Etherton v Mitchelmore - [2024] NSWSC 170 - NSWSC 2024 case summary — Zoe

NSWNSWSC

Etherton v Mitchelmore

[2024] NSWSC 170

Supreme Court of NSW|2024-02-06|Before: Basten AJ

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At a glance

Source facts

Court

Supreme Court of NSW

Decision date

2024-02-06

Before

Basten AJ

Catchwords

[1938] HCA 34 Fast v Rockman [2013] VSC 18 Re Estate of Hodges (dec'd)

Source

Original judgment source is linked above.

Catchwords

[1938] HCA 34 Fast v Rockman [2013] VSC 18 Re Estate of Hodges (dec'd)

Judgment (17 paragraphs)

[1]

HEADNOTE [This headnote is not to be read as part of the judgment] The plaintiff, Robin Etherton, commenced proceedings in relation to the estate of Caterina Felice Bohen (the deceased). The plaintiff sought to have an informal document (a handwritten note) given to him by the deceased in December 2020 admitted to probate as an alteration to the deceased's 2016 will under s 8 of the Succession Act 2006 (NSW). The claim was opposed by the executor, Dean Joseph Mitchelmore, in the interests of the primary beneficiaries under the 2016 will, the deceased's five grandchildren. The informal document was prepared by the deceased on the back of a used envelope and purported to convey her desire to leave her house (which was the primary asset in her estate) to the plaintiff, in recognition of his occasional help over a period of around five years with odd jobs around the house. The 2016 will bequeathed the plaintiff $200,000 and a motor vehicle. If the informal document were declared an alteration to the 2016 will, the plaintiff would, after costs and expenses, receive essentially the entirety of the estate, subject to a concurrent family provision claim brought before the Court by the two daughters of the deceased. The issues for determination were whether: (i) the informal document expressed the testamentary intentions of the deceased; (ii) the deceased intended the informal document to constitute an alteration to her will; and (iii) the estate should bear the unsuccessful plaintiff's costs. The Court, dismissing the plaintiff's claim, held: In relation to (i) 1 The informal document was in the deceased's handwriting, bore a date and her signature and referred to the disposition of her property, demonstrating elements of the deceased's testamentary intention. However, doubt as to the truth of the explanation provided in the informal document, cast doubt on whether the document as a whole reflected her testamentary intention at the time it was prepared: [21]-[22]; [68]. Hatsatouris v Hatsatouris [2001] NSWCA 408; Campton v Hedges [2016] NSWSC 201; Fast v Rockman [2013] VSC 18; Re Estate of Hodges (dec'd); Shorter v Hodges (1988) 14 NSWLR 698 applied. In relation to (ii) 2 Irrespective of the conclusion on the first issue, the plaintiff failed to establish that the deceased intended the informal document to be an alteration to her 2016 will. The language used in the document was better understood as a proposed course of conduct than as a declaration of alteration: [23]-[24]; [68]. 3 The deceased had knowledge and understanding of the formal process for altering a will, including the role of s 100 statements. This context allowed an inference that the deceased knew that to alter her will she would need to see a solicitor, as the note anticipated, to complete the process she had undertaken in the past: [30]-[33]. 4 The physical nature of the document (the back of a used envelope), the failure to keep a copy, give it to an independent party (such as her solicitor) for safekeeping, or give any directions to the plaintiff, cast doubt on her intention to view the informal document as a legally effective alteration to her will: [37]; [68]. 5 The plaintiff's evidence of the conversation he had with the deceased when given the document was a reconstruction and unreliable: [51]-[58], [68]. 6 The deceased's failure to see her solicitor to formally alter her will, before or after preparing the handwritten note, knowing the process, lends credence to the conclusion she did not intend the informal document to be an alteration: [65]-[68]. In relation to (iii) 7 The executor acted in an appropriate fashion in order to protect the interests of the grandchildren from a claim that would otherwise deprive them of the entirety of their inheritance from the estate: he was entitled to costs from the estate assessed on an indemnity basis: [76]. 8 The estate should not bear the costs of the unsuccessful plaintiff because (i) the claim that the testator wanted to disinherit her grandchildren was inherently implausible (ii) the existence of the daughters' family provision claims made any likely benefit from success too small to justify the expense of the litigation and (iii) the plaintiff was to receive $200,000 under the will: [90]. Middlebrook v Middlebrook (1962) 36 ALJR; Perpetual Trustee Company Limited v Baker [1999] NSWCA 244; Re Estate of Hodges; Shorten v Shorten (No 2) [2003] NSWCA 60; Campton v Hedges [2016] NSWSC 201 applied.

[3]

Proceedings

The proceeding brought by Robin Etherton concerns a handwritten document dated 27 December 2020 and signed by the testator. After setting out the testator's address and the date, the document reads: "I Caterina Felice Bohen wish to leave my house to Robin Etherton of Roseville, as he was the only one who ever helped me when I needed help".
The statement, written on the back of a used envelope, was handed to Mr Etherton when he visited the testator at her home on the date of the document (Sunday, 27 December 2020). Mr Etherton had been married to the older daughter, Tina Bohen, from about 2007 until 2010 or 2011, although they had separated within about a year of the marriage. Mr Etherton said that between 2012 and May 2021, he had visited the testator and done odd jobs for her at her request.
Although the handwritten document did not comply with the formal requirements for a valid will set out in s 6 of the Succession Act 2006 (NSW), Mr Etherton contended that it was a document purporting to state the testamentary intentions of the testator and that the Court should be satisfied that she intended it to form an alteration to her will, for the purposes of s 8(2) of the Succession Act. If the Court were so satisfied, the document would constitute a valid and effective alteration to the will.
On 11 July 2023, Richmond J made orders (i) dispensing with service of the proceedings on Charlotte Gloria Bohen, one of the grandchildren who is now over 18 years of age and (ii) appointing Richard John Neal as tutor for the other grandchildren who are still under 18 years of age. Neither Charlotte Bohen nor Mr Neal has played any part in this proceeding.
A second proceeding (actually commenced earlier) was brought by the testator's daughters, Tina Bohen and Angela Bohen, seeking orders for provision out of their mother's estate, pursuant to Pt 3.2 of the Succession Act. The family provision proceeding is the subject of a separate judgment, but turns in part on the outcome of the present proceeding.
The parties accepted that the two matters, although heard together, should be dealt with in stages and that the probate dispute should be determined before considering the family provision claims. That is clearly correct: if Mr Etherton succeeds in having the handwritten document accepted as a codicil to the will, he will become the primary (and in practical terms, the sole) beneficiary of the estate. A family provision claim in that circumstance by the daughters would clearly have stronger prospects of success, and prospects of a more substantial allowance, than a claim where the grandchildren are the primary beneficiaries.
As sought, there will be a direction that evidence in each proceeding be evidence in the other. This will have significance in this proceeding. Evidence given by the daughters in the family provision proceeding demonstrated that the testator made formal statements about her motives and intentions which were false.

