His Honour continued at p 171:
"… I would not regard the principle underlying recovery against the solicitor as being an extension of the Hedley Byrne assumption of responsibility. The Hedley Byrne category of case depends upon an assumption of a duty of care as a factual element in the relationship between the plaintiff and defendant. In cases of the present kind, there is no anterior relationship between solicitor and intended beneficiary and the duty of care is imposed by law."
73 Other members of the majority in Hill spoke to similar effect. The language of assumed responsibility was considered by Dawson J at 185-186. His Honour commenced at p 185:
"Thus, when a solicitor accepts responsibility for carrying out a client's testamentary intentions, he or she cannot, in my view, be regarded as being devoid of any responsibility to an intended beneficiary. The responsibility is not contractual but arises from the solicitor's undertaking the duty of ensuring that the testator's intention of conferring a benefit upon a beneficiary is realised. In a factual, if not a legal sense, that may be seen as assuming a responsibility not only to the testatrix but also to the intended beneficiary.
In the present case there was no reliance upon the solicitor by Mrs Van Erp nor did she request her to do anything for her. Mrs Van Erp did not change her position in reliance upon anything said or done by the solicitor. It is true that Mrs Van Erp was told that she was a beneficiary under the will and took no steps to protect her position. In that way it might be said that she relied upon the solicitor to carry out the testatrix's instructions carefully. However, I make no point of that in the present case."
74 After reference to statements by Mason J in Sutherland Shire Council v Heyman (1985) 157 CLR 424 at 464, Dawson J continued:
"The notion of general reliance or dependence described by Mason J is apt also to describe the situation in which, whilst there will usually be no specific reliance by an intended beneficiary upon a solicitor retained to attend to the will, the intended beneficiary's interests are totally and unavoidably dependent upon the proper performance of a function within the sole province of the solicitor. And, it might be added, in that situation the solicitor knows of the beneficiary's dependence and in that respect may be regarded as having assumed responsibility towards the intended beneficiary."
75 Toohey J agreed with Dawson J (p 188) as did Gaudron J, relying upon matters of principle, including the position of control which was in the hands of the solicitor, in finding liability for loss to the intended beneficiary (at p 199).
76 In the present case there was the additional factor of an anterior relationship. Although the solicitors complained that the conclusion reached by the trial judge at [57] relied upon a suspect finding that the solicitor "assumed a responsibility" for his advice, that may have been an unnecessary and extraneous step, though the factual finding was justified, in the sense explained by Dawson J.
77 To avoid the existence of a duty in the present circumstances, the solicitors sought to rely upon the proposition that any duty to the respondent would have conflicted with their duties to Mrs McGeoch. Whilst it may be accepted that a duty would not arise in such circumstances, the factual premise was not made out: at least between December 1995 and March 1996, protection of the respondent's interests would not only have been in accordance with Mrs McGeoch's instructions, but reasonably necessary in order to carry them into effect.
Breach of duty of care
78 Having found that there was a retainer and a breach of the relevant contractual obligations, his Honour, understandably, paid little attention to the alternative basis which required consideration, of how any specific duty of care may have been breached. Given the rejection of the existence of a retainer between the respondent and the solicitors, it is necessary to consider how precisely the solicitors may have been in breach of a general law duty of care owed to the respondent.
79 As already noted, the breach must have flowed, if at all, from the failure to give effect to Mrs McGeoch's proposal for the disposition of her property in a legally effective manner. If an immediate transfer inter vivos had been decided upon, the solicitor's duty would have extended to preparing, obtaining the execution of and registering an appropriate transfer. By mid-January, it was known that this approach was not available in accordance with Mrs McGeoch's instructions. But on 22 January 1996, at a time when it was proposed that both properties be transferred inter vivos, Mrs McGeoch made a will devising "Wanganui" to Robert McGeoch and Mollymook to the respondent, provided that she was the owner of the properties at the date of her death. Apart from a minor bequest, the residue of her estate was to be divided equally between her two sons. The solicitors prepared and arranged for the attestation of a will, the validity of which was not in doubt, giving effect to Mrs McGeoch's instructions. If such a testamentary disposition had failed because, for example, the respondent's wife had witnessed the will, the solicitors would have been liable in accordance with Hill v Van Erp.
