Petith v New South Wales Trustee & Guardian; Bone v New South Wales Trustee & Guardian

Supreme Court of NSW|2024-09-20|Before: Pike J

Introduction

These two proceedings relate to the estate of the late Gail Margaret Thelen (Gail or the Deceased) who passed away on 27 April 2021 aged 65.
Prior to her death, Gail made a number of wills, relevantly: 1. 20 April 2021 (2021 Will); 2. 13 December 2019 (2019 Will); 3. 15 June 2018 (2018 Will) with a codicil dated 30 May 2019 (the Codicil); and 4. 29 October 2014 (2014 Will). (together, the Wills)
In proceedings 2021/00364938 (the Probate Proceedings), there is a dispute as to which of these wills should be admitted to probate. The plaintiff (Mr Petith), Gail's brother, by a second further amended statement of claim filed 9 December 2022, seeks a declaration that a copy of the 2014 Will is the last will and testament of Gail and an order that probate be granted to the first defendant (NSWTAG) in respect of that will. Declaratory relief is also sought that Gail lacked testamentary capacity at the time of each of the subsequent Wills or did not understand them or that each was procured by way of undue influence.
The second defendant/first cross-claimant in the Probate Proceedings (Mr Bone) was the de facto partner of Gail at the time of her death. By an amended first cross-claim filed on 9 December 2022, he seeks a variety of relief: 1. first, an order that probate in solemn form of the 2021 Will be granted to the NSWTAG; 2. in the alternative, an order that probate in solemn form of the 2019 Will be granted to the NSWTAG; 3. in the further alternative, an order that probate in solemn form of the 2018 Will be granted to the NSWTAG; and 4. in the further alternative, in the event that the Court is not satisfied that the 2014 Will should be admitted to probate, an order that letters of administration of the intestate estate of Gail be granted to Mr Bone as the de facto of Gail at the time of her death.

Overview of these reasons

The central issue in these proceedings is which of the Wills should be admitted to probate, which in turn focusses attention on Gail's cognitive state at the time of making the Wills as well as the role played by Mr Bone in the preparation of the Wills.
In Tobin v Ezekial (2012) 83 NSWLR 757 at [2], Campbell JA observed: [2] In litigation relating to probate, certainly one, and sometimes more, of the people best able to inform the Court about facts relevant to the drafting and execution of the will are not available to give evidence…
This is one of those cases. The drafter of the Wills, being Gail's long-standing solicitor, Mr Lakos, died in December 2021. Dr Alexander Wah Seng Lim (Dr Lim), Gail's longstanding GP, passed away in November 2023.
The evidence also includes a number of conversations alleged to have been had with Gail. The usual principles apply when considering this evidence: see Van Rensburg v Adilinis; Van Rensburg v Raft [2024] NSWSC 1146 at [12].
The principal witness to give evidence as to Gail's cognitive state between 2015 and 2021 was Mr Bone, her de facto partner. His interest in Gail's estate increased in each of the 2018 Will, the Codicil, the 2019 Will and the 2021 Will. His evidence, as a person clearly interested in the outcome of the proceedings, must be considered in that light in accordance with well-understood principles.
Given these features, the most reliable guide on the relevant matters is the body of contemporaneous documents, including medical records in relation to Gail's repeated admissions to hospitals as well as the documents kept by the late Mr Lakos, which document his communications with Mr Bone, either on Mr Bone's own behalf or purportedly on behalf of Gail. This material is supplemented somewhat by the observations of those who dealt with Gail from time to time.
These reasons are structured as follows: 1. Gail's Assets. 2. Overview of the Wills. 3. General observations of the lay witnesses and their credibility. 4. The factual chronology. 5. Mr Bone's financial position. 6. The opinions of Professor Watson. 7. Relevant legal principles. 8. Which of the Wills should be admitted to probate? Testamentary capacity and undue influence. 9. Mr Bone's claim for provision. 10. Conclusion and orders.

Gail's Assets

As at September 2024, the estimated gross distributable value of the estate assets is $19,400,611.37. The principal assets are a property located at Amiens Road, Clontarf, NSW (the Clontarf Property) (estimated value $12,000,000), a property located at Main Beach, Queensland (the Main Beach Property) (estimated value $2,200,000), $3,222,266.52 held in trust by the NSWTAG and $1,918,605 owed to Gail by the Werner Family Trust. The liabilities of the estate total $673,830.10, resulting in a net distributable estate of approximately $18,418,556.33 after legal fees are included.
In addition to these assets, Gail was the sole member of the Gainer Associates Superannuation Fund (the Fund). By a Binding Death Benefit Nomination signed by Gail on 20 April 2021 at the same time as she executed her 2021 Will (the Nomination), Gail had nominated the legal personal representative of her estate as the person entitled to payment of her death benefit.
Because the Nomination was not signed in the presence of two witnesses it is not binding on the trustee of the Fund. The Fund has substantial assets (exceeding $7 million), including a property at Woy Woy valued at $5,290,000.
Mr Bone sought payment of the entirety of the death benefit to him. The NSWTAG and Mr Petith sought payment of the entirety of the death benefit to the NSWTAG (so as to form part of Gail's residuary estate).
On 26 February 2024, Gainer Associates Pty Ltd, the trustee company of the Fund (the Trustee Company), wrote notifying that it proposed to pay one third of the death benefit to Mr Bone and the remaining two thirds to the NSWTAG. The Trustee Company subsequently sought judicial advice pursuant to s 63 of the Trustee Act 1963 (NSW) and on 6 September 2024, a judge of this Court advised the Trustee Company that it would be justified in paying the death benefit in the proportions notified on 26 February 2024: see In the matter of Gainer Associates Pty Ltd [2024] NSWSC 1138.
Mr Bone indicated in final submissions through his counsel that he did not propose to contest this position and as such he will receive one third of the Fund and the estate will receive two thirds. There was some issue at the hearing as to what taxes and the like would need to be paid and as such what amounts would be received by Mr Bone and the estate. It is not necessary to resolve this issue given the value of the estate without it. The only relevance of the issue potentially concerns Mr Bone's claim for provision and in this regard, there was no dispute that Mr Bone is likely to receive in the order of at least $2 million from the Fund. Something in the order of about $4 million will be paid to the estate and will form part of the testamentary trust.
The Werner Family Trust has net assets of approximately $2,586,137 and a liability of approximately $1.9 million to the estate. The trust deed for the Werner Family Trust cannot be located. An application for judicial advice is apparently to be brought in relation to how the fund and assets are to be distributed. It is not necessary for the purposes of these proceedings to speculate as to where these assets will end up.

The Wills

As set out above, there are four wills at issue in the proceedings. They have a similar structure. I set out the key aspects of the Wills from most recent to oldest.

The 2021 Will

The relevant clauses of the 2021 Will, dated 20 April 2021, may be summarised as follows: 1. appoint Mr Lakos as the executor but if he predeceases Gail, or dies before proving the 2021 Will, appoint the NSWTAG as executor (clause 2); 2. give to her friend, Mr Ronnie Mansfield, a legacy of $100,000 and her Volvo motor vehicle (clause 3(a)); 3. give to Ms Erin Louise Tharpe, Mr Bone's daughter, the sum of $100,000 (clause 3(b)); 4. give to her sister-in-law, Mrs Patricia Anne Petith, who goes by her middle name (Anne Petith) and to Anne Petith's daughters Elise Petith (Elise) and Chantelle Petith (Chantelle) all her womanly effects, including her personal jewellery and handbags (clause 3(c)); 5. give to Mr Bone her Lexus motor vehicle, a legacy of $1 million, all furniture and household items, together with all paintings, sculptures and items of fine art in the Clontarf Property and Main Beach Property, a right to live for his life at the Clontarf Property or, in effect, at an alternative home using so much of the sale price of the Clontarf Property, or the rent from it, to buy/rent the alternative home. Mr Bone is required to pay for the outgoings and maintenance on the Clontarf Property or alternative home (clause 3(d)); 6. the residue of her estate is to be held in a testamentary trust for the longer of 20 years from her death or Mr Bone's death and the income from that trust is to be distributed three ways, payable quarterly each year - one third to the sister of her late husband, Ms Alice Quintus, one third to her brother, Mr Petith, and his wife, Anne Petith (or to Elise and Chantelle on their death) and one third to Mr Bone. If one or more classes of beneficiaries dies before the vesting date, the income is to be paid to the remaining classes (clause 4(a)); 7. as soon as practicable following the vesting date, the assets of the Trust (inclusive of any undistributed income) are to be paid to four named charities (clause 4(b)); and 8. Gail acknowledged that she has considered her moral obligation to each person who is potentially an eligible person in relation to her estate and is satisfied that the benefits conferred on the beneficiaries named in the 2021 Will are fair and reasonable and satisfy her moral obligations (if any) to each of them (clause 7).

The 2019 Will

The 2019 Will, dated 13 December 2019, was similar to the 2021 Will, save that: 1. Mr Bone was left all paintings, sculptures and items of fine art in the Clontarf Property and the Main Beach Property (clause 3(d)(ii)); and 2. Mr Bone was not left a life estate. Importantly, it was in this 2019 Will that Mr Bone received one third of the income of the testamentary trust.

The 2018 Will

The 2018 Will may be summarised as follows: 1. a gift of $100,000 to Ronnie Ransfield (clause 3(a)); 2. a legacy of $100,000 to Erin Louise Tharpe, "the daughter of my lucky friend Steven Rundle Bone" (clause 3(b)); 3. a gift of her womanly effects in the same terms as the 2019 Will and 2021 Will to Anne Petith and her daughters Elise and Chantelle (clause 4); and 4. the residue of her estate being held in a testamentary trust to continue for 20 years from the date of her death with one half of the income distributed to Ms Quintus and one half to Mr Petith and his wife, Anne Petith, with the Trust on vesting to be distributed to four charities (clause 5).
The Codicil introduced a legacy of $1 million to Mr Bone.

The 2014 Will

The 2014 Will may be summarised as follows: 1. a gift of $100,000 to Ronnie Ransfield (clause 3); 2. a gift to Anne Petith and her daughters Elise and Chantelle of all of her personal effects and personal possessions (clause 4); 3. the residue of her estate to be subject to a testamentary trust to vest 20 years from her death, with the income to be split, one half to Ms Quintus and one half to Mr Petith and Anne Petith (clause 5(a)(ii)(A)); and 4. on vesting, the assets of the trust inclusive of income and capital must be distributed equally to six charities (clause 5(a)(ii)(B)).
Looked at from oldest to newest, the Wills maintained the same structure of particular legacies, a testamentary trust with the residuary estate after the testamentary trust comes to an end being left to various charitable institutions. The principal change in the Codicil, the 2019 Will and the 2021 Will were increases in Mr Bone's legacy - first $1 million, then a one third share of the income of the testamentary trust and finally a portable life estate in relation to the Clontarf Property.

General observations of the witnesses and their credibility

The principal lay witness was Mr Bone. He was extensively cross-examined over nearly three days, mainly by senior counsel for Mr Petith but also by counsel for the NSWTAG in relation to his fallback claim for provision.
Mr Bone struck me as quite a determined witness who, at times, gave his evidence in a combative way. He appeared to me to have a very firm belief as to his entitlement to receive the benefits given to him under the 2021 Will, either under that will or by way of an order for provision or further provision under the Act. He was quite unwilling to compromise in any respect. As he said on several occasions, if Gail "hadn't gotten cancer and died", he would have continued to live quite a lavish lifestyle at Gail's expense, either in the Clontarf Property or in a similar residence.
One example of his unwillingness to compromise concerned alternative residences available to buy or rent in or near his neighbourhood.
The principal area where Mr Bone's evidence was really questioned in a relevant sense, concerned his alleged discussions with Gail and the extent to which the many communications which he sent to Mr Lakos, particularly in 2021 after Gail's cancer diagnosis, were in fact discussed with Gail or were Mr Bone's own thoughts. In some respects, Mr Bone's oral evidence of his discussions with Gail was at odds with the emails, which causes me to be very cautious about accepting Mr Bone's oral or affidavit evidence. One example in this regard is the alleged conversation on 12 April 2021. This was shown to be incorrect in several respects and it is also likely that there were earlier conversations which Mr Bone either could not recall or chose not to give evidence about. An associated point is the inconsistent evidence given by Mr Bone concerning when he had decided to stay in Australia.
Against this however, Mr Bone did make a number of concessions which were against his interests. One such example was his admission of drafting emails to Mr Lakos, purportedly written by Gail, on 25 November 2019, 29 November 2019 and 9 December 2019. Another is his ready acceptance that he remained in the hospital room with Gail when she made her 2021 Will.
I approach his evidence with caution appropriate to cases where interested beneficiaries give evidence of conversations with deceased persons: see Eggins v Robinson [2000] NSWCA 61 at [26] per Sheller JA; see also Chant v Curcuruto [2021] NSWSC 751 at [262]ff per Hallen J.
The evidence of the remaining witnesses for Mr Bone, being Ms Renee Emanuel and Ms Julia Hewlett, who were both working at the hospital and witnessed Gail signing her 2021 Will, Ms Quintus, Ms Patricia Pizem, a long term close friend of Gail's, Ms Jennifer Turner, a long term friend of Gail's who would look after the Clontarf Property while Gail was away, Bishop Robert Michael McGuckin and Mr Ronnie Ransfield, was quite limited. As was the evidence of the witnesses for Mr Petith, being Mr Petith himself, Anne Petith, Mr Wessel Wessels and Mrs Nicky Wessels, Gail's neighbours. None were seriously challenged. No credit challenges were advanced in closing submissions.
For the most part, each was giving evidence about what they observed of Gail, either in person or over the telephone, including her behaviour when under the influence of alcohol. Where the principal issue in the case is Gail's testamentary capacity at various particular points in time, which must involve an assessment of all relevant material at each particular time, including medical evidence of which the witnesses were largely not aware, and must address the matters relevant to testamentary capacity, only limited assistance can be gained from observations made at irregular intervals over many years and which for the most part do not deal with the particular matters relevant to capacity. That said, each of their evidence was of some assistance.
Dr Lim was Gail's long term GP. He made an affidavit on 19 April 2022 on behalf of Mr Bone. Unfortunately, Dr Lim passed away before the hearing and was thus not available for cross-examination. I admitted his evidence over objection on the basis that I would have regard to the well-known principles applicable in this regard: Fulton v Fulton [2014] NSWSC 619 at [111] per Hallen J.
Dr Lim's evidence went to his dealings with Gail up to her death and were to the effect that she appeared lucid, especially at the time of their last conversation which occurred over the telephone on 26 March 2021. At no time did Dr Lim administer any tests to determine her cognition as he did not consider that there was any need to do so. Dr Lim was also a visiting medical officer at Manly Waters. His affidavit asserts, in effect, that despite her heavy drinking and refusal "to go to detox", her various falls, and later her chemotherapy - all of which Dr Lim was cognoscente of at the time - Dr Lim did not have any concerns about Gail's mental capacity to know and understand what a will is and what her assets were and to identify, evaluate and discriminate between the claims of potential beneficiaries of her estate. Dr Lim opined that her mental capacity was wholly unaffected by any medical condition from which she suffered at the time. This cannot be correct as there were a number of cognitive assessments carried out at Manly Waters which raised concerns. This causes me to have considerable doubts as to the reliability of Dr Lim's recollection and, having considered the totality of the evidence, I place no weight on his affidavit evidence.
The parties jointly retained Professor John Watson, a highly respected neurologist, to express various opinions on a retrospective basis as to Gail's testamentary capacity on the dates of the Wills. Professor Watson was then cross-examined by each of the parties. The cross-examination lasted for nearly a day. The whole process of engaging Professor Watson and his cross-examination was highly efficient and of great assistance. The parties are to be commended in this regard. I was greatly assisted by Professor Watson's evidence. However, a significant limitation on his evidence was the fact that he was not Gail's treating doctor and his opinions on Gail and her condition were provided on a retrospective basis principally by reference to material provided to him, rather than having had the benefit of seeing and assessing Gail. As Professor Watson admitted, this was a significant limitation. I have ultimately placed principal reliance on the contemporaneous material.

The factual chronology

I set out below the factual chronology. Where there was a dispute on the evidence that is relevant to the issues to be decided, I set out my resolution of the dispute. The chronology is necessarily detailed and therefore lengthy. Given the absence of witnesses, principally Mr Lakos, a determination of Gail's capacity at relevant points in time involves a detailed review of the chronological material.

The early years

It begins with a brief overview in relation to Gail. She was born in 1955 and represented Australia in the 1974 Miss World competition, where she was the runner up.
In the mid-1970s, Gail married Ian Gow but they were divorced after two or three years. For a period, she worked as a police officer. Her father was a police officer as was her brother, Mr Petith. She resigned from the police force after a few years.
In the late 1970s, Gail married her second husband, Werner Thelen (Werner). Together they accumulated considerable wealth and appeared to have a rather envious lifestyle, including travelling the world on cruise ships. It does not appear to be dispute that they were each heavy drinkers. Mr Petith gave unchallenged evidence that Gail became a heavy drinker during her marriage to Werner.
At some stage, the evidence does not identify when, Gail worked for Mr Lakos in his law practice. Mr Lakos was admitted to practice in 1971. Mr Lakos provided legal services to Gail and Werner for a number of years and was responsible for the drafting of each of the Wills.
The evidence was reasonably consistent that Gail had been a heavy drinker for many years, dating back to her time in the police force. Ms Alice Quintus, Gail's sister-in-law, dated it back to as early as 1980, the first time she met Gail, noting that since this time, Gail would drink "a lot of alcohol…drinking in the morning…afternoon and…at night". Ms Patricia Pizem and Mr Ronnie Ransfield - two other long time friends of Gail's - gave similar evidence of heavy drinking from the early days.
There is some suggestion that Gail may not have started drinking heavily until the period leading up to 2014 when Werner was sick. Mr George Weissel, a long time friend of Mr Petith said it was not until attending the wedding of Mr Petith's daughter in 2014 (apparently June 2014) that he observed Gail to be a heavy drinker. Mr Weissel was not cross-examined. There does not appear to be any dispute that Gail was heavily intoxicated at this event and that this was a source of lingering tension between Mr Petith and Gail. Given that Mr Weissel, on his own evidence, would only occasionally see Gail, I do not regard this evidence as of much assistance in terms of when the heavy drinking started. It is against the weight of the evidence that the heavy drinking started much earlier. In any event, I do not need to go too far on this issue because Professor Watson said his opinions would be the same even if the heavy drinking had only commenced in 2014, as opposed to the 1980s.
Werner passed away on 10 September 2014. It was shortly after his death that Gail made the 2014 Will, drafted by Mr Lakos. Werner had been diagnosed with Parkinson's disease in about 2006 and Gail became his primary carer. It appears that this role took a toll on Gail and may have exacerbated her already heavy drinking.

Gail meets Mr Bone

In November 2014, Gail went on a cruise from Barcelona to Singapore. She had originally planned to go on the cruise with Werner. It was on that cruise where she met Mr Bone, an American citizen. He was working on the cruise providing estate planning and wealth management courses to passengers. Mr Bone was a qualified lawyer who was licensed to practice law in the States of Indiana in 1976 and New Mexico in 2002. He came to specialise in estates, tax, trusts and family wealth planning, including drafting trust instruments and wills. In 1985 he founded a company, Wealth Development Resources LLC in Indiana to promote various specialised financial/estate planning services.
Mr Bone and Gail quickly formed a romantic relationship. Mr Bone extended his time on the cruise, moving into Gail's cabin to spend the remainder of the cruise with her after he was scheduled to leave the cruise.
After the cruise was over, Gail went to visit Mr Bone in Santa Fe, living with him between 10 March and 14 May 2015. Thereafter the two appeared to be quite inseparable, dividing their time between Sydney, the Gold Coast and Santa Fe, where Mr Bone had his residence, and going on holidays together. They were primarily only separated when it was necessary for one or the other to return home due to visa requirements.
Mr Bone gave evidence, which did not appear to be seriously disputed, that the two spent only 11 months apart between when they first met in late 2014 and when Gail died in April 2021. Their love and affection for each other did not appear to be seriously in dispute.
It would appear that Gail continued to drink quite heavily and on a daily basis throughout their entire relationship.
Given the issues in the proceedings - principally concerning testamentary capacity and alleged undue influence in relation to the 2018 Will, the 2019 Will and the 2021 Will - it is convenient to pick up the chronology at the start of 2018.

2018

During the period from at least January 2018 to April 2021, Gail was in and out of hospital and rehabilitation care. There was considerable documentation in evidence recording her condition at various times throughout this period. I set out below the relevant entries with the dealings surrounding the making of the relevant testamentary documents interspersed.
The records begin on 12 January 2018 when Gail was admitted to the Northern Beaches Hospital (NBH) after falling down. At the time, Mr Bone was living in Australia with Gail at the Clontarf Property. He travelled back to Santa Fe on 21 May 2018. The emergency department assessment records note that Gail reported that she had not had a drink for three days because she had run out of wine at home. Under the heading "ETOH" (a medical abbreviation used to describe anything related to alcohol), the records state: Drinks 1-2 bottles of wine a day Starts drinking -9am Has Been drinking 1-2 bottles a day for st [sic] least 3 years - difficult to get exact time Had 48hrs without ETOH last year while on holidays - Steve states Gail was close to having a seizure and needed medical attention Gail states able to go 2 weeks without ETOH last May without a problem Denies withdrawal sx if doesn't drink Steve states Gail will hide the wine and mix with other drinks or use multiple small glasses Was carer for husband who had Alzhiemers [sic] and passed away - significant stressor Was Police woman - "everyone drank" - significant stressor Nil attempts at detox Doesn't feel guilty about drinking Doesn't regret drinking Doesn't feel she should cut back If she were to cut back it would so Steve wouldn't leave her Doesn't think anyone comments on her drinking however Steve states people do
The hospital records indicate that Gail was given thiamine intravenously (Professor Watson said that this was standard for patients admitted with excess alcohol consumption). The final entry was to the effect that Gail was "Advised to continue drinking in order to avoid withdrawal". She appears to have followed that advice.
On 13 January 2018, Gail and Mr Bone went on a fishing trip with Mr Petith at Forster for five days and also took a short cruise on the Queen Mary II between Sydney and Brisbane. Mr Bone had foot surgery in March 2018 and Gail cared for him after his discharge from hospital at the Main Beach Property and then at the Clontarf Property.

The making and execution of the 2018 Will

On 15 June 2018, Gail executed the 2018 Will.
According to Mr Bone, in May 2018, Gail handed him a copy of her 2014 Will and asked him to have a look at it and tell her what he thought. He looked at the 2014 Will, making notes on a copy. They then had a discussion where Gail apparently asked Mr Bone whether she could do something for him in her will. He said she didn't need to do anything for him and Gail then raised giving $100,000 to Mr Bone's daughter. Mr Bone said that would be okay if that is what she wanted to do and Gail decided to give Mr Bone's daughter $100,000.
Arrangements were made for Gail to confer with Mr Lakos on 17 May 2018. A conference took place on 17 May 2018, which was also attended by Mr Bone. Mr Bone could not recall how he participated in that meeting or what was said.
On 19 May 2018 Gail, sent an email to Mr Lakos with the subject "Re: my Will!" providing Mr Lakos "as promised" with further details of the addresses for her niece Chantelle, Tim and Sue Bowen and Alice Quintus. The email was signed off "Big Regards, Gail".
On 22 May 2018, Mr Lakos emailed Gail, copying Mr Bone, attaching updated drafts of her will, an Advanced Care Directives document and an Appointment of Enduring Guardian document. Mr Bone and Anne Petith were proposed to be her guardians.
By the time Mr Bone had returned, or was en route, to Santa Fe, he was then involved in reviewing the draft documentation that had been circulated. Mr Bone took to emailing Mr Lakos directly with his comments, which he did by email dated 25 May 2018. Mr Bone's email ended with: Thanks for jumping on this project. There is a real need to treat it with urgency!
Mr Lakos responded to Gail, copying Mr Bone, in relation to Mr Bone's comments. Mr Bone then emailed Gail with his comments on what Mr Lakos had said. Gail then spoke to Mr Lakos on 1 June 2018 in relation to the draft documents. There were then further drafts circulated and then discussed between Gail and Mr Bone, with Mr Bone then engaging in further communications with Mr Lakos. Mr Lakos sent a detailed email on 13 June 2018 to Gail and copied Mr Bone, in which he responded to Mr Bone's queries.
Gail executed the 2018 Will on 15 June 2018. Mr Lakos had arranged for an independent solicitor, Ms Jessica Swain, to attend on the execution of the 2018 Will and associated documents. Mr Lakos had arranged for her attendance, through her then employer, Uther Webster & Evans Solicitors, to provide a certificate of witnessing and advice in relation to the enduring power of attorney and Appointment of Enduring Guardian. This was necessary because Mr Lakos was to be appointed one of her enduring guardians.
Ms Swain witnessed Gail's execution of the 2018 Will. Ms Swain made two affidavits - the first confirming that she witnessed Gail's signature on various documents executed on 15 June 2018 and the second setting out her usual practice when witnessing a will, which included making a preliminary assessment of the client's mental capacity. Ms Swain said that to the best of her recollection, she followed her usual practice on 15 June 2018 and did not have any concern as to the mental capacity of Gail. She gave general evidence that Gail gave clear and coherent responses to questions. Ms Swain was not required for cross-examination.
Gail appointed Mr Lakos, Mr Bone and Anne Petith as her enduring guardians.

2018 after the 2018 Will

Gail went to Santa Fe to join Mr Bone on 22 June 2018 and remained there until 18 September 2018, when she returned home due to her visa requirements. Mr Bone had further foot surgery during this period and Gail looked after him.
Whilst she was away, she received an email from Mr Lakos dated 26 June 2018 confirming what had transpired on 15 June 2018, attaching copies of her new 2018 Will and Advanced Care Directives, together with a copy of his tax invoice for his recent work. On 1 July 2018 Gail, sent an email to Mr Lakos in response, notifying him that she was away in America until September and could not attend to the payment of his invoice until her return. On her return, she arranged for the invoice to be paid and sent an email to Mr Lakos on 21 September 2018 telling him that her cheque was in the mail.
Gail was admitted to the Gold Coast Hospital on 1 December 2018. Mr Bone brought her to the emergency department at 9.55 am following a fall while intoxicated. Her blood alcohol level is recorded as 0.25 at 10.55 am. The records note that Gail "Currently drinks 2 bottles wine daily, often drinks in mornings".
The emergency department clinical examination notes record that there have been multiple recurrent falls, worsening over the past few months with three falls since yesterday, and that Gail had struck her head twice in the last 24 hours. The entry in the Progress Notes for the evening of 1 December 2018 include: Currently not keen to really think about stopping alcohol intake Partner describes short term memory not the best and sometimes mood swings
A CT scan of Gail's head was performed on 1 December 2018. The conclusion included: Ventricular prominence slightly disproportionate to degree of sulcal atrophy with no evidence of obstructing lesion or transependymal CSF spread may reflect normal pressure hydrocephalus, clinical correlation recommended.
Gail and Mr Bone returned to Sydney from the Gold Coast on 4 December 2018.
On 12 December 2018 Gail, was admitted to NBH after a fall. The ambulance record includes that Mr Bone advised that Gail "drinks 2 bottles of wine/day however [Gail] only admitting to 1 bottle wine/day". She remained in hospital until 14 December 2018. When questioned about this entry, Mr Bone said that the reference to two bottles was "from time to time" but speaking in general terms it was one to two bottles a day. He later said when she was drinking one to two bottles a day "she could function normally" including driving a motor vehicle. Gail did not stop driving until about mid-2020.
An entry made by Emma Myers, a registered nurse on 13 December 2018 includes "patient is a poor historian". Mr Bone agreed with this statement at the time. The entry goes on to record that Gail was experiencing alcohol withdrawal symptoms at the time and Professor Watson agreed that one would expect someone experiencing these symptoms to be a poor historian. Gail apparently had two falls in hospital on 13 December 2018.
The Social Work review on 13 December 2018 records Gail acknowledging that she drinks too much but that she did not wish to engage with any rehabilitation services. There are many references to rehabilitation services in other hospital records at the time and later. It was a recurring theme. It was not only health professionals that encouraged Gail to seek long term help. Those closest to her did the same. They all tried to make her go to rehab, but she said no, no, no!
A cerebral MRI was performed on 13 December 2018. Under the heading comment, the report by Dr Tim Mander-Jones stated: No acute infarction. In the presence of the clinical triad of incontinence, memory loss and gait disturbance together with the asymmetric prominence of ventricular system relative to the overlying gyri underlying normal pressure hydrocephalus (NPH) should be considered.
Mr Bone agreed that at the time Gail was having balance issues and when she had too much to drink, her memory was not as good as it should have been.
Professor Watson had access to and reviewed these cerebral MRI scans and the accompanying report of Dr Mander-Jones. Professor Watson gave evidence that the report suggested "some abnormality of flow in the CSF [cerebrospinal fluid] through the particular channels where it has to flow". Professor Watson agreed with the proposition put to him by senior counsel for Mr Petith that the fact that ventricles were very large was indicative of the potential NPH condition being "well-developed".
A CT scan of Gail's brain was also performed on 13 December 2018. The report written by Dr Mark Wilkinson includes: There is prominence of the ventricular system that may relate to central parenchymal volume loss. No mass lesion, mass effect or midline shift. No parenchymal haemorrhage or extra-axial collection. There is periventricular and deep white matter hypodensity consistent with chronic small vessel ischaemic change. Grey-white differentiation is preserved.
Professor Watson explained Dr Wilkinson's discussion of the "periventricular and deep white matter hyperdensity of chronic small vessel ischemic change" by reference to the white matter being "like the circuit board" and the grey matter, the neurons, being the "chips on the circuit board". Essentially, Professor Watson highlighted that, in the presence of white matter disease, there is "often significant inefficiency in how signals come into the brain, go out of the brain, and are transmitted across the brain to several areas". In relation to the parenchymal volume loss, Professor Watson interpreted this reference by Dr Wilkinson as an allusion to brain atrophy and NPH.
The Progress Notes record a neurological consultation on 14 December 2018 which includes a reference to "midline cerebellar atrophy" under the heading "MRI reviewed". The Progress Notes go on to state "gait disturbance more likely form [sic] cerebellar dysfunction frpom [sic] long term ETOH than NPH".

2019

Gail was again admitted to the emergency department of NBH on 6 February 2019. She was brought in by ambulance called by Mr Bone after she fell on the kitchen floor after slipping from the staircase, hitting her head, with the ambulance report noting a laceration to her left eye. The discharge summary records multiple falls on 6 February 2019 and that Gail had "1-2 bottles of wine last night." The ambulance electronic record also refers to Gail having had a head strike as well as a history of "brain lesion affecting balance" and that her breath smelt of alcohol. The discharge summary also records on examination there was "Nil nystagmus". Nystagmus, according to Professor Watson, is a common ophthalmic sign and an early indicator of thiamine deficiency and is one of the characteristics of Wernicke encephalopathy. It also appears that thiamine was given to Gail while in hospital, a matter relied on by Professor Watson.
On 12 February 2019, Mr Bone and Gail met with their GP, Dr Lim at his surgery in Seaforth. Dr Lim told Gail that her life expectancy, if she did not quit drinking was 6 months to 6 years maximum. He also said that: Alcohol has damaged Gail's cerebellum in the back of her brain and that damage is affecting her balance.
A further MRI of Gail's brain was carried out on 18 April 2019. The report prepared by Dr Sunil Kaniyur records a history of "?cerebellar atrophy ?NPH" being a reference to normal pressure hydrocephalus. Two conclusions are stated in the report: 1. There is global disproportionate cerebral and cerebellar atrophy with background mild to moderate microvascular disease. 2. Morphological normal pressure hydrocephalus but with the CSF flow study suggesting a degree of compensation with the flow perimeters in the normal range. This is of uncertain functional or clinical significance.
Professor Watson referred to these scans when deposing to the fact that Gail's mammillary bodies had "significantly atrophied", which was one of the bases upon which Professor Watson formed the view that Gail was already suffering from Korsakoff syndrome at this time.
On 25 April 2019, Gail and Mr Bone flew to Tahiti and embarked on a 17-day cruise. Mr Bone returned to Santa Fe from Sydney on 21 May 2019.
Prior to departing, on or about 13 April 2019, Mr Bone had a discussion with Mr Lakos on the phone. It is not entirely clear who initiated the call, likely Mr Bone. Mr Lakos could not locate the Appointment of Enduring Guardian document executed the year earlier, which had been sent to Anne Petith for her signature, then returned to Gail, such that she could take the document to the US for Mr Bone to sign. Mr Lakos noted that he never received the executed original document and he asked Mr Bone whether he could locate it. Mr Bone wrote back that he could not locate the document in the Clontarf Property and that Gail believed she had left it in Mr Bone's house in Santa Fe. On 22 April 2019, Mr Bone requested for at least a partially executed copy to be sent to Gail, such that Mr Bone could execute this copy. A copy of the document, which was partially executed, signed by Gail and Mr Lakos, was sent to Mr Bone on 23 April 2019.

The May 2019 Codicil

On 17 May 2019, Gail and Mr Bone attended a conference with Mr Lakos, where Gail informed Mr Lakos that she wanted to gift $1 million to Mr Bone in her will. Mr Lakos prepared a draft codicil and sent it to Gail on 20 May 2019. As set out above, Mr Bone returned to Santa Fe on 21 May 2019. On 22 May 2019, Gail emailed Mr Bone raising an issue about Mr Bone's address as stated in the draft codicil and asking him to liaise with Mr Lakos about his. Mr Bone emailed Gail and Mr Lakos his correct address and a revised draft was emailed on 23 May 2019. Mr Bone was in Santa Fe at the time.
An appointment was made for Gail to attend on Mr Lakos to execute the Codicil on 30 May 2019, which duly occurred. Her signature was witnessed by Mr Lakos and his secretary Ms Pauletta Sghabi.
Ms Sghabi made three affidavits but was not required for cross-examination. In relation to the Codicil, Ms Sghabi said she did not recall the details of her meeting with Gail to witness the Codicil.
Mr Lakos' file also contained a handwritten file note of Mr Lakos' dealing with Banks v Goodfellow (1871) LR 5 QB 549 (Banks v Goodfellow). It was agreed between the parties that having regard to the location of this note in Mr Lakos' file, it was likely prepared at the time of the Codicil.

The second half of 2019

After executing the Codicil, Gail joined Mr Bone in Santa Fe. They returned to Sydney in early September 2019.
Whilst overseas, Gail was emailing her friend, Ms Jennifer Turner, back in Sydney. For example, on 23 July 2019 she sent an email to Ms Turner dealing with a number of topics, including Mr Bone's foot and his recovery from surgery, that Mr Bone has recently been issued with his Australian visa and so hopefully would be returning with her to Australia on 3 September 2019, and where they would then be travelling. She asked Ms Turner whether she would be prepared to house sit for Gail again.
She had earlier sent an email to Ms Turner on 3 July 2019 updating Ms Turner on Mr Bone's health and her own health and, in particular, her "good days and not so good days due to dizziness".
These emails obviously bear somewhat on Gail's cognition at the time. The absence of any such communications at the time of the 2021 Will is also quite important. A further small insight into Gail's cognition at or around this time was given by Mrs Nicky Wessels, Gail's neighbour at Clontarf, who gave evidence that in the last part of 2019, Gail had told her that she had left $1 million in her will for Mr Bone.
According to Mr Bone, prior to their return to Sydney, he had observed that Gail sometimes had difficulty balancing, whether or not she had been drinking, and occasionally leaned on him for support. After September 2019, Gail began to stumble more often and to have more falls, but she was able to pick herself up and was not injured until her fall on 24 October 2019.
On 24 October 2019, Gail had a fall on the inside garage stairs at the Clontarf Property that left her bleeding from the head and unconscious on the lower landing floor. She was conveyed by ambulance to the Royal North Shore Hospital. On admission her past medical history as recorded included "chronic ETOH" and "no detox or rehab; not interested in ceasing ETOH". It was recorded that she had approximately one litre of wine on board. Mr Bone said he doubted it was much more than that because he thought it was fairly early in the morning.
The Discharge Summary records that Gail's recollection of how she fell was different to Mr Bone's recollection. Mr Bone also reported that Gail had had an earlier fall on 24 October 2019 "from standing height".
The Discharge Summary also records "normal eye movements, no nystagmus". In cross-examination, Professor Watson opined that all that could be drawn from this entry was that Gail did not have nystagmus on this occasion.
A CT of Gail's brain was performed on 24 October 2019. It found: There is a small acute extra-axial haematoma overlying the left temporal lobe measuring 5mm in depth associated with small volume sulcal acute subarachnoid haemorrhage. No significant mass effect. No acute transcortical infarct. Moderate generalised cerebral volume loss. Bilateral periventricular white matter hypodensity reflects background chronic microvascular angiopathy.
A further CT of the brain was performed on 25 October 2019. There was no change reported from the CT the day earlier. The report notes "no hydrocephalus".
Gail remained in hospital until 6 November 2019. A report to Dr Lim by the Neurosurgical Registrar dated 11 November 2019, after the Registrar had seen Gail, records that: Since review, it does not appear she has had any major symptoms although I suspect there is a degree of confabulation.
It was put to Professor Watson that the suspected confabulation recorded by the Registrar was more likely to relate to the effects of the fall than the Korsakoff syndrome. Professor Watson did not agree. Persons suffering amnesia as a result of a fall do not necessarily confabulate. Professor Watson regarded the observation as an unusual one, particularly by a neurological registrar, which Professor Watson placed some weight on.
During this period, Mr Bone kept a diary record of how alcohol was affecting Gail. Between 12 September and 30 November 2019, he recorded at least 15 falls, the most serious being the 24 October 2019 fall.
On 16 November 2019, Mr Bone met Dr Lim alone and was apparently told: [Gail] should get her affairs in order as soon as possible. Her falls have become serious and life threatening. It would not be wise for you to take your cruise next month.
Mr Bone then told Gail what Dr Lim had said.