[4]

Legal principles

The principles to be applied in determining the legal effect of a document which does not comply with the formal requirements for a will under the Succession Act are not in dispute. In substance, s 6 provides that a will is not valid unless it is in writing and signed by the testator in the presence of two or more witnesses, present at the same time and in the presence of the testator. It is not essential for a will to have an attestation clause: s 6(3). However, the need for strict compliance with s 6 is ameliorated by the dispensation provision in s 8, which states: 8 When may the Court dispense with the requirements for execution, alteration or revocation of wills? (1) This section applies to a document, or part of a document, that - (a) purports to state the testamentary intentions of a deceased person, and (b) has not been executed in accordance with this Part. (2) The document, or part of the document, forms - (a) the deceased person's will - if the Court is satisfied that the person intended it to form his or her will, or (b) an alteration to the deceased person's will - if the Court is satisfied that the person intended it to form an alteration to his or her will, or (c) a full or partial revocation of the deceased person's will - if the Court is satisfied that the person intended it to be a full or partial revocation of his or her will. (3) In making a decision under subsection (2), the Court may, in addition to the document or part, have regard to - (a) any evidence relating to the manner in which the document or part was executed, and (b) any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person. (4) Subsection (3) does not limit the matters that the Court may have regard to in making a decision under subsection (2). (5) This section applies to a document whether it came into existence within or outside the State.
It was agreed by Mr Etherton that the document upon which he relied should be viewed as "an alteration to the deceased person's will", within s 8(2)(b). It was clearly not a will in the sense that there were other matters not addressed, but which had been addressed in the 2016 will, and it did not in its terms purport to be a full revocation and replacement of the 2016 will. The document was not inaptly described as purporting to be an informal codicil.
Before addressing the issues arising from the evidence, it may be observed that s 8 is commonly addressed in terms of three criteria, [1] namely that: 1. there must be a "document"; 2. the document must express or record the testamentary intentions of the deceased; and 3. the Court must be satisfied that the document itself was intended to form (relevantly) an alteration to the testator's will.
As to the first element, there was no dispute that the handwritten paper constituted a document, but one not executed in accordance with the requirements of s 6 of the Succession Act. Submissions focused on (2) and (3), and particularly the third element.
It was common ground that Mr Etherton bore the onus of proof with respect to the necessary elements of s 8, [2] and the executor submitted that, whilst the standard to be met was the balance of probabilities, that standard required comfortable satisfaction on the part of the Court in accordance with the principles stated in Briginshaw v Briginshaw; [3] which means that, in accordance with s 140(2) of the Evidence Act 1995 (NSW), the Court should take into account the nature of the subject matter of the proceeding and the gravity of the matters alleged in reaching its state of satisfaction.
Mr Etherton took issue with the latter proposition, on the basis that no allegation of impropriety or anything similar was involved, and therefore the reasoning in Briginshaw did not apply. However, in Fast v Rockman Habersberger J stated: "48 The person seeking to propound an informal will must establish the requisite elements on a balance of probabilities. Furthermore, because of the nature of probate, the consequences of any findings that may be made and the inability to hear any evidence from the deceased as to his [or her] actual intentions, the Court needs to evaluate the evidence with great care in accordance with the Briginshaw v Briginshaw principle."
Whether or not that approach should be adopted in all cases involving informal documents under the Succession Act (and with what effect), it should be applied in the present case. In this case, the purport of the informal document is to deny a provision in the formally valid will leaving the residue of the estate to the five grandchildren, who were natural subjects of the testator's affection and moral obligation, and leave the residue, together with a significant separate bequest (being in practical terms the whole of the estate) in favour of someone not a member of the family. This was not a case where exigencies explained why formalities were not attended to, nor was there any reason why the testator would not have informed the solicitor responsible for her last two wills of her intention, if it were in truth a settled and deliberate intention to change her will. The justification proffered for the change was not inherently persuasive. Accordingly, the evidence must be assessed with care.

[8]