80 In relevant respects, the 1996 will was substantively similar to a previous will signed by Mrs McGeoch in 1993. The purpose of executing a fresh will in January 1996 was, it may be inferred, at least in part to reflect the agreement reached in December 1995. The expectation at that stage was that neither property would still be owned by the testatrix at her death, unless it occurred before the relevant transfers were executed. However, there was nothing in the will which foreclosed the possibility that Mrs McGeoch would otherwise dispose of the properties during her lifetime nor that the will might not be altered or revoked at any time.
81 To Mr Hendriks' knowledge, unless the respondent reached some agreement with his brother, he would lose access to "Wanganui" and occupation of part thereof, on his mother's death. Mr Hendriks was also aware that the proposed transfer to Mr Robert McGeoch was designed to achieve an earlier termination of the respondent's occupation. Whether or not that could have been unilaterally achieved by Mrs McGeoch revoking his licence to occupy the land, on reasonable notice, is beside the point: she did not seek to take such a step, but rather sought to achieve the result through an agreement involving both brothers. By 24 January 1996, that agreement required the testamentary disposition of the Mollymook property to the respondent. Assuming that the agreement reached in December 1995 had not been a charade on the part of Mrs McGeoch, the solicitors should properly have taken steps to make the agreement legally enforceable or, if their instructions were to the contrary, to advise both brothers that that would not be done. Rather, Mr Hendriks failed to render the agreement enforceable on the part of the respondent, whilst at the same time reassuring him that his interests were being looked after. Such conduct constituted a breach of his duty to the respondent, such breach occurring on and from approximately February 1996, when he had had an opportunity to consider and act upon the fresh instructions from Mrs McGeoch, which were not to proceed with an inter vivos transfer of Mollymook.
Damages
82 The next question is the assessment of the loss suffered by the respondent, arising from the solicitors' breach of duty. This question involved two steps: the first step required a finding that, assuming that Mr Hendriks had prepared an appropriate agreement, the respondent would have executed it; the second, a finding that Mrs McGeoch would have executed it. (An appropriate agreement would probably have included Mr Robert McGeoch as a party, but nothing was said to turn on that fact.)
83 The trial judge did not address the first question, but there was no suggestion that the respondent would not have signed an appropriate agreement, in circumstances where his intention was to obtain (originally by immediate transfer and later by testamentary disposition) ownership of Mollymook and, if that were not possible immediately, control of Mollymook prior to his mother's death. Accordingly, it should be accepted as common ground that the first step was made out.
84 In relation to the second step, his Honour held in his first judgment at [49], in considering a breach of duty under a retainer between the respondent and Mr Hendriks:
"He failed to draw up and have executed an agreement that would protect Mr Jon McGeoch's interests by binding his mother not to alter her will with respect to the devise of the Mollymook property. There is no doubt that had such an agreement been drawn, Mrs McGeoch would have signed it. She executed a transfer of the Mollymook property before the issue of the adverse effect on her pension entitlement arose."
85 This was a finding of breach of contract and not an assessment of loss. It is not precise as to the time of the breach, although it appears to assume that at the relevant time, Mrs McGeoch's intentions would have been the same as at 22 January 1996 when she executed the transfer. As noted above, the question of damages was left for a further hearing subsequent upon the finding in relation to liability. The issue was then dealt with briefly. His Honour commenced by noting that he had been referred to a passage in Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 at 349-350, in the joint judgment of Mason CJ, Dawson, Toohey and Gaudron JJ stating:
"Damages in tort have also been assessed by reference to the probabilities or possibilities of what will happen or what would have happened. That approach has been frequently adopted in the assessment of damages for personal injuries where a court has been called upon to assess future possibilities and past hypothetical situations. In Malec v J C Hutton Pty Ltd (1990) 169 CLR 638, this Court drew a distinction between, on the one hand, proof of historical facts - what has happened - and, on the other hand, proof of future possibilities and past hypothetical situations. The civil standard of proof applies to the first category but not to the second, particularly when it is necessary to determine future possibilities and past hypothetical situations for the purpose of assessing damages."
86 Whether his Honour adopted that approach is not entirely clear. He proceeded, [2007] NSWSC 364 at [3]:
"It was submitted that for assessment of damage purposes the appropriate loss of chance percentage would be in the range of 51% to 60%. I have said in my reasons for judgment that I have no doubt that the deceased would have signed an agreement if drawn up by the solicitor, Mr Hendriks. If it had been necessary for me to express a percentage of that loss of chance, it would have been closer to 100% and certainly in excess of the suggested range."