponent without risk that its “bottom line” will be revealed to the court;
2. To save the public costs which are necessarily incurred in litigation which events demonstrate to have been unnecessary, having regard to an earlier (and, as found, reasonable) offer of compromise made by a plaintiff to a defendant; and
3. To indemnify the plaintiff who has made the offer of compromise, later found to have been reasonable, against the costs thereafter incurred. This is deemed appropriate because, from the time of the rejection or deemed rejection of the compromise offer, notionally the real cause and occasion of the litigation is the attitude adopted by the defendant which has rejected the compromise. In such circumstances, that party should ordinarily bear the costs of litigation.”
See also Morgan v Johnson (1998) 44 NSWLR 578 at 581–582; Croghan v Blacktown City Council (2019) 100 NSWLR 757; [2019] NSWCA 248 at [11].
UCPR r 42.15A provides that, where a defendant’s formal offer of compromise is unreasonably rejected by the plaintiff, and the defendant obtains judgment which is no less favourable than the terms of the offer, then, “unless the court orders otherwise”, the defendant is entitled to: (i) costs on the ordinary basis up to the time that the offer was made; and (ii) costs on an indemnity basis thereafter. Satisfaction of the elements in UCPR r 42.15A therefore creates a “prima facie entitlement to indemnity costs” from the date of the offer: Leach v Nominal Defendant (QBE Insurance (Australia) Ltd) (No 2) [2014] NSWCA 391 at [40] (Leach); Houghton v Potts (No 3) [2023] NSWSC 69 at [16]. The unsuccessful party bears the onus of persuading the Court that indemnity costs should not be ordered: Leach at [29]; Snowy Mountains Grammar School Ltd v Adventurer AWD Pty Ltd [2022] NSWSC 53 at [4].
In contrast, where a plaintiff rejects a Calderbank letter, and the defendant obtains judgment which is no less favourable than the terms of the offer – the offeror is not presumptively entitled to indemnity costs: Valmont Interiors Pty Ltd v Giorgio Armani Australia Pty Ltd (No 3) [2021] NSWCA 160 at [23]-[24]. Rather, as the Court held in Stewart v Atco Controls Pty Ltd (in liq*)* (No 2) (2014) 252 CLR 331; [2014] HCA 31 at [4]:
“This Court has a general discretion as to costs. The non-acceptance of a Calderbank offer is a factor, in some cases a strong factor, to be taken into account on an application for indemnity costs.”
Nonetheless, in exercising discretion as to costs in relation to Calderbank letters, the Court looks to (i) whether there was a genuine offer of compromise; and (ii) whether it was unreasonable for the offeree not to accept it: Ziegler atf Doris Gayst Testamentary Trust v Cenric Group Pty Ltd [2020] NSWCA 85 at [69]; Miwa Pty Ltd v Siantan Properties Pte Ltd (No 2) [2011] NSWCA 344 at [8].
Returning to the costs judgment in the present case, Slattery J was in the difficult position of having to exercise a discretion without having presided at the trial which had run for some six days. The discretion which inheres in the power to award costs will usually be informed by the knowledge of the judge who has presided over the trial. His Honour, because of the unusual circumstances in which he came to hear the costs application, did not enjoy this usual advantage.
His Honour correctly noted that, usually, the rejection of a Calderbank letter or offer of compromise produces a “clear outcome of indemnity costs after the offer”: CJ [48]. Nonetheless, his Honour held that “the judicial exercise of the Court’s cost discretion still requires some constraints on giving full effect to” the Appellant’s letter and offer of compromise: CJ [48].
Slattery J at CJ [49] referred to the primary judge’s concern expressed at PJ [533], and outlined above at [121], that any costs order would reduce the Appellant’s “buffer for contingencies”. His Honour held that:
“[51] As [the Respondent] submitted, some level of costs order can be made against [the Appellant] that is consistent with still giving due weight to Henry J’s concern that [the Appellant] should have access to something like the $160,000 that he estimated was necessary to start [and] run a business. The buffer Henry J allowed in the result of about $220,000 means that there is still about $60,000 of an unallocated buffer after [the Appellant’s] potential business start-up expenses have been taken into account. In the Court’s view, the correct discretionary course in this case is to use part of that unallocated buffer to give effect to at least part of the result that would ordinarily flow from [the Respondent’s] effective September 2021 and June 2022 offers.