Context

This level of uncertainty as to the proper characterisation of the document invites attention to contextual issues, in accordance with s 8(2) and (3) of the Succession Act as construed and applied in Campton v Hedges. [4] These may be considered in two stages. First, there are the known circumstances arising from prior conduct of the testator and her relationship with other members of her family. Secondly, there is the evidence given by Mr Etherton of the conversation he had with the testator at the time she handed him the document.
Dealing first with the known contextual circumstances, there are the terms of the 2016 will which the handwritten document must have purported to alter. The 2016 will was in a standard form containing ten paragraphs. Clauses 1-3 and 8-10 are machinery provisions. Clauses 1-3 revoked former wills, appointed executors and trustees and provided that no gift would take effect unless the beneficiary survived her by 30 days. Clause 8 permitted the executors and trustees to be paid professional fees in defined circumstances; cl 9 contained powers of the executors to apply income and capital, to make investments and to appropriate property. There is no suggestion that the handwritten document purported to change any of those provisions.
The dispositive provisions were cll 4-7. Clause 4 bequeathed the furniture and contents of the testator's home to her daughters in equal shares. Clause 5 bequeathed a sum of $200,000 and the testator's motor vehicle to Mr Etherton. Clauses 6 and 7 dealt with the residue of the estate which was "to be divided between such of my grandchildren as survive me and attain the age of 35 years in equal shares", subject to provision for the grandchild's share to pass to his or her offspring in the event the grandchild did not survive the testator and attain 35 years of age.
For present purposes, three aspects of this will were significant. First, the testator's daughters were excluded from any financial benefits and only obtained property which might have some sentimental value, but which, it was agreed, had no significant monetary value. Secondly, Mr Etherton, was entitled to a sum of $200,000 and a motor vehicle pursuant to cl 5. The handwritten document did not purport to vary those specific bequests. Thirdly, the residue of the estate, which included the house and little else, was to be shared between the testator's grandchildren, who, while not eligible to make a claim for family provision, were appropriate recipients of testamentary favour.
It may be inferred that the testator knew in December 2020 that her property included three items of significant value, namely a bank account (which had some $100,000 in it at the time of her death), a benefit under a life insurance policy (valued at some $250,000 at the time of her death), and her house (valued at a little over $1 million at the time of her death). The benefit under the life policy would not form part of her estate; there was no evidence as to whether she understood that, nor as to whether she knew its value. However, it was not referred to in her wills, nor in the handwritten document, so I infer she disregarded it at that time. By leaving Mr Etherton a bequest of $200,000 and her house, the testator would have understood that she was effectively excluding the whole of her family, including her grandchildren, from any significant benefit under her will.
A further circumstance of significance in that context was the preparation and execution of two statements expressed to be made pursuant to s 100 of the Succession Act. The first, dated 13 March 2015, accompanied her will of that date. It stated: "1 I have made my Will this day and left the majority of my estate to my grandchildren. 2 I have made my Will in this manner as my two daughters Tina Louise Bohen and Angela Marie Bohen inherited from the estate of my late brother Joseph Ruggerio in 2007. 3 Although neither of my said daughters told me the exact amount received I understand the amount they each received was a substantial amount. 4 Accordingly my daughters have no need and it is my wish that my estate passes substantially to my grandchildren."
A second statement, dated 10 August 2016, accompanied the 2016 will and purported to "update" the earlier statement. This statement contained more detail by way of further explanation, rather than by way of updating. The statement read: "3. In relation to my daughter Angela Marie Bohen: (a) I have had no contact from my daughter Angela even though I have tried to make contact with her. I have not spoken to her more than five or six times in the last 20 years. (b) My daughter Angela said to me 'I do not want to receive any of your money'. 4. In relation to my daughter Tina Louise Bohen: (a) Tina had a child, Max, approximately one year ago but she did not tell me she had had a second child until recently when she forwarded to me an invitation which read 'Almost One Birthday Party'. It was not until receipt of this invitation that I became aware she had had the child Max. (b) As Tina lives in Adelaide I did not go to the birthday party but I forwarded a present for Max. (c) In a conversation with Tina last weekend (6/7 August 2016) I asked when Max was born. She was hesitant in her reply but informed me he was born on 20 November 2015. 5. In view of the lack of contact from my daughters with me and in view of the amount my daughters received from my brother Joseph, I do not feel under any obligation to leave them any part of my estate and I have left my estate substantially to my grandchildren."
For reasons which will be explained below, the second statement, as set out above, was false in material respects and must have been known to be false by the testator at the time she prepared it. I infer that the information contained in the statement of 10 August 2016 was provided by the testator to her solicitor in response to advice that the exclusion of her daughters from her will was susceptible to challenge and would require supporting factual explanation. The falsity of that document, together with evidence of her relationship with her daughters which will be discussed further below, precludes the Court being satisfied as to the truth of any material statement made by the testator in relation to her family, where there is no objective support for the opinions expressed. That conclusion includes the truth of the statements in the handwritten document.
The making of the two statements, and in particular the second statement, permits the inference that in December 2020, the testator was well aware of the need to provide an explanation if she were to make a legally effective will excluding her daughters and her grandchildren from any significant benefit. As a result, it is most unlikely that the testator believed in December 2020 that she could make a legally effective alteration to her will, depriving her grandchildren of the significant benefits under the 2016 will, without attending to the formalities which had been required in 2016 (including the s 100 statements) and without advice from a solicitor. There was no evidence that around Christmas 2020 the testator was mentally disturbed, in poor health, or unable to attend to her affairs.
A further contextual element is supplied by the explanation in the handwritten document itself, namely that Mr Etherton "was the only one who ever helped me when I needed help". It will be necessary to explain the limited services which Mr Etherton had supplied, and which could not provide any rational basis for the devise to him of the testator's house, in addition to the generous bequest of $200,000. That is not to deny Mr Etherton's willing responses to occasional requests for assistance by the testator, nor to suggest that (despite the present proceeding) the assistance was provided at the time with expectation of material reward. When hearing from Tina Bohen of her mother's death in September 2021, Mr Etherton replied by email expressing affection for Tina's mother, which I accept was genuine and which was his motivation in assisting her with small tasks around the house, in transporting her to and from hospital on two occasions, when she asked him to do so, and for talking to her on the phone occasionally when she rang him. Mr Etherton stated (and I accept) that the call for assistance on 27 December 2020 was for him to assemble a new television cabinet which the testator had obtained. (The content of the email to Tina Bohen will be considered further below.)
More generally, both daughters described in evidence their mother's behaviour as erratic, emotionally manipulative (including in relation to contact with their father and their attention to her), physically abusive (when the girls were young) and verbally abusive. However, there was no evidence that she was other than devoted to her grandchildren. The reason given in the handwritten document for wishing to leave the house to Mr Etherton may have been intended as a somewhat viperous attack on her daughters, but provided no explanation for disinheriting her grandchildren.
This contextual background confirms, rather than mitigates, the doubt that the handwritten document was intended itself to be effective as a codicil to the 2016 will.

