Lewis v Lewis - [2020] NSWSC 1306

Supreme Court

New South Wales

Medium Neutral Citation: Lewis v Lewis [2020] NSWSC 1306
Hearing dates: 15, 16, 17, 18 June 2020; further submissions ending 1 July 2020
Date of orders: 25 September 2020
Decision date: 25 September 2020
Jurisdiction: Equity - Probate List
Before: Parker J
Decision:
See [464]-[468]

Catchwords:
SUCCESSION – contested probate – testamentary capacity – soundness of mind, memory and understanding – litigious dispute between testator and family members concerning restructuring of family investments – testamentary provisions giving control of family companies, unit trust and discretionary trusts – testamentary provisions for claw-back of monies from bequests to beneficiaries – knowledge and approval

Legislation Cited:
Corporations Act 2001 (Cth), s 247A
Succession Act 2006 (NSW), s 8

Cases Cited:
Banks v Goodfellow [1870] LR 5 QB 549
Estate of George Aeneas McDonald; Howard v The SydneyChildren’s Hospital Network (Randwick & Westmead) [2015] NSWSC 1610
Estate of Stanley William Church [2012] NSWSC 1489
Hobhouse v Macarthur-Onslow [2016] NSWSC 1831
Hoff v Atherton [2004] All ER (D) 314
Tobin v Ezekiel (2012) 83 NSWLR 757

Texts Cited:
Law Society of New South Wales, When a client’s capacity is in doubt: A Practical Guide for Solicitors 2009

Category: Principal judgment
Parties: David Grant Lewis (Plaintiff/Cross Defendant)
Peter Howarth Lewis (Defendant/Cross Claimant)
Representation:
Counsel:
C Vindin (Plaintiff/Cross Defendant)
LJ Ellison SC (Defendant/Cross Claimant)
Solicitors:
Walker and White (Plaintiff/Cross Defendant)
L Rundle & Co Solicitors (Defendant/Cross Claimant)

File Number(s): 2017/130576
Publication restriction: Nil

Judgment

These are probate proceedings concerning the testamentary dispositions of Pamela Lewis who died in 2017 at the age of 92. For convenience and without disrespect I will refer to the members of the testator’s family by their given names. Except where otherwise stated, references to “the Act” are to the Succession Act 2006 (NSW).
The testator was born in 1924. She married Geoffrey Howarth Lewis, who was born in 1922. Together they had four sons: Peter Howarth Lewis, born in 1949; David Grant Lewis, born in 1951; Roger Geoffrey Lewis, born in 1953; and Hugh Barnby Lewis, born in 1956.
The testator’s husband, Geoffrey, predeceased her, dying in June 2012. The testator herself died in February 2017.
The testator’s last will (or purported will) was dated December 2014. This was followed by two codicils dated May 2015 and July 2015. Two versions of the May codicil were executed. The first contained drafting errors which were corrected in the second.
The testator’s 2014 will had been preceded by an earlier will dated June 2011. That will was followed by three codicils, dated March 2012, September 2012, and December 2012. In April 2013 the testator signed a letter prepared by her solicitor which provided, in the event of her death, for a gift of $50,000 in favour of Kate Amanda Lewis, who is Hugh’s daughter. Then in November 2013 the testator signed a further codicil, the fourth.
The testator’s 2011 will had been preceded by two wills made in 2010. The earlier one was made in May, and the later one in July.
There is a history of conflict and estrangement between different members of the family at different times. A conflict, or a renewed conflict, arose between David and his brothers in or around March 2012. The conflict spilled over into litigation in this Court in which the testator and David were defendants. The surviving members of the family separated into two camps, with the testator and David in one and Peter, Roger and Hugh in the other.
The beginning of the conflict between David and his brothers post-dated the June 2011 will, but pre-dated all of the later testamentary documents in issue in these proceedings. All of those later documents were prepared by, or on the instructions of, David.
The rest of this judgment is organised as follows:

at [10] to [17] I identify the parties’ claims for determination in the proceedings;

at [18] to [124] I set out a chronology of the key events;

at [125] to [397] I analyse the evidence on the factual issues which arise;

at [398] to [463] I deal with the parties’ claims in the light of that analysis;

at [464] to [468] I summarise my conclusions and set out my orders.

Claims for determination

In these proceedings David is the plaintiff and Peter is the defendant. David propounds the December 2014 will and the two codicils to it. Peter actively resists the admission of these documents to probate. He has made a cross-claim in support of the 2011 will. Peter also propounds the second and third codicils to the 2011 will (the first codicil was revoked by the third). Peter does not propound the fourth codicil.
The original of the 2011 will has been lost. Moreover the purported witnesses were not present when it was signed. Peter therefore propounds a copy of the will pursuant to s 8 of the Act. For convenience, I will continue to refer to the instrument as a will.
David accepts that the 2011 will was signed by the testator although it was not properly witnessed. David’s position is that if the 2014 will is not admitted to probate, the 2011 will should be, together with all four codicils. In that event David also propounds a letter signed by the testator in April 2013, contending that it was testamentary in nature.
The Court must decide first on the validity of the December 2014 will and the two 2015 codicils. The issues raised by Peter in opposition to the grant of probate are whether the testator had testamentary capacity and whether the testator relevantly knew and approved of the contents of each instrument.
If the 2014 will is not valid, the Court must consider the validity of the 2011 will, four codicils to that will, and the April 2013 letter. The validity of the fourth codicil is contested by Peter on testamentary capacity and knowledge and approval grounds. Peter does not admit that the April 2013 letter was testamentary in nature, but has raised no affirmative case in support of that non-admission.
The parties thus agree that if the 2014 will is invalid, the 2011 will and the second and third codicils should be admitted to probate (nothing turns on the admission of the first codicil, as it was revoked by the third). But although the parties agree, the Court must independently be satisfied of the due execution of these instruments. In the course of the hearing, evidence emerged which raised questions as to whether the requirements of knowledge and approval were satisfied.
In order to meet the possibility that the Court might refuse to admit the 2011 will to probate, both parties amended their claims in the proceedings. Both now seek to have the July 2010 will admitted to probate if the June 2011 and December 2014 wills are invalid.
The 2014 will appointed David as sole executor. David was also one of the executors appointed under the 2011 will, and the fourth codicil left him as sole executor. Peter raised an issue as to whether David is a fit and proper person to act as executor. In the course of these proceedings the parties agreed to a special grant of administration to Jeremy Neil Glass, solicitor, for the purpose of realising the testator’s assets and paying her liabilities. The parties have also agreed, despite the terms of the competing wills, that whatever instrument(s) may be admitted to probate will be the subject of a general grant of administration to Mr Glass with the relevant instrument(s) annexed.

Chronology of events

The testator’s husband Geoffrey was an accountant. He was one of the principals (and presumably one of the founders) of a firm known as Lewis & Coble, at Chatswood. The testator was a social worker. Before she retired in the early 1970s she worked as such at a local hospital.
Peter qualified as an accountant, and practised as such from 1969 onwards. In 2009 he qualified as a solicitor and now practises (separately) as an accountant and as a solicitor. David also qualified as an accountant. He practised accountancy prior to his estrangement from his brothers in 1994 but he appears not to have been in paid employment since about 2000 (apart from the possible exception of work done for the family investment company up to 2010: see [25] below). Roger obtained qualifications for, and worked in, human resource management. He is now retired. Hugh became an airline pilot. Following his diagnosis with cancer in 2013 (referred to in more detail below) he ceased work but has subsequently returned to work as a pilot on a casual basis.
Peter is married, with no children. David is divorced, with two children. Roger is married, also with two children. Hugh is married, with three children. There are thus seven grandchildren of the marriage between Geoffrey and the testator. All of them are now adults.
In May 1994 David broke off all contact with his three brothers. The estrangement was to last for almost sixteen years. During this period David also seems to have been estranged from his own children. He remained in contact with his parents.
In 2001 Geoffrey and the testator handed over to their sons a total of $1 million. Each son received $250,000. David, who was going through a divorce at the time, received his money as a loan. His brothers all received their money as gifts.
The relevant events for the purposes of this judgment begin in early 2007. At that time, the testator and Geoffrey had two principal assets. One was the family home, a house at Turramurra in Sydney’s northern suburbs. The house was owned by Geoffrey.
The couple’s other major asset was an investment company called Anne Lewis Pty Limited, to which I will refer as the “Lewis Company”. Each of Geoffrey and the testator held half the shares in the Company, and each was a director. As well as significant holdings of cash, the Company owned a portfolio of listed shares in public companies which had been built up by Geoffrey over time. The evidence does not disclose the precise value of the Company’s assets in early 2007 but by 2012 it was $9 million. The assets generated interest and dividend income on which Geoffrey and the testator lived.
It appears that Geoffrey was principally responsible for the administration and record-keeping work associated with the Lewis Company’s investments. A room in the Turramurra house was used for this purpose. David was said to have been “employed” by his father to assist with clerical work. But it appears that this was not plain sailing, as there are references in the evidence to David being “sacked” from this work on more than one occasion. The evidence does not reveal whether there was ever a formal employment relationship.
In January 2007 both Geoffrey and the testator made wills. Geoffrey’s will appointed as his executors his son, Peter, and Bryan Edmund Bird. Mr Bird was a partner of Lewis & Coble who acted as the family accountant.
Geoffrey’s will provided that if he was survived by the testator, she was to have a right to live in the Turramurra house (or some substitute residence), and to receive the income from the rest of Geoffrey’s estate (principally his half share in the Lewis Company), for the rest of her life. Upon her death, the estate was to be divided equally between their four sons. The will also recited the $250,000 loan to David, which it described as a joint loan from Geoffrey and the testator, and provided that should Geoffrey survive the testator and become the sole owner of the loan, it was to be released.
The testator’s will effectively mirrored Geoffrey’s. The executors were also Peter and Mr Bird. If the testator was survived by Geoffrey, he was to receive the income from her estate for life. Otherwise her estate would be divided equally between their four sons. Should the testator survive Geoffrey, the loan to David was to be released.
In around the late 1990s, when the testator was in her seventies, she began to suffer from macular degeneration. By 2007 her eyesight was severely impaired. She obtained a device to help her with reading which she set up in one of the rooms in the Turramurra house. The device could be used to magnify documents and display them on a computer monitor. Among other things, she used the device to read the newspaper and do crosswords. It seems that her use of the device declined over time as the condition gradually worsened; I deal with the evidence about this in more detail below.
Geoffrey’s health appears to have declined after 2007. In January 2010 he was admitted to a nursing home. The testator continued to live at the Turramurra house, with the help of a cleaner who visited every week or so. Roger lived nearby at Gordon. He had regularly provided care and assistance to his parents and continued to do so for his mother after his father went into the nursing home.
The testator visited Geoffrey in the nursing home usually once a week and Roger would join her for the visit and bring her home. He would also visit her several times a week, take her to medical appointments, and take her shopping or do her shopping for her. He was the nominated contact on her personal alarm system, known as “Vitalcall”.
The other sons were further afield. Peter was carrying on his practices as an accountant and solicitor at Cooma in southern New South Wales, and dividing his time between there and Bermagui on the New South Wales south coast. David (still estranged from his brothers) was living at Leura in the Blue Mountains. Hugh was living in Queensland.
Many years beforehand, Geoffrey had executed a general power of attorney in favour of the testator. This was used by the testator to control his affairs once he went into the nursing home. Peter’s evidence in this case was that his father was suffering from dementia by the time of his admission to the nursing home. If this was correct, the power of attorney would have been invalid: it was not an enduring power. No attention, however, appears to have been paid to this by anyone until later.
Although David was living at Leura, he appears to have been visiting the testator regularly, occasionally staying overnight. Following his father’s institutionalisation, David took over the paperwork for the Lewis Company and his parents’ other business affairs. He also effectively became his mother’s advisor on financial matters. I discuss this in more detail below.
It appears that at the time Peter and Hugh were both in regular contact with the testator. Hugh’s wife, Rhonda, also spoke regularly with the testator by telephone. The testator also had occasional contact with Hugh and Rhonda’s daughter, Kate. Kate had a disability and the testator was particularly concerned for her welfare.
In March 2010, David (who had developed diabetes) suffered a diabetic seizure and almost died. He was in hospital in the Blue Mountains for many months, first spending about two months in intensive care, followed by a long period of rehabilitation. Apparently as a result of this experience, David re-established contact with his brothers, and they visited him in hospital.
In May 2010 the testator made a new will to replace the will she had made in January 2007. The will was prepared for her by a solicitor, David John Thompson. His firm, Collins & Thompson, was at Hornsby. He appears to have been retained, with David’s involvement, before David suffered his seizure at the end of March.
The May 2010 will represented a departure from the provisions in the testator’s January 2007 will. There was no life interest in favour of Geoffrey if he survived the testator. Instead her estate was to be divided into five equal shares. Each of her sons was to receive one share. The remaining share was to be divided between her seven grandchildren.
At the same time as Mr Thompson prepared the May 2010 will, he apparently prepared a power of attorney from the testator in favour of David and Roger. There is no direct evidence that this power of attorney was signed by the testator and accepted by David or Roger. In his affidavit Roger stated that in “about 2011” he was appointed as his mother’s attorney together with his brother, Hugh. The evidence did not take this any further, but Roger’s assertion that he was his mother’s attorney was not contradicted in cross-examination and I assume that it is correct.
Soon after signing the May 2010 will, the testator gave $500,000 to Peter by way of advance on his entitlement from her estate. Peter signed an acknowledgement to this effect on 6 July. The advance appears to have resulted from a request by Peter, which had been approved by David. A few weeks later, at the end of July, the testator made a further will prepared by Mr Thompson. It was almost the same as the May will.
Peter was not involved in the preparation of the May and July wills. But it appears that he later discussed them with David. In September, at David’s request, he reviewed the July will and wrote a letter to the testator suggesting some alterations for her and David to consider.
Peter’s alterations were forwarded to Mr Thompson and there was a further conference with him in January 2011 or thereabouts. The conference was attended by the testator, David and Roger. In March Mr Thompson wrote to the testator enclosing a further draft will which took Peter’s suggestions, and the discussion at the conference, into account. But Mr Thompson appears not to have received any further instructions from the testator and in July Roger obtained an authority from the testator to collect her papers from him.
Instead of proceeding with Mr Thompson’s draft, a fresh will was prepared for the testator by Peter. His correspondence to her (including his letter from the previous year) was written on his solicitor’s letterhead, but Peter did not enter into any formal retainer agreement with his mother, nor did he charge her for his work on the will. The testator signed the will in June 2011. Again the basic structure was the same: each of the testator’s sons was to receive one fifth of the estate and her grandchildren were to share the other fifth.
In July 2011, the testator made a payment to Roger of $50,000 by way of advance against his ultimate entitlement under her estate. Roger signed a formal acknowledgement to this effect on 22 July.
Peter and David expected that the assets of the Lewis Company would be split up following the deaths of their parents and were concerned to avoid as much tax as possible when that happened. Some of the listed shares owned by the Lewis Company had been acquired prior to September 1985 and therefore any capital gains made on their ultimate realisation would not attract capital gains tax (CGT). But other shares had been acquired since September 1985 and were therefore subject to CGT.
In an attempt to avoid this CGT, a series of transactions was undertaken at David’s instigation so as to transfer the listed shares out of the Lewis Company. Litigation ultimately resulted in this Court. The relevant events were analysed by White J (as his Honour then was) in a judgment delivered in July 2015: Thomas v Arthur Hughes Pty Ltd [2015] NSWSC 1027. The parties agreed that I should adopt his Honour’s findings of fact for the purposes of this judgment.
White J recorded that Peter and David first decided to retain tax counsel, Mr BR Pape, in July 2011. Mr Pape produced a draft opinion upon which they both commented, and then a second draft opinion. There was a conference between Peter and David and Mr Pape on 11 November. On 22 November, Mr Pape produced a supplementary draft opinion which canvassed a plan for a distribution of the Lewis Company’s assets.
Mr Pape’s supplementary opinion was only a draft, put forward for discussion, and no final opinion appears to have been produced. But without obtaining the agreement of his brothers (or of his father, who at this time was still alive, although his mental state was not clear on the evidence) David proceeded to implement the proposal, to which he referred as the “succession plan”.

The relevant steps began on 12 January 2012. The steps were taken in the names of the testator and Mr Bird (who had been appointed as a director of the Lewis Company shortly beforehand, presumably for the purpose of effecting the transactions). But the plan was David’s and both the testator and Mr Bird acted at his direction.
The steps taken to implement the “succession plan” are set out in detail by White J at [11]-[26] and the tax consequences for the year ended 30 June 2012 are set out at [38]. For present purposes, it is sufficient to summarise the transactions in the following way.
Six new companies were incorporated. The first of these was a company called Arthur Hughes Pty Ltd. The other five companies were wholly owned subsidiaries of that company, and all had the word “Hughes” in their names (the testator’s mother’s maiden name was Hughes). They were called Speakman Hughes Pty Limited, Telfer Hughes Pty Limited, Melvie Hughes Pty Limited, Gypson Hughes Pty Limited and Bathurst Hughes Pty Limited.
I will refer to Arthur Hughes Pty Limited as the “Hughes Parent Company”, the five subsidiaries as the “Hughes Subsidiary Companies” and the parent and subsidiaries collectively as the “Hughes Companies”. The testator was the sole shareholder of the Hughes Parent Company. The board of directors of each of the Hughes Companies consisted of the testator and Mr Bird.
On or soon after incorporation, the Hughes Parent Company was constituted as the trustee of five separate trusts. I will refer to these trusts as the “Hughes Trusts”. The Parent Company’s shares in each of the five Hughes Subsidiary Companies were an asset of one of the Trusts. For convenience, I will refer to a dealing involving the Hughes Parent Company as trustee of one or other of the Hughes Trusts as a dealing with that Trust.
Four of the Hughes Trusts were discretionary family trusts. The trust deeds were in virtually the same terms. The trustee (the Hughes Parent Company, which was owned by the testator) had full discretion to appoint income and capital among a defined class of beneficiaries. In each case the testator was nominated as the appointor. The trust deed gave her power as appointor to replace the trustee and to nominate a new appointor by will.
These four Hughes Trusts were apparently intended for the testator’s four sons. In each case the class of beneficiaries to whom income and capital could be appointed under the trust deed was customised so as to include that son and members of his family. But the terms of the class were broad enough to include members of the wider family, including the testator herself, and a range of charitable institutions (see White J at [13]).
The fifth trust was intended for the testator’s grandchildren. It was a unit trust, not a discretionary trust. A total of 140 units were issued, representing 20 units per grandchild. But rather than the units being issued to the grandchildren themselves, they were issued to the trusts intended for the grandchildren’s fathers. David’s trust received two-sevenths of the units, Hugh’s trust three-sevenths and Roger’s trust two-sevenths. The unitholders’ entitlements were thus channelled into the discretionary trusts, where they were under the control of the testator.
The next step was that the shares and other securities held by the Lewis Company were transferred to the four Hughes Subsidiary Companies belonging to the sons’ trusts. Each Subsidiary Company received one-quarter of the securities. No cash changed hands on the purchases; in each case the purchase was financed by an equivalent loan (unsecured) from the Lewis Company to the Hughes Subsidiary Company. The loan was to be for not longer than seven years, with “interest to be charged on a mutually agreed basis”.
The cash assets of the Lewis Company (totalling about $3.6 million) were paid over to Bathurst Hughes, the Hughes Subsidiary Company belonging to the grandchildren’s trust. This was recorded as a loan from the Lewis Company to Bathurst Hughes on the same terms as the loans to the Hughes Subsidiary Companies belonging to the sons’ trusts.
The cash transferred to Bathurst Hughes represented more than one fifth of the total assets of the Lewis Company. According to evidence given by David, it was intended to adjust the loan accounts between the Lewis Company and the Hughes Subsidiary Companies so that the division of the Lewis Company assets would reflect the testamentary plans of Geoffrey (one quarter to each of the sons) and the testator (one-fifth to each son and the remaining one-fifth to the grandchildren). This would leave Bathurst Hughes with one-tenth of the net value of the Lewis Company’s assets (that is, one-fifth of the half share representing the testator’s interest in the Lewis Company). The other four Hughes Subsidiary Companies would hold one quarter of the remainder. It is not clear whether this actually happened. In the meantime Bathurst Hughes in effect functioned as the treasury for the Lewis and Hughes Companies.
Nominally the “succession plan” did not have any immediate effect on the asset position of the Lewis Company. The Company’s investments were replaced with loans to the Hughes Subsidiary Companies having an equivalent face value. But any capital gain thereafter on the securities would be captured by the Subsidiary Companies belonging to the sons’ trusts. And the capital in the Lewis Company could only be unlocked by requiring repayment of the loans, which could only have been met by liquidating the assets of the Hughes Subsidiary Companies to meet their repayment obligations.
As a result of the asset transfer, the Hughes Subsidiary Companies belonging to the Hughes Trusts would also receive the income generated by the securities and the cash. It does not appear to have been intended that the Subsidiary Companies would be paying interest on the loans from the Lewis Company. The flow of dividend income from the Lewis Company would therefore cease.
On 6 March 2012, the testator signed a codicil to the 2011 will. The codicil exercised the testator’s power under the trust deeds for the sons’ trusts to nominate a new appointor for those trusts by will. The testator nominated each of her sons as the appointor for his trust after her death.
The codicil was prepared by John Rickard, a solicitor practising at Pymble. Mr Rickard had been retained by David, based on a recommendation obtained by Roger from Roger’s accountant. Eventually Mr Rickard was to act for the testator, on David’s instructions, on a variety of matters. According to Mr Rickard, he actually started acting for the testator in December 2011, but on the evidence it is not clear what, if anything, he did for her prior to preparing the codicil.
The codicil was prepared by Mr Rickard on David’s instructions. Following its execution, a signed copy was provided to Roger (who was one of the executors under the 2011 will). Peter also received a copy.
On 17 March the testator was admitted to hospital following a fall at her home. She had been found by Roger in a dehydrated and disoriented state, and had broken her wrist. She was also suffering from an infection and exhibiting delirium. On 11 April she was transferred to a private hospital for rehabilitation. It was not until early May that she was discharged home.
As already noted, David had acted alone in implementing the “succession plan” and it was only after the asset transfers had happened that his brothers became aware that he had actually implemented them. This was on 21 March or thereabouts.
On 24 March there was a meeting between all four brothers about the steps David had taken to implement the “succession plan”. The meeting apparently lasted for most of the day, and was heated. Peter, Roger and Hugh were all, to a greater or lesser extent, critical of what David had done. For his part, David saw his brothers as only caring for their future inheritances.
Peter followed up with a letter to David dated 31 March. The letter criticised David for acting alone, contrary to previous understandings between the family members. It referred to possible tax liabilities and breaches of the Corporations Act 2001 (Cth) as a result in the way in which the plan had been carried out. It posed a number of questions to which it sought answers in writing within fourteen days.
The form of the questions indicated other criticisms and concerns. For instance, Peter asked David what professional qualifications he had, and what independent taxation and legal advice he had obtained. He also referred to Mr Bird and Lewis & Coble as having potentially been embroiled in a conflict of interest.
There is no evidence of any response by David to Peter’s letter. The meeting appears to have marked a fresh rupture in his relationship with his brothers. In late April, Peter and Roger visited the testator in hospital and tried to persuade her to take action to rein David in. She was not willing to do so.
After the testator was discharged from hospital, David came and lived with her at the Turramurra house, staying for four or five days at a time. Roger continued to visit, but only when David was not there.
On 22 June 2012 Geoffrey died. The family came together for his funeral on 28 June, but his death appears to have caused a rift between the testator and Peter, who, along with Mr Bird, was Geoffrey’s executor. There was no further oral communication between the testator and Peter after 28 June.
It is not necessary to analyse in detail the reason for the rift between David and the testator on the one hand and Peter (and later Roger and Hugh) on the other. But part of it involved the Turramurra property. Because the property had been in Geoffrey’s name, it became an asset in his estate. All the testator had was a right of residence under the terms of Geoffrey’s will. In his evidence, David professed himself to be disgusted by this. He also claimed that the testator also expressed concern about the security of her position. On 10 July Roger forwarded to his brothers text messages from David asking them to agree to transfer the property into the testator’s name. They refused.
On 1 August Mr Bird resigned as a director of the Hughes Companies. Two days later, on 3 August, David was appointed as a director of the Hughes Parent Company, Telfer Hughes (the Hughes subsidiary company belonging to David’s trust), and Bathurst Hughes (which remained the repository of the Lewis Company’s cash). This left David and the testator as the directors of those companies. The testator was sole director of the remaining Hughes subsidiaries, which belonged to Peter’s, Roger’s and Hugh’s trusts.
Mr Bird remained a director of the Lewis Company and, for the moment, one of the testator’s named executors. But his involvement in the Hughes Companies and the Hughes Trusts, if any, ceased.
On 6 August, the testator signed cheques for $50,000 each by way of gift to her seven grandchildren. Although the evidence does not directly confirm this, I assume that the cheques were in due course provided to, and cashed by, each of the grandchildren. The $350,000 given to the testator’s grandchildren came from Bathurst Hughes and was treated as a loan from Bathurst Hughes to the testator. The gifts and the associated loan were effected by David. His brothers only became aware of the gifts afterwards.
On 6 September, the testator signed a second codicil to the 2011 will, which provided that gifts made to her grandchildren during her lifetime were not to be deducted from. Again the codicil was prepared by Mr Rickard on David’s instructions, but a signed copy was provided to Roger and Peter.
Following Geoffrey’s death, Peter and Mr Bird, as the appointed executors, took steps to obtain probate of his 2007 will. For this purpose they retained a firm of solicitors called North Coast Legal Services (“NCLS”) at Coffs Harbour. Probate of the will was later granted in October.
On 29 August Mr Geoffrey Knight, a solicitor at NCLS, made a telephone call (apparently directly to the testator) asking that Peter be appointed as a director of the Lewis Company in his father’s place. Mr Rickard responded on behalf of the testator by letter to Mr Bird (as Peter’s co-executor) on 6 September. The request was refused. The reason offered by Mr Rickard was that such an appointment would “dilute [the testator’s] voting rights in the company to a minority status” an apparent reference to the fact that at the time the testator and Mr Bird were the only directors. The letter went on to record that Mr Rickard was “instructed” that the failure to appoint Peter did not disadvantage the Company or Geoffrey’s estate.
On 12 September, Mr Rickard went on to the front foot. He wrote letters to each of Peter, Roger and Hugh. The letters stated that the testator was “keen to continue the estate planning exercise that was commenced earlier this year”, an apparent reference to the “succession plan”. It went on to ask each of the recipients a series of questions “in order to assist [the testator] and to ease her concerns”.
The letter to Peter asked whether he wanted part of the share portfolio which had been transferred to the Hughes Subsidiary Company which belonged to his trust to be sold back to the Lewis Company, and whether he wanted to remain a beneficiary of his trust. Next Peter was asked whether he objected to the testator distributing $50,000 each to her seven grandchildren, an apparent reference to the gifts which she had already made the previous month. Peter was also asked whether he objected to the testator making early inheritance advances to David, Roger and Hugh, or to the testator making further cash gifts to her grandchildren.
The letters to Roger and Hugh asked them the same questions. They were also asked, in addition, whether the way Peter was acting as executor of his father’s estate met with their approval.
These letters, which pointedly asked for a prompt reply to be sent to Mr Rickard, not the testator herself, met with a predictably furious response. Both Peter and Roger wrote back with their own lists of questions about where Mr Rickard’s instructions were coming from. The way in which they phrased the questions indicated that they did not accept that Mr Rickard had been validly retained.
At this point, oral communication between the testator and Roger ceased. Their last conversation was on 18 September. Roger stopped visiting the testator, although his son apparently continued to mow the lawns at the Turramurra property for her. Roger’s appointment as an attorney formally continued and he remained the nominated contact on her Vitalcall alarm system until August 2013, but neither position resulted in any communication, let alone rapprochement, between him and the testator.
On 19 September, Peter made an application to the Guardianship Tribunal concerning the testator’s affairs. Peter’s application sought the appointment of a financial manager. The application form identified the testator’s disabilities affecting her decision-making capacity as her advanced age and macular degeneration. It did not suggest that she had dementia or any other form of cognitive disability.
The grounds given for the application repeated many of the criticisms which Peter had made of David’s conduct. The application stated that the testator had a close relationship with David and he had acted, at best, imprudently in undertaking the restructuring. It also stated that he lacked the professional qualifications needed to protect the testator’s interests.
The purpose of the application was to replace David as the testator’s source of advice (or at least her exclusive source of advice) on financial matters with someone independent. But the testator treated it as an allegation that she had lost her mental capacity. Mr Rickard was retained to defend the application on her behalf.
Following the making of the application, the fencing provoked by Mr Rickard’s letters of 12 September continued. Peter, Roger and Hugh refused to be drawn by Mr Rickard’s questions. They declined to answer, on the ground that they lacked sufficient information about what had been done under the “succession plan”. Peter and Roger also refused to let the retainer issue die. Each of them made a complaint to the Legal Services Commission. After Mr Rickard wrote a long letter to the Commissioner justifying his position, the complaints were dismissed early in December.
The family had now split clearly into two camps, with David and the testator in one, and Peter, Roger and Hugh (albeit less vehemently) in the other. From time to time thereafter, there were proposals by the testator for reconciliation, or at least discussions. Some of these came in the form of letters from Mr Rickard as the testator’s solicitor, and others in the form of typed letters which had been signed by the testator. Feelers continued until after the delivery of judgment in the liquidator’s action in the second half of 2015. None of these approaches ultimately led anywhere.
As I will explain below, it is unnecessary for the purposes of this judgment to trace the course of the correspondence or to go into the merits of the parties’ positions. It is sufficient to say that Peter, Roger and Hugh believed that the approaches came from David and reflected his objectives. In this I think they were probably correct. Most if not all of the correspondence in the testator’s name appears to have been written by David himself.
On 6 December, the testator signed a third codicil to the 2011 will. Again this was prepared by Mr Rickard on David’s instructions. The codicil removed Roger as an executor, and he was not provided with a copy of it. Neither he nor his other brothers was aware of it. The same was so for the later testamentary instruments prepared by Mr Rickard for the testator, and I will not refer to them in this chronology.
White J recorded that the loan from Bathurst Hughes in August 2012 to the testator to fund her $350,000 gift to her grandchildren was repaid by her six months later. The judgment refers to an earlier loan of $200,000 by Bathurst Hughes to the testator and to various other payments, loans and dividends involving the Hughes Companies and the Hughes Trusts between 2012 and 2014.
As already noted, the flow of dividend income from the Lewis Company would have ceased with the implementation of the “succession plan”. The testator would have needed money to live on. Presumably that came in some way from the income generated by the cash and shares held by the Hughes Subsidiary Companies. The evidence does not reveal how much was involved or the mechanism for payment (that is, whether by way of loan or trust distribution). I suspect that the transactions referred to in White J’s judgment do not represent a complete list. The critical thing for present purposes is that the evidence before me does not reveal what liabilities the testator had at the time she made her contested testamentary dispositions from 2012 onwards.
Peter’s Guardianship Tribunal application was heard before the Tribunal on 25 January 2013. The testator was represented at the hearing by Mr RS Bell of counsel, instructed by Mr Rickard. The hearing was attended by the testator herself, Peter, Roger and David.
The Tribunal’s decision recorded that the testator did not fully understand the “succession plan”, but she did understand the motivation for it, being to avoid CGT, and she trusted David completely. The Tribunal observed that making an unwise or unfortunate decision about whom to trust is not the same thing as a lack of capacity to make decisions about one’s financial affairs. On balance, the Tribunal was not satisfied that the testator was incapable of managing her financial affairs and dismissed the application.
Mr Rickard later made an application on behalf of the testator for an order that Peter pay her costs of the Guardianship Tribunal proceedings. According to Peter, the amount claimed was $65,000. The application was refused.

In February 2013, Hugh was diagnosed with cancer. He visited the testator in Sydney and asked whether she was prepared to give him a further advance on his inheritance. According to Rhonda, she also said to the testator during one of their regular telephone conversations that if the testator wished to help Hugh financially, now was the time to do so.
The response to these requests seems to have come through David, who spoke to both Hugh and Rhonda at various stages over the next few months. There is a dispute about what was said and when. But some money was paid over. In evidence are two letters to Hugh, prepared by David and signed by the testator, dated 14 March and 5 April and enclosing cheques totalling $75,000 by way of further advance on Hugh’s inheritance.
On 24 May Mr Rickard wrote with a proposal to make a further $350,000 available. The letter however was not addressed to Hugh, but to Peter and Mr Bird as executors of Geoffrey’s estate.
The letter stated that the testator was unable to assist Hugh “as a result of your [Peter’s and Mr Bird’s] failure to provide [the testator] with her just entitlements in accordance with the terms” of Geoffrey’s will. The testator requested, purportedly on behalf of Hugh, that Peter and Mr Bird as Geoffrey’s executors advance Hugh $350,000 on his entitlement as a beneficiary of Geoffrey’s estate. This advance would be financed by a loan from Bathurst Hughes to the estate of $350,000, to be secured by a mortgage over the Turramurra property, with the estate to pay interest.
The letter was an unsubtle attempt by David to drive a wedge between his brothers by exploiting Hugh’s need for money. When, predictably, the request was declined, David wrote to Hugh and Rhonda on 3 July putting the same proposal to them with the rider that the interest payable by Geoffrey’s estate would be paid equally by all four sons. This proposal too was declined.
From this point onwards there was no further communication between Hugh and his mother. The regular telephone contact between Rhonda and the testator, however, continued.
Negotiations also continued between David on the one hand and Hugh and Rhonda on the other about the testator providing further money to Hugh. Eventually David proposed an arrangement whereby sums totalling a further $60,000 would be provided, to come from the Hugh’s trust. Eventually and reluctantly Rhonda accepted this on Hugh’s behalf in December 2013.
Meanwhile, Peter had turned to litigation in this Court. In May 2013 he commenced proceedings in the Corporations List, naming the Lewis Company as first defendant; the testator as second defendant; and the Hughes Companies as third to eighth defendants; and Mr Bird, his co-executor, as ninth defendant.
Peter’s application sought the production of documents concerning the “succession plan”. As against the Lewis Company, it was based on the Court’s powers under the Corporations Act, s 247A, and relied on Peter’s status as a shareholder by virtue of his being an executor of his father’s estate. As against the testator and the Hughes Companies, the documents were sought by way of preliminary discovery.
Mr Rickard acted as the solicitor for all of the defendants. On behalf of Mr Bird he filed a submitting appearance. He briefed counsel (Mr DA Lloyd) to act for the other defendants.
On 6 August Peter’s application for the production of documents came on for hearing before Bergin CJ in Eq. After the argument had advanced some distance, and her Honour had made some comments, the parties agreed on consent orders. The orders provided for most, but not all, of the documents sought to be produced by the Lewis Company. The further hearing of the application was adjourned.
On 28 November, after the documents had been produced under the consent order, Peter’s application came back before Brereton J. Peter did not seek the production of any further documents from the testator or the Hughes Companies. His Honour dismissed the balance of the proceedings and made no order as to costs: In the matter of Anne Lewis Pty Ltd [2013] NSWSC 1192.
In the same month, Peter commenced fresh proceedings in the Corporations List, seeking an order that the Lewis Company be wound up. The grounds for the winding up included the just and equitable ground.
Peter’s winding up application came on for hearing on 9 April 2014 before Brereton J. The Lewis Company, which was the only defendant, was represented by counsel instructed by the Sydney law firm, Gadens. The evidence does not reveal where their instructions on behalf of the Lewis Company came from. Mr GR Waugh of counsel appeared, instructed by Mr Rickard, on behalf of the testator as an interested party.
At the outset of the hearing, counsel for the Lewis Company sought an adjournment of the proceedings to permit a mediation to take place. This application was supported by Mr Waugh on behalf of the testator. But his Honour rejected it: In the matter of Anne Lewis Pty Ltd [2014] NSWSC 418. Although this is not recorded in the published judgment, his Honour then went on with the hearing of the winding up application. He made a winding up order and appointed Mr HC Thomas as liquidator.
Shortly afterwards, Mr Thomas commenced an action in the General List, alleging that the transactions between the Lewis Company and the Hughes Companies had been procured by breach of duty on the part of the testator as a director of the Lewis Company. This was the action which ultimately resulted in the judgment of White J to which I have referred.
In the liquidator’s action the Hughes Parent Company and the Hughes Subsidiary Companies were named as the first to sixth defendants. The testator was the seventh defendant, David was the eighth defendant and his son, Daniel, was the ninth defendant. Mr Rickard was retained by David to defend the proceedings on the testator’s behalf, and he briefed Mr Waugh to act for her. David acted for himself and the other defendants were unrepresented.
The hearing before White J took place on 4 and 5 December. The testator gave evidence before his Honour on 4 December and parts of the transcript of her evidence are in evidence before me. His Honour reserved his judgment.
On 29 July 2015 White J delivered his judgment. Although his Honour accepted that the testator and David had not acted with dishonest intent, he upheld the liquidator’s claim that entry into the “succession plan” constituted a breach of duty on behalf of the testator. David was also liable as an accessory for having instigated the transactions.
His Honour set out at the end of his judgment a set of proposed declarations and orders to reflect his decision. Those orders provided for the transactions to be rescinded and the shares and monies transferred to the Hughes Subsidiary Companies to be returned. The Hughes Subsidiary Companies were also required to account to the Lewis Company for any dividends or other income received by them from the shares.
White J concluded, however, that there was no basis for relief against the Hughes Parent Company or David’s son, Daniel. They had not received any assets as a result of the “succession plan”, and the claims against them should be dismissed.
In his judgment, his Honour indicated that the testator and David would be liable for equitable compensation to the extent that any assets or dividends could not be retrieved from the Hughes Companies, or other losses had been suffered by the Lewis Company. His proposed orders were that the quantum of any equitable contribution would be determined at a later point. His Honour indicated that prima facie the Hughes Subsidiary Companies, the testator and David should pay the costs of the proceedings. He directed the parties to bring in short minutes of order in accordance with his reasons for judgment.
Although there is no direct evidence of this, I assume that orders were made at some point after July 2015 which reflected the orders proposed by White J in his judgment. Although the investments were returned to the Company, not all the dividends were accounted for. The liquidator pursued an application for equitable compensation to cover the shortfall.
The application ultimately came before Black J in November 2016: Thomas v Arthur Hughes Pty Ltd [2016] NSWSC 1861. His Honour recorded that for “practical reasons” the claim was only pursued against the testator, but on her behalf claims for contribution were reserved as against the other defendants, including David. In a separate application by the liquidator in the winding up, his Honour approved the liquidator’s proposal that the compensation be set off against the distribution to which the testator was entitled as shareholder: In the matter of Anne Lewis Pty Ltd [2016] NSWSC 1860.
In his judgment on the compensation application, Black J resolved the identified issues of principle on which the parties disagreed. He directed that they bring in short minutes of order calculating the amount of compensation. His Honour foreshadowed making an order that the liquidator’s costs be paid out of the company’s assets, but that there be no order as between the parties. The final orders do not appear to be in evidence.
Meanwhile, in November 2015 the testator had suffered a stroke. She remained in hospital until mid-January 2016 when she was discharged to her home. Both her physical and mental state had declined as a result of the stroke. Early in March 2016 she went into a nursing home. On 24 February 2017 she died.
Peter gave affidavit evidence in general form of having searched unsuccessfully for the original 2011 will. In particular, he made enquiries of David and of Mr Rickard, neither of whom has it. Mr Rickard apparently worked from a copy which David gave him when Mr Rickard prepared the first codicil to the will in early 2012. According to David, he thought the document he gave Mr Rickard was the original (it requires careful scrutiny to identify it as a copy). Where the original could have gone is not explained, but there is no reason to think it was destroyed with intention to revoke it.
The wind up of Lewis Company has been completed and the company has been deregistered. The Turramurra property has been sold, but I was informed that the administration of Geoffrey’s estate is still not complete. No action has yet been taken to pursue David for any contribution to which the testator’s estate might be entitled as a result of his co-ordinate liability for the costs of the liquidator’s action and for the equitable compensation. This will be a matter for Mr Glass to consider as administrator.

Summary and analysis of evidence

In this section of the judgment I deal with the factual aspects of the evidence which require detailed analysis. I first identify the witnesses who gave evidence. I then summarise the evidence on the testamentary instruments executed by the testator over the relevant period, being from the first will prepared by Mr Thompson (May 2010) to the last codicil prepared by Mr Rickard (August 2015). My summary covers both the terms of the instruments and the evidence about their preparation and execution.
I then summarise and analyse the evidence on two further topics. The first covers the general evidence about the testator’s health and cognitive function and reliance on others over the relevant period, The second covers the testator’s understanding of the “succession plan” and the litigation which resulted from it.

Witnesses

David was the principal witness in his case. Evidence was also led from Mr Waugh (now Mr Waugh SC) concerning his observations of the testator in the course of the liquidator’s action. Shortly before the trial, David’s legal representatives obtained an affidavit from Mr Rickard which dealt with his role in preparing the post-2011 testamentary instruments in issue in the case. All three witnesses were cross-examined.
David’s case also included formal attesting witness affidavits from Ross Hodgson, a solicitor who had formerly been in practice with Mr Rickard and who witnessed the May 2015 codicil; Margaret Clare Wainwright, an associate of Mr Rickard who witnessed the August 2015 codicil; and (at the very end of the hearing) Mr Thompson, who had witnessed the July 2010 will. None of these witnesses was required for cross-examination.
Peter, Roger and Hugh all gave evidence in support of Peter’s case and each of them was cross-examined. Evidence was also called from Hugh’s wife, Rhonda, concerning her conversations with the testator, and she was briefly cross-examined. As I will describe in more detail below, the 2011 will was not in fact witnessed by the purported attesting witnesses and no evidence was called from them.
Unfortunately, the conduct of both of the solicitors who gave evidence was open to criticism. Mr Rickard’s actions in preparing and having the testator sign the various testamentary instruments for which he was responsible were attacked on the basis that they were, at best, perfunctory. Peter’s conduct with respect to the witnessing of the 2011 will was positively discreditable. I refer further to this when analysing the evidence concerning the preparation of the wills in more detail below.
Why Mr Bird participated in implementing the “succession plan” according to David’s directions is not explained. Mr Bird was not a defