Nicholson & Ors v Knaggs & Ors [2009] VSC 64

Nicholson & Ors v Knaggs & Ors [2009] VSC 64 - VSC 2009 case summary — Zoe

[139]

In dealing with the Banks v Goodfellow test it is, I think necessary to bear in mind the differences between life in 1870 and life in 1995. The average expectation of life for reasonably affluent people in England in 1870 was probably less than 60 years and for others less well off under 50 years: the average life expectation of males in Australia in 1995 was 75 years. Younger people can be expected to have a more accurate understanding of the value of money than older people. Younger people are less likely to suffer memory loss. When there were fewer deaths at an advanced age, problems which arise with age such as dementia, were less common. In England in 1870, if you had property it was likely to be land or bonds or shares in railway companies or government backed enterprises. Investment in ordinary companies was far less common than now. Older people living today may well be aware that they own substantial shareholdings or substantial real estate but yet may not have an accurate understanding of the value of those assets, nor for that matter, the addresses of the real estate or the particular shareholdings which they have. Many people have handed over management of share portfolios and even real estate investments to advisers. They may be quite comfortable with what they have; they may understand that they have assets which can provide an acceptable income for them, but at the same time they may not have a proper understanding of the value of the assets which provide the income. They may however be well able to distribute those assets by will. I think that this needs to be kept in mind in 2004 when the requirement of knowing "the extent" of the estate is considered. This does not necessarily mean knowledge of each particular assets or knowledge of the value of that asset, or even a particular class of assets particularly when shares in private companies are part of the estate. What is required is the bringing of the principle to bear on existing circumstances in modern life.

[218]

The relevant law is not doubtful. It may be thus stated: - (1) In general, where there appears no circumstance exciting suspicion that the provisions of the instrument may not have been fully known to and approved by the testator, the mere proof of his capacity and of the fact of due execution of the instrument creates an assumption that he knew of and assented to its contents (Barry v. Butlin; Fulton v Andrew). (2) Where any such suspicious circumstances exist, the assumption does not arise, and the propounders have the burden of removing the suspicion by proving affirmatively by clear and satisfactory proof that the testator knew and approved of the contents of the document (Baker v. Batt; Tyrrell v. Painton; Shama Churn Kundu v Khettromoni Dasi). (3) If in such a case the conscience of the tribunal, whose function it is to determine the fact upon a careful and accurate consideration of all the evidence on both sides, is not judicially satisfied that the document does contain the real intention of the testator, the Court is bound to pronounce its opinion that the instrument is not entitled to probate (Baker v Batt; Fulton v Andrew). (4) The circumstance that a party who takes a benefit wrote or prepared the will is one which should generally arouse suspicion and call for the vigilant and anxious examination by the Court of the evidence as to the testator's appreciation and approval of the contents of the will (Barry v Butlin and Fulton v Andrew; per Lord Shaw in Low v Guthrie). (5) But the rule does not go further than requiring vigilance in seeing that the case is fully proved. It does not introduce a disqualification (per Lord James in Low v Guthrie). (6) Nor does the rule require as a matter of law any particular species of proof to satisfy the onus (Barry v Butlin). (7) The doctrine that suspicion must be cleared away does not create "a screen" behind which fraud or dishonesty may be relied on without distinctly charging it (Lord Loreburn LC in Low v Guthrie). [Footnotes omitted]

[494]

In summary, Miss Dyke was an eccentric and independent single woman who lived on her own supported by friends until she manifested clear signs of dementia by mid 2002. Prior to this, her mental state was probably affected by combined effects of mild cognitive decline (or mild dementia), pain, physical disability, depression and anxiety, with or without the effects of misuse of benzodiazepines and narcotic analgesics, although a contribution of cognitive decline was less likely as far back as September 1999. In September 1999 she made a will which differed in its emphasis, rather than inclusiveness by changing her major beneficiaries from a group of charities to the friends who supported her to secure and maintain their involvement and she maintained this will-making pattern through subsequent codicils in March and December 2000 and another will in January 2001. The consistency of this pattern over two years and her ability to identify this change and the reasons for it suggested that despite any mental impairment she retained testamentary capacity over this period.

I believe that regardless of the extent to which Dr Lloyd's and my estimate of her cognitive level prior to 2002 might differ (and I must emphasise that this estimation was difficult in this case for the reasons outlined earlier), the detailed, contemporaneous notes of her accountant and solicitor more accurately demonstrated her capacity than any estimate of her cognitive functioning. Importantly, the presence of cognitive decline or dementia does not preclude testamentary capacity and there is no empirical scientific evidence correlating stage of dementia or Mini Mental State Score with loss of capacity, other than to say that it is probably lost in severe dementia, although even this depends on the complexity of the estate. From my extensive experience acting as an expert witness in over 100 cases of challenged testamentary capacity and my extensive writings and presentations in this area, I believe that generalizations in this area are fraught with difficulty. Each case must be examined on its own merit with regards to the particular manifestations of the dementia and the decisions to be made in terms of the complexity of the estate arid the nature and history of the relationships which bear on the claims one ought to consider.