[9]

Providing the handwritten document

Given that contextual background, it is necessary to address Mr Etherton's evidence as to what occurred on 27 December 2020. However, before turning to the conversation of which Mr Etherton gave evidence, it is important to note the physical nature of the document. First, although having a flavour of formality and a signature, the document was written on the back of a used envelope. In the absence of any evidence of relevant exigency, that somewhat diminishes any likelihood that it was intended to be legally effective. Secondly, there was no evidence that the testator kept a copy of the document, nor that she provided it to her solicitor, or to anyone else for safekeeping, and I am satisfied that she did none of those things. Rather, she handed it to Mr Etherton for his information, without any instructions as to what he might do with the document. There was no evidence that she had informed Mr Etherton about the bequests in her 2015 and 2016 wills, nor that she told any other beneficiary of the contents of her wills. It is not unusual for a person to make a will and not inform the proposed beneficiaries of its contents, but it is curious that, having made a valid and effective will without notifying the beneficiaries, the change, if seriously proposed, was written on the back of a used envelope and handed to the proposed replacement beneficiary. That conduct is not, in my view, consistent with an intention to treat the document as legally effective as a codicil to her 2016 will.
Mr Etherton asserted that at the time the document was handed to him the testator walked over to him whilst he was assembling a new television cabinet and handed him the used envelope with the handwriting on the back, stating: "'I've decided to leave you the house and this is a note just in case I don't get to the lawyers to update my will.' I said: 'Isn't that overly generous, wouldn't you like to give that to your family?' She said: 'I don't want my daughters to have anything which is why I initially left it to my grandchildren, but I have changed my mind because you help me and you are the only one who helps me and I want you to have it.'"
Various aspects of Mr Etherton's affidavit evidence, including his recounting of this conversation, were challenged in cross-examination.
First, it was suggested that he was imprecise as to dates, even in relation to the period of his relationship with Tina Bohen. The dates of the relationship and the period during which they lived together were significantly exaggerated in his affidavit. He acknowledged in cross-examination that they had separated in 2008, about 12 months after they were married.
He stated that while he and Tina were married they visited the testator on "seasonal occasions and birthdays", but agreed that he did not otherwise visit her, nor visit her alone, which was at least consistent with Tina Bohen's evidence that her mother expressed a dislike for Mr Etherton and relief when the relationship ended.
In his affidavit Mr Etherton stated that he had first received a telephone call from the testator seeking help with repair of her gutters, which he said was in about 2012. He said that he went to the testator's home, repaired the gutters and thereafter, "two or three times a year", responded to calls for assistance including collecting her from hospital on two occasions and taking her shopping for a new television on one occasion. That evidence suggested 20-30 calls for assistance over some 10 years. He tendered his E-Toll records that showed he travelled across the Sydney Harbour Bridge from November 2011 to May 2021 on 15 Sundays which he said, "would ordinarily have been to attend on the deceased at her home". He said he did not "ordinarily" permit other persons to drive his vehicle and that he may "on one or two occasions" have crossed the Harbour Bridge on a Sunday morning for other purposes, but could not recall doing so.
Counsel for the executor cross-examined Mr Etherton with respect to an exchange of emails between Tina Bohen and him on 7 September 2021, that is three weeks after the testator's death. Tina Bohen's email, sent in the morning, was to the following effect: "Hey! How are you? I'm not sure if you know but my mum passed away recently. Had you been in touch with mum over the years? Because she has left you a lot of money and her car in the will and my sister and I the house contents. I'm a bit confused about all of this and obviously very upset about her passing. This has been a very hard situation, complicated by covid. Hope all is well."
Mr Etherton replied that evening: "Hey, I'm so sorry to hear about your mum. Her health has been up and down but she always tried to look at the bright side and be positive. I have been in contact with her. She called me years ago, maybe 6ish, who knows. She needed help with some gutters and something in the shed so I went over and helped. That's where it started. Then every so often she'd call and I'd pop over and help. The last time I saw her was to clean up some stuff in the house and move it to the shed. I gave the house a vacuum while I was there as the service hadn't been in a while. That was before lockdown of course, then we spoke after that by phone. I couldn't get home to help my mum with stuff so this was my way of helping a mum that I knew. I got to know your mum in a different situation, she had a good sense of humour and could be cheeky. My Mum passed about 3 years back now and that was hard. Sorting out everything. It was only after that it hit me and I was upset for some time. So I know what your going through. Expect [except ?] of course I wasn't hampered by COVID. Will there be a service? Online perhaps. I'd like to pay my respects if that would alright with you. If you wouldn't feel comfortable then I understand. I know you have 2 boys and she was so proud of them. In the pictures I saw they looked like big healthy blonde boys and I'm sure give you trouble if they have any of you in them. My condolences to you and Angela. It's a sad day."
The suggestion in the email as to when his visits to the testator commenced, (namely, "6ish" years before the email in September 2021) would suggest a time around 2015 rather than 2012.
Further, his evidence was that he would visit the testator on a Sunday when asked to do so; but the E-Toll records identified two such Sundays in August 2012 and then no Sunday crossings until 29 June 2014, at 5.45am. He agreed with counsel for the daughters that it was unlikely that he was visiting the testator at that hour. The next reading on the records was for 22 March 2015, followed by August 2015, two crossings in July 2016, three in 2017 (being in January, April and July) and two in 2020 prior to the date of the meeting on 27 December 2020.
I infer from this material that it is likely that Mr Etherton's significant contacts with the testator commenced, as his email to Tina Bohen suggested, in about March 2015. There were 10 trips on Sundays in the period from 22 March 2015 until 27 December 2020. Mr Etherton said there may have been one or two other occasions when he took the testator to hospital or collected her from hospital. It is also possible that not all the Sundays listed involved a visit to the testator. I accept that there were about 12 visits over a period of six years. Mr Etherton also gave evidence, which I accept, of telephone calls "about once a year". [5]

[10]

Effects of handwritten document

As noted above, if the handwritten document were legally effective, it would have resulted in Mr Etherton receiving virtually the whole of the testator's estate. As will be explained in dealing with the family provision claims, the evidence of Tina Bohen (which was largely unchallenged and was supported by documentary evidence) was that she remained in frequent and regular contact with her mother throughout the period from 2015 through to August 2021, despite living in the UK for most of that period. In his affidavit, Mr Etherton acknowledged occasions when he had spoken to the testator and she had said that "she had heard from her daughters. She also said that her grandchildren… had sent her a card". [6] Details of the contacts between the testator and her daughters will be addressed in the family provision proceeding judgment. Contact with Angela and Angela's children was less frequent from December 2013, but there was nevertheless evidence of continued contact. That evidence is relevant because it makes it unlikely that the testator intended to disinherit her grandchildren by intending that immediate effect be given to the handwritten document.
Further, the nature of the property, the subject of the document, is a significant consideration.
Angela Bohen gave unchallenged evidence that her father had moved out of the matrimonial home in 1989 and that her mother received the home in her property settlement with the daughters' father. [7] The house was in Ashfield, but at some point the testator sold the Ashfield house and bought the property in Croydon Park. I infer, however, that the house she was wishing to leave to Mr Etherton replaced the house obtained from her former husband, John Bohen, at least as to a half-interest, as a result of the property settlement. I also infer that she knew that her estate would not satisfy the bequest of $200,000 to Mr Etherton and a gift of the house. (Tina Bohen gave evidence of her mother's concerns as to her lack of money.) That consideration also militates against the testator intending, by an informal handwritten document, to dispose of the house to a person not part of the family, without proper consideration as to the moral claims of the daughters and their families to what had been the family home when her children were young.