The making and execution of the 2019 Will

This discussion with Dr Lim, and Mr Bone subsequently telling Gail, appears to have been a catalyst for a discussion between Gail and Mr Bone about her estate plan. The discussion appears to also have been in the context of the cruise that Gail and Mr Bone were planning on going on to Antarctica in late December 2019. In cross-examination, Mr Bone said that it was probably him that raised or "implemented" the conversation.
According to Mr Bone, in his affidavit evidence, Gail raised the topic of how her 2018 Will was going to provide for Mr Bone if she did not survive the cruise. She apparently said that she wanted to leave the Clontarf Property to Mr Bone so that he could keep living in Sydney after Gail died but he said he was not emotionally prepared to make Sydney his permanent home without Gail. Mr Bone also said that at that time he did not have a permanent residence visa for Australia. Mr Bone was challenged on this evidence in cross-examination. I deal with this challenge below. I do not accept Mr Bone's evidence in this regard about not having formed a view as to staying in Sydney.
Mr Bone said in his affidavit evidence he could not recall in detail the entirety of the discussions he had with Gail or their consequence.
The documents and email communications, including with Mr Lakos, provide a fairly reliable guide as to what occurred.
Gail attended the Neurosurgery Clinic at the Royal North Shore Hospital on 18 November 2019. She had a fall when entering the clinic and "face planted but did not lose consciousness".
On 22 November 2019, Mr Lakos made a handwritten file note of a telephone attendance on Gail recording that she had decided to alter her 2018 Will in two respects. First, "On GT's death, 100% interest in Clontarf property to Steve B" and "Ensure brother Paul is excluded - (other than his participation in income from Testamentary Trust)".
On 25 November 2019, an email was sent from Gail's email account to Mr Lakos, copying Mr Bone referring to a conversation from the previous week. Mr Bone admitted that he drafted the email after a discussion with Gail.
The email stated that Gail wanted to add a specific bequest of the Clontarf Property to Mr Bone to the specific cash bequest she had already given him. In relation to this aspect of Gail's instructions, Mr Bone said in cross-examination that this was not something he wanted. He said it was never his intention to get a fee simple in the Clontarf Property, because at this time he was not ready to commit to living in Australia at that time. Mr Bone was challenged on this evidence as to whether he had decided to live in Australia by this time. I do not accept Mr Bone's evidence for the reasons set out below.
The email also indicated that Gail wanted to leave all of her tangible personal property to Mr Bone, save for her Volvo, which was to go to Mr Ransfield and her jewellery, which was to be divided among her sister-in-law and nieces.
The email concluded: Given that my health has not been good and we are about to leave the country for South America, I'd like to get this taken care of before we leave Sydney on 17 December.
Mr Lakos sent a draft of the 2019 Will on 27 November 2019 to Gail. On 29 November 2019, another email was sent to Mr Lakos, ostensibly from Gail but again drafted by Mr Bone. The email stated that there were a number of misunderstandings and that Mr Bone and Gail had discussed her intention in more detail and she wished to make them clearer.
Two matters were clarified. First, as regards the division of her personal, "womanly" effects, such as her jewellery and clothing. Second, the personal tangible property that was to be given to Mr Bone. In relation to the latter, the email stated: I wish for him to be able to take possession of and occupy any Sydney residence after my death, indefinitely and without any disruptions regarding house contents.
The email also asked whether a "no contest" clause could be included in the 2019 Will. This was in the context of an apparent concern that Mr Petith may seek to attack Gail's 2019 Will.
Mr Lakos' file contains a copy of an article that had appeared in the December 2019 Law Society Journal entitled "Practical tips for dealing with knowledge and approval of a will" suggesting he was alert to the issue of testamentary capacity or undue influence at the time.
Whilst Mr Bone did not have a permanent residence visa for Australia at the time, he was certainly considering applying for one. On 2 December 2019, Mr Lakos emailed Gail with a referral to an immigration lawyer. In cross-examination, Mr Bone admitted that by November 2019 "we were well on our way" to having an application for him to live in Australia on a permanent basis, completed. There was then the following exchange: Q. So, I suggest to you, sir, that the fact that you had started seeking that visa to enable that to happen meant that you had formed the view, as of November 2019, that you intended to continue living in Australia, particularly in Sydney, particularly in Clontarf, long-term moving forward. Correct? A. Yes.
This evidence is flatly inconsistent with Mr Bone's evidence set out above that at the time of the lead up to the making of the 2019 Will, he had not decided to stay in Sydney and that this was a reason he gave to persuade Gail not to leave him the Clontarf Property. It is also inconsistent with Mr Bone's other evidence in relation to what occurred in 2021 (which I deal with below) that his circumstances had changed between 2019 and 2021 in that it was not until 2021 that he had decided that he wanted to live permanently in Australia. I do not accept Mr Bone's evidence in this regard. The contemporaneous emails which I set out below are also flatly inconsistent with Mr Bone's suggestion that the reason why Gail did not leave the Clontarf Property to him was because he had not decided whether he wanted to stay in Sydney. The emails are more reliable.
Mr Lakos sent a revised draft of the 2019 Will to Gail and Mr Bone on 2 December 2019 together with a covering email responding to the matters raised in the 29 November 2019 email.
Mr Bone then responded directly by email to Mr Lakos dated 7 December 2019, copied to Gail. The email is quite significant at several levels and so I set it out in full: When Gail and I went over the latest draft of her will, it all appeared to be what she thought she wanted and that which she directed. However, that proved not to be the case when she asked me about the ramifications of gifting the Clontarf property ("Clontarf") to me outright and absolutely. When I explained that Clontarf (or whatever is left of its value, regardless how it's invested at my death should I decide to sell it) would pass into my living trust, that lead her to question what happens to the remainder of my trust estate when I die. I explained that the remainder at my death will pass to the heirs and the charities I've designated to receive it as I've directed. Gail responded by making it clear she does not wish for my daughter or any of my other heirs/beneficiaries to receive any interest in Clontarf (or any proceeds from its sale by me in the future) at my death, regardless how I might invest any Clontarf sales proceeds in the future. Until she asked that question, she did not understand the legal ramifications of making an absolute, testamentary gift of Clontarf to me. Now that she understands, I explained that leaving Clontarf to me outright would not be what she intends. We discussed several possible solutions to address her concern; but only the following one is acceptable to both of us. Rather than giving Clontarf and her tangible personal property to me outright or in a separate sub-trust for my life, the only gift she would be making to me, in addition to my existing $1M cash bequest, is a 1/3 interest in the trust income generated by her testamentary trust for the shorter of its 20-year term or my life. If the trust is still in existence at my death, my 1/3rd income interest would be split as of my death among the surviving income beneficiaries in shares equal to their respective, percentage, income interests as they exist at that time, for the remainder of the trust term. Also, the draft appears to be lacking a specific instruction as to when/how often trust income distributions are to be made. A provision needs to be added requiring these distributions to be made by the Trustee (in Australian Dollars) each calendar year on a quarter-annual basis. Any solution more legally-complicated than this appears to be a bit much for her to comprehend at this time. I'll ask Gail to confirm these changes to you via her own email when she's ready.
The stated reason for Gail's change of mind was not wanting Mr Bone's daughter to receive any interest in the Clontarf Property after he dies. At various times in his evidence, Mr Bone sought to link the change to a concern about US taxes, but I do not accept this evidence. There is also nothing in the email to support Mr Bone's later assertion that he was not intending to reside permanently in Australia at this point in time. This is also refuted by other contemporaneous documents. I thus reject Mr Bone's evidence in this regard.
The concluding paragraph also suggests that, at the time, Mr Bone was concerned about Gail's ability to comprehend certain matters. Mr Bone said that this last paragraph was referring to all of the matters in the email, not just the matters in the penultimate paragraph. The final paragraph refers to a "solution". The only solution referred to in the body of the email is giving Mr Bone a one third interest in the income of the testamentary trust to deal with Gail's concern in not wanting to gift the Clontarf Property outright. Mr Bone's view was that Gail was not able to understand the notion of a life estate in 2019. He also agreed that Gail's condition, both mentally and physically had deteriorated greatly between 2019 and 2021. This is a matter of some significance in relation to whether the 2021 Will should be admitted to probate, which I deal with later in these reasons.
Mr Lakos responded later that day. His response included: For completeness I observe that when in due course Gail approves the final draft and attends my office to sign, I will again explain to her in detail the meaning of each provision including potential inheritance claims arising. Accordingly, before she signs, I will verify that she fully comprehends all provisions and that these accurately reflect her wishes.
By email dated 9 December 2019, Gail asked Mr Lakos to help her make sure that she had signed everything required to make sure all superfund assets will pass into her testamentary trust at her death.
By further email dated 9 December 2019, purportedly from Gail but drafted by Mr Bone, Gail confirmed to Mr Lakos that Mr Bone's email to Mr Lakos accurately described her concerns about gifting the Clontarf Property to Mr Bone and that she wanted to substitute that proposed gift to him with a one third lifetime income interest in the testamentary trust.
Mr Lakos sent a further draft of the 2019 Will by email to Gail, copying Mr Bone on 10 December 2019. A couple of hours later, Mr Bone responded suggesting a change referable to the lifetime income interest to him. An hour later he sent another email to Mr Lakos in relation to his lifetime income interest.
On 11 December 2019, an email was sent from Gail to Mr Lakos, drafted by Mr Bone, confirming in relation to the lifetime income interests that if one class no longer survives, the remaining classes get half each and so on. It was suggested to Mr Bone that Gail did not understand what was being conveyed by this email. I do not accept this attack. Mr Bone's evidence was that this role was to suggest changes so that the words were clear and reflected Gail's intentions. I accept this evidence. There is also Mr Lakos' file note from 13 December 2019 which supports a finding that Gail understood all of the 2019 Will.
As at this time, Gail and Mr Bone were still going on their cruise. The evidence of Nicky Wessels, Gail's neighbour suggests that Gail was in a lot of pain at the time and perhaps a little morose. Gail apparently told her that she was planning on going on the cruise and jumping off the back of the boat because she was in so much pain.
Mr Lakos provided a further draft on the afternoon of 12 December 2019. The email concluded: Subject to your approval of the attached draft, I can meet with you tomorrow… to again explain the final document and witness your execution.
Mr Lakos met with Gail and Mr Bone on 13 December 2019 to execute her will. Mr Bone was present throughout the conference. Mr Lakos' handwritten file note begins with a series of entries in relation to Gail's current medical condition. The note then records: Other than periodic vertigo problems, feels fine - no pain able to enjoy holidays in Qld + cruises. Gail has followed evolution of latest version of will - has read in detail. Fully understands & is really pleased [with] structure. Read to [Gail] each clause - she fully comprehends & approves provisions - keen to sign. Proceed to execution.
The file note concludes with a signature and "1 ¼ hr" suggesting this was how long the conference lasted.
Gail's signature was witnessed by Ms Lia Oliver and Ms Sghabi. Ms Sghabi had no recollection of the meeting. Ms Oliver made an affidavit which simply confirmed her signature. Neither was cross-examined.
Ms Sghabi also gave evidence that after the 2019 Will was executed, she removed the original 2018 Will (including the Codicil) from Mr Lakos' records, and destroyed them, consistent with Mr Lakos' usual practice.

Late December 2019 and 2020

On 13 December 2019, Gail's GP, Dr Lim, diagnosed Gail with "vertigo due to cerebellar atrophy".
On 21 December 2019, Gail was again admitted to NBH where she remained until 30 December 2019. She presented to the emergency department after a fall down two steps, with a fracture of her "vertebra lumbar". A lumbar spine CT showed "acute L5 burst fracture with 10mm retropulsed fragment, moderate canal stenosis". By all accounts, it was a very significant fall. The Discharge Summary recorded "chronic ETOH- 2x bottles of wine a day".
The Occupational Therapy Discharge Referral recorded that Gail had reported "recent new urinal incontinence over the past 3 months", which had not been investigated and that she had started to wear "pull-ups at home".
The report also records that "ETOH use impacts decision making" and Mr Bone and Gail concur "3-4 falls per weeks recently, related to ETOH use".
On Christmas Day 2019, Gail and Mr Bone became engaged to be married. This was confirmed in a telephone conversation between Ms Pizem and Gail, and also between Ms Quintus and Gail.
Gail was discharged to Manly Waters Private Hospital on 30 December 2019 for rehabilitation. The Manly Waters Private Hospital admission and discharge summary notes "ETOH dependence ?up to 2 bottles/D (declines detox)". The Progress Notes record several occasions where alcohol was found in the possession of Gail and that it had been "brought into patient from friend or partner". She was discharged on 20 January 2020.
The Medical Admission History dated 30 December 2019 included in the "Admitting Diagnosis" one reference to "Cerebellar Ataxia Atrophy" and against "Cognition", recorded "confused at times". Professor Watson agreed that this tells you nothing about the type of confusion, whether it is minor or major.
While at Manly Waters, a Mini-Cog assessment of Gail was performed on 4 January 2020. Gail scored three out of five. A score of less than three has been validated "for dementia screening". Professor Watson opined that her ability to recall the three words suggests that Gail's working memory, rather than executive function, appears to be working all right. He would have expected someone who was affected on the more severe end of Korsakoff syndrome to have difficulty with that task. In relation to the clock drawing aspect, Gail scored zero out of two even though she drew all of the hands in roughly the correct position. The test is a blunt instrument with weaknesses. All that can be gathered from it is that there is some level of cognitive dysfunction and extra assessment/precautions may be needed.
On 11 January 2020, the Progress Notes at 1pm record "short term memory ↓" and at 3.20pm "reminded of need of supervision for gym work @ this stage - short term memory decline may be an issue there". Professor Watson regarded this as an important observation. Gail had to be reminded to be supervised, which implies memory problems.
Gail was re-admitted to Manly Waters on 30 January 2020 after having had spinal surgery at Royal North Shore Private Hospital on 24 January 2020.
A further Mini-Cog assessment was performed on 31 January 2020 and Gail scored two out of five. The assessment contains a handwritten notation "Reported cognition impaired" with a further reference to "pain meds", which Professor Watson regarded in cross-examination as an important observation as cognition may be impaired "through pain and pain med[ication]". He accepted that he should have mentioned this in his reports and his failure to do so was an oversight. Notes of a Rehabilitation Case Conference at Manly Waters on 4 February 2020 refer to "? ↓ cognition".
Gail was transferred to Royal North Shore Private Hospital via ambulance on or around 5 February 2020, then re-admitted to Manly Waters on 7 February 2020. Again, the Progress Notes record alcohol being found in the presence of Gail and that she had at least one fall while at the hospital. She was discharged to home on 19 February 2020.
A further Mini-Cog assessment was performed on 8 February 2020. Gail scored two out of five. She recalled two of the three words asked and made the same error in the clock drawing.
On 11 February 2020, a different cognitive test, known as a Montreal Cognitive Assessment (MOCA) was performed. Gail scored 20 out of 30. A normal score for someone like Gail is at least 24 to 26 out of 30. Professor Watson agreed that this tells you that there is some kind of cognitive problem going on, but not its extent. Professor Watson also accepted that there may be other reasons why a person scores poorly on such a test not related to cognitive dysfunction.
Gail was admitted to Manly Waters Private on 21, 25 and 27 February and 3, 5, 10, 12 and 17 March 2020 for "management of wound breakdown" after "L4/L5 Decompr", which involved physiotherapist sessions.
Gail was again admitted to NBH on 3 May 2020 and remained there until 7 May 2020. She presented from home via ambulance after recent falls. The Case Description records that Gail is unable to complete activities of daily living (ADLs) with Mr Bone at home.
The social history recorded includes "2-3 bottles of wine per day". In the Discharge Summary it is noted that: Ambulance officers handed over concerns regarding self-care at home - during multiple home visits have noted significant tripping hazards, bottles of wine everywhere… Impression: falls multi-factorial with contributions including peripheral neuropathy, possible NPH, cerebral atrophy secondary to prolonged EtOH use.
Gail's blood alcohol concentration on admission was 0.354g/100mL, some seven times the legal driving limit.
She was discharged to Manly Waters for rehabilitation.
The Occupational Therapy Discharge Referral Summary prepared by NBH included the following in relation to cognition: Evident throughout Ax that pts memory and recall was poor, pt reports this is due to ETOH abuse. She reports its better when she is not drinking, but pt declines to give up on ETOH. Pt performing at baseline function, and was safe and (l) on ward, however pt has not had any ETOH since last friday. Pt reports current function is baseline when she hasn't been drinking. However pt advises when at home she will be drinking heavily daily and has nil intention of abstaining.
A further MOCA was performed on 3 May 2020 and Gail scored 20 out of 30. The Discharge Summary records "MOCA on admission 20/30 however significant BAC at the time". Professor Watson admitted that such a significant blood alcohol concentration would have an impact on Gail's cognition at the time of the test. Professor Watson said that his failure to refer to blood alcohol concentration in his report was an oversight. The Progress Notes in relation to that MOCA include: Memory impaired, some confabulation during conversation. Does not recall how often she falls.
Professor Watson placed some reliance on the references to confabulation in the records. He did not agree that you could not place significant weight on this record because of the alcohol in Gail's system at the time. In his opinion, you could place some significance on the record "because [the reporting doctor] speaks about a mode of memory dysfunction in the form of confabulation."
Under the heading "Impression", the Progress Notes state: Not safe at home Difficult to assess capacity at this time - requires formal assessment of capacity. NPH is a possibility which may be compounding her ataxia/incontinence. Likely Korsakoff syndrome A formal capacity assessment was recommended.
Another CT scan of Gail's head was performed on 3 May 2020. The conclusion includes: Prominence of ventricular system more pronounced than surface sulci, with a degree of crowding at the vertex suggestive of normal pressure hydrocephalus.
The Progress Notes for 4 May 2020 report a "Lateral nystagmus". According to Professor Watson in cross-examination, this was an important observation. It is possible that it could be the nystagmus that is associated with the classic triad of Wernicke encephalopathy, where a nystagmus is generally only present in the early stages.
A spinal tap was undertaken whereby 33mL of spinal fluid was drained from Gail's spine, which is noted as being a "high volume CSF drainage". There is a dispute in the evidence as to whether this led to any obvious improvements. The Discharge Summary records that Gail's gait was assessed prior to the procedure and two hours after, with "nil obvious improvements noted". Mr Bone gave evidence that he observed some improvement. Professor Watson agreed that Mr Bone's observations of some improvement makes the diagnosis of normal pressure hydrocephalus more likely or stronger.
The Progress Notes in relation to a neurological consultation on 4 May 2020 record a history given of poor nutrition: -nil breakfast (has wine instead) -lunch -dinner (eg lamb chops, 2-3 bites)
Mr Bone is also recorded as saying: Steve reports worsening walking since september [sic] post operation balance has been poor prior to that, had falls in US with hospital admissions last time walking normal AUgust [sic] 2019, however reports some issues with balance since hes [sic] known her report she cannot remember what happens 2 hours ago sometimes -explains she sent him to groceries with a shopping list, and when he returned did not know where he went has fluctuations in personality reports cerebellar atrophy well knowon [sic]
On 5 May 2020, the Progress Notes record that Gail gave a different history for her diet to that which she gave on 4 May 2020, suggesting she has breakfast, "'not much'" lunch due to having breakfast late, and a hot meal for dinner.
The nutrition diagnosis was in the following terms: Suspected malnutrition (mild-moderate) related to predicted impact of EtOH on appetite and displacing oral intake as evidenced by report of improved appetite during admission, diet history demonstrating inadequate oral intake, suspected unintentional weight loss with evidence of mild-moderate subcutaneous fat loss and muscle wasting on physical examination (SGA B). Patient is likely at high risk of refeeding syndrome given Hx of EtOH excess, deranged electrolytes, suspected inadequate nutritional intake and recent weight loss.
Professor Watson accepted that if Gail was to be accepted as to her diet, it suggests she was not receiving all of her calorie intake from alcohol. He said however, he was circumspect about whether Gail was telling the truth because of her long term alcoholism. He did not give it significant weight.
An Occupational Therapy Initial Assessment dated 7 May 2020 records, under the heading "Previous Function", "Cognition- ETOH cognitive deficits evident, pt reports poor memory and recall". Under the heading "Current Function", the notes record "Cognition- Evident throughout Ax that pts memory and recall was poor, pt reports this is due to ETOH abuse. She reports its [sic] better when she is not drinking, but pt declines to give up on ETOH."
Gail was transferred to Manly Waters Private Hospital and admitted on 7 May 2020. The Medical Admission History and Discharge Summary states as the Admitting Diagnosis: "Cerebral & Cerebellar Atrophy". The secondary diagnosis included "Normal Pressure Hydrocephalus" and "Malnutrition due to ETOH abuse".
On 8 May 2020, a further Mini-Cog assessment was performed at Manly Waters Private Hospital. Gail scored one out of five.
Gail was discharged on 21 May 2020.
On 16 September 2020, Gail, Mr Bone and Ms Turner had lunch at Clonny's at Clontarf. According to Ms Turner, she observed that Gail needed assistance walking, but mentally she did not appear to be affected. Ms Turner also observed that Gail appeared to be in pain and "frustrated with it". Regardless, they were able to have a normal conversation.
Gail was re-admitted to NBH on 9 October 2020 and remained there until 13 October 2020. Again, she presented after a fall at home. The ambulance record refers to five falls in the past 24 hours and "Fluid on the brain with neuro interventions and hx alcohol related dementia". Having regard to the Progress Notes dated 9 October 2020, Mr Bone likely told the ambulance officers of a concern of a buildup of fluid on the brain again. He told hospital staff of the previous spinal tap "with some improvement in symptoms". No further detail was provided as to the nature of the improvement.
The Progress Notes for 10 October 2020 state "Admitted due to ETOH excess related to Dementia, however, patient not scoring in AWS." There are also various references to Mr Bone not coping at home in the background of Gail's alcohol excess. The 11 October 2020 Progress Notes report "Admitted due to ETOH excess related to dementia", which Professor Watson interpreted as meaning "alcohol-related dementia", a term which has "fallen out of favour", but refers to the loss of cognition over at least two domains of cognition.
A report of a Social Worker at NBH dated 12 October 2020 includes a reference to "discussion with MO who advised unclear re Ms Thelen's capacity for decision making." The Medical Progress Notes for 12 October 2020 contain the following entries - apparently based on a discussion when both Gail and Mr Bone (wrongly referred to as Simon) were present: Still drinking daily now down to one bottle of wine per day Simon reports no admission to hospital since May this year when presented with fall At this time admitted under Dr Iyer Falls deemed to be likely multifactorial longstanding alcohol related peripheral neuropathy, alcohol intoxication There was a thought that perhaps NPH could be a contributing factor given prominent ventricles CSF drainage performed 33ml no improvement in symptoms Was discharge to rehab improved significantly following this however then deteriorated once discharged and outpatient rehab ceased
She was discharged to Manly Waters Private on 13 October 2020. The Admission History records frequent falls, five falls in four hours, chronic alcohol abuse and cerebellar degeneration due to alcohol, and normal pressure hydrocephalus. She was discharged home on 26 October 2020.
A Mini-Cog assessment was performed on 13 October 2020 - Gail scored two out of five. She was able to recall two of the words and was able to do the numbers on the clock but not the hands.
Anne Petith gave evidence that during 2020, Gail often rang her on her mobile phone. Her speech was often slurred, indicating she was intoxicated. There were, however, occasions during 2020 when Anne had a conversation with Gail and Gail would ask about Anne's family and seemed caring. Her speech seemed more normal in these conversations.
The evidence of others, including Wessel Wessels and his wife Nicky, also paints a picture of a significant decline in Gail's health in 2020 with increased falls.
A satellite factual issue that emerged during the hearing was whether Gail was not invited - or more accurately was uninvited - from attending Christmas in 2020 with Mr Petith and Anne Petith and their family. Some evidence was led on behalf of Mr Bone, including from Ms Tracey Wells, that Gail had told them that she had been uninvited from attending Christmas in 2020 and that this had caused Gail some upset. Anne Petith and Mr Petith both gave evidence to the effect that Gail was not uninvited. Rather, Anne simply told her there was a particular day when one of Anne Petith and Mr Petith's two daughters was attending and Gail may wish to come on that day.
Senior counsel for Mr Petith sought to rely on the issue as an example of confabulation by Gail whereas Mr Bone said it went to the relationship between Gail and Mr Petith, demonstrating a breakdown between the two.
It is not necessary to resolve this factual issue. At best, it is a single instance of conduct and is not of much significance in the overall scheme.
Ms Tracey Wells, Gail's long term hairdresser, gave evidence that she last saw Gail on 16 December 2020 when Gail apparently told her that she had spoken to her solicitor and that Mr Bone would be okay. This was apparently in response to a discussion earlier in 2020 - either 10 September or 28 October - where Gail had said to Ms Wells she was worried about her health and wanted to talk to her solicitor to make sure Mr Bone had a roof over his head and was looked after.
The objective evidence - and in particular the absence of any discussions with Mr Lakos during this period - makes it very difficult to accept this evidence which is uncorroborated by anything. I do not accept it as recording a discussion in 2020. If it occurred, it is more likely to have taken place in 2019 and after the making of the 2019 Will. Ms Wells admitted she was not good with dates.

2021

Gail's next admission to hospital was to NBH on 14 January 2021, where she remained until 20 January 2021. This time the admission was not due to a fall but to symptoms which were ultimately diagnosed as related to ovarian cancer. The hospital records note: Vague hx [history] - patient has poor memory from long term alcohol excess.
As Professor Watson admitted, the entry does not tell what part of the history was vague or what aspects of the memory were vague. He agreed that he was not able to tell from these types of entries what the extent of the problem was.
Gail reported loss of appetite, recent vomiting and intermittent pain in lower abdomen. Mr Bone agreed that Gail had experienced a loss of appetite but did not agree with the record that Gail has poor memory from long term alcohol excess.
Gail was discharged to Manly Waters Private on 20 January 2021. The Manly Waters admission notes record, quite understandably, that Gail was depressed. She remained at Manly Waters until about mid-February 2021.
A Mini-Cog assessment was performed on 21 January 2021 - Gail scored three out of five. She was able to recall three words but got the clock drawing wrong again. Professor Watson agreed that getting the clock wrong says nothing about whether Gail could call to mind friends or family she would like to benefit from her estate. In relation to Gail's ability to recall the three words, Professor Watson accepted that if the test was properly administered and in particular there being a delay before the patient is asked to recall the three words - you would think that, based on the test results, Gail may not be at the severest end of the Korsakoff spectrum.
The Rehab Progress Notes for 28 January 2021 record Gail as telling Manly Waters staff that she was going out to see her cancer specialist for a 3pm appointment with her partner. The notes also record that she subsequently returned from the specialist appointment in time for dinner and was "teary and distressed" and then gave a detailed recount of what treatment she was to receive for her cancer. Professor Watson agreed that if this record is accurate it demonstrates a level of short term memory, an ability for Gail to hold concepts in her mind and an ability to relay those concepts. Her level of cognition was up to the task on that day.
Nicky Wessels, Gail's neighbour at Clontarf, gave evidence that prior to the end of January 2021 she had received emails from Gail, but the last of these was received at the end of January 2021. The prior emails had contained jokes but these stopped at the end of January 2021.
Ms Pizem gave evidence of a number of discussions with Gail in early 2021. They apparently spoke at least weekly. On more than one occasion, including during her final illness in early 2021, Gail said to Ms Pizem that she had left Mr Bone money and also wanted to leave him the house but did not know how to do this because it could cause him complications in America with taxes.
On 29 January 2021, Mr Bone sent an email to Jessie Xu, Gail's long term financial advisor. In that email, Mr Bone advised Jessie Xu that Gail had been diagnosed with cancer and that she would need to have chemotherapy for about nine weeks.
Gail was readmitted to NBH on 22 February 2021. She presented with pain in her back. She was undergoing chemotherapy at this time. She was again discharged to Manly Waters on 26 February 2021.
A Consultation Request dated 6 March 2021 refers to an MMSE memory test having been performed on Gail in which she scored 16 out of 30 with the medical officer stating they were "suspicious of neurology impairment". Professor Watson said the result was "pretty bad", suggestive of moderate dementia.
Mr Ransfield visited Gail at Manly Waters on 6 and 7 March 2021. He says that they had a normal conversation in which Gail actively engaged. No detail was given as to what was discussed.

The making and execution of the 2021 Will

As Gail's condition worsened in the first quarter of 2021, Dr Lim apparently told Gail and Mr Bone to get Gail's affairs in order. Mr Bone says that this caused Gail and him to have a conversation about where Mr Bone was going to live if Gail was to die. He says that by the time of this conversation he had made the commitment to live in Australia and had applied for his partner visa. He admitted in cross-examination that it was his wish that Gail would change her will to look after Mr Bone by enabling him to continue living in the Clontarf Property.
The only such conversation Mr Bone deposed to in his affidavit was on 12 April 2021. In cross-examination he agreed, however, that there must have been a discussion before 8 March 2021 because on that date, he sent an email to Mr Lakos with the subject "Question about possible change to Gail will and trust" where he asked Mr Lakos whether he was "willing to make hospital/house calls to Manly/Clontarf" if Gail remained unable to walk, must be confined to her hospital bed and wants to make additional changes to her will and trust. The email stated that Gail had told Mr Bone and Mr Ransfield that she was thinking about it. Mr Bone asked Mr Lakos to advise regarding the procedures he would require in order to draft and execute amendments if Gail decides to make them. There were various anomalies in Mr Bone's evidence in relation to this period which I deal with later in the chronology.
Mr Lakos responded later that day to the effect that having regard to his long association with Gail, he would make an exception to his usual no house calls practice. His email went on: A fundamental issue which overrides any proposed change to Gail's will involves the core question of her capacity to make a new will. The issue of capacity involving the making of a will (including amending an existing will) is complex. It is particularly so, in circumstances such as Gail, where over a number of months her physical condition has declined, resulting in extensive surgery, chemotherapy and a range of related medical procedures. In such a case I am required to implement a rigorous examination of Gail's cognitive status, focusing upon the issue of her comprehension of concepts associated with the disposal of her estate as well as the related issue of her ability to make informed decisions. In her case, depending upon my conclusion, I am also likely to require the opinion of an independent health professional who may need to be engaged to verify the issue of Gail's capacity to make an amended will. It appears from your email below that at this stage Gail has not made a firm decision to alter her will. Accordingly, if she does, please send me details of the Hospital where I can meet with her alone to discuss the issue with her and to assess her capacity. When I receive your update and it reflects Gail's wish to amend her will, I will make arrangements to attend upon her. Depending upon her medical condition, I may be able to implement the required consultation procedures by arranging for a member of the hospital staff (or a social worker) to facilitate a Facetime consultation with Gail from her hospital bed, in the course of which, from my office I may ask questions and observe Gail's responses. Provided I form the view that Gail has the necessary cognitive capacity and is able to give me informed instructions, I will be in a position to prepare a revised will. At that stage, I will again be in a position to meet with her (either in person or via Facetime) to arrange the execution of the new document. (emphasis added)
Mr Bone admitted in cross-examination that at this time it was basically his belief that a doctor was the only person who could assess Gail's medical condition as referred to by Mr Lakos. It is also of some significance that Mr Lakos had not seen Gail since late 2019 and there is no suggestion that he had any detailed knowledge of Gail's medical history since late 2019, including her fall where she fractured her lumbar spine and her frequent falls and hospital admissions thereafter. His concerns about Gail's capacity seem to have been driven only by what he had been told about her recent diagnosis and potentially being confined to bed.
Mr Lakos' file also contains copies of articles from the February 2021 edition of the Law Society Journal in relation to superannuation death benefit claims where there is no Binding Death Benefit Nomination, and testamentary capacity.
On 10 March 2021, Mr Bone responded to Mr Lakos. His email included: Some days, like yesterday, she's very cognitive, and others, she's not "altogether".
On 11 March 2021, Mr Lakos appears to have had a telephone discussion with Mr Ransfield. It appears Mr Ransfield called Mr Lakos. The discussion included Gail's desire to be cremated and for Mr Petith to have nothing to do with her funeral. It also included Gail's desire to transfer the 2008 Toyota Corolla, which Gail had used when at the Gold Coast, to Mr Ransfield and that he - Mr Ransfield - had sent the transfer papers to Mr Bone for Gail to sign.
On 17 March 2021, Mr Bone sent a further email to Mr Lakos and Gail raising issues regarding taxation of income from testamentary trusts and whether Gail should be designating a beneficiary of her superannuation.
Mr Bone admitted in cross-examination that he was trying to understand who would get the benefit of Gail's superannuation in the event she passed away.
Mr Lakos responded later that day. His email suggested Mr Bone contact Jessie Xu in relation to whether a death benefit nomination had been signed and included: For completeness, I observe that having regard to my understanding of Gail's recently deteriorated condition, any legally binding document she may currently sign will have questionable binding force. In an earlier email I provided you with advice about the tests applied by the Courts of New South Wales to assess the capacity of a person to enter into legal documents. Without significant face-to-face assessment (possibly also requiring support from an independent medical specialist) it is at this stage impossible to determine whether Gail has the necessary capacity. On the assumption that the documentation currently in place appropriately covers Gail's estate-related wishes, the complex issue of her capacity may not be particularly significant.
On 18 March 2021, Mr Bone stated in an email to Mr Lakos: I personally believe [Gail] remains competent, but I understand its not "my call'". We cannot appreciate enough your willingness to make a "house call"!
Mr Bone agreed in cross-examination that one of the matters at the forefront of his mind was for Gail to sign a Binding Death Benefit Nomination if she had not signed one. Determining competency was not his call, it was Mr Lakos' although he agreed that Mr Lakos had not seen Gail for over a year and therefore had no up-to-date personal contact to observe any deterioration. Mr Lakos observed as much in his email back to Mr Bone on 18 March 2021.
On 22 March 2021, Mr Bone sent an email to Mr Lakos attaching a service agreement which Carers and Companions wanted executed. Mr Bone had arranged for Carers and Companions to provide in-home care for Gail. Mr Bone stated that he had received the agreement and did not see anything out of the ordinary with it. Mr Bone stated that he believed that his appointment as Enduring Guardian gave him authority to sign the document "even if she can't fully understand it (almost a certainty) and balks."
It was put to Mr Bone in cross-examination that the reason why Mr Bone thought that Gail would not be able to understand the agreement was because he was concerned with her cognitive abilities. Mr Bone did not agree and said that it was because the agreement was written in "legalese" and he would have done the same thing even if Gail had been alcohol-free her whole life.
He then asserted that Gail was experiencing "chemo fog" and this affected her cognition.
I do not accept this evidence from Mr Bone. The reality likely was that Mr Bone was dealing with all matters on behalf of Gail because she was wholly incapable to managing her affairs at the time. As set out below, Mr Bone admitted in the context of his role very shortly thereafter in ensuring that a Binding Death Benefit Nomination form was executed by Gail that she wasn't in a position to be dealing with professionals about anything, other than her doctors.
It soon became clear that Gail had not signed a Binding Death Benefit Nomination. On 19 March 2021, Mr Lakos emailed Mr Bone, copying Ms Xu, stating: Having regard to the complex issue of [Gail's] capacity, it may not be vital to obtain a Death Benefit Nomination. Most such Superfund Deeds contain a provision directing the Trustee following the death of a member to make the distribution of Superfund assets. Accordingly, depending on the wording of the Superfund Deed, the issue may already be appropriately covered. I will advise further after I review the provisions of the Deed.
Gail was copied on a number of these emails although Mr Bone said that he suspected that Gail was not reading them.
Mr Bone admitted he was the person with the job of ensuring that the Binding Death Benefit Nomination form was obtained and made available for Gail's signature because she wasn't in a position to be dealing with professionals about anything, other than her doctors.
On 24 March 2021, Gail had been discharged from Manly Waters and was at home. Mr Bone emailed Mr Lakos, attaching a copy of the Manly Waters Discharge Summary, noting that Gail's "depression is severe and we can only hope that she'll start to feel better emotionally after she's home a little longer".
A Hammond Care report dated 28 March 2021 of a visit to Gail at the Clontarf Property records that Gail has remained cared for in bed for the last three weeks and she is not able to mobilise. Gail acknowledged previous excess alcohol use and continues to drink wine at home daily, "but states that Steve has restricted her intake to two glasses of wine a day". The report does not note any issues with Gail's cognition at the time.
On 31 March 2021, Mr Bone observed in an email to Mr Lakos "We're both dealing with depression but are hanging in there". Mr Bone suggested in cross-examination that Gail's depression, which he noted in his 24 March 2021 email to Mr Lakos, lifted shortly thereafter. This was obviously not correct.
Mr Wessel Wessels gave evidence that in about March 2021 he went to see Gail with his wife Nicky, as Nicky had said to him that Gail was close to dying. Gail was in bed. She smiled. When she spoke, her speech was very slow. When Mr Wessels asked her how she was, she nodded. He did not recall her responding verbally.
It was at about this time - a month before Gail died - that she and Ms Turner last spoke by phone. Gail was apparently able to converse and she was engaged in their conversation. Based on Ms Turner's affidavit, the discussion was brief and concerned the need for ramps in the house. In her interactions with Gail, Ms Turner did not observe anything to suggest that Gail was adversely affected by alcohol, despite being aware that Gail was suffering from falls at home and suspected these falls to be a result of Gail's alcohol consumption.
Mr Lakos wrote a detailed email to Mr Bone, copying Ms Xu dated 1 April 2021, which dealt in part with Mr Lakos' review of the rules of the super fund. Mr Lakos pointed out that in the absence of any financial dependants, a trustee is generally expected to exercise its discretion in favour of a spouse, and that it appeared to Mr Lakos that Mr Bone satisfied the requirements of "spouse".
Significantly, the email continued as follows: In accordance with your earlier request, I have also considered the potential of Gail signing a DBN. However, as I highlighted in my earlier advice, in light of the currently available medical evidence, particularly involving Gail's emotional and mental condition, there is a significant risk that any such DBN signed by her at the present date will not be valid and binding. In this regard I note that you have periodically informed me of your observation that Gail's personality has recently displayed symptoms of significant depression. This is supported by the fact that in the "Discharge Medication Summary" the Manly Water has recorded the ongoing treatment of Gail with a number of medications including an antidepressant. In addition, in the section of the Discharge Summary headed "Recent Medical/Surgical History" the hospital has referred to "long standing brain deterioration", followed by certain handwritten words which I have been unable to decipher. By way of summary of the broad estate issues involving Gail's personal assets, the distribution of that personal estate is appropriately covered by the executed will together with the governing structure of the Superfund in relation to the assets of the latter.
Mr Lakos, having been provided with the Discharge Summary, obviously had serious reservations about Gail's cognitive ability.
Nicky Wessels visited Gail on 5 April 2021. She stayed for only 5 minutes and observed Gail to be tired and pale. They spoke briefly.
Gail was admitted to NBH between 8 and 10 April 2021 for her third chemotherapy treatment. She was also experiencing abdominal discomfort at the time. At the time of her discharge, she was prescribed a number of medications including diazepam, 5mg each night. The medications Gail may have been taking at this time - particularly when she gave instructions for her new will on 15 April 2021 and when she executed this will on 20 April 2021 - have some relevance to her cognitive state on each of those dates.
The next significant event appears to be the discussion between Mr Bone and Gail on or about 12 April 2021. Mr Bone set out a version of the conversation in his affidavit. He was heavily challenged on aspects of that version. This challenge was principally by reference to the emails sent at the time (together with emails sent in 2019) and so it is convenient to set out those 2021 emails before returning to Mr Bone's affidavit account and the challenge to Mr Bone's evidence.
Throughout this period, it would appear that Mr Bone was providing regular updates on Gail's condition via Facebook. These updates provide some contemporaneous evidence of Gail's condition. One such update was posted on 12 April 2021, where Mr Bone stated: The fact that Gail is still too weak to walk or even sit up in bed by herself is a complicating factor. Her despondency over this is heart breaking and maddeningly frustrating to me and our care giving team.
Mr Bone admitted in cross-examination that Gail's condition was deteriorating during this period.
Mr Bone's email of 13 April 2021 to Mr Lakos stated, in part: I've explained to her our need to have you review the Carers & Companions contract before she signed it, the incomplete status of her estate plan, given no designated beneficiary of her Superfund account, plus other aspects and the lose (sic) ends getting Viva Energy to pay all of the Woy Woy property outgoings. Her interest level in these matters has taken a "back seat" to her health concerns and the possible outcomes, understandably. Yesterday, we had a serious conversation about her existing estate plan, given how our circumstances have changed significantly since she last revised her will. She asked me once again to work with you and Jesse to get everything into a new order. We need to talk about these concerns and your observations about the disposition of her Superfund at her death ASAP, especially given the risks inherent in her anticipated surgery. I continue to believe she remains competent, though depressed. She is taking no drugs during the day that interfere with her cognitive abilities, just bed-time meds to help her sleep through the night. I also recognise the need to get your last invoice paid ASAP. I assume you will accept payment by credit card and will call later today with the information if that's OK. Please advise. We have much to discuss and urgency is very much needed.
On 14 April 2021, Mr Lakos sent an email to Ms Xu, copied to Mr Bone, which was as follows: Earlier this afternoon I left a voicemail message, requesting you to call me to indicate whether you will be available to attend with me at Gail Thelen's home tomorrow to discuss with her various estate issues. I have not met with Gail for over twelve months. According to Steve Bone, there is significant urgency attached to my obtaining Gail's up-to-date instructions relevant to various estate matters. This may result in the need for certain new documents to be prepared for Gail's signature. However, before I prepare any new documentation, in light of her recent health problems, I will need to assess Gail's capacity to understand the key issues and to give instructions. Having regard to your long-term knowledge of and dealings with Gail, as part of that assessment process, your input will be extremely valuable. I have spoken to Steve Bone and he has advised that 12 noon tomorrow, Thursday, 15 April 2021 is suitable for Gail. Accordingly, following your receipt of this email, as soon as possible please contact me to confirm that you will be in attendance at 12 noon tomorrow. I look forward to receipt of your confirmation.
On 14 April 2021, Mr Bone sent a lengthy email to Mr Lakos and Ms Xu. Although signed off "Steve and Gail", it was written by Mr Bone. I set it out in full: As a follow up to my email to John yesterday and his response, here's a bit of our history and what we are trying to accomplish now, assuming Gail remains competent. We have been living together for 6.5 years. All but eleven, non-contiguous months of which have been in Australia or on cruise ships. We've had no intention of ever moving to the US as a couple and have only intended to visit my family there for 2-3 months a year pursuant to her 3-month visas. After living in Sydney continuously just under two years (thanks to Covid lockdown rules) I've concluded I am ready to continue living in Sydney even if Gail predeceases me. Sydney is now my home. A year ago this month, we applied for my permanent, partnership visa. I believe all of the prerequisites will have been satisfied after I get my visa medical exam to the immigration authorities next week. Hopefully, their decision will be favourable and not long in coming. From my research, I agree with you that I appear to qualify as Gail's de facto spouse under Aussie law, especially that related to her Superfund account. Gail has been providing needed financial support to me primarily for my housing, utilities and automobile needs. I've been paying for most of our food, gasoline and my medical expenses. But for her supplemental financial support and income interest in her testamentary trust, my annual, after-tax income would be insufficient for me to live here alone as we've been living. In our serious conversation two days ago, I explained to Gail the estate planning issues that will arise if she does not execute a Superfund Death Benefit Beneficiary form before her death. We discussed my desire to continue to live in "our" home in Clontarf after she dies; the complex, Aussie/US tax problems that will arise if we don't plan for this properly; that I am unlikely to have any legal right to continue living in the house after she dies without a revision to her will; and my lack of any legal/affordable alternatives for doing so without some kind of bequeathed, ownership interest. I recall that she bequeathed the house to me outright in her will before the current one, but that I researched the negative/unreasonable tax consequences for doing this and asked her to replace this gift with the 1/3 income interest presently bequeathed to me. At that time, I was not sure like I am today that I want to live out the rest of my life in Aussie. Our conversation resulted in Gail asking me to work with you and Jesse to get these revisions made to her will, revised estate plan and Superfund beneficiary designation. Here's what we've discussed and what I believe she is ready to endorse, subject to your confirmation: (1) Ronnie Ransfield needs to be designated expressly in the will as the organizer and manager of her funeral. (2) A specific bequest to me of a life estate in our home at 9B Amiens Road would be added to the will (and the existing list of specific bequests) to become effective if I survive Gail by 30 days. This is now our home and she has indicated to me that she does not want me to be forced to move for any reasons if she dies first. Nevertheless, I do not wish to own it outright (as provided in her earlier will) because I cringe at the thought of it being in my estate at my death and subject to US death taxes when I die. There's no way I want "a dime" of the value of this property subject to any US death taxes! Unfortunately, It does not appear I would be entitled to an Aussie, personal residence, capital gain tax exclusion for an outright bequest of the property or to a basis "step up" to its fair market value on her DOD because I'm not an Aussie citizen. But my life expectancy now is only about 7 years and the value of my life estate in 9B should not be that great for Aussie capital gains taxation purposes, assuming the original basis would be apportioned between the lifetime and remainder interests and the latter would be stepped-up to FMV at Gail's death if retained by the trustee. Regarding the remainder interest, it would be retained by Gail's testamentary trust. The trustee would be free to try and sell it during my life and would realise a fee simple interest in the entire property to either retain for the remainder of the trust term, rent out or sell at my death. Perhaps Jesse can confirm the correctness of my Aussie tax liability beliefs. I do not believe Gail's bequest to me of a life estate in our Sydney residence would trigger the realisation of any US estate or capital gain tax liabilities to either of us. Assuming Gail's trust would get a tax basis "step up" to the FMV for its remainder interest as of her DOD (to be confirmed by Jesse), our next-door neighbor, Wes Wessel has given us an informal, standing offer to buy the house at its FMV and even let us continue to live in it for awhile [sic] after his purchase. If the Trust was to sell him the remainder interest to him at a discount based on the relatively-low value of my my [sic] life estate, that could be a good deal for him. Assuming the trust would get a stepped-up tax basis for the DOD value of its retained remainder interest, the remainder interest could be sold without realising a significant, taxable, capital gain (to be confirmed by Jesse). It should be very beneficial to all of us trust income beneficiaries if this partial value in the house could be realised, reduced to cash and reinvested to produce distributable trust income. If I should decide in the future I can't continue to live in 9B, I could sell my life estate (probably) to Wes before I die, at a deeply-discounted price, based on my steadily diminished life expectancy. Plus, no one else would be likely to wish to buy it without also purchasing/owning the remainder interest. In conclusion, Testamentarily [sic] bequeathing the life estate to me by will should create a relatively minimal, LTCG realisation event for Aussie tax purposes and no tax liability to me from a US tax perspective. Thankfully, I understand that Aussie has no death taxes. (3) All tangible personal property located at 9B (including the Lexus) other than that which is now specifically bequeathed by Gail's will to others would be specifically bequeathed to me if I survive Gail by 30 days. I would be unhappy having to refurnish the house and buy another car, given that this property is all seriously depreciated, not worth much and I can live with it. Plus, I'd like to have the power to gift some of it to charity. (3) The trust term of Gail's testamentary trust would be changed to the greater of my life or 20 years to cover the unlikely prospect I might still be alive more than 20 years from now. There's no way I can afford to continue living here until my death without a trust income interest term that matches my lifetime. Additionally, potentially extended the trust term would incentivize Paul's kids to look after me if I live into my 90's as well as to work hard/save to accumulate their own wealth through their own efforts, given the trust's likely, 20-year limitation on the length of their income beneficiary status. (4) The existing designation and gifts to the three classes of trust income beneficiaries would remain the same. Without my currently designated, trust income interest, my ability to keep 9B maintained until I die would be in serious jeopardy. (5) I would be interested in being designated as an unpaid co-trustee of the Thelen Trust (or at least as a recognised advisor to the trustee) who is authorised to serve for as long as I'm competent and interested in serving. I could then be involved with choosing and helping to manage Thelen Trust investments, drawing on my own expertise as a professional trust officer and investment manager. (6) Regarding the Superfund beneficiary, I understand I would be the beneficiary as Gail's de facto spouse, given that she has not specifically designated another beneficiary. This gift would make me very wealthy, but totally screw up her anticipated estate plan, tax liabilities and fairness to the other beneficiaries. I very much desire receiving a will bequest of a life estate in 9B Amiens Road, rather than receiving the income-producing assets in the Super. Without I these assets being contributed to the trust, none of us who are income I beneficiaries would be receiving significant income. Neither Gail nor I desire that to happen! As for my related, personal, estate planning: I would create an Aussie will to deal with whatever other property I own in Aussie at my death and acknowledge this will in an amendment to my existing, US will. I would likely be moving some of my TPP from SFe to Sydney that I'd want my daughter to have at my death. Any property to which my Aussie will applies would be specifically bequeathed to Gail's trust, except for any TPP I move down from the US and have specifically bequeathed to my daughter and grandson. My Aussie will would leave all of my Aussie TPP not specifically bequeathed by me in either of my US or Aussie wills to the Thelen Trust. Concluding: Below you will find a few Aussie tax-law-related questions, given the "boilerplate" in her existing, testamentary trust provisions. The trust/tax lawyer side of me is resurfacing, now that Gail's life is in jeopardy. I've been doing some hasty research into how Australia taxes the "income" distributed from a personal, testamentary trust like Gail's to beneficiaries like those of us who she has named - and am finding it to be a relatively complex area of the law. Here are several Australian tax-related questions I have about Gail's existing and proposed will/trust/estate plan: (1) In checking her trust document, I'm finding no definitions of what, exactly, constitutes "income" and how it is distinguished from "distributable net income" (DNI)? The term, "net" means "net of taxes and any other trust expenses." Given that these terms are not expressly defined, will the law define them, by default? How? Or will some person (e.g. the trustee) have discretion to define them after Gail's death - and what legal options will the definer have? Shouldn't the trust document define them expressly to avoid future controversies? (2) How is DNI generated? For example, If the trust sells capital assets and realises net capital gains, are these realised gains treated as DNI if the trust document does not expressly address the issue? What discretion, if any, does the trustee have to come up with a DNI definition when the trust document is silent? Or is one provided by law in this instance? If so, what's the legal definition? (3) Who pays Australian capital gains taxes on capital gains realised by an Australian, estate and/or a [sic] irrevocable, testamentary trust - the trustee or the income beneficiaries? How does it matter whether they are distributed? Might it be possible that the income beneficiaries (of a trust that defines "income" to include realised capital gains or the law provides such a definition by law) will be personally liable for the capital gains taxes - even if the proceeds from the trust's sales of gain-assets are not distributed or distributable to them? (4) Regarding Gail's "Super" that owns just about all of her income-producing assets, is this a separate legal entity that will survive her death? [You have said "yes"] If so, who will administer it? Will any tax liability arise if its assets are transferred to the owner's irrevocable, testamentary trust? If so at what rates/percentage? How long before realised income is distributed after trust is first funded? How long will it last? If not, will the Super be dissolved and assets transferred into her probate estate, ASAP after she dies? (5) Regardless, has she designated in writing a beneficiary for the Super assets it holds when she dies? [You confirmed that she has not]. Given the answer is "no," can her testamentary trust be designated as the legal death benefit beneficiary? And if she has failed to designate a beneficiary, then what happens? [You have answered this, given that I'm legally her de facto spouse] To What must she sign to designate her estate or trust as the beneficiary and which beneficiary designations would result in the lowest tax liability? Who will prepare this document? Where and before who must it be signed? (6) Under what circumstances, if any, will the rental income generated by the assets transferred out of the Super at her death and into the trust NOT be considered "DNI"? If there are none, will her trust income beneficiaries have a right to receive this income or would the trustee have a duty or discretion to hold and reinvested it in the trust? If so, under what conditions? (7) If the Super's assets will all pass outright into Gail's trust at her death, under what circumstances, if any, might this title transfer generate the realisation of any capital gains that would be taxable to the trust and/or its income beneficiaries? (8) If either of you see any additional tax questions/problems that need to be addressed with the implementation of the provisions in the proposed, revised will/trust, please advise. Should you lack the specialised knowledge to answer any of these questions without going to great time and expense, we would appreciate your referral to a trust/tax specialist who can make short order of the answers and recommendations. We've been warned to waste no time in getting Gail's affairs in order, and these issues are important ones to resolve! Many Thanks!
On 15 April 2021, in one of his regular Facebook updates, Mr Bone stated:

Unmatched double quotation marks in next paragraph * I discovered and reported last week a potentially very costly and unintended problem with Gail's estate plan that hadn't been caught be [sic] either her attorney or CPA. I discovered it by doing research into applicable Australian tax laws, the questions about which Just popped into my head "out of nowhere." Both professionals admitted this omission and our attorney surprised me with a call at dinnertime, agreeing to make a rare "house call" with the CPA to talk through solutions tomorrow, Gail has been too uncomfortable physically to care much, but 'Ok'd" me yesterday to present the issues to them for resolution. It took me all afternoon today to complete and present a technical explanation that I had ready to send them via email in preparation for tomorrow. The timing of my work and their immediate availability is another true miracle. With the possibility that "time might be of the essence," this is another answer to prayer.

Having set out Mr Bone's email of 14 April 2021 and his Facebook update of 15 April 2021, it is convenient to now consider the evidence in Mr Bone's affidavit of a conversation which is alleged to have taken place on 12 April 2021. Mr Bone admitted in cross-examination that in the discussion he was trying to convince Gail to leave him a life estate in the Clontarf Property. According to Mr Bone, the conversation took place at Gail's bedside at the Clontarf Property and was to the following effect: Mr Bone: "My Partner Visa should be issued at any time, and I'm committed to living in Australia even if you die." And "I am the only dependent beneficiary of your super. Its assets are most likely going to be distributed to me when you die unless you sign a document asking for them to be transferred to your estate and trust. I think that would be a good idea and in the best interest of all your beneficiaries." And "If you don't make it, we've got to figure out now what's going to happen to this house. I'm going to have to move out the way your will is drafted now. Is that what you want?" Gail: "No, I want you to have the house and the contents I haven't otherwise gifted. I want to put a roof over your head for however long you wish to live in Australia after I die, regardless of what that means for the estate interests I would be leaving the Petiths or any other beneficiary." Mr Bone: "I'm also going to need the Lexus. And how you leave the house to me and deal with your Superfund will be very important if major taxes are to be avoided. We've discussed how costly the US tax burden could prove to be, and how we can lessen the tax burden by the life estate concept we discussed before." Gail: "That's fine. I appreciate your request to have this gift made to you at the lowest tax cost. Get with John and Jessie as soon as possible to work out how my will needs to be changed to make this possible." Mr Bone: "I'll tell John we discussed this and you, John and Jessie can take it from there."
Mr Bone agreed in cross-examination that there were two fundamental things that were being discussed at the time - namely what was to happen to the super fund in the event of Gail's death and what was going to happen to the Clontarf Property and Mr Bone's ability to live there. Mr Bone was apparently to get a life estate and Gail's superannuation was to be paid to her estate.
It was put to Mr Bone that contrary to his account of the conversation in his affidavit, he did not in fact speak to Gail on 12 April 2021 about the Clontarf Property. They only spoke about the super fund. Had the Clontarf Property been spoken about, Mr Bone would have referred to that fact in his email to Mr Lakos of 13 April 2021, which only refers to the super fund.
I am not sure that much turns on this, as the email the next day from Mr Bone - 14 April 2021 - does make reference to Mr Bone continuing to live in the Clontarf Property and this being unlikely without a revision to Gail's will and that this was discussed with Gail. I am satisfied that both issues - the Clontarf Property and Gail's superannuation - were likely discussed on 12 April 2021.

Post execution of the 2021 Will

The Progress Notes at 8.53 am on 21 April 2021 includes: Patient reported that she feels fine Breathing is fine Not in pain Visited by husband and lawyer yesterday Reports signing will "talking about millions and millions of dollars" and later Alert Delirious and slightly agitated
A palliative care review conducted at 11.31 am on 21 April 2021 noted "cognitive impairment long term MMSE 16/30 3.21" and "severe peripheral neuropathy mutlifactorial [sic] including etOH". A current main issue that was noted in the review was "Delirium on background long term cognitive dysfunction".
Later that day, it appears to have been decided that there was little more treatment that could be given to Gail. Mr Bone said that he would like to take Gail home.
On 22, 23, 24 and 25 April 2021, the Progress Notes record that Gail was "alert and orientated". It appears that Gail's return to her home was delayed by reason of transport issues. She was ultimately transported home in the afternoon of 26 April 2021.
There was in evidence a Complete Medication Record of Inpatient Stay, which identifies the medications that were administered to Gail whilst she was at NBH between 17 and 26 April 2021. This has some relevance to her cognitive state during this period. Of relevance, she was given mirtazapine at 8 pm on each of 19 to 25 April 2021, diazepam at around 10 pm on 17 and 18 April 2021, but diazepam was withheld on 19 and 20 April 2021 because Gail appeared drowsy. She was also given an injection of clonidine on 18 April 2021. Morphine was administered on 23 and 26 April 2021. Professor Watson opined that diazepam is a long-acting drug which can persist, although on the day that Gail executed the 2021 Will, she had not had diazepam for two days, since 9.47 pm 18 April 2021.
Mr Bone's Facebook update for 22 April 2021 painted a further grim picture, to the effect that Gail was close to death and "past wishing to talk in complete sentences. When she does speak, she was refusing to say much of anything other than, 'just let me die'." As Mr Bone said in cross-examination, Gail had pretty much thrown in the towel at that point.
About three days before Gail died, Ms Pizem gave evidence of a phone discussion with Gail in which Gail told her that Bishop Bob McGuckin was trying to make it down to see her and that she was excited and grateful.
Ms Pizem also gave evidence that the last couple of times she spoke to Gail, she observed that Gail was quite breathless but she could manage a short conversation slowly. Gail said that she was tired and sad because she would not be able to continue her relationship with Mr Bone. Gail had apparently told Ms Pizem that she wanted to look after Mr Bone.
On 24 April 2021, Bishop Bob McGuckin visited Gail at NBH. Bishop McGuckin had known the Petith family, including Gail, for many years and had officiated at Gail's wedding in 1988 and at her husband's funeral in 2014. Bishop McGuckin has held a number of judicial appointments within the Catholic Church.
Bishop McGuckin drove from Toowoomba to visit Gail on 24 April 2021. Prior to then, he had been speaking with Gail on the telephone on about a monthly basis, including about her cancer diagnosis. He had not seen Gail since 2015.
Bishop McGuckin spent about an hour with Gail on 24 April 2021. He says that she was "conscious, aware and composed" and "clear and lucid". He spoke with her about a number of matters for 30 to 45 minutes before Mr Bone arrived. He then gave her the last rites.
In oral evidence, Bishop McGuckin also added that when he was talking with Gail on 24 April 2021, her answers were not just "yes/no" but became a little bit of a conversation, and that her voice "seemed quite strong". Apart from conversing about shared memories, Bishop McGuckin agreed that Gail did not to talk about any things she had partaken in herself.
Professor Watson indicated that he was somewhat surprised by that evidence of what transpired between Bishop McGuckin and Gail on 24 April 2021. It indicates that Gail was doing well in terms of her cognition on that day.
Mr Petith and Anne Petith visited Gail in hospital on 25 April 2021. Anne stayed for about 10 minutes and Mr Petith another 10 to 15 minutes. Gail appeared to be completely unconscious. Nicky Wessels visited Gail at home on 26 April 2021. Gail appeared unconscious.
Gail passed away at home on 27 April 2021. Her Death Certificate noted three causes of death - aspiration pneumonia (10 days), metastatic adenocarcinoma of ovaries (3 months) and severe alcohol abuse (years).

Post Gail's death

Gail's funeral took place on 6 May 2021 and Bishop McGuckin officiated.
On 16 August 2021, Mr Bone's partner visa was granted.
On 13 August 2021, solicitors for Mr Petith wrote to Mr Lakos to the effect that Mr Petith and Anne Petith were "very concerned that Gail did not have testamentary capacity at the time Gail's will was apparently signed, being 20 April 2021." Several matters were set out in the letter as providing a basis for the concerns. The letter requested Mr Lakos to respond to six matters in relation to the circumstances surrounding the execution of the will and what steps were taken by Mr Lakos to be satisfied that Gail had testamentary capacity.
Mr Lakos retained Teece Hodgson & Ward to act for him.
A caveat was lodged by Mr Petith and Anne Petith on 26 August 2021.
On 14 October 2021, Teece Hodgson & Ward provided a substantive response to the 13 August 2021 letter. The letter relevantly stated: As you can appreciate, our client has no beneficial interest in the outcome of the proceedings, however given the length of his relationship with the deceased, would like to ensure that her wishes are carried out. To alleviate some of your clients concerns, we are instructed to provide the following information: 1. The Will was witnessed by two employees of Northern Beaches Hospital in the presence of the deceased and our client. Our client is not aware why all pages of the Will were not signed, as he had instructed them to do so. However, our client was present at the time that the document was signed, and prior to its execution, had explained the document in detail to the deceased. It is also Important to note that the deceased's long term accountant, Jessie Xu was also present at the time that the Will was both explained and executed by the deceased and the witnesses, and will be able to provide affidavit evidence as to its due execution. 2. Whilst the Will was executed at a time that the deceased was ill in hospital, the original instructions were provided by the deceased whilst she remained at Clontarf, before she was admitted to hospital. Five days after instructions were received, our client met with the deceased in hospital, confirmed instructions, explained the effect of the Will and once satisfied allowed the Will to be executed. 3. After the Will was explained and executed by the deceased and the two witnesses, it was then taken by our client directly back to his office, where the original remained until he instructed our firm to act on obtaining the Grant of Probate. The chain of command of the document was in possession of our client as executor, and as a solicitor of the Court, the entire time. 4. When taking instructions for preparation of a Will, our client has a usual procedure of completing a checklist about capacity, and was satisfied that the deceased both understood the nature and effect of making a Will, understood her assets and confirmed her instructions accorded with her wishes. Our client was satisfied that whilst the deceased was severely ill, she understood the nature and effect of executing the Will. We are In the process of collating further evidence in support of our client's position.
Mr Lakos passed away on 23 December 2021.
Mr Petith commenced the Probate Proceedings on 23 December 2021. He sought to propound the 2019 Will. It was not until the filing of a second further amended statement of claim filed in December 2022 that Mr Petith contended that Gail lacked capacity at the time she made the 2019 Will, the Codicil and the 2018 Will.
On 8 March 2022, an interim grant of administration was made to the NSWTAG.
Mr Bone commenced the Provision Proceedings on 26 April 2022.

Mr Bone's financial position

Mr Bone made two affidavits setting out his financial position in support of his claim for provision/further provision - the first dated 2 June 2022 and then an updating affidavit made 2 September 2024.
As at 2 June 2022, Mr Bone contended his assets totalled $3,452,294 in AUD, made up principally of securities held with Merrill Lynch Brokerage and Retirement Accounts and Fidelity International Retirement and Profit Sharing Accounts (approximately $2.9 million) and a two thirds interest in a condominium located in Santa Fe ($465,300), the other one third interest apparently being owned by Mr Bone's sister.
Against these assets he had no liabilities.
As at 2 September 2024, his assets totalled $5,173,658 - the securities now totalled approximately $4.4 million and the two thirds interest in the Santa Fe condominium was now estimated to be worth $600,000.
It emerged in the cross-examination of Mr Bone that his sister no longer had a one third interest in the Santa Fe condominium and had not done so for some time. Rather, Mr Bone had transferred a 19% interest to a trust associated with his father, such that Mr Bone now has an 81% interest in the property. On this basis, the estimated value of Mr Bone's interest should be $729,000.
Adding to these figures, at a minimum, is the one third value of the Fund which Mr Bone will now receive, although it appears that Mr Bone has an outstanding liability for legal fees in relation to the separate proceedings associated with the Fund. This will likely add approximately $2 million to Mr Bone's financial position.
Mr Bone contends that his monthly expenses total approximately $10,427. All of his income is derived from his US Social Security pension and his US investment portfolio. His current monthly income, net of US tax and converted to AUD, is $6,897.
Against these assets, Mr Bone has liabilities of approximately $2,763, which is comprised of balances owing on his BAC Mastercard and BAC Visa.
Mr Bone also agreed in cross-examination that Gail effectively paid most of living expenses, enabling him to increase his personal wealth.

The position of other beneficiaries

Mr Petith and Anne Petith, together with their children, Chantelle and Elise, all put on unchallenged evidence as to their financial position and needs. I do not need to summarise that evidence. It suffices to observe that they are each in a substantially worse financial position than Mr Bone. They each receive less by way of provision than Mr Bone under all of Gail's testamentary instruments, with the exception of the 2014 Will.
Each of the charity beneficiaries filed evidence concerning their respective causes, the work they fund, and their financial restraints.
None of this evidence was challenged. In essence, Mr Bone's contention was that the estate was large enough to make the order for provision/further provision sought.

The opinions of Professor Watson

As set out above, Professor John Watson AM, a highly respected neurologist, was jointly retained by the parties to provide a retrospective opinion on Gail's testamentary capacity at the time of the 2018, 2019, and 2021 Wills. Professor Watson provided four reports and was cross-examined for nearly a day. The process was highly efficient and of great assistance to the Court, to the parties' credit.
In substance, Professor Watson was given all of the available medical records and all of the lay evidence.
In his first report dated 9 November 2022, Professor Watson was asked a number of questions. Before answering each of the questions, Professor Watson made the following general comments: General comments about Ms Thelen's Medical and Cognitive situation In my opinion Ms Thelen had a number of major medical conditions that had a high probability of affecting her neurocognitive status. There is considerable evidence that she was a chronic alcoholic, and at the severe end of this spectrum with several failed or refused attempts to become abstinent, drinking early in the morning ("eye openers") and consuming table wine in significant quantities. At some points, her consumption was estimated to be as high as four bottles of wine a day. We have clinical and lay witness evidence of her being markedly intoxicated on multiple occasions. On two occasions objective blood alcohol measurements returned extremely high levels of alcohol, incompatible with normal functioning for most of us, e.g. on one occasion a blood alcohol level seven times higher than the legal driving limit in New South Wales on one occasion. There is evidence of self-neglect and neglect of diet essentially with her obtaining, on my interpretation, virtually all her calorie intake through alcohol and highly likely to be deficient in important micronutrients and vitamins in particular the vitamin B group and thiamine. There is evidence of significant alcohol-related harms and injuries. She sustained significant falls with evidence of fractures over a lengthy period of time, and unconsciousness after at least one of these falls. One fall caused a severe lower spine fracture with neurological complications. This clinical tableau meant, in my opinion, that it was highly likely that Ms Thelen suffered from significant alcohol-related brain disease (ARBD) and the Wernicke-Korsakoff syndrome. There is ample evidence of her difficulty in cognition, particularly memory. Confabulation was recorded in the notes to describe her presentation (an older term for Korsakoff syndrome or Korsakoff psychosis is Korsakoff Confabulation). In Ms Thelen's case we do have evidence of cognitive dysfunction. There are the brief cognitive assessments in a number of places, particularly at the Manly Waters Private Hospital in which she never scored more than 2/5 and on occasion only 0/5. There were also several Montréal Assessments of Cognitions (MoCA) assessments in which she generally scored around 20/30. In her age group and gender this is well below the cut off to suspect a dementing-type problem. Moreover there is also literature on the correlation between alcohol-related brain disorder, Wernicke-Korsakoff syndrome and MoCA scores. One concludes from this literature that such a MoCA score was highly significant and in this case likely to be predictive of alcohol-related brain damage in general and WKS more specifically. Ms Thelen had other significant problems which I will discuss now. I am of the opinion that Ms Thelen also likely had normal pressure hydrocephalus. This diagnosis was raised on a number of occasions on both radiological and clinical criteria. She underwent a diagnostic and therapeutic lumbar puncture at the Northern Beaches Hospital with apparently an adequate amount of CSF taken off. Unfortunately although requested the radiologist did not record the opening pressure which would have been useful. There was said to be video of her gait both before and after. This recording would be standard for such a procedure, but it seems it was only recorded on a smart phone by junior medical officer and did not find its way into the medical record. At the time it was thought that Ms Thelen did not improve after this procedure (sometimes known as the spinal tap test). However with her multifactorial problems not least the cerebellar atrophy associated with the alcohol, there may be less opportunity to see a dramatic improvement. Moreover, after the test her partner Mr Bone thought that in fact there was improvement that day. There is ample evidence that Ms Thelen was against having a ventriculoperitoneal (VP) shunt which would have been the treatment procedure. We know that a spinal tap test causing significant improvement is predictive of both the presence of NPH and the likely response to treatment. However we also know many people who do not make a good response to the spinal tap test still do respond well to the VP shunting procedure. The classical diagnostic trait and features of NPH are ataxia (unsteadiness on the feet), incontinence (usually urgency of urination) and cognitive dysfunction, and there is considerable literature on the cognitive defects. In my opinion these were likely in play for Ms Thelen over a significant period of time; in my opinion the increase in the ventricular dimensions over the radiology that I have measured only around 2.5 years apart (and crucially, leading up to the April 2021 Will making) would be more consistent with NPH than with atrophy of cerebral tissue. Ms Thelen also had brain scanning evidence of cerebral white matter microvascular disease, well established to cause cognitive dysfunction. As discussed in the Appendix, in particular my review of the Radiology, I am of the opinion that Ms Thelen likely had Wernicke-Korsakoff encephalopathy/syndrome (WKE or WKS). I base this opinion on the clinical situation, the record of Ms Thelen confabulating, and the radiology. WKS is notoriously a disease of alcoholism and poor nutrition. Pioneering work by Professor Clive Harper and colleagues in Australia demonstrated how it is greatly underdiagnosed in clinical practice, especially at the acute end this spectrum, Wernicke encephalopathy. The next issue to discuss is her terminal illness of metastatic ovarian adenocarcinoma. As set out above in my opinion she was already in a nutritionally very precarious state, and the evidence is that she worsened significantly in those three to four months from January 2021 from the time of diagnosis to her death. There is literature that the presence of metastatic cancer including ovarian cancer per se can have cognitive effects; furthermore there is evidence that chemotherapeutic agents also have a significant effect on cognition, even known by the slang term of "chemo brain." Ms Thelen underwent at least three cycles of powerful chemotherapy before a decision was made to withdraw this, and I am of the opinion that her cancer, her increasingly malnourished and cachectic state and the chemotherapy all, on balance of probability, likely added to her cognitive dysfunction. There was evidence that even when she was extremely ill and close to death Ms Thelen continued to drink alcohol. There was reference to this consumption being cut down, not unexpectedly under the circumstances but still drinking up to a bottle of wine a day. Although this was at lower levels than historically the case for her, in my opinion it would be reasonable to argue in the face of her increasingly severe terminal illness that any alcohol consumption would have an even stronger effect on her general state and on her cognitive state; on balance of probabilities her cognition would be more likely to be affected effect on a lower intake. Finally, there were the medications prescribed towards the end of her life, a number of which are psychoactive including morphine, midazolam, diazepam and haloperidol.
The first question Professor Watson was asked was, "[w]hat medical condition(s), including any neurological injuries, was Gail suffering from at the time of the giving of instructions on 15 April 2021 and at the time of the making of the 20 April 2021 Will"?
Professor Watson's response was:

Severe alcohol-related brain damage (ARBD) secondary to decades of alcoholism. As part of this, it was also likely that she had Wernicke-Korsakoff syndrome, well known to have significant effects on memory and frontal lobe (executive) function;
More probably than not, she had normal pressure hydrocephalus which also has an effect on cognition, in particular frontal lobe executive functions;
In the last 12 days of her life, there was likely to have been present primary cognitive effect from advanced ovarian cancer; and
She would also probably have had significant effects from the prescribed medications she was receiving at the time in April 2021, given that she was still continuing to drink alcohol.

Second, "[w]hat medication was being administered to Gail at or around the time of the giving of instructions on 15 April 2021 and at the time of the making of the 20 April 2021 Will, and please identify any short or long term effects of that medication on cognition".
Professor Watson identified morphine, midazolam, diazepam, and haloperidol. It is not known what medication Gail took at home. These medications have powerful effects on cognition both in the short and medium term and powerful interaction effects with mutual increase in their toxicity.
Third, "[h]ow, if at all, what each relevant medical condition and/or medication administered to Gail have affected Gail's understanding and appreciation of the act of making a Will?".
In Professor Watson's opinion, the first test for will making - the act of making a will - would probably still have survived for the most part, but perhaps intermittently, in terms of Gail's ability to understand and appreciate the act of making a will.
Fourth, "[h]ow, if at all, would each relevant medical condition and/or medication administered to Gail have affected Gail's appreciation of the nature and value, in general terms, of her estate?".
In Professor Watson's opinion, any and all of the above medical conditions and/or medications were likely to have affected Gail's appreciation of the nature and value of her estate. To answer this question in real time, the professional legal or medical assessor would have had to use open questions (and not lead Gail) to ask her to go through the property that she owned etc and there is no evidence that this happened.
Fifth, "[h]ow, if at all, would each relevant medical condition/s and/or medication administered to Gail have affected Gail's ability to identify the natural objects of her testamentary affection?".
Professor Watson's opinion was that more probably than not, any and all medical conditions or medication administered would have affected Gail's ability in this regard. Professor Watson added that Gail was in such a parlous and vulnerable state that she was likely to have been susceptible to the influence of whoever was with her at the time.
Sixth, "[h]ow, if at all, would each medical condition and/or medication administered to Gail have affected Gail's ability to comprehend and appreciate the claims which she ought to give effect?".
Professor Watson's opinion was, again, that any and all would have affected Gail's ability in this regard.
Professor Watson also included, as an appendix to his first report, a detailed review of the material provided to him, including documents, lay evidence and radiology.
In his second report dated 28 June 2023, Professor Watson, having been given some further material, was asked to answer the same six questions by reference to the 2019 Will, the 2018 Will and the Codicil.
As an overarching response, he expressed the opinion that the degree and duration of Gail's drinking was so excessive that, more probably than not, she was affected in her cognition to the same degree as set out in his first report, and probably well before the 2019 Will.

Relevant legal principles

Where a will is sought to be admitted to probate, the onus of proving the will lies on the propounder. The propounder must prove that the testator had testamentary capacity and knew and approved the contents of the will at the time of its execution: see Veall v Veall (2015) 46 VR 123 at [166] per Santamaria JA (Beach and Kyrou JJA agreeing). The two are linked and such evidence will be relevant in both issues: see Mekhail v Hana [2019] NSWCA 197 (Mekhail) at [136] per Leeming JA.
In the context of capacity, in Lim v Lim [2023] NSWCA 84 (Lim v Lim) at [7]-[9], Kirk JA stated in a passage recently approved by the Court of Appeal in Anderson v Yongpairojwong [2024] NSWCA 220 (Anderson v Yongpairojwong): [7] It is a precondition of a valid will that the testator had testamentary capacity at the time the will was made, that is, the ability to understand the nature and significance of making a will. The judgment of Cockburn CJ in Banks v Goodfellow (1870) LR 5 QB 549 is regarded as the locus classicus on the issue. Reflecting Banks, the requirement has been understood as encompassing the following elements (see eg Carr v Homersham (2018) 97 NSWLR 328; [2018] NSWCA 65 at [5]-[6] per Basten JA): (a) the capacity to understand the nature of the act of making a will and its effects; (b) the capacity to understand the extent of the property the subject of the will; (c) the capacity to comprehend moral claims of potential beneficiaries; and (d) the absence of mental disorders or delusions which affect the testator's "mental faculties [so as] to make them unequal to the task of disposing of [their] property" (to quote Bailey v Bailey (1924) 34 CLR 558 at 571-572 per Isaacs J). [8] Although authoritative, the discussion of testamentary capacity in Banks ought not be read like a statute: Mekhail v Hana [2019] NSWCA 197 at [164] per Leeming JA. Further, these are matters of capacity, that is the ability to understand. It need not be shown that the testator in fact turned their mind to, for example, the extent of their property: King v Hudson [2009] NSWSC 1013 at [51] per Ward J; Dickman v Holley [2013] NSWSC 18 at [159] per White J; Simon v Byford [2014] WTLR 1097; [2014] EWCA Civ 280 at [40]-[41]. Because the issue is capacity there commonly will be substantial overlap when considering these factors. Capacity to understand (say) the extent of one's property will commonly substantially overlap with capacity to comprehend the claims of potential beneficiaries. [9] Whilst the test of capacity is a generic one, what is required in practice depends upon the particular will. The simpler the will and the less surprising its contents (eg in terms of providing for those who might have been expected to be provided for) the easier it may be to establish the requisite capacity: note Croft v Sanders [2019] NSWCA 303 at [126] per White JA.
In the context of knowledge and approval, Kirk JA stated in Lim v Lim at [10]: [10] A further, obvious precondition of a valid will is that the testator knew and approved of the contents of the will. In some cases that may also require showing that they appreciated the effect of what they were doing, so that it can be said that the will contains the real intention and reflects the true will of the testator: Tobin v Ezekiel (2012) 83 NSWLR 757; [2012] NSWCA 285 at [47] per Meagher JA; Lewis v Lewis (2021) 105 NSWLR 487 at [166]-[187] per Leeming JA. Again, the simpler the will the more easily it might be established that a testator knew and approved of its contents.
At [11] - [15] in Lim v Lim, Kirk JA made the following observations: [11] It has long been established that the legal onus of proof with respect to testamentary capacity and knowledge and approval, if those issues are raised on the evidence, is on the party propounding the validity of the will. Talk of shifting burdens and of presumptions has been common in this area of the law. The way in which the question of onus is often dealt with in respect of testamentary capacity was summarised by Meagher JA in Tobin v Ezekiel at [45]: If the will is rational on its face and is proved to have been duly executed, there is a presumption that the testator was mentally competent. That presumption may be displaced by circumstances which raise a doubt as to the existence of testamentary capacity. Those circumstances shift the evidential burden to the party propounding the will to show that the testator was of "sound disposing mind": Waring v Waring (1848) 6 Moo PC 341 at 17 355; 13 ER 715 at 720; Sutton v Sadler (1857) 3 CB NS 87 at 97-98; 140 ER 671 at 675-676; Smith v Tebbitt (1867) LR 1 P & D 398 at 436; Bull v Fulton [1942] HCA 13; 66 CLR 295 at 343; Kantor v Vosahlo [2004] VSCA 235 at [49], [50]. That doubt, unless resolved on a consideration of the evidence as a whole, may be sufficient to preclude the court being affirmatively satisfied as to testamentary capacity: Bull v Fulton at 299, 341; Worth v Clasohm [1952] HCA 67; 86 CLR 439 at 453. [12] In respect of knowledge and approval, the language of "suspicious circumstances" has often been used. In Nock v Austin (1918) 25 CLR 519; [1918] HCA 73, for example, Isaacs J explained (at 528): (1) In general, where there appears no circumstance exciting suspicion that the provisions of [a testamentary 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 2 Moo PCC at p 484; Fulton v Andrew LR 7 HL 448. (2) Where any such suspicious circumstances exist, the assumption does not arise, and the proponents 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 2 Moo PCC 317 at 321; Tyrrell v Painton [1894] P 151; Shama Churn Kundu v Khettromoni Dasi LR 27 Ind App 10 at 16. [13] Although it is not necessary to resolve the issue here, there is reason to doubt the utility now of the language of presumptions, shifting burdens, and suspicious circumstances. Writing extrajudicially, Justice Lindsay has observed: Although conventional, this style of language does not sit comfortably with the way a modern probate suit is heard by a judge sitting alone, without a jury, receiving almost all the evidence on both sides of a question by affidavits, upon which deponents are selectively cross examined. In the modern form of "judge alone (case managed) trial" it is generally artificial, at least at a final hearing, to analyse a case in terms of a "prima facie case" or dispositive "presumptions". By the time a judge is called upon to determine a case, it generally must be determined on all the evidence then before the Court, drawing whatever inferences may be available from that evidence. [G Lindsay, "The 'Why' and 'What' of 'Suspicious Circumstances' in Probate Litigation", paper delivered to Law Society of South Australia Succession Law Conference, Adelaide, 16 November 2018, at [45]] [14] With specific reference to testamentary capacity, in Carr v Homersham, at [47], Basten JA explained: To speak of there being a "doubt" as to testamentary capacity is to say little more than that a real issue has been raised on the evidence, which requires the resolution of the court. Unless such an issue has been raised, testamentary capacity need not be addressed; its existence will be presumed. Once the issue is raised, the court must resolve it; that must be done by a consideration of all the evidence and the inferences which may be drawn from it. It is true that the court must be affirmatively satisfied as to testamentary capacity, but in doing so, it should be alert to the fact that to find incapacity and thus invalidate a formally valid will is, in the words of Gleeson CJ, "a grave matter." A doubt which does not preclude the probability that the testator enjoyed testamentary capacity cannot warrant a finding of invalidity. [15] Much the same may be said of knowledge and approval (see also Mekhail v Hana at [164]-[173]).
Of relevance in the present case are the remarks of Leeming JA in Mekhail at [131]-[132]: [131] Where as here those taking a benefit under a will have played a part in its preparation, it is for the propounder to show "the righteousness of the transaction", namely, that the testator or testatrix knew the contents of the will and appreciated its effect, so that it can be said that the will contains the real intention and reflects the true will of the testator or testatrix. The same is true where there are "suspicious circumstances", such as those mentioned by the primary judge, including the erroneous description of Georgette as Nadia's daughter, and the erroneous belief of Mr Liondos. (I return below to what precisely are "suspicious circumstances".) [132] What is necessary to discharge that onus depends on the case. As Meagher JA said in Tobin v Ezekiel at [48] (which was reproduced by the primary judge): "In this context the statements prescribing 'vigilance' and 'careful scrutiny' and referring to the court being 'affirmatively satisfied' as to testamentary capacity and knowledge and approval are not to be understood as requiring any more than the satisfaction of the conventional civil standard of proof: see Worth v Clasohm at 453. What such statements do is emphasise that the cogency of the evidence necessary to discharge that burden will depend on the circumstances of each case and in particular the source and nature of any doubt or suspicion in relation to either of these matters: Kantor v Vosahlo at [22], [58]; Dore v Billinghurst at [44]. They also recognise that deciding whether a document is indeed a person's last will is a serious matter, so any decision about whether the civil standard of proof is satisfied should be approached in accordance with Briginshaw v Briginshaw [1938] HCA 34; 60 CLR 336 or, now, s 140(2) of the Evidence Act 1995." (Emphasis added.)
The present case also involves the not uncommon situation of real time observational evidence and also past medical evidence - this time from a world-renowned neurologist Professor Watson. The present case is somewhat complicated by the fact that two of the key observers - Mr Lakos and to a lesser extent Dr Lim - are now deceased.
In this regard, I bear in mind what was said by Young JA in Zorbas v Sidiropoulous (No 2) [2009] NSWCA 197 (Zorbas) at [89]: [89] In a probate suit, the vital evidence is very often not given by medical experts, but is given by experienced lay observers. I have said more than once in deciding probate cases at first instance, that the most valuable evidence is usually given by the experienced solicitor who witnessed the will as opposed to a very highly qualified psychiatrist whose evidence is based not on any personal observation of the testator, but who has reasoned his or her opinion from medical and hospital notes.
Hodgson JA in Zorbas said at [65] that the criteria in Banks v Goodfellow are matters for "commonsense judicial judgment on the basis of the whole of the evidence".
To similar affect, Vickery J observed in Nicholson v Knaggs [2009] VSC 64 at [41] in a passage recently approved by Bell CJ in Anderson v Yongpairojwong at [140]: [41] In the end it is for the Court, assessing the evidence as a whole, to make its determination as to testamentary capacity. In the present case, the opinions of expert witnesses as to whether the testator was competent or not competent, while not without weight, cannot be decisive as to testamentary capacity at the relevant times. The Court must judge the issue from the facts disclosed by the entire body of evidence, including the observations of lay and professional witnesses who knew and saw the testatrix at the time of her making the relevant wills and codicils. The manner in which she gave her instructions, the content of those instructions, the setting in which the instructions were given and the outcome of enquiries made by the solicitor acting in the matter, all assume importance.
In the present case, an aspect of the evidence is the not uncommon situation that Gail was subject, at various points in time, to various cognitive tests, including various Mini-Cog assessments and various MOCAs. I bear in mind when considering this material, as Professor Watson admitted, that such tests are essentially a screening tool for cognitive impairment and provide some basis for assessing memory recall: see, for example Bear v Bear; Jordan v Bear [2022] NSWSC 1687 at [141] - [145] per Meek J. They do not, however, in and of themselves, establish the nature and extent of any cognition problems.
In the context of the 2021 Will, an issue was also raised as to whether the critical date for the assessment of testamentary capacity was 20 April 2021, the date on which the Will was executed, or 15 April 2021, when Mr Lakos saw Gail at home to take instructions. In this regard, Mr Bone contended that the relevant date was 15 April 2021. Reliance was placed on the following well-known statement of Sir James Hannen P in Parker v Felgate (1883) 8 PD 171 at 173-174: If a person has given instructions to a solicitor to make a will, and the solicitor prepares it in accordance with those instructions, all that is necessary to make it a good will, if executed by the testator, is that he should be able to think thus far, 'I gave my solicitor instructions to prepare a will making a certain disposition of my property. I have no doubt that he has given effect to my intention, and I accept the document which is put before me as carrying it out'... That would be one state of mind. But if you should come to the conclusion that she did not at that time recollect in every detail all that had passed between them, do you think that she was in a condition, if each clause of this will had been put to her, and she had been asked, 'Do you wish to leave So-and-So so much,' or do you wish to do this (as the case might be), she would have been able to answer intelligently 'Yes' to each question? That would be another condition of mind. It would not be so strong as the first, viz., that in which she recollected all that she had done, but it would be sufficient. There is also a third state of mind which, in my judgment, would be sufficient. A person might no longer have capacity to go over the whole transaction, and take up the thread of business from the beginning to the end, and think it all over again, but if he is able to say to himself, 'I have settled that business with my solicitor. I rely upon his having embodied it in proper words, and I accept the paper which is put before me as embodying it;' it is not, of course, necessary that he should use those words, but if he is capable of that train of thought in my judgment that is sufficient. (emphasis added)
The principle is obviously well understood, having been applied on various occasions: see Briton v Kipritidis [2015] NSWSC 1499 at [37]. A key aspect of the principle, relevant in the present case, is that there have been no substantive changes to the will between the taking of instructions and the execution of the will.

Application to the facts

I now consider which of the Wills should be admitted to probate, beginning with the 2021 Will.

2021 Will

As set out above, the onus is on Mr Bone to prove that Gail had testamentary capacity and knew and approved the contents of the will at the time of its execution. For the reasons set out below, and being acutely conscious that to invalidate a formally valid will is a grave matter, I am not satisfied that Mr Bone has discharged his onus on either count. I am not affirmatively satisfied that Gail had capacity at the time of making the 2021 Will or knew and approved the contents of that will.
In considering the issue of testamentary capacity, it is useful to bear in mind what has been said in the cases about how a solicitor should go about ensuring that a testator has testamentary capacity.
Counsel for the NSWTAG referred to two cases in this regard. First, in Petrovski v Nasev; The Estate of Janakievska [2011] NSWSC 1275 (Petrovski v Nasev) at [89], Hallen AsJ (as his Honour then was) referred to what Santow J had earlier said in Pates v Craig & Anor; The Estate of Cole (NSWSC, 28 August 1995, unreported) as follows: There is an additional consideration, not dependent on the question of conflict of interest. That is, the duty of the solicitor taking instructions from an obviously enfeebled testator, where capacity is potentially in doubt, to take particular care to gain reasonable assurance as to the testamentary capacity of the testator. It is clearly undesirable to attempt to lay down precise and specific rules as to what that necessarily entails for every case. Such rules may lead to a perfunctory, mechanical checklist approach. What should be done in each case will depend on the apparent state of the testator at the time and other relevant surrounding circumstances. Any suggestion that someone, potentially interested, has instigated the will, whether or not a client of the will draftsperson, should particularly place the solicitor concerned, on the alert. At the least, a solicitor should ask the kind of questions designed to probe the testator's understanding of the basic matters which connote testamentary capacity... For this purpose, and subject to the earlier caveat concerning checklists, the advice concerning the taking of instructions contained in Mason & Handler's "Wills, Probate and Administration Service NSW (Butterworths) [at 10,019] is a useful guide: '[10,019] TAKING OF INSTRUCTIONS - ISSUES OF TESTAMENTARY CAPACITY If any doubts do rise as to the testator's capacity the following procedures on the taking of instructions will assist significantly in the avoidance of potential problems for the estate as well as for the solicitor in the discharge of his duties: (i) The solicitor who is to draw the will should attend on the testator personally and fully question the testator to determine capacity - the questions should be directed to ascertain whether the testator understands that he is making a will and its effects, the extent of the property of which he is disposing and the claims to which he ought to give effect; (ii) One or more persons should be present, selected by the solicitor having regard to their calibre as witnesses if required to testify whether the issue of capacity is raised. Where possible, one of the witnesses should be a medical practitioner, preferably the doctor who has been treating the testator and is familiar with him, who should in making a thorough examination of the testator's condition, question him in detail and advise the solicitor as to the capacity and understanding of the testator. The presence of other persons at this time would require the testator's consent; (iii) A detailed written record should be made by the solicitor, the results of the examination recorded by the medical practitioner and notes made by those present. If after careful consideration of all the circumstances the solicitor is not satisfied that the testator does not have testamentary capacity he should proceed and prepare the will. It is a good general practice for the solicitor who took instructions to draw the will and be present on execution and this practice should not be departed from in these circumstances. On execution, the attesting witnesses should, where possible, come from those persons (including the solicitor) referred to above who were present at the time of instructions and, again, as at every stage, detailed notes of the events and discussions taken.' If those questions and the answers to them, leave the solicitor in real doubt as to what should be done, other steps may be desirable. This may include obtaining a more thorough medical appraisal or, if the testator declines, considering whether the will can be properly drawn, should assurance on testamentary capacity fail to satisfy the test just quoted.
Second, in Ryan v Dalton; Estate of Ryan [2017] NSWSC 1007, Kunc J said at [106]-[107]: [106] Questions of testamentary capacity are necessarily fact sensitive. No rule or procedure will cover every case to avoid the possibility of litigation. Nevertheless, the effort involved in paying attention to questions of capacity at the time instructions for a will are taken and the will is executed (including, where necessary, obtaining an assessment of the client where it is thought one is called for) pales into insignificance with the expense, delay and anxiety caused by litigation after the testator's death. Bearing that in mind, and without wishing in any way to derogate from, for example, the desirability of all solicitors being familiar with the guidelines, the recent experience of the Court suggests that proposing some basic rules of thumb (which, as such, are necessarily arbitrary) may be of assistance. [107] It seems to me that the following is at least a starting point for dealing with this increasingly prevalent issue: (1) The client should always be interviewed alone. If an interpreter is required, ideally the interpreter should not be a family member or proposed beneficiary. (2) A solicitor should always consider capacity and the possibility of undue influence, if only to dismiss it in most cases. (3) In all cases instructions should be sought by non-leading questions such as: Who are your family members? What are your assets? To whom do you want to leave your assets? Why have you chosen to do it that way? The questions and answers should be carefully recorded in a file note. (4) In case of anyone: (a) over 70; (b) being cared for by someone; (c) who resides in a nursing home or similar facility; or (d) about whom for any other reason the solicitor might have concern about capacity, the solicitor should ask the client and their carer or a care manager in the home or facility whether there is any reason to be concerned about capacity including as a result of any diagnosis, behaviour, medication or the like. Again, full file notes should be kept recording the information which the solicitor obtained, and from whom, in answer to such inquiries. (5) Where there is any doubt about a client's capacity, then the process set out in sub-paragraph (3) above should be repeated when presenting the draft will to the client for execution. The practice of simply reading the provisions to a client and seeking his or her assent should be avoided.
It is immediately apparent that what Mr Lakos did in 2021 left a lot to be desired: 1. he did not keep detailed file notes of the process which he followed to assess Gail's testamentary capacity. He only appears to have considered capacity on 15 April 2021 and not on 20 April 2021. His file note of the conference on 15 April 2021 does not directly address the elements of the Banks v Goodfellow test; 2. notwithstanding that he was clearly on notice from the moment he was first told in early March 2021 that Gail may wish to make a new will, of potential issues with her capacity, and he recognised that a rigorous assessment would need to be carried out, it was never carried out; 3. Mr Lakos did not seek the assistance of a medical practitioner. From a note he made, he seems to have treated the assistance of a medical practitioner as a form of insurance; 4. taken at its highest, based on the contents of the 20 April 2021 file note, he seems to have done no more than read the new provisions to Gail, a practice deprecated in the authorities.
The deficiencies in what Mr Lakos did, and his unavailability to provide any further evidence, make it difficult, if not impossible, for me to have any confidence to conclude that he was satisfied that Gail had capacity at the time of making her 2021 Will. There is little other evidence to suggest that Gail had capacity and much to cast doubt on whether she did.
Counsel for Mr Bone placed principal reliance on the evidence of Gail's friends and family from 2020 to April 2021, contending that this evidence demonstrated that Gail was able to engage coherently and rationally, ask sensible and genuine questions and to recall and communicate information. In considering this evidence, it is important to bear in mind that the relevant time that Gail had to have capacity was between 15 and 20 April 2021.
Quite a lot of the evidence relied on by Mr Bone concerned interactions with Gail in 2020. I find this material to be of quite limited relevance in circumstances where Gail appears to have been in significant decline in 2020 - evidenced by the increase in the number of falls.
More importantly, Gail was diagnosed with ovarian cancer in late January 2021 and this appears to have had a profound impact on her mood, general outlook on life and willingness to actively engage in matters such as her estate planning.
There are frequent references to Gail being depressed after the diagnosis. There also do not appear to be any written communications from Gail (as opposed to the emails drafted by Mr Bone purportedly on behalf of Gail) during the first quarter of 2021 to suggest that she was still actively engaged in life. This appears to be a change from December 2019 and earlier.
The evidence of interactions with Gail in 2021 came from (apart from Mr Bone) Wessel and Nicky Wessels, Jennifer Turner, Alice Quintus, Patricia Pizem and Ronnie Ransfield.
The closest in time to mid-April 2021 is the evidence of Nicky Wessels (who visited Gail on 5 April 2021), Alice Quintus (who last spoke to Gail about two weeks before she died) and Patricia Pizem (who spoke to Gail on 15 April 2021).
The evidence of all but Patricia Pizem is quite general about Gail engaging in conversations. It does not go too far on the question of capacity. Patricia Pizem's evidence is more relevant and establishes that on 15 April 2021, Gail was aware that her solicitor was at her house to do some last minute changes and tidy up the will. In and of itself, this evidence does not, however, establish capacity on 15 April 2021. There is little by way of objective evidence to establish capacity on 15 April 2021. Mr Lakos' file note of the conference on 15 April 2021 does not assist on capacity for the reasons set out above.
Mr Bone's evidence also does not take matters too far on the question of capacity on 15 April 2021. He was not present in the room with Mr Lakos, Jessie Xu and Gail.
Mr Lakos recognised in early March 2021 that there were likely to be issues with Gail's cognition in light of her recent medical issues. As he became more aware of those issues, he appears to have become even more aware of an issue as to her capacity, even observing on one occasion that it is unlikely that any Binding Death Benefit Nomination would be effective if executed. Mr Lakos was only aware of Gail's recent medical issues, not her immediate history of an increasing recurrence of falls, poor cognition test results and the like.
The evidence in relation to capacity on 20 April 2021 is even less satisfactory. Mr Lakos' file note suggests that he did not test for capacity on 20 April 2021. Whilst it appears that Mr Lakos and Mr Bone were with Gail for at least an hour and a half (arriving at 1pm, with the will being executed at about 2.30pm) there is no probative evidence about what was discussed during that period. There is nothing for the Court to be satisfied that Gail had capacity. Mr Bone's evidence was that the discussion in relation to the will took place in the presence of the witnesses, yet they were only in Gail's room for a few minutes. Mr Bone had no recollection as to what was said. There is also no evidence to suggest that Gail was engaged in the process in the sense of asking questions or responding verbally to questions. The highest the evidence really goes is Gail perhaps nodding or mumbling a few words. Precisely what she was "responding" to by mumbling or nodding is not clear.
The hospital records during this period also cast considerable doubt on Gail's capacity. The clear evidence is that Gail was in a very bad way physically on 20 April 2021, having experienced significant problems in the preceding days since she was rushed to hospital on 17 April 2021. Mr Bone's Facebook updates paint a very grim picture of Gail's heath during this period. This evidence falls well short of satisfying me that Gail had capacity on 20 April 2021.
Measured against what Professor Watson said should be done to establish capacity, which is consistent with the statement by Kunc J in Ryan v Dalton that I have extracted above, there is simply no probative evidence to establish that Gail had capacity on 15 April 2021 and, perhaps more importantly, on 20 April 2021.
I do not accept the contention - based on Parker v Felgate - that the relevant date for assessing capacity is 15 April 2021. Counsel for Mr Bone accepted that the principle would only have application if I was satisfied that there was no substantive change between the instructions provided by Gail on 15 April 2021 and the will as executed on 20 April 2021. This is clearly not the case. Mr Bone raised a number of matters - by email post 15 April 2021 in his own interest resulting in a number of changes, particularly in relation to the life estate.
Gail needed to have capacity in order to understand these changes. This is also against a backdrop of Mr Bone admitting that Gail did not understand the concept of a life estate at the time of the 2019 Will. Her health generally, and more importantly her cognition, significantly deteriorated after the 2019 Will was made. She would not have understood what a life estate was even if someone explained it to her.
I am not satisfied that Gail had capacity on either 15 or 20 April 2021.
I turn now to consider whether, assuming (contrary to what I have just found), that Gail had testamentary capacity at the time that she made her 2021 Will, whether I am satisfied that Gail knew and approved of the contents of the 2021 Will. For the following reasons I am not so satisfied.
Given my assumption is that Gail had testamentary capacity, and there was no issue that the 2021 Will was validly executed, there is a presumption of knowledge and approval of the contents of the will at the time of execution, which presumption may be displaced by any circumstance which creates a well-grounded suspicion or doubt as to whether the will expresses the mind of the testator: see Tobin v Ezekial at [46] per Meagher JA.
Evidence that the testator gave instructions for the will or that it was read over by or to the testator is said to be "the most satisfactory evidence" of actual knowledge of the contents of the will. What is sufficient to dispel the relevant doubt or suspicion will vary with the circumstances of the case. Particular vigilance is required where a person who played a part in the preparation of the will takes a substantial benefit under it. In those circumstances, it is said that such a person has the onus of showing the righteousness of the transaction: see Tobin v Ezekial at [47].
In Petrovski v Nasev at [259] Hallen As J stated: [259] In considering whether circumstances that excite suspicion exist, the Court looks at a number of factors including the circumstances surrounding the preparation of the propounded will; whether a beneficiary was instrumental in the preparation of the propounded will; the extent of the physical and mental impairment, if any, of the deceased; whether the will in question constitutes a significant change from a prior will; and whether the propounded will, generally, seems to make testamentary sense. Suspicion engendered by extraneous circumstances arising subsequent to the execution of the propounded will is not a reason for rebutting the presumption of the due execution of a will regular on its face.
The relevant circumstances are as follows: 1. at the time that Gail made her 2021 Will she was gravely ill. She was diagnosed with ovarian cancer in late January 2021 and had undergone three courses of chemotherapy. As at 20 April 2021, she was in Northern Beaches Hospital; 2. Gail was not in a good mental state - there are frequent references to her being depressed; 3. even assuming Gail did have testamentary capacity, there were a number of issues with her cognition as a result of a number of falls consequent upon long term alcohol abuse; 4. Mr Bone appears to have been the driving force behind Gail changing her will, and in particular, to provide him with some certainty in relation to living at the Clontarf Property in the event of Gail's death. He was the person to benefit most from Gail making a new will; 5. understandably, there appears to have been some urgency about changing Gail's will, given the considerable uncertainty as to how long she would live; 6. there is a real issue as to the accuracy of what Mr Bone told Gail, particularly in relation to the discussions that had occurred in 2019, and the reasons as to why Gail had not agreed to grant a life estate to Mr Bone; 7. Mr Bone was purporting to pass on instructions to Mr Lakos on behalf of Gail, which instructions, even on Mr Bone's account, were based on discussions with Gail which included a number of inaccuracies; 8. as ultimately executed, Mr Bone significantly benefited under the 2021 Will securing a portable life estate in relation to the Clontarf Property; 9. at the time of the 2019 Will, Gail was not in favour of granting any interest in the Clontarf Property to Mr Bone. Indeed, at the time of the 2019 Will, it seems quite clear that Gail did not understand notions of a life estate and the like. Gail gave Mr Bone a one third share of the income from the testamentary trust instead of any interest in the Clontarf Property. Gail's general health and in particular, her mental health and cognition, declined significantly between the making of the 2019 Will and April 2021. There is a real doubt that Gail would have understood what was contemplated by the portable life estate granted to Mr Bone under the 2021 Will but this point is academic in circumstances where there is no probative evidence that any explanation of the life estate was ever provided to Gail; 10. all that can be gleaned from the objective material is that Gail instructed Mr Lakos on 15 April 2021 to grant Mr Bone a "right to occupy" the Clontarf Property. Mr Bone raised a number of issues with this immediately after 15 April 2021 which resulted in Mr Lakos making a number of changes to the draft will - clauses 3(b)(iv)(A) - (J) - which substantially benefitted Mr Bone. There was no suggestion that these changes were explained to Gail prior to 20 April and what occurred on 20 April 2021 rises no higher than the discussion about the new will taking less than five minutes with there being no satisfactory evidence of any actual engagement by Gail with the process or ascent to the terms of the will; 11. Mr Bone was present on 20 April 2021 throughout what occurred in relation to the new will; and 12. there is no evidence that Gail read for herself on 20 April 2021 the terms of the will. She was wholly incapable of doing so. Whilst Mr Lakos' file note refers to the contents of the will being read to Gail, there is other evidence to suggest this was very brief. There is also no clear evidence that Gail understood and agreed with whatever it was that was read to her.
Having regard to these circumstances, I am far from satisfied that Gail knew and understood the terms of the 2021 Will. This is a conclusion that I reach having regard to all of the evidence admitted at the hearing. One does not need to linger on questions of onus: cf Dedakis v Deligiannis; The Estate of Rebecca Deligiannis [2024] NSWSC 1018 at [10] - [15] per Leeming JA; Anderson v Yongpairojwong at [184] per Leeming JA.

2019 Will

I have set out above the chronology of the dealings leading up to the making of the 2019 Will.
The relevant starting point is Gail conferring by telephone with Mr Lakos on 22 November 2019. It would appear that Gail conferred with Mr Lakos alone, i.e. without Mr Bone being present at the time of the call. She instructed Mr Lakos relevantly of two changes she wanted to make to her will: 1. on her death, 100% interest in the Clontarf Property to Mr Bone; and 2. ensuring that her brother Mr Petith is excluded from her will other than his participation in the income from the testamentary trust.
There is some suggestion in the evidence that Gail may have previously raised the idea of ensuring that Mr Bone has a roof over his head if Gail was to die with her hairdresser, Tracey Wells. In her affidavit, Ms Wells suggested that the conversation occurred in 2020 but accepted in cross-examination that it could have taken place in 2019. Given the uncertainty as to dates and the fact that it only appears to have been one conversation, I do not place too much reliance on this point. Of more relevance is that Gail likely spoke to Mr Lakos alone and gave him her instructions.
This starting point in the instructions is significant. It provides some clear evidence of Gail's capacity at the time, demonstrating her ability to identify a substantial asset of her estate and weigh the interests of her de facto partner. The instructions provided in relation to Mr Petith obviously involve Gail appreciating an important aspect of her existing will - namely the testamentary trust and weighing up whether she wanted him to benefit any more, which she did not. The communication also provides evidence of Gail's capacity to understand the nature of the act of seeking a will and its effects.
Thereafter, there are a series of emails, involving Mr Lakos and either or both of Gail and Mr Bone. It was not in dispute that the emails which were purportedly sent by Gail were in fact drafted by Mr Bone in consultation with Gail. At least one of the emails - dated 29 November 2019 - expressly states that Mr Bone helped Gail write the email.
Mr Bone communicated directly with Mr Lakos (copying Gail) on 7 December 2019, advising Mr Lakos that Gail had asked Mr Bone about the ramifications of gifting the Clontarf Property to Mr Bone "outright and absolutely". Once it was explained to Gail that this meant that the property would pass under Mr Bone's will, she indicated that she did not want this to occur. The email from Mr Bone went on to record that the only solution "acceptable to both of us", ie both Gail and Mr Bone, instead of the outright gift was a one third interest in the income of the testamentary trust.
I accept the contention advanced by Mr Bone that this email faithfully relayed Gail's instructions as it was against Mr Bone's interests. The position also has a ring of truth about it from Gail's perspective - not wanting a significant asset to pass pursuant to Mr Bone's will but instead she was happy to provide Mr Bone with income during his lifetime but no substantial asset to pass under Mr Bone's will.
I am not overly troubled, in the circumstances, by Mr Bone's concluding words: Any solution more legally- complicated than this appears to be a bit much for her to comprehend at this time. I'll ask Gail to confirm these changes to you via her own email when she's ready.
I do not read the first sentence as suggesting some cognitive issues at the time. It simply suggests that Gail was not in a position to consider any more legally complicated solutions than giving Mr Bone a one third share of the income from the testamentary trust instead of an outright gift of the Clontarf Property. Testamentary capacity does not involve the testator being able to consider all possibilities for dealing with their estate, no matter how complex.
Mr Lakos responded to Mr Bone to the effect that he would explain to Gail in detail the meaning of each provision and will "verify that she fully comprehends all provisions and that these accurately reflect her wishes".
Mr Lakos' file contained an article from the December 2019 Law Society Journal entitled "Practical tips for dealing with knowledge and approval of a will", suggesting he was at least conscious of this issue at the time.
The confirmatory email from Gail alluded to in Mr Bone's email to Mr Lakos dated 7 December 2019 was sent, purportedly from Gail, on 9 December 2019, although this was drafted with the assistance of Mr Bone. I do not accept that Mr Bone was acting on some frolic of his own in drafting and sending this email and am satisfied that Gail was in fact consulted and approved the email. The email does not only deal with new gifts to Mr Bone, it also clarifies the gifts to other beneficiaries.
Gail met with Mr Lakos on 13 December 2019 to execute the will. According to Mr Lakos' file note Mr Bone was also present during the conference at which the will was executed. Whilst this was far from ideal, it does not, in and of itself, bear on capacity or knowledge and approval.
According to Mr Lakos' file note, the conference lasted for one and a quarter hours. It likely took place at Mr Lakos' office. The note records that Gail has read the latest version of the will "in detail". In contrast with what occurred in April 2021, there is no suggestion in the contemporaneous material including her dealings with others, that in December 2019, Gail's health was such that she was not able to read the will. Having read it in detail, Gail indicated that she fully understood it. It then appears that Mr Lakos separately read to Gail each of the clauses and she (Gail) fully comprehended and approved the provisions. This is the very thing that Mr Lakos told Mr Bone that he would do in his email of 7 December 2019.
There is considerable lay evidence to suggest that, at this time, Gail was continuing to converse with friends and family in a way that suggested she did not have any significant cognitive issues. All of the witnesses called by Mr Bone spoke with the one voice on this. The evidence paints a picture of Gail declining in 2020 after her bad fall in late December 2019.
Gail's brother, Mr Petith, spoke to Gail regularly and saw her on about five or six occasions after she met Mr Bone. He did not raise any issues with Gail's capacity in relation to this will (and the earlier wills) until December 2022. His initial concern was only in relation to Gail's capacity at the time of making the 2021 Will. Mr Petith did not give evidence of any significant events prior to the 2019 Will that would raise significant questions in relation to Gail's cognition. His first affidavit made 23 December 2021 deals only with Gail's health and cognition at the time of making the 2021 Will. At the time he made this affidavit, he also filed a summons seeking a declaration that the 2021 Will is void and that the 2019 Will is Gail's last will. Anne Petith also gave evidence of speaking to Gail in 2020 during which Gail asked after her nieces. This all goes to paint a picture of Gail having capacity at the time of the making of the 2019 Will.
The opinions expressed by Professor Wason do not lead me to fail to be satisfied that Gail had capacity. As set out above, a number of Professor Watson's opinions on Gail's capacity at this time were based on Professor Watson's assumptions as to the effect of long term alcohol abuse based on his many years' experience. They were, in effect, his well-educated guesses. There was, however, little in the actual evidence concerning Gail to support those opinions. The evidence of Gail's dealings suggest quite strongly that she did have capacity.
I am satisfied that Gail had capacity at the time of making the 2019 Will. The evidence demonstrates that she had the capacity to understand the nature of the act of making a will and its effects, to understand the extent of the property the subject of her will and to comprehend moral claims of potential beneficiaries.
I turn now to consider the issue of knowledge and approval. Being satisfied of capacity and there being no question about due execution, a presumption of knowledge and approval arises. The involvement of Mr Bone in the dealings with Mr Lakos and his presence at the conference on 13 December 2019 when the will was signed, against the background of him being the beneficiary of the amendments made in the will, however, displaces the presumption. Mr Bone must therefore prove affirmatively that Gail knew and approved of the contents of the 2019 Will.
I am affirmatively satisfied that Gail knew and approved of the contents. Having regard to Mr Lakos' file note of the conference on 13 December 2019, I am satisfied that Gail read over the will in detail. This is the most satisfactory evidence: see Tobin v Ezekial at [47] per Meagher JA.
Counsel for Mr Petith contended that the Court could not be satisfied that Gail knew and approved the contents of the 2019 Will. Reliance was placed on the fact that Mr Bone was the instigator of the will, having spoken to Dr Lim without Gail and that he was, as emerged in cross-examination, then the author of all the written instructions to Mr Lakos and was also present at the conference on 13 December 2019.
I deal with each of these matters in turn.
First, as regards the discussion with Dr Lim, it is clear that Dr Lim was also Mr Bone's general practitioner and there is nothing in the evidence to suggest that Mr Bone deliberately met with Dr Lim to discuss Gail's condition and that this was somehow part of a plan on Mr Bone's part. There was no secret as to Gail's declining health. Dr Lim had previously told both Gail and Mr Bone.
Second, I do not regard the fact that Mr Bone did not volunteer in evidence-in-chief that he was the author of the email communications in Gail's name with Mr Lakos as telling against Gail knowing and approving the contents of the 2019 Will. Mr Bone readily admitted his involvement in cross-examination. One of Gail's early emails clearly states that Mr Bone had helped Gail write the email. Mr Bone was also openly writing to Mr Lakos in his own name. Mr Lakos' response on 7 December 2019 to Mr Bone was that he (Mr Lakos) would verify that Gail fully comprehends the provisions and that they accurately reflect her wishes. His file note records that he did this.
Given these matters, it cannot seriously be contended that Mr Lakos was somehow misled into thinking that emails were drafted by Gail and as such did not take steps to be satisfied that Gail knew and approved the contents of the 2019 Will.
Third, Mr Bone's attendance at the 13 December 2019 conference should not have occurred but in the circumstances, particularly the clear entries in the 13 December 2019 file note of Mr Lakos, which (by contrast with April 2021) are not called into doubt by Gail's physical condition and circumstances.
I am satisfied that Gail knew and approved of the contents of the 2019 Will.

The Codicil

In light of my conclusion that Gail had testamentary capacity and knew and approved of the contents of the 2019 Will, it is strictly unnecessary for me to consider any of the earlier testamentary dispositions - the Codicil and the 2018 Will. Against the possibility that I am wrong in relation to the 2019 Will, I deal with each of these two documents.
Putting to one side the medical opinion of Professor Watson, there is little to suggest that Gail did not have capacity at the time of the making of the Codicil on 30 May 2019. There is a generalised comment of Mr Bone, recorded in the medical records on 1 December 2018, that Gail's short term memory was "not the best".
I have set out above the circumstances leading to the execution of the Codicil.
Gail and Mr Bone met with Mr Lakos on 17 May 2019. Mr Lakos was instructed that Gail wished to amend her will to include a legacy to Mr Bone of $1 million.
Mr Lakos confirmed those instructions by email to Gail on 20 May 2019, providing a draft codicil to Gail.
Gail was obviously personally interested to review the draft codicil because she emailed Mr Lakos on 22 May 2019 stating that she could not download the codicil and she asked him to send it in another form. Mr Lakos did that and it seems clear that Gail read the draft, as she emailed Mr Bone on 22 May 2019, in effect noting that Mr Lakos had included the wrong address for Mr Bone, and asking for Mr Bone to email Mr Lakos to correct the error. Mr Bone was not with Gail at the time, having returned to Santa Fe.
By email dated 23 May 2019, Mr Bone advised Mr Lakos, copied to Gail, his correct address. Mr Lakos then sent a revised draft to Gail, copied to Mr Bone dated 23 May 2019, in which he requested that Gail schedule a conference to meet so that she could execute the Codicil.
Gail met with Mr Lakos on 30 May 2019 and executed the Codicil. Mr Bone was not present at that conference. It also appears that Gail paid Mr Lakos for his services on 30 May 2019.
This chronology demonstrates, quite clearly, that Gail had capacity in the relevant sense. She obviously reviewed the draft and corrected an error. I also do not regard anything in the Codicil as inefficacious. It cannot be said to be irrational for someone in Gail's position to want to make provision for Mr Bone in circumstances where she had not previously made any provision for him, and they had been in a relationship for some four and a half years. There is also the evidence that Gail subsequently told Nicky Wessels that she had left $1 million to Mr Bone in her will.
There is nothing in the opinions expressed by Professor Watson to lead to a different outcome. The lay and other evidence is more powerful than the educated assumptions made by Professor Watson.
Given that Gail had capacity and again there is no suggestion that the Codicil was not duly executed, a presumption of knowledge and approval arises. Whilst Mr Bone was obviously in attendance at the initial conference with Mr Lakos and Gail on 17 May 2019, he thereafter was overseas. His early involvement and obvious gain from the Codicil may be said to displace the presumption. In any event, I am comfortably satisfied on the evidence that Gail knew and approved of the contents of the Codicil. No other conclusion is reasonably open on the evidence, particularly Gail's email of 22 May 2019 where she picked up on the error in relation to Mr Bone's address and asked for him to correct it. The Codicil is also only half a page in length, consisting of three clauses. The subsequent statement by Gail to Nicky Wessels that she had left $1 million to Mr Bone in her will also evidences knowledge and approval.
I am therefore satisfied that Gail had capacity and knew and approved of the contents of the Codicil.

2018 Will

Again, putting to one side the retrospective medical opinion of Professor Watson, there is little in the evidence to suggest that Gail did not have capacity to make a will prior to 2018. There is nothing in the medical records identifying concerns as to memory prior to then.
On the evidence, the suggestion of amending her will was raised first by Gail. It was Gail that raised with Mr Bone the possibility of her providing for him in the will, which he declined. Gail then decided to gift $100,000 to Mr Bone's daughter.
The initial conference with Mr Lakos was on 17 May 2018 and was attended by both Gail and Mr Bone. It is clear that Gail was actively engaged and following what was required of her, because on 19 May 2018 she sent an email to Mr Lakos providing further details of addresses of the beneficiaries in her will. This suggests that she was obviously aware of what was occurring as she needed to provide details of the beneficiaries of her will. It also demonstrates that she was able to call to mind her beneficiaries.
The inescapable inference from this email is that Gail had provided instructions to Mr Lakos two days' earlier as to who were to be her beneficiaries. Relevantly, Mr Lakos sent a further draft of the will to Gail on 30 May 2018. He then had a telephone discussion with Gail on 1 June 2018. Further drafts were then sent on 1 June 2018 and 13 June 2018.
An appointment was then made for Gail to execute her will at Mr Lakos' offices on 15 June 2018. One of the witnesses was an independent solicitor, Jessica Swain. She gave unchallenged evidence of her usual practice in relation to satisfying herself that the testator had capacity. She gave unchallenged evidence that she had no concern as to Gail's capacity at the time of the meeting. There is nothing to cast doubt on this evidence.
There is considerable other evidence from around this time of Gail interacting with others in a way which suggested that she was aware, for example, of her asset position and was otherwise in complete control of her faculties. One example is evidence given by her sister-in-law, Anne Petith of a conversation that she had with Gail in around 2018 in which Gail referred to her ownership of a 7-11 store, that she had purchased for $5.2 million.
A further important indicator of Gail's capacity at the time is that shortly after executing the 2018 Will, she went to join Mr Bone in Santa Fe. On 26 June 2018, Mr Lakos sent an email to Gail reporting on the outcome of the meeting of 15 June 2018, and attaching his tax invoice for the legal work that he had carried out. Gail responded to that email on 1 July 2018, stating that she was overseas and would not be able to pay his tax invoice until her return. On her return to Sydney Gail paid that invoice on 21 September 2018. This conduct demonstrates that Gail understood what was being asked of her by Mr Lakos, understood the way in which bills were being paid while she was away and as such, that it would not be possible to pay Mr Lakos' invoice until her return. She was acting in a coherent and logical way.
Turning now to whether Gail knew and approved of the contents of the 2018 Will, in circumstances where I am satisfied that Gail had capacity at the relevant time and the will was duly executed, a presumption of knowledge and approval arises. There is little in the circumstances, surrounding the lead-up to and making of the will to arouse suspicion. It appears that the idea of changing her will was first raised by Gail. The only change of any substance from the earlier 2014 Will was a gift of $100,000 to Mr Bone's daughter. There is nothing unusual in the evidence as to how this came about. By this time, Gail and Mr Bone had been a couple for approximately three and a half years.
Mr Bone was not present in Australia at the time that the 2018 Will was executed. Further, the evidence of Ms Swain as to her usual practice and the fact that she followed that practice on 15 June 2018, also strongly supports a finding that Gail knew and approved of the contents of the 2018 Will.
I am satisfied on the evidence that she did.

Relevant principles

The applicable legal principles were, understandably, not in dispute. They were summarised for example in Petrovski v Nasev at [263]-[277] per Hallen AsJ.
Undue influence in probate is to be distinguished from the equitable doctrine of undue influence. It requires actual coercion, not simply the influence of affection and attachment or the desire to gratify the wishes of another. The coercion must overpower the volition of the deceased. It is to be distinguished from mere persuasion, appeals to the ties of affection or pity for future destitution, all of which are legitimate.
In Trustee for the Salvation Army (NSW) Property Trust v Becker (2007) 14 BPR 26,867; [2007] NSWCA 136, Ipp JA observed at [63] that the circumstances must be such that the disposition is not regarded as the free and voluntary act of the testatrix and that the volition of the testatrix must be overpowered so that her mind does not accompany her act in making the will.

Application to the Facts

In closing submissions, senior counsel for Mr Petith, made it clear that the allegations of undue influence were not pursued in respect of the 2018 Will or the May 2019 Codicil. The allegations were maintained in respect of the 2019 Will and the 2021 Will, to which I now turn.

2021 Will

I deal first with the 2021 Will.
The alleged undue influence, as I understand the closing submissions of senior counsel for Mr Petith, centres on two matters. First, that Gail was misled by a Mr Bone in entering into the 2021 Will. Second, that central to the 2021 Will was the fact that in return for Mr Bone receiving the life estate in relation to the Clontarf Property, the entirety of the balance of Gail's self-managed superannuation fund was to be paid to her estate, with a Binding Death Benefit Nomination being executed by Gail to give effect to this, with Mr Bone being responsible for ensuring that the wishes of Gail were given effect to in this regard. In circumstances where the Nomination that was executed is not effective, Mr Bone has therefore failed in the task that he was responsible for yet he still seeks to retain all, or now part of the self-managed superannuation monies.
It is strictly not necessary and somewhat artificial to consider whether Gail's will was overborne in circumstances where I have found that Gail did not have capacity at the time of making the 2021 Will and did not know and approve of its contents. I consider the contention briefly on the assumption that Gail did have capacity.
For the reasons set out above, I am satisfied that if the 12 April 2021 conversation that Mr Bone deposes to having had with Gail occurred in the manner in which he contends it did, it contained at least two errors. First, as to Mr Bone having recently decided to remain permanently in Australia. He had decided this already in 2019. Second, as to the reasons why Gail decided not to leave the Clontarf Property to Mr Bone outright. It had nothing to do, as Mr Bone contended, with any issue in relation to taxes. Rather, as the contemporaneous emails at the time make clear, Gail did not want the Clontarf Property to pass under Mr Bone's will.
Notwithstanding these errors, I am far from satisfied that Gail's will was overborne in the relevant sense. Mr Lakos and Jessie Xu conferred with Gail in the absence of Mr Bone on 15 April 2021. Mr Lakos confirmed Gail's instructions. He was clearly acting for Gail. Thereafter, there were communications between Mr Bone and Mr Lakos where it was clear that, at least in part, Mr Bone was seeking to advance his own interests as to the nature of the life estate to be left to him. Those changes requested by Mr Bone were considered by Mr Lakos (acting for Gail) and were very briefly dealt with in the conference with Gail on 20 April 2021. In these circumstances, there is no basis to conclude that Gail's will was overborne by Mr Bone. Assuming she had capacity, Gail's actions are readily explainable by reason of a desire to provide more for Mr Bone.
The second of the two matters relied upon also does not lead to a conclusion of any undue influence. Whilst it is clear that Mr Bone understood the key aspects of Gail's apparent testamentary intentions - namely a life estate to Mr Bone in circumstances where the entirety of her self-managed superannuation would be paid to the estate - and that Mr Bone admitted that, because of Gail's incapacity, it was he that was driving the execution of the Nomination, there is nothing to suggest that Mr Bone was in any way, shape or form, aware that the Binding Death Benefit Nomination that Mr Lakos had prepared was likely to be ineffective. Mr Bone's evidence was that he could not recall the Nomination being executed on 20 April 2021. There is nothing in these circumstances to conclude, again, that Gail's will was somehow overborne by Mr Bone.
All that could be said is that Mr Bone was now seeking to take advantage of the ineffective Nomination by not only maintaining the claim to the life estate, but also making a claim on the self-managed superannuation. That, however, is not undue influence.
I am thus not satisfied that there was any undue influence exerted by Mr Bone in relation to the 2021 Will.

2019 Will

In relation to the 2019 Will, senior counsel for Mr Petith's argument centred on Mr Bone's involvement in the preparation of the 2019 Will. It was contended that Mr Bone provided all the instructions to Mr Lakos under Gail's name, that he was the instigator of the will in circumstances where Gail did not clearly understand fundamental aspects of what was being discussed.
I have set out above my findings in relation to Gail's capacity and knowledge and approval of the 2019 Will. I have concluded that Gail had capacity at the time and further that she knew and understood the contents of the will. The contentions advanced by senior counsel for Mr Petith do not, as I understand it, raise any different factual allegations. There is nothing in the circumstances of the dealings between Gail, Mr Bone and Mr Lakos leading up to the making of the 2019 Will, to suggest that Gail's will was in fact overborne by Mr Bone. Whilst Mr Bone was heavily involved, the changes that occurred after the initial instructions were provided by Gail to Mr Lakos, were to the detriment of Mr Bone. He was no longer to receive the Clontarf Property outright but rather was to receive a one third interest in the income of the testamentary trust. Gail's actions are, again, readily explainable by reason of a desire to provide more for Mr Bone having regard to the development of their relationship.

Mr Bone's claim for further provision

Mr Bone's claim for further provision under the Act was only advanced if the 2021 Will is not admitted to probate. I have found above that the 2021 Will should not be admitted to probate because Gail did not have capacity at the time and did not know and approve of the contents of the 2021 Will. The claim for further provision therefore arises for consideration.
It is important to appreciate at the outset that the claim for further provision arises in circumstances where I have determined that the 2019 Will should be admitted to probate, or more accurately, given that the original will was destroyed, a copy of it. Under the 2019 Will, Mr Bone receives not only the $1 million legacy introduced by the Codicil but also one third of the income of the testamentary trust.
In circumstances where the Clontarf Property will not be subject to a life estate in favour of Mr Bone, there is no reason why the Clontarf Property should not be sold and the proceeds form part of the residue. It seems to be clear that the market value of the Clontarf Property is in the order of $12 million. The income earnt by the testamentary trust would be significantly increased by the addition of approximately $12 million to it and Mr Bone would benefit accordingly by virtue of his one third share of the annual income.
In addition, Mr Bone will receive in the order of $2 million from the self-managed superannuation fund with the remaining $4 plus million (after tax is taken out) forming part of the residuary estate. The annual income of the testamentary trust will be correspondingly increased as a result with Mr Bone receiving a third of that income.
Mr Bone also has substantial assets in the United States. I have set these out above.
Mr Bone was cross-examined by counsel for the NSWTAG in relation to his asset position and his likely annual income. Ignoring the value of his property in Santa Fe, Mr Bone's assets, including the $1 million legacy under the 2019 Will and the $2 million likely to be received from Gail's self-managed superannuation fund, are in the order of $7.3 million. If these assets earn a five percent return annually, Mr Bone will earn approximately $365,000 per annum. Mr Bone's expected return was in fact higher - in the order of eight to ten percent.
A rough estimate of the value of the testamentary trust, assuming the Clontarf Property is sold, and its proceeds invested, is in the order of $19 million. If this earns a five percent return, the annual income will be approximately $960,000 and Mr Bone's share in the order of $320,000. These figures do not take account of the $4 million injection into the testamentary trust from Gail's self-managed super fund.
It was put to Mr Bone in these circumstances that he would be well able to buy a suitable property in Sydney or alternatively rent one. A number of properties were identified to Mr Bone in cross-examination. He did not agree that any of the properties would be suitable. As set out above, this was an example of Mr Bone's intransigence.
Mr Bone's claim for further provision is also to be considered in circumstances where he is now 74 years old. His relationship with Gail began in late 2014 and obviously ended when Gail died in April 2021 - a period of a little over six years. At least during the period from September 2019 until Gail passed away in April 2021 when the couple were living in Australia due to COVID restrictions, Mr Bone admitted that Gail paid for almost the entirety of his living expenses and as such, his wealth was otherwise not depleted and grew. Allied to this, it is clear that Mr Bone does not claim to have made any financial contribution to Gail's estate. They kept their respective estates separate.
Mr Bone put his claim this way in answer to a question in cross-examination from counsel for the NSWTAG: Q. Mr Bone, I'll put it to you as a proposition. You can't make any realistic case that you need more than $4.3 million for those purposes, can you? A. You know, it all depends on how you wish to live, sir. You know, I mean, yeah, the way that Gail and I have been living is - is not living in a two-bedroom, one-car garage house that only has about 1,400 square feet in it. I mean, that's not been our lifestyle. And as her surviving spouse, without any kids or what have you, I would expect that - of course, I understand the law here is different, but I would - would expect here that it's not so much a question of what can I afford, but what should I be entitled to as a result of living the way I've lived with my wife, being as wealthy as she was, and the lifestyle that we had. And, you know, I would hope to be able to continue that, and she would wish for me to be able to continue that as well. So, anybody can live on $4 million. I mean, let's face it, okay, I - I can't really say no to that. The question is how, your Honour, how are you going to live? And, I mean, if you want to confiscate most of my wife's estate and distribute it elsewhere, well I guess I can't keep you from doing that, but I think basically, as a matter of - of fairness, and - and when you consider the way that we have been living, that I'm entitled, you know, to at least a four to $5 million sum that I can go out and find on my own a property that I like to be able to buy and live in without debt and have enough left over to be able to - to live the way we - we were living our lives before she got sick and died. And I don't know how else to describe that, but I'm - I'm completely at your mercy there. You know, I can't - most people in Australia don't - aren't worth what I'm worth. Okay, when you look at what - my portfolio, I mean, most people in the United States don't have three - a $3 million dollar portfolio, especially now the way things are going. So, you know, what can I say? Yeah, I can - I can - I don't want to say "Live like a pauper," but live a heck of a lot with - with a heck of a lot less, but that's not how I - that's not what I would expect. And that's not how I would be living if Gail hadn't gotten cancer and died. So I don't know what else to say.
Counsel for Mr Bone emphasised that the relevant question under the statue is not just whether the provision is "adequate", but whether adequate provision for the "proper" maintenance, support and advancement of the applicant has been made. Proper maintenance is not limited to the bare sustenance of a claimant's position in life including age, status, relationship with the deceased financial circumstances, the environs to which he or she is accustomed, and mobility: see Alexander v Jansson [2010] NSWCA 176 at [18] per Brereton J. Reliance was also placed on what Callinan and Heydon JJ wrote in Vigolo v Bostin (2005) 221 CLR 191 at 228 [114] to the effect that regard must be had to how the parties have lived and might reasonably expect to have lived in the future.
In circumstances where the estate is large and there are no other beneficiaries who present competing moral claims on Gail's estate, and considering Mr Bone's position as a loving, dutiful and dependant spouse to Gail, it was contended that the Court should make provision for Mr Bone which provides him with secure accommodation in a way that does not require him to realise his own assets (and thereby reduce his available income). The primary submission was that provision in terms of what was provided for in the 2021 Will should be ordered. Alternatively, a capital sum should be ordered and the Court would have the flexibility under the Act to in effect capitalise the whole trust now to enable this to occur.
The NSWTAG's primary position was that no order for further provision should be made in favour of Mr Bone. He could purchase suitable accommodation from his own resources, including those legacies left to him under the 2019 Will. Reference was also made to the cases that each claim for provision must be determined on its merits regardless of the relationship between the claimant and the deceased eg Grant v Roberts; Smith v Smith; Roberts v Smith; Curtis v Smith [2019] NSWSC 843 at [170] per Ward CJ in Eq (as her Honour then was).
The relevant principles are well understood. Having regard to all relevant circumstances at the present time, did Gail make inadequate provision for Mr Bone's proper maintenance or advancement in life: s 59(1) of the Act; Dighton v Norwood [2024] NSWSC 318 at [87]ff.
Having regard to all of the circumstances, I am not satisfied that inadequate provision was made by Gail in the 2019 Will for Mr Bone's proper maintenance or advancement in life.
I am conscious that the question is whether adequate provision is made for Mr Bone's proper maintenance, education or advancement in life and that these are relative concepts which must have regard to the size and nature of Gail's estate and the lifestyle Gail allowed Mr Bone to live. Gail's estate is large and for the two and half years before Gail died, the two of them lived in a large waterfront home in Clontarf or at Gail's apartment on the Gold Coast. Gail in effect funded Mr Bone's lifestyle. The fact that the estate is large does not provide a basis for some kind of blank cheque exercise: see Soulos v Pagones (2023) 416 ALR 181 at [682] per Ward P.
A surviving spouse does not have a right, in effect, to be maintained in the manner to which they were accustomed when living with the now deceased. An evaluative assessment is required having regard to the relevant circumstances.
In the present case, those circumstances as at the present time include: 1. Gail and Mr Bone's relationship lasted for a little over six years. It was no doubt a loving and caring one which included each caring for the other in their times of need (Mr Bone being more needy in the earlier stages of their relationship and Gail in more recent times); 2. there was no intermingling of finances and Gail largely supported Mr Bone financially, particularly in the latter period of their relationship whilst they were locked down in Australia; 3. Mr Bone came into the relationship with substantial assets in the U.S, including real estate. Mr Bone has largely not needed to draw on those assets particularly during the latter part of his relationship with Gail because of her financial support of him. Gail's financial support has enabled Mr Bone's assets to grow; 4. in addition to being financially supported by Gail during her lifetime, Mr Bone will also benefit substantially under Gail's 2019 Will - a $1 million legacy and one third of the income of the testamentary trust. Mr Bone will also benefit, somewhat fortuitously, from the fact that the Nomination is not effective - a $2 million windfall for Mr Bone. The value of the testamentary trust will increase by approximately $4 million and the income from the trust will increase accordingly, with Mr Bone receiving one third of the increased income; 5. he can readily afford, out of his own existing and to be received assets, to buy or rent suitable accommodation on Sydney's north shore befitting his station in life, if that is what he wants to do.
Having regard to all of these matters, it is my view that the community would not expect for Gail to provide any more for Mr Bone.
Mr Bone's claim for further provision should be dismissed.

Conclusion and orders

For the reasons set out above, a copy of the 2019 Will should be admitted to probate. Mr Bone's claim for further provision should be dismissed. At the request of the parties, I will hear them as to costs if they are unable to reach agreement. Any remaining issues, including as to costs, will be determined on the papers.
The orders of the Court are: 1. Direct the parties to confer and seek to agree final orders to give effect to these reasons, including as to costs. 2. Direct the parties to provide any agreed orders, or competing orders, to my Associate by no later than 5pm on 10 December 2024. 3. In the event there is no agreement, including as to costs, direct the parties to provide to my Associate by no later than 5pm on 10 December 2024 any submissions and supporting material, such submissions not to exceed 3 pages. 4. Direct the parties to provide to my Associate by no later than 5pm on 17 December 2024 any submissions and supporting material in reply, such submissions not to exceed 3 pages, whereupon the remaining issues will be determined on the papers.

Amendments 02 December 2024 - correct typographical error in [474(e)] DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 02 December 2024

Trustee Act 1963(NSW)s 63

Dedakis v Deligiannis; The Estate of Rebecca Deligiannis [2024] NSWSC 1018 Dighton v Norwood [2024] NSWSC 318 Eggins v Robinson [2000] NSWCA 61 Grant v Roberts; Smith v Smith; Roberts v Smith; Curtis v Smith [2019] NSWSC 843 In the matter of Gainer Associates Pty Ltd [2024] NSWSC 1138 Lim v Lim [2023] NSWCA 84 Mekhail v Hana [2019] NSWCA 197 Nicholson v Knaggs [2009] VSC 64 Parker v Felgate (1883) 8 PD 171 Pates v Craig & Anor; The Estate of Cole (NSWSC, 28 August 1995, unreported) Petrovski v Nasev; The Estate of Janakievksa [2011] NSWSC 1275 Soulos v Pagones (2023) 416 ALR 181 Tobin v Ezekial (2012) 83 NSWLR 757 Trustee for the Salvation Army (NSW) Property Trust v Becker (2007) 14 BPR 26,867; [2007] NSWCA 136 Van Rensburg v Adilinis [2024] NSWSC 1146 Veall v Veall (2015) 46 VR 123 Zorbas v Sidiropoulous (No 2) [2009] NSWCA 197 Texts Cited: Nil Category: Principal judgment Parties: In proceedings 2021/00364938: Paul Petith (Plaintiff) New South Wales Trustee & Guardian (First Defendant) Steven Rundle Bone (Second Defendant)

(2021) 105 NSWLR 487

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