Jeavons v Chapman (No 2)

Case [2009] SASC 3

SUPREME COURT OF SOUTH AUSTRALIA

(Civil: Application)

JEAVONS v CHAPMAN (No 2)

[2009] SASC 3

Reasons for Decision of The Honourable Justice Gray

12 January 2009

MENTAL HEALTH - MANAGEMENT AND ADMINISTRATION OF PROPERTY - PROTECTION ORDERS

MENTAL HEALTH - GUARDIANS, COMMITTEES, ADMINISTRATORS, MANAGERS AND RECEIVERS - OTHER MATTERS

MENTAL HEALTH - LEGAL PROCEEDINGS BY AND AGAINST MENTALLY ILL AND OTHER PROTECTED PERSONS

SUCCESSION - WILLS, PROBATE AND ADMINISTRATION - THE MAKING OF A WILL - TESTAMENTARY CAPACITY - IN GENERAL

Plaintiffs granted protection order over defendant and defendant’s estate pursuant to section 7, Aged and Infirm Persons’ Property Act 1940 (SA) and appointed managers of protected estate pursuant to section 10, Aged and Infirm Persons’ Property Act – in making protection order, Court was satisfied that defendant was unable to manage her affairs – plaintiffs sought advice, directions and authorisations from Court in relation to management of protected estate pursuant to section 13(2) and 16, Aged and Infirm Persons’ Property Act – whether section 13(2), Aged and Infirm Persons’ Property Act enables Court to authorise plaintiffs as managers to pursue proceedings in testamentary causes jurisdiction to make a statutory will for defendant – whether Court should authorise plaintiffs to pursue testamentary causes proceedings – whether Court should make an order indemnifying plaintiffs against all costs, charges and expenses properly incurred by them in the testamentary causes proceedings, pursuant to section 7(8) Wills Act 1936 (SA).

Held: Court has a wide discretion under section 13(2) Aged and Infirm Persons’ Property Act to authorise persons in role of manager of protected estate to pursue statutory will application in an appropriate case – Court should not exercise discretion to authorise plaintiffs as managers to pursue statutory will application in this case – plaintiffs’ statutory will application is driven by personal, moral and familial obligations, is unconnected with management of protected estate, and is not justified on facts and evidence – orders as to indemnity undesirable and premature at this stage of the proceedings – plaintiffs’ applications dismissed.

Aged and Infirm Persons’ Property 1940 (SA) s 7, s 8, s 10, s 13, s 16, s 18, s 24, s 29, s 31; Administration and Probate Act 1919 (SA) s 69; Court of Protection Rules 2001 (UK); Court of Protection Rules 2007 (UK); Mental Health Act 1983 (UK) s 96(1)(e); Mental Capacity Act 2005 (UK) s 18(1)(i); Protected Estates Act 1983 (NSW) s 13(1), s 71(1); Supreme Court Rules 2006 (SA) 89; Trustee Act 1936 (SA) s 35(2), s 91; Wills Act 1936 (SA) s 7; Wills (Wills for Persons Lacking Testamentary Capacity) Amendment Bill 1996 (SA), referred to.
Australian Securities and Investment Commission v Commercial Nominees of Australia Ltd (2002) 42 ACSR 240; Bridge Shipping Pty Ltd v Grand Shipping SA (1991) 173 CLR 231; Bryant v Blake (2004) 237 LSJS 23; D’ercole v Wood [2005] SASC 57; Executor Trustee Australia Ltd v Blum [2007] SASC 329; Glazier Holdings Pty Ltd v Australian Men’s Health Pty Ltd (Unreported,…

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Jeavons v Chapman (No 2) [2009] SASC 3
Case
[2009] SASC 3
Decision Date

CaseChat Overview and Summary

Jeavons v Chapman (No 2) involved an application by Mr and Mrs Jeavons for a protection order over the estate of Mrs Chapman, an elderly woman suffering from mental impairment. The applicants sought to be appointed as managers of the estate and to be allowed to pursue a testamentary causes proceeding in that capacity. The dispute arose from the substantial assets of Mrs Chapman, estimated to be between $8,000,000 and $10,000,000, and the lack of clear testamentary intentions on her part. The legal issues centred around the interpretation of sections 7 and 13(2) of the Aged and Infirm Persons’ Property Act 1940 (SA) and whether the court had the discretion to authorise the applicants to pursue a statutory will application under section 7 of the Wills Act 1936 (SA). Additionally, the court needed to determine whether it should grant an indemnity to the applicants for costs incurred in the testamentary causes proceeding.

The court examined the statutory provisions and their intent, finding that the Aged and Infirm Persons’ Property Act was remedial and intended to protect the estate of incapacitated persons. The court found that section 13(2) of the Act indeed allowed the court to grant managers wide powers concerning the protected estate. However, the court held that the specific power to pursue a statutory will application under the Wills Act was not encompassed within the general powers granted by section 13(2). The court also concluded that, even if the power existed, the merits of the case did not support granting such authority to the applicants at that stage of the proceedings. Finally, the court determined that making an indemnity order would be premature and undesirable given the uncertain outcome of the application.

The court declined to grant Mr and Mrs Jeavons permission to proceed with the testamentary causes proceeding as managers of the protected estate. It also dismissed their application for indemnification from the estate for costs that might be incurred in the testamentary causes proceeding. The court found that such decisions should be made at a later stage, once the merits of the testamentary causes proceeding were clearer.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

This is an application for advice and directions.Background The defendant, Torrie Stoddart Chapman, is 88 years of age. She suffers from both physical and mental impairment. She resides at the Francis Nursing Home in Bordertown. A consultant physician and psychiatrist have attested that Mrs Chapman lacks testamentary capacity. Mrs Chapman has no surviving spouse, siblings, issue of siblings, and has no issue of her own. There are no relatives of the first, second, third or fourth degree presently living. There are only issue of relatives of the fourth degree living. The plaintiff, Juliet Marie Seymour Jeavons, is a member of that class. Mrs Jeavons is also the holder of a power of attorney over Mrs Chapman, pursuant to a registered deed executed on 6 January 2007. The plaintiff, Steven David Jeavons, is Mrs Jeavons’ husband. Mrs Chapman has substantial assets, said to be of a total net value of between $8,000,000 and $10,000,000. Her estate includes a residential property at Crafers, which houses a valuable antique collection, a residential property in Queensland, a residential property in Bordertown, rural land in the South East of South Australia, and a substantial share portfolio. On 18 February 2008, Mr and Mrs Jeavons, by summons, instituted the within proceedings, seeking, inter alia, a protection order with respect to Mrs Chapman’s estate, pursuant to section 7 of the Aged and Infirm Persons’ Property Act 1940 (SA),[1] and the appointment of Mr and Mrs Jeavons as managers of the protected estate, pursuant to section 10 of the Aged and Infirm Persons’ Property Act[2] – the protection proceeding. The summons was issued pursuant to section 8(1)(e) of the Aged and Infirm Persons’ Property Act,[3] on the basis that Mr and Mrs Jeavons were persons who would adduce proof of circumstances, which in the opinion of the Court, would make it proper that they should make the application.[1] Section 7 of the Aged and Infirm Persons’ Property Act 1940 (SA) relevantly provides:(1)Where it is made to appear to the satisfaction of the court that any person is, by reason of age, disease, illness, or physical or mental infirmity—(a) unable, wholly or partially, to manage his affairs; or(b) subject to, or liable to be subjected to, undue influence in respect of his estate, or the disposition thereof, or of any part thereof; or(c) otherwise in a position which in the opinion of the court renders it necessary in the interest of that person or of those dependent upon him that his property should be protected as provided by this Act,the court may make a protection order in respect of the estate or part of the estate of that person.…[2] Section 10 of Aged and Infirm Persons’ Property Act 1940 (SA) provides as follows:(1)If the court thinks fit to make a protection order, the court shall, in and by the protection order, appoint the spouse, domestic partner or near relation by blood or marriage of the protected person, or some other person, or any body corporate incorporated in this State by or pursuant to any law of this State, either alone or with any other person or persons, or the Public Trustee alone, to be the manager to take possession of and to control and manage all or such part or parts of the estate of the protected person as the court may direct.(2)The court may in any case appoint the Public Trustee alone to be manager, but shall not appoint any person to be manager together with the Public Trustee.(3)The court may, if it thinks fit, require any manager other than the Public Trustee to give such security to the Public Trustee as to the court seems fit for the due performance of the duties of manager.(4)If by the protection order any person other than the Public Trustee is appointed to be manager, the court shall cause a copy of the protection order to be supplied to the Public Trustee.[3] Section 8(1)(e) of the Aged and Infirm Persons’ Property Act 1940 (SA) provides as follows:(1)Except in the case of an application made under subsection (1) of section 8A of this Act, every application for a protection order shall be made by originating summons, and may be made—…(e) by any other person who adduces proof of circumstances which in the opinion of the court make it proper that such other person should make the application.

Evidence

Evidence Before The Court

At the conclusion of the hearing, having regard to the impending trial of the testamentary causes proceeding, I indicated to the parties that I would first make a ruling on the statutory will issue. On 8 August 2008, I dismissed the application of Mr and Mrs Jeavons seeking an order that they be conferred with power and authority to prosecute the testamentary causes proceeding in their capacities as managers of the protected estate, and I dismissed their application that they be indemnified out of the protected estate against all costs, charges and expenses which have been or may hereafter be properly incurred by them which they may be ordered to pay as plaintiffs in the testamentary causes proceeding. The reasons that follow address these orders. The Evidence Affidavits both from the testamentary causes proceeding and the protection proceeding were referred to and relied on in the course of the application. It is appropriate to identify the basis on which the application is to be addressed. However, as this is an interlocutory hearing it is not appropriate to make findings of fact or to express other than preliminary views about the effect of the evidence. I have closely reviewed all of the voluminous material referred to on the application. I propose to refer to some of the material as in my view it tends to suggest that Mrs Chapman was known to make many statements about the property and its possible disposition following her death. On separate occasions she spoke of leaving the same property to different persons. It is to be observed that some of the evidence concerning Mrs Chapman’s testamentary intentions has been expressed as the beliefs of deponents without identifying the basis of each asserted belief. Aspects of the affidavit evidence as proffered on the application would not be admissible at trial and even if admitted would be of little or no weight. Frank Charles Hurren, who had known Mrs Chapman for more than 60 years, under the heading “Testamentary Intentions”, deposed inter alia as follows:[Mrs Chapman] had some, but not many, conversations with me about her testamentary intentions.I did not know the dates upon which these conversations took place. The most recent conversation would have been several years ago now.I had long been aware that it was [Mrs Chapman’s] intention to leave her property, ‘Kil Lel’ at Crafers to the National Trust of South Australia. I understood however that this gift was to be conditional upon the National Trust maintaining the property and opening it up to the public as though it were a museum. I had personal doubts as to the practicality of such a gift but I did not voice those doubts to [Mrs Chapman].I do not recall [Mrs Chapman] ever mentioning any gifts to Prince Alfred College. I do vaguely recall her discussing the possibility of establishing an agricultural college upon her property at Mundalla in the South East. [Mrs Chapman] liked the idea of such a college, akin to Roseworthy, being constructed on the Hunt family’s historic estates. I believe she also liked the idea of the sons of ‘families of quality’ (to use her term) going onto the land.I have long assumed that [Mrs Chapman’s] major beneficiary would be the Women’s and Children’s Hospital in Adelaide (“Hospital”). I have long been aware that both [Mrs Chapman] and the Brigadier did a great deal of fund-raising in relation to that Hospital. I always assumed that [Mrs Chapman] wanted a bequest to the institution in the Brigadier’s name to perpetuate his ‘sainted’ memory.It is difficult to see how Mr Hurren’s suggested awareness, understandings and assumptions expressed in their present form would be admissible and how his recollections and beliefs, if admissible, could have more than little weight. A more detailed evidentiary basis would need to be established.

Decision

Reasons for decision

GRAY J
Had I taken the view that Mr and Mrs Jeavons should be granted permission as managers to pursue the testamentary causes proceeding, I would not have made any indemnification order. In my view, the making of such an order would be both undesirable and premature at this stage of the proceedings. If the application were found to be meritorious, then Mr and Mrs Jeavons would be adequately protected. If the application were dismissed, but it had been reasonably pursued, it might be expected that Mr and Mrs Jeavons again might be adequately protected. In the event that the Court reached the conclusion that the plaintiffs had acted unreasonably or inappropriately, then the Court would retain its unfettered discretion to make an appropriate order as to costs.Conclusion For these reasons I declined to make an order granting Mr and Mrs Jeavons permission as managers to proceed with the statutory will application.

Ratio Decidendi

Legal Principle Established

Established by: GRAY J

The above provisions would suggest that the Court has a discretion to provide a manager with wide powers with respect to a protected estate. These are remedial and beneficial provisions and are not to be given a restricted interpretation.Consideration of the Application The following questions arise for consideration with respect to the application concerning the statutory will. Does section 13(2) of the Aged and Infirm Persons’ Property Act enable the Court to authorise Mr and Mrs Jeavons in their capacity as managers to seek permission to proceed with an application pursuant to section 7 of the Wills Act, seeking an order for the making of a statutory will on behalf of Mrs Chapman – the power question. If the answer to this question is yes, should the Court in the established circumstances, authorise Mr and Mrs Jeavons in their capacities as managers to prosecute the testamentary causes proceeding –the merits question. Finally, should the Court make an order indemnifying Mr and Mrs Jeavons out of the protected estate against all costs, charges and expenses which have been or may hereafter be properly incurred by them, or which they may be ordered to pay as plaintiffs in the testamentary causes proceeding to any other party, pursuant to section 7(8) of the Wills Act – the indemnity question.The Power Question Mr and Mrs Jeavons submitted that the commencement of an action to make a statutory will under section 7 of the Wills Act was “in respect of the protected estate”,[32] and, as such, the Court may grant Mr and Mrs Jeavons such power and authority under section 13(2) of the Aged and Infirm Persons’ Property Act,[33] to pursue an application under section 7 of the Wills Act. The plaintiffs further submitted that the grant of authority should carry with it an indemnity as to costs, in that such costs and expenses of the litigation would be “expenses properly incurred” by them pursuant to section 31 of the Aged and Infirm Persons’ Property Act.[34][32] Wills Act 1936 (SA), section 7.[33] Goodridge v Jenkins (1973) 5 SASR 288 at 293 (Sangster J).[34] Section 31 of the Aged and Infirm Persons’ Property Act 1940 (SA) provides:(1)All expenses properly incurred by the manager in respect of the maintenance of the protected person, or the administration of the protected estate, shall be charged against and payable out of that estate; and in addition, there shall be payable in respect of all moneys forming part of the protected estate, and coming under the control of the manager, such remuneration by commission or otherwise to the manager, and such other charges, as are allowed by the court in any manner thought fit by the court. (2)If the Public Trustee is the manager, there shall be payable in respect of all moneys forming part of the protected estate and coming under the control of the Public Trustee, a commission and fees determined in accordance with regulations made pursuant to section 112 of the Administration and Probate Act 1919 or as is otherwise allowed by the court, and such other charges as may be allowed by the court.