[11]

Conversation of 27 December 2020

It remains to consider the evidence concerning the conversation between Mr Etherton and the testator on 27 December 2020, and his email to Tina Bohen on 7 September 2021. This discussion puts to one side the veracity of the testator's statements in the handwritten document.
In his affidavit, Mr Etherton set out his conversation with the testator when she handed him the "letter written on the back of an envelope from 'Catholic Health Care'". [8] To the extent that Mr Etherton's view of the legal effect of the handwritten document is significant, a matter dealt with below, it is material that he described it as a "letter written on the back of envelope", and said the testator referred to it as a "note". The conversation was set out as follows: [9] "'I've decided to leave you the house and this is a note just in case I don't get to the lawyers to update my will.' I said: 'Isn't that overly generous, wouldn't you like to give that to your family?' She said: 'I don't want my daughters to have anything which is why I initially left it to my grandchildren, but I have changed my mind because you helped me and you are the only one who helps me and I want you to have it.'"
The explanation that, "this is a note just in case I don't get to the lawyers to update my will" permits no certain inference to be drawn as to the testator's intention with respect to the legal effect of the document. On the one hand, it might be thought to be inconsistent with an intention that the document constitute a legally effective amendment of the will. On the other hand, though somewhat less likely, it might be inferred that she intended the "note" to be effective even if she did not "get to the lawyers".
The cross-examination also addressed the omission of this conversation, or indeed any reference to the testator's handwritten document, in the email of 7 September 2021 to Tina Bohen: [10] "Q. You didn't tell Tina anything about the conversation which you'd had with Mrs Bohen in that email, you didn't disclose it. And is the reason for that that you'd forgotten it? A. Yeah, it didn't, it didn't come up at that time. I'd just heard her mother had passed. Q. Yes. And you had forgotten the conversation at the time that you sent the email back? Do you agree with that? A. Yes. I was responding to that she had passed. Q. If you had remembered it, you would have referred to it in the email, wouldn't you? A. Yeah, to continue on from this, yes. Q. In particular, you could see when you read Tina's email that she was under the impression that her mother had left you a lot of money and a car, but it was clear enough to you that she wasn't aware that you were potentially getting the house? A. From, yes, what Tina says, yeah. … Q. The reason you didn't disclose it is because you didn't think the document had any legal effect? A. I wasn't sure of its legal value at all."
Objection was taken to the last question (and hence the admissibility of the answer). The question was allowed, not on the basis that Mr Etherton's opinion as to the legal effect of the document was relevant, but on the basis that his opinion could have explained the reason why he did not refer to the document in his email. If he had forgotten about receipt of the document, the reliability of his later account of the conversation when he received the document might have been compromised.
It should be noted that Mr Etherton's answers to the questions were equivocal. While he agreed that he had forgotten about the document at the time he wrote the email, he also suggested that he was simply responding to news of the testator's death. However, the latter part of the explanation should not be accepted. The second paragraph of the email was not a response to news of the death, but an answer to the question in Ms Bohen's email which followed that news, namely, "had you been in touch with mum over the years?" There was a stated reason for asking the question, namely that the deceased had left Mr Etherton a lot of money and her car in the will, whereas the daughters were to share only the contents of the house. There was no evidence that Mr Etherton knew whether the testator had changed her will as she had indicated she might in her note to him; there was no evidence that he inquired.
It is not possible to resolve the tension in the language reported by Mr Etherton; nor is it possible to be sure that the words recounted by Mr Etherton were the words used by the testator and I do not accept that they were said. The second sentence ascribed to the testator set out above has a strong flavour of reconstruction. Mr Etherton accepted in cross-examination the proposition that "what actually occurred in terms of discussions between you and Mrs Bohen are more likely to be accurately reflected in the note than what is the product of your recollection two years later". [11] Mr Etherton also conceded that at the time the handwritten note was passed to him, he had no idea as to whether it had any legal effect. Although he kept the piece of paper, he did not immediately recollect or recover it when hearing of her death. I infer that the conversation which accompanied the handwritten note was not of consequence to him at the time. Accordingly, although in the ensuing cross-examination he adhered to his evidence as to the content of the conversation, I have no confidence in those answers and I am not able to identify the words actually used from what I consider on the probabilities to be a reconstruction.
It follows from this consideration that the only aspects of Mr Etherton's evidence which are significant in determining the legal effect of the handwritten document are (i) his evidence as to the circumstances in which he received the document; (ii) the fact that it was given to him; and (iii) the assessment of the extent of the services which he had provided to the testator.

[12]