[562]

12 January - Betty confused + can't follow the conversation [it appears in relation to Geoff's finances]; 14 April - She was mixed up. Forgetting that it was Leon Watt she spoke to this mon. evening. Betty says it was a fortnight ago; 21 April - Betty's conversation was all confused. She was away with the fairies. She thought Tim's [Tim Knaggs'] mother was Gary's [Gary Smith's] mother. Gary called to do cows + he phoned later to tell me that Betty was off the planet; 1 June - Betty phones in afternoon. Said she couldn't remember who'd been this morn. Sounded vague - loss of memory + realising she wasn't making sense; 2 June - Betty quite strange; 3 June - Betty couldn't understand where all the bananas had gone. She denied putting them down in the aviaries. She cooked up more tongues for the dogs. She had trouble last night finding her electric blanket. Straightened her bed. It was already filthy from Honey [the dog] wiping her backside on the sheets. (I only changed them last week). She was depressed about Dr Knobel telling her that she wasn't going to gain anything from an operation couldn't see any future. (hanged Patch [of morphine] 2nd strength) ...Betty seemed happier - in less pain she was muddling her sentences, but most of then time OK; 6 June - Betty getting all confused over what she was going to feed the dogs.; 10 June - She was all muddled up in her speech but seemed to think everyone was plotting against her; 11 June - Betty had tipped out nails all over the floor shed. ...bent over when sitting, just dozing off; 12 June - I think she scolded herself with hot water her arm was burnt + red. She was in a bad way; 13 June - She couldn't find her mother. ... She was OK for a moment then off the rails again; 15 June - Betty been on a rampage, cupboard in porch emptied plant house geraniums all tipped over - hole in front of verandah wall + Joes sleepout chaotic. Betty found in paddock with scratches etc Tim +Diane take to Knobel [Doctor] while Gary + I clean up; 17 June - Betty at it again complaining about the fridge +confused about dogs meat; 18 June - Betty on about meat again. being difficult, but depressed. Can't understand why she's like she is; 19 June - Betty up at 8 - cold, shaky + messed her pants of night - I changed the lot. Clean clothes, but she wouldn't wash. ... Tim went to solicitor + Dr Knobel ... Knobel's tests came through + he suggested hospital + ambulance. Diane + I got betty organised. Tim arrived + went in Ambulance with Betty to Fkst [Frankston].

[576]

Thankyou for referring this rather complex 82-year-old lady whom I saw at Frankston Hospital today. This lady has basically got advanced dementia but has been managing to mask this by living alone in a farm in Mount Martha and basically looked after by friends. She has been admitted in an acute confusional state wandering and extremely anxious. Initially she was quite drowsy and hence appeared to have a delirious state on top of the underlying dementia. However all routine septic screens have been normal apart from low iron and chest X-ray has been clear.

In the time of admission she was found to be in a state of gross self-neglect with faecal soiling etc. The social report gives more insight into this where it appears that she has been living on a large property with no regular contact with family and supported by 3 couples living nearby who assist with her cattle, dogs and birds. Friends report that her cognitive function has progressively decreased over the last I year. She is non-compliant with medications, has refused all services, only excepting [accepting] support from her friends. Over the last 3 weeks her confusion and disorientation has become considerable[y] worse with her wandering during the night and being found caught in barb wire etc.

Examination revealed a lady who is very confused and disorientated and could not even perform a proper Mini Mental but the OT report indicates a score 13/30. She is currently awaiting a neuropsychiatric assessment. Pulse was 80 per minute regular, blood pressure 110/70, lungs were clear; abdomen was soft, there were no obvious neurological deficits.

Biochemistry and haematology has essentially been unremarkable.

This lady's main problem is severe Alzheimer's disease and she now needs high level of care placement. She was discussed at the team meeting today and I have filled out the necessary forms including a 2624. She will need a Guardianship Board application and a guardian appointed. In the interim I will try and get into an interim care bed in the Age Care Unit at Golf Links Road where they have a dementia wing. Alternatively such an accommodation may need to be found in the community pending permanent placement.

[685]

515 The conversation lasted in the order of 24 minutes. Mr Moffatt made handwritten notes of this telephone conversation which he completed immediately after it had concluded. I accept these notes as an accurate summary of the conversation. Mr Moffatt noted the following: Mr Knaggs opened by introducing himself as the husband of Denise Knaggs. He then said that he had spoken "to her re Betty Dyke". I infer from this that Mr Knaggs had spoken to his wife Denise Knaggs about Betty Dyke and her proposal to have a new will prepared. Mr Knaggs then said: "She's decided". The conversation then proceeded broadly as follows: Tim Knaggs described the letter dated 17 August 1999 from Mr Moffatt to his client Ms Dyke, as "good"; Mr Knaggs discussed what was designated in the letter as "Option 2B", being a sale offered by executor followed by splitting the proceeds; he also discussed what was designated in the letter as "Option 2C" in the following terms: "2C may be preferable in case the land is sold before death, as under 2B this would cause the three friends to receive nil". Here Mr Knaggs is presumably referring to the possibility that if Betty Dyke sold her land before her death, and then distributed the cash to other parties, the Neighbours would receive nothing. Mr Knaggs then advised that "Betty wants her will to be simple, but having trouble reaching decision". He then said: "They will talk to her about the 2C option and what sort of split she wants". It was at that point that Mr Moffatt warned Mr Knaggs: "I'm concerned and you should back off and let her make up her own mind". Mr Knaggs then said that when Betty had decided and was ready to speak to Mr Moffatt again she would contact him. Mr Moffatt suggested that he would see her and perhaps Mr Wadeson also (to ensure her instructions were what she really wanted). Mr Knaggs then briefly discussed Betty Dyke's mental capacity with Mr Moffatt, in the course of which Mr Knaggs said that Betty Dyke had a letter from a doctor. They then briefly discussed the responsibility which Betty Dyke owed to others, for example, relatives. In the course of this part of the discussion Mr Knaggs confirmed what Betty Dyke had told Mr Moffatt - that she had no close relatives other than elderly cousins and second cousins to whom she did not feel responsibility, but that she wanted to leave them "a little something".

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