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Key decisions

  • Glenda Phillips v James Phillips; John Matthew Phillips by his tutor NSW Trustee & Guardian v James Phillips [2017] NSWSC 280
  • McNamara v Nagel [2017] NSWSC 91
  • Kraljevic v Kraljevic [2017] NSWSC 225
  • Jodell v Woods [2017] NSWSC 143
  • Steiner v Strang [2017] NSWSC 132

Capacity and brain injury

Practitioners’ focus when assessing capacity for will making and giving powers of attorney has largely been on the aged client with perhaps associated dementia and Alzheimer’s disease and cognitive impairment. The capacity of intending willmakers with acquired brain damage has received little attention by comparison.

Kunc J considered the issue in Glenda Phillips v James Phillips; John Matthew Phillips by his tutor NSW Trustee & Guardian v James Phillips [2017] NSWSC 280 and found that the testator lacked capacity. The deceased testator had suffered a significant brain injury when he was struck by a motor vehicle when a pedestrian. He was then aged 82 and did not suffer from dementia.

While the will was rational on its face, there was a finding that there were sufficient circumstances which raised doubt as to the existence of testamentary capacity and a finding that the testator lacked capacity.

The principal evidence relied on by the Court was the extensive contemporaneous medical reports, coupled with the inability of the solicitor who prepared the will to satisfy the Court that the testator had testamentary capacity. There were inadequate file notes and the solicitor failed to follow up on suggestions the testator possibly lacked capacity when the will was made. Practitioners should consider paragraph 141 of the judgment for consideration of the role of the solicitor drafting the will.

The judgment also considered the interrelationship between testamentary capacity and the making of a financial management order. His Honour said (at [128]), that it is ‘convenient at the outset that it was common ground that the fact that the Court had made an order in relation to Bill under the Protected Estates Act 1983 (NSW) did not lead to the conclusion that Bill was conclusively to be presumed to have lacked testamentary capacity: Perpetual Trustee Company Ltd v Fairlie – Cunninghame & Anor (1993) 32 NSWLR 377 (Powell J). However while that may be so I accept Mr Cheshire’s submission that in many cases (of which I consider this case is an example) the fact that a person has been found incapable of managing their financial affairs provides a good starting point for establishing a doubt about that person’s testamentary capacity’.

Consideration is given in the judgment to the role of expert medical evidence which was called by one party only.

The will itself was relatively short and simple. In all cases where the willmaker may be of lesser intellectual capacity as the result of a brain injury, but satisfies the capacity tests enunciated in Banks v Goodfellow, a lack of complexity, unnecessary length and lists of powers are desirable.

Frequently the assets of such willmakers are modest such that the expense of a statutory will may not be justified. The making of the will in such circumstances, having regard to the cautions I have expressed, may indeed be proper having regard to principles of free and independent testation.

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