Subsequent conduct

One further evidential matter should be addressed. Counsel for Mr Etherton submitted that neither the unfairness of the testator's conduct in giving the house to Mr Etherton, nor her failure after 27 December 2020 to take any further steps to change her will, was a material factor.
Each of these submissions can be accepted, but only in part. As to the unfairness of the transaction, it is not a fact relevant in itself, but it has indirect relevance in that, for reasons which have been explained, the testator was fully aware of the desirability of having a will prepared by a solicitor and, if close family members were to be excluded, providing a statement explaining why members of her family to whom she had devised her property were to be excluded in favour of a person unrelated to the testator. If, as I infer on the probabilities, she understood the inherent risks of making a legally effective codicil in this way, that diminishes the likelihood that she intended the handwritten document to be such, rather than, as described by Mr Etherton, a "note" expressing her intention to amend her will with the help of a solicitor. Indeed, the document itself has the flavour of a statement explaining such a disposal of property, rather than an operative disposal.
As to the question of subsequent conduct, counsel for Mr Etherton submitted that if the handwritten document were legally effective, that effect resulted from the testator's intention at the time she prepared the document and handed it to Mr Etherton; once prepared, the effect could not be undone except by conduct which would revoke a will, which, to comply with s 11, would need, relevantly for present purposes, to be by a further document, and there was none.
This analysis, so far as it goes, may also be accepted. There is authority which is said to supports the analysis. [12] However, it does not follow that subsequent conduct is irrelevant and inadmissible. Rather, subsequent conduct may be admissible to the extent that it casts light upon the testator's intention as at 27 December 2020. That conclusion has been applied in a number of analogous circumstances, including, for example, the calculation of compensation for compulsorily acquired land when the value must be assessed as at the date of acquisition. In Housing Commission of New South Wales v Falconer [13] Hope JA explained: "However there are many decisions, including decisions of the High Court, in which it has been held that evidence of future events is admissible not to prove a hindsight, but to confirm a foresight."
Indeed, that approach is consistent with the relevant passage in the reasons of Powell JA in Hatsatouris: [14] "However, while it is legitimate to have regard to statements made, and actions taken, by the relevant Deceased, after the relevant document has been brought into being and signed, in determining whether or not at the time when the document was brought into being or signed, the relevant Deceased had the relevant intention, once it be held that the relevant Deceased had the relevant intention recourse cannot be had to subsequent statements or events - unless they fall within the provisions of s 17 of the Act - to deprive the relevant document of its status as a testamentary instrument."
In short, subsequent conduct may be relevant as revealing the true intention of the testator at the time that she made the informal document. It is not relevant to suggest a change of intention, absent a written revocation, but the latter function was not relied upon in the present case and may be disregarded.
In the present case, it is significant that the testator did not go to a solicitor before 27 December 2020. Accepting the thrust of the conversation as recounted by Mr Etherton as occurring on that date, she was fully aware that the proper manner for amending her will was for her to see a solicitor. In the absence of any known exigency which prevented her taking that significant step before 27 December 2020, it may be inferred that she did not intend any informal note written on that date to be effective to change her will. The fact that she did not take that step in the eight months after 27 December 2020, where there was no evidence to suggest anything precluding her doing so, confirms the inference that she did not intend, as at 27 December 2020, to change her will. She failed to act on the suggestion in the note that she intended to see her solicitor, not because she did not think she needed to do so because the handwritten document was legally effective, but because she did not in fact intend to leave Mr Etherton her house.
The note expressed a "wish", but there may be wishes and wishes. One can wish to do something which one knows is not possible or not realistically practicable. The evidence (unchallenged) suggests that she expressed such wishes, in relation to her estate, on more than one occasion, although not in writing. Tina Bohen gave the following evidence of a conversation in the course of which both her children and she spoke to the testator on the phone. She said that the call lasted for about 45 minutes. Her evidence continued: [15] "During this conversation, Mum said words to the effect: Mum: 'I'm getting emotional. I love you all so much. Tina I want to leave you a million dollars so you can give the boys a better life than I had.' There were countless other occasions when Mum said to me: Mum: 'I will leave you a million dollars.' Sometimes it didn't come up naturally in conversation. Mum just blurted it out in the conversation. I felt uncomfortable talking about Mum's money and I always responded with words to the effect: Me: 'I really don't want to talk about it Mum, it is morbid. …'"
Whilst recognising that such verbal communications are of a different character to a signed handwritten statement of wishes, the evidence nevertheless illustrated the point that her expression of a wish, even with respect to her own estate, did not indicate her intention to change her existing will. It might be necessary to reassess the conviction with which a particular wish had been expressed if thereafter steps were taken to act upon the wish. Failure to take such steps provides some support for the view that the expression of the wish was a relatively transitory feeling and made without any firm intention to act upon it, let alone treat it as self-executing.

[13]

Conclusions

For the reasons set out above, I have not reached a level of comfortable satisfaction on the balance of probabilities that the handwritten document was intended by the testator to constitute an alteration to her will. Indeed, I have reached a comfortable satisfaction that it was not so intended at the time it was prepared. Indeed, if it were necessary, I would conclude that the handwritten document did not truthfully express her testamentary intention at that time. The principal steps in the reasoning in support of that conclusion are as follows: (1) Although the written document has an air of formality and is signed, it was prepared by a person who was reasonably familiar with the formalities of making a will and had received advice (and acted upon such advice) as to the need to set out reasons for excluding the natural subjects of one's testamentary favour, including close family members. (2) The language of the document was, at best, ambivalent as to whether it was intended to operate as a codicil to the 2016 will, or merely as a statement of intention to alter the will. (3) It is relevant that those who would be disinherited if the document were an effective codicil, would be the testator's grandchildren to whom, even Mr Etherton agreed, she was devoted. (4) She complained to her daughters about lack of money on more than one occasion: nevertheless her 2016 will left a sizeable bequest to Mr Etherton (in an amount of $200,000) so that she must have understood that to leave him her house, in addition to that sum, would effectively disinherit all her family. (5) In these circumstances, the reference in the document to her "wish" suggests that she did not see the document as having the effect referred to in the last paragraph; and the second part of the document suggests the whole was merely a statement as to why she was proposing to take a course of action, rather than taking it. (6) The testator did not give the handwritten document to her solicitor or to any person who would be responsible for executing her wishes following her death, or even to an independent and trusted friend: rather she gave it to the proposed beneficiary, with no indication as to what he should do with it. (7) If an alternative explanation for the document were necessary, it might be inferred that it constituted a means by which the testator sought to express her deeply felt thanks and gratitude to Mr Etherton, but it was a false promise. (8) To the extent that Mr Etherton gave evidence of a conversation with the testator on 27 December 2020 in the course of which she expressed her wish more definitively as something she had "decided" to do, I am not satisfied that the use of that word is reliable so as to give greater precision to her "wish" than the language of the note itself. On the other hand, it would be consistent with her understanding of the proper way to alter her will that she referred in the conversation to not getting "to the lawyers to update my will". That language is also consistent with her not intending the handwritten document to have that legal effect of its own force. Further, if the last sentence ascribed to the testator in the conversation be correct, it demonstrates that she was conscious that she was disinheriting her own grandchildren which she is unlikely to have intended to do without consulting her solicitor. (9) The fact that she prepared a handwritten document without speaking to her solicitor is supportive of the conclusion that her "wish" (if she so wished) had not risen to the level of a determination to act. That inference is supported by the fact that she did not in the following eight months raise the issue with her solicitor. (10) The evidence of Tina Bohen, which I accept, that the testator was inclined to express a wish to confer testamentary benefits on her offspring or their children, whilst at other times castigating them for their failures, both to their faces and to others, demonstrates that, at least orally, she expressed such wishes in a way which was clearly not intended to be legally binding even though inconsistent with her existing will.

[14]

Costs

The statutory scheme established, in its current form, under s 98 of the Civil Procedure Act 2005 (NSW) and r 42.1 of the Uniform Civil Procedure Rules 2005 (NSW) is that, whilst costs are generally in the discretion of the Court, "the court is to order that the costs follow the event unless it appears to the court that some other order should be made". That rule applies to contested probate litigation. Nevertheless, in some cases it has been said that there are "exceptions" to the rule in such litigation. [16] However, the term "exception" may be thought to imply that the rule does not operate in particular circumstances. That would clearly be wrong: it is not for the courts to craft exceptions to a statutory rule. The matter was more accurately expressed by Dixon CJ (McTiernan J agreeing) in Middlebrook v Middlebrook [17] : "No doubt in probate suits the prima facie rule is that, as in other litigation, costs follow the event. But in probate suits there are considerations which more readily affect the application of this rule than in most other forms of litigation."
Putting to one side third party costs orders, the available options are that: 1. the unsuccessful party pays the costs of the successful party; 2. there be no order as to costs; and 3. the unsuccessful party is paid costs from the estate, despite lack of success in the litigation.
Circumstances in which the general rule may not apply have been described in the following terms: [18] "1 where the testator has, or those interested in residue have, been the cause of the litigation, the costs of unsuccessfully opposing probate may be ordered to be paid out of the estate; 2 if the circumstances led reasonably to an investigation in regard to the document propounded, the costs may be left to be borne by those who respectively incurred them … ."
As noted in Perpetual Trustee: [19] "The two exceptions tend to overlap. As was said by Santow J in In the Estate of Moyle: Moyle v Moyle (18 June 1988, unreported), if a testator is by his mental frailty and other circumstances in a position where the circumstances reasonably call for investigation of the validity of the will 'in one sense the testator, though usually with no sense of blameworthy fault, has by his or her conduct caused the litigation to occur'. A party reasonably but unsuccessfully propounding or challenging the will, and so bringing about the necessary investigation, should no more have to bear his own costs than pay the costs of the other party. So it has been said that where the conduct and habits and mode of life of a testator have given ground for questioning his testamentary capacity the costs of the unsuccessful party should be paid out of the estate, as distinct from being left to be borne by that party … ."
Questions of testamentary capacity provide a common example of the overlapping operation of the two principles in the formulations set out above. The principles have also been invoked in relation to disputes concerning informal wills. Indeed, if the source of the litigation is an informal document prepared by the testator, it may readily be expressed as a dispute "caused" by conduct of the testator. It does not follow, however, that in all cases involving informal wills, the unsuccessful party's costs will be paid out of the estate.
In relation to the second principle, the term "investigation" is designed to cover an investigation by the Court, rather than merely a non-judicial inquiry. Further, the breadth of the term "circumstances", may aptly include the preparation of a document, the question being whether it was reasonable to pursue a claim to admit such document to probate by way of litigation. It should not be inferred that to state that the testator caused the litigation will necessarily justify an order for costs of the unsuccessful party out of the estate without consideration as to whether the pursuit of the litigation by that party was, in all the circumstances, reasonable. In either case, reasonableness is not to be assessed by reference to the outcome, but by reference to what may objectively have been reasonable in the circumstances which preceded the hearing in Court.
As Mason P noted in Shorten, the general rule is designed to compensate the successful party for the costs of the litigation, and not to punish the unsuccessful party. [20] It does not require proof of the unreasonableness of the losing party. One may add that a significant practical effect of the rule is to impose a discipline on both lawyers and clients in circumstances where litigation is pursued primarily for financial advantage: there will be costs resulting from failure, beyond the party's own costs of the litigation. In circumstances where the parties are litigating over a fund, the Court should not too readily adopt practices which subvert the valuable discipline of the general rule. Sometimes the interests of the legal profession may tend to subvert the need for such discipline. Further, little attention was paid in the probate cases relied on by the parties, most of which pre-dated the Civil Procedure Act, to the overriding purpose of the rules, including the costs rule, requiring litigants, lawyers and the courts to facilitate the just, quick and cheap resolution of the real issues in the proceedings: Civil Procedure Act, s 56. The issues are to be resolved in such a way that the cost to the parties is proportionate to the importance and complexity of the subject-matter in dispute: s 60. These considerations should inform an assessment of the reasonableness of Mr Etherton's conduct.

[15]

Application of principles

Given that Mr Etherton has been unsuccessful in these proceedings, there can be no doubt that the executor behaved entirely appropriately in seeking to protect the interests of the grandchildren, while agreeing to administer the estate on the basis of the handwritten document, if that were found to be legally effective. He will have his costs, at least from the estate, assessed on an indemnity basis.
Written submissions were exchanged between the parties, with leave, following the hearing. Mr Etherton's primary submission was that, even if not successful, he should be awarded his costs; alternatively, he should not be ordered to pay the executor's costs. Counsel supported the primary submission by reference to authority and the circumstances of the case. It will be necessary to return to those matters shortly.
In contrast, counsel for the executor stated that the plaintiff, even if unsuccessful, should receive his costs out of the estate, assessed on the ordinary basis, "because the litigation was caused by the deceased by her failure to properly execute the informal document". It may be that that submission was made in ignorance of the basis on which the informal document would be rejected, but it is based on an assumption that the document was intended to constitute an alteration to the testator's will, in which case the claim should have succeeded. As the sole basis of the submission is unsound, I place no weight on the executor's submission in the present circumstances.
Mr Etherton's submissions relied upon four propositions. The first was that probate proceedings being "interest litigation", a party would have no standing if he or she had no interest in the matter, implying that no weight should be given to the fact that Mr Etherton pursued the litigation in his own financial interest.
In my view, consistent with authority, [21] such a consideration is not immaterial. Mr Etherton had standing because he was named in a document which he sought to propound as an alteration to the 2016 will. However, unless a successful outcome to the proceedings was likely and was likely to provide some significant financial benefit, proportionate to the costs to himself and to the estate, it would be difficult to justify any order that he obtain his costs from the estate, or even an order that he not have to pay the costs of the estate, in the event of failure.
The second basis upon which costs were sought was that the plaintiff pursued the litigation on the "reasonable view that the informal document was an amendment to the will of the deceased or alternative[ly], a will of the deceased". That factor is undoubtedly a material consideration, although there was no tenable basis to suggest that the handwritten document effectively replaced the whole of the 2016 will, as opposed to altering one clause. However, for reasons given below, even the claim of a testamentary alteration should not reasonably have been pursued.
Thirdly, Mr Etherton relied upon the proposition that the testator both generated and encouraged a belief in him that she had delivered to him a testamentary document. That submission involved a number of factual assertions which might need to be addressed. However, while the subjective beliefs of the plaintiff may be relevant in some circumstances, the case was brought by the plaintiff with the assistance of solicitors and counsel and the material question is whether any such belief was a reasonable belief, if and when it was acted upon.
Fourthly, counsel for Mr Etherton submitted that his conduct was reasonable and appropriate "because at the end of the day he was seeking to give effect to what was considered to be the deceased's testamentary intentions". [22] It would be ingenuous to accept that view. In his email of 7 September 2021 to Tina Bohen, Mr Etherton recorded his understanding of the testator's devotion to her grandchildren. I do not accept his evidence of that part of the conversation on 27 December 2020 in which the testator purportedly explained that she had left the house to the grandchildren but now wished to change her will. There is no record of that statement in the handwritten document, nor is there any other evidence before the Court indicating a wish to disinherit her grandchildren. The irrationality underlying the disinheritance of her grandchildren because no-one except Mr Etherton had given her any assistance, in circumstances where that assistance appeared to involve minor domestic help for a few hours on one or two occasions a year, is part of the reason for not concluding that the handwritten document was intended to effect a change to the 2016 will.
Mr Etherton gave evidence as to other conversations with the testator revealing his understanding of her relationship with the family, in the following terms: [23] "When I was at her home, we talked, sometime[s] for an hour. The deceased also telephoned me about once a year, saying to me: 'Hello Robin. It's been a while, I just thought I'd call to see how you were.' The conversation that followed on those occasions canvassed things that I had done, things I was going to do such as going for dinner with friends, or going out with a walking group. The deceased also complained to me about her daughters, on occasions saying to me: 'They don't treat me well. They speak badly to me.' On some occasions, the deceased said that she had heard from her daughters. She also said that her grandchildren who had sent her a card [sic]."
In oral evidence, Mr Etherton said that he did not engage with the testator over her views about the conduct of her daughters and said nothing to endorse her views. [24] He understood that the daughters remained in touch with the testator. [25]
In the conversion of 27 December 2020, Mr Etherton stated that he responded to her information that she would leave the house to him by saying: "Isn't that overly generous, wouldn't you like to give that to your family?" Whether or not that part of the conversation took place, or is a reconstruction, is presently immaterial: I accept that it reflects Mr Etherton's belief as to what he would have said at the time, because he retained that view when he prepared the affidavit. From an objective perspective, over-generosity might have been an understatement. However, any reasonable person in Mr Etherton's shoes would have recognised the moral claims of the testator's family. The claim that the testator had wanted to disinherit her grandchildren was inherently implausible.
Those moral claims would have persisted had I been satisfied that the testator intended the handwritten document to form an alteration to her will. Indeed, counsel for the daughters was ambivalent as to whether or not to oppose Mr Etherton's claim, conscious no doubt that the daughters might have stronger claims for family provision orders if he were the residuary beneficiary, rather than the grandchildren. That view, supported by the executor, is undoubtedly correct. It is relevant to the present question of costs.
After costs and expenses are met, as counsel for Mr Etherton accepted, the net value of the residuary estate will be in the order of $900,000. In the accompanying judgment dealing with the family provision claims, the Court upholds the daughters' claims for orders for provision out of the residuary estate, otherwise subject to the trust for the grandchildren. Those orders do not diminish the separate legacy of $200,000 in favour of Mr Etherton. On the basis that Mr Etherton had succeeded in the probate claim and the Croydon Park property was left to him, I would have made family provision orders in favour of the daughters which again would not affect the specific bequest to Mr Etherton, but would divide the net residuary estate between the daughters equally. That is, on the basis that Mr Etherton was successful in this probate proceeding, each daughter would have obtained approximately 50% more than the order proposed in the accompanying judgment. As between the daughters of the testator (who have personal needs and responsibilities for the maintenance, education and advancement in life of the testator's grandchildren), and Mr Etherton, (who provided casual assistance with odd jobs for the testator about twice a year for the last 10 years of her life and who received a bequest of $200,000), provision of $450,000 to each daughter would be a proportionate disposition of the estate.
The family provision proceedings were commenced before Mr Etherton's claim, and he would have known of them and, I infer, sought advice in relation to them, before or shortly after commencing his own proceeding. Whether the hypothetical outcome set out above should be accepted, or some lesser amount awarded, on no view was Mr Etherton reasonably likely to obtain the full proceeds of sale of the house. Indeed, his counsel accepted that some provision should be made for each daughter in any event, though in sums below those awarded. For that reason, I discount the suggestion that the proceedings were brought with the public-spirited intention of ensuring that the testator's final wishes be given effect. Rather, in my view the probate proceedings were brought out of financial self-interest and in circumstances where, properly advised, Mr Etherton must have been aware of the likelihood of success of the daughters' family provision claims. I also take into account that in resisting the probate proceeding, the executor was acting in the interests of the grandchildren.
In those circumstances, I do not consider it would be appropriate that the estate be diminished in order to pay Mr Etherton's costs of his unsuccessful proceeding. Indeed, there is a tenable case not to depart from the usual principle that he should pay the executor's costs of the probate proceeding, to be assessed on the ordinary basis. However, as counsel for the executor did not seek costs in the event of success, the appropriate course is to make no order as to Mr Etherton's costs, with the intent that he bear his own costs of the proceedings.

Etherton v Mitchelmore

At a glance

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Judgment (17 paragraphs)

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Legislation Cited (5)

Cases Cited (11)

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