[52] [The Respondent] submitted that a costs order should be made in his favour against [the Appellant] in the sum of $90,000 based on [the Respondent’s] legal fees and disbursements, which Mr Ziman’s affidavit proves have been incurred. But that is too much. An award in that amount would unacceptably diminish the sum available to [the Appellant] from his entitlements under the 1998 will, which he could use to start his own business. The Calderbank letter and the offer of compromise do change the discretionary costs landscape slightly in [the Respondent’s] favour. The Court should make an order for costs in [the Respondent’s] favour fixed in the maximum sum of $40,000. This figure is selected as coming comfortably within the approximate $60,000 residual buffer available to [the Appellant] under the 1998 will after allowing for him to commence his own business. It also allows [the Appellant] to discharge his obligation to pay Dr Lonie from within that buffer. Fixing a precise figure such as this gives greater certainty to the administrator of the estate, Ms Ross-Maranik and simplifies her subsequent administration of the estate.”
Having regard to the fact that the Respondent’s costs were $187,526, Slattery J made a gross sum costs order of $40,000, pursuant to s 98(4)(c) of the Civil Procedure Act 2005 (NSW): CJ [53]-[54].
Slattery J’s decision is challenged on a number of bases, as set out in [120] above.
His Honour’s decision was plainly powerfully influenced by what the primary judge had said at PJ [533]. That statement was, however, made without any knowledge on her Honour’s part of the two offers of compromise. It also appeared to be influenced by a view that the Appellant had some entitlement to the so-called buffer for contingencies. We agree with the Respondent’s observation that there was something of a conceptual conflation in this language. In using the expression, her Honour was in truth describing the residue that would be left over after he had spent part of his inheritance on accommodation, transport and discharging existing obligations. That amount was able to be used at his discretion. In no sense was it “allocated” by the Court as a result of the primary judgment. Slattery J’s use of the expression “unallocated buffer” may be subject, with great respect, to the same criticism.
Any amount awarded, whether or not characterised as a “buffer”, is available for its recipient to use as he or she pleases. If that be in pursuing litigation as opposed to a business, the risks of failed litigation or a failed business are no different. Those risks are known, and not unforeseen or unforeseeable contingencies.
In Haertsch v Whiteway (No 2) [2020] NSWCA 287 (Haertsch), this Court held that:
“[4] The general power to award costs in Civil Procedure Act 2005 (NSW), s 98 provides that costs are in the discretion of the court, though the exercise of that discretion is subject to the general rule that costs should follow the event: Uniform Civil Procedure Rules 2005, r 42.1. Family Provision Act, s 33 contains an additional power and permits certain unsuccessful applicants for provision to have their costs paid out of the estate whether or not there are special circumstances justifying such a course. It has been said to reflect a different starting point to the default rule in r 42.1 but, as has been explained, it can have no application to this case.
[5] It is well established that family provision applications “raise different issues with respect to costs” to those raised by other proceedings: Salmon v Osmond [2015] NSWCA 42 at [172] (Beazley P, McColl and Gleeson JJA agreeing). The liberal approach to costs in such cases has a long provenance, though reference is now typically made to remarks of Gaudron J in Singer v Berghouse [1993] HCA 35; (1993) 67 ALJR 708 at 709, to the effect that “costs in family provision claims generally depend on the overall justice of the case” and that it is “not uncommon, in the case of unsuccessful applications, for no order to be made as to costs, particularly if it would have a detrimental effect on the applicant’s financial position”. Indeed, in some jurisdictions it would seem that no order as to costs is the usual or general consequence of an unsuccessful application: Bowyer v Wood (2007) 99 SASR 190 at 210, 211; [2007] SASC 327; Underwood v Underwood [2009] QSC 107 at [32]-[33].
[6] However, as Giles JA observed in Jvancich v Kennedy (No 2) [2004] NSWCA 397 at [11] (Handley and McColl JJA agreeing), the “overall justice of the case” is “not remote from costs following the event”. For one thing, the default rule encourages prospective applicants for provision to have regard to the significant costs consequences to themselves of making such an application. But while the default rule in r 42.1 applies to family provision proceedings, its application remains subject to the court exercising greater than usual “liberality and discrimination” in deciding whether to depart from it: Salmon v Osmond at [174] (Beazley P, McColl and Gleeson JJA); Chapple v Wilcox (2014) 87 NSWLR 646; [2014] NSWCA 392 at [26]-[27] (Basten JA, Gleeson JA agreeing); [138]-[139] (Barrett JA, Gleeson JA agreeing).
[7] It is not uncommon, though atypical, for an unsuccessful applicant not to be ordered to pay the defendant’s costs where the applicant is or would become impecunious and the claim for provision was reasonable or borderline: see eg, with no attempt to be exhaustive, Re Sherborne Estate (No 2) (2005) 65 NSWLR 268; [2005] NSWSC 1003; Moussa v Moussa [2006] NSWSC 509; Bevilacqua v Robinson (No 2) [2008] NSWSC 520; Ray v Greenwell [2009] NSWSC 1197; Dugac v Dugac [2012] NSWSC 192; Raiola v Raiola [2014] NSWSC 1172; Purnell v Tindale [2020] NSWSC 746.”
In the present case, the primary judge held that the claim for family provision was not reasonable because the 1998 Will adequately provided for the Appellant. Secondly, there was no suggestion that the Appellant would be rendered impecunious in the event that costs were ordered against him. Thirdly, what this Court said in Haertsch was not said in the context of offers of compromise having been made.
We respectfully disagree with Slattery J’s observation that “[t]he Calderbank letter and the offer of compromise do change the discretionary costs landscape slightly in [the Respondent’s] favour” (emphasis added). The unreasonable rejection of the formal offer of compromise, under the UCPR, operated presumptively to entitle the Respondent to indemnity costs. Both it and the Calderbank letter set out clear reasoning as to the basis of the offers. The Amended Defence which had been filed was very fully particularised, as may be seen in [56] above. This was a case where there was not one but two reasonable settlement offers made and rejected, one prior to the commencement of proceedings and one well prior to the commencement of the hearing. Further, whatever liberality of approach may obtain in relation to the question of costs to family provision claims, in the present case, the principal fight was as to the deceased’s testamentary capacity and the disputed loan claims. On these issues, the Respondent was wholly successful.
It should also be noted that Slattery J’s decision to award a gross costs sum of $40,000 would result in the Respondent having unrecovered costs of almost $150,000, thereby eroding almost 20% of his inheritance in circumstances where his brother had unreasonably rejected offers and was found to have exercised undue influence over their late mother in the execution of the 2013 Will.
In these circumstances, leave to appeal should in our opinion be granted and the appeal allowed in relation to the costs judgment.
The Respondent submitted that, for simplicity’s sake, he sought 70% of the $187,526 costs incurred by the Respondent:
“ALLAN: … I have instructions that to avoid all the difficulties of assessment et cetera, 70% of that figure [$187,526] would be the target figure, as it were, for my client. The hoped for figure. If this Court was--
BELL CJ: 70% of 130?
ALLAN: 187.
PAYNE JA: That's your target figure. You do a broad brush approach, you may get less than that. But just so we're clear, that's at least what you're asking if the Court were otherwise persuaded on the series of assumptions that I put to you.
ALLAN: Yes.”
**********
Chalik
Chalik [2025] NSWCA 136
(1990) 169 CLR 279
(2010) 189 FCR 356
(1938) 60 CLR 336
(2022) 108 NSWLR 342
(2019) 100 NSWLR 757
(2003) 214 CLR 118
(1916) 22 CLR 490
(2019) 266 CLR 129
(2023) 113 NSWLR 131
(1992) 27 NSWLR 721
(1998) 44 NSWLR 578
(2022) 109 NSWLR 390
(2018) 265 CLR 236
(2019) 372 ALR 264
(2009) 76 NSWLR 22
(2019) 99 NSWLR 687
(2014) 252 CLR 331
(1988) 14 NSWLR 698
(1993) 67 ALJR 708
(2007) 99 SASR 190
(2014) 87 NSWLR 646
(2005) 65 NSWLR 268
Appeal dismissed with costs; leave to cross-appeal granted; cross-appeal allowed with costs; the costs order varied by substituting $130,000 for $40,000.
On 26 September 2011, Dr Maria Opacic, the deceased’s new GP, recorded after meeting with the deceased that she “forgets things in the fridge, forgets taking medications, ? short term memory, asking same questions”: PJ [144].
The Appellant deposed that, after he moved back to Sydney from Melbourne, the deceased was in a “poor state”, with her unit being “dirty and messy” and it appearing that she had not showered for some time: PJ [135].
On 16 March 2012, Dr Opacic completed a Centrelink Carer Payment report for the Appellant, noting that the deceased was “cognitively impaired”, and had “poor short term memory”: PJ [151].
The Respondent and his children provided evidence that in 2012, the deceased was forgetful and could not remember where she was travelling in a car, or the rules of tennis or checkers: PJ [157]-[158].
The Appellant provided evidence that in early 2013 and for years afterwards, although the deceased was “forgetful and absent minded”, this was only in relation to “trivial matters”, and that she could talk without difficulties about her husband, relatives and family history: PJ [159].
On 17 April 2013, the deceased and the Appellant met with Mr Mourice Wermut, a solicitor, for the purposes of making a new will. During this meeting, Mr Wermut spoke with the deceased alone. He gave evidence at trial that:
the deceased was uneasy and uncomfortable when Mr Wermut told her that he wished to speak with the deceased alone: PJ [172(1)];
the deceased was psychologically quite dependent on the Appellant, evidenced by a tendency to look to the Appellant for reassurance: PJ [172(1)];
the deceased could not reply to Mr Wermut’s question about why she was attending the meeting: PJ [172(4)]. Mr Wermut accepted that this “raised a flag” as to the deceased’s capacity: PJ [176];
the deceased conversed with him at a basic level of Yiddish (describing his own Yiddish as “rusty but conversant”), and concluded that, while the deceased did not have a very agile mind, she was lucid, intelligible, responsive and adamant about the Appellant receiving everything under the new will: PJ [175];
Mr Wermut never asked the deceased to repeat back her understanding of the 2013 Will and could not say whether the deceased had considered her estate: PJ [176]; and
the deceased presented no indication of any cognitive impairment which suggested that she was unaware of what she was doing: PJ [176].
On 23 April 2013, the deceased and the Appellant met with Mr Wermut for a second appointment, at which the 2013 Will was executed. Mr Wermut, who had retired from practice in 2018, did not retain notes of his two meetings with the deceased in 2013.
The primary judge at PJ [295] summarised a body of evidence about matters predating the execution of the 2013 Will as follows:
On 25 September 2015, the Respondent commenced proceedings in the NSW Civil and Administrative Tribunal, seeking to appoint a financial manager and guardian for the deceased.
On 21 December 2015, Dr Opacic completed a Health Professional Report form, noting that the deceased had mild to moderate dementia: PJ [213].
On 4 January 2016, Acting Professor Brennan noted that the deceased had evidence of dementia and suspected Alzheimer’s disease: PJ [214].
On 18 April 2016, JewishCare notes recorded that the deceased presented with “significant cognitive impairment”: PJ [216].
On 17 December 2017, the Appellant opened a joint bank account with the deceased. He transferred a total of $98,000 from the deceased’s account into the joint account between 18 to 27 December: PJ [224]. He debited that entire sum by 2 April 2019: PJ [224]. The Appellant was living with the deceased at this time: PJ [225].
On 1 November 2018, Fagan J ordered that the Appellant repay the $98,000 sum that had been removed from the deceased’s account: PJ [231].
On 12 September 2019, the deceased was hospitalised after a fall, and had an operation: PJ [239]. Following this, on 10 October 2019, the deceased was moved into a nursing home: PJ [240].
In June 2021, the deceased’s Bondi unit was sold for $1,620,000: PJ [246].
On 20 July 2021, the deceased passed away: PJ [247].
Section 19(2) was not relevant to the primary judge’s consideration of the deceased’s testamentary capacity, and her Honour did not err in failing to advert to it. Her Honour applied the well-established principles for assessing testamentary capacity in Banks v Goodfellow consistent with recent authority of this Court such as Photios v Photios [2019] NSWCA 158; (2019) 372 ALR 264 at [8], Lim v Lim [2023] NSWCA 84 at [7] (Lim) and Anderson v Yongpairojwong [2024] NSWCA 220 (Anderson). Her Honour’s analysis and conclusions were expressed by reference to those principles.
Although it was not entirely clear under what ground of appeal the argument fell, the Appellant also advanced the oral submission that the meaning of capacity in the expression “testamentary capacity” should be derived from s 13 of the Evidence Act. That section, however, is concerned with the competency of a person to give evidence in court proceedings. It is not concerned with and has nothing to say about a person’s capacity to execute a will.
The Appellant further argued that Dr Lonie failed to inform the Court about the deceased’s UTI symptoms which merely resembled advanced dementia. Arguments concerning the UTI were rejected by the primary judge at PJ [293]-[294], as extracted above at [84].
The primary judge had earlier held at PJ [52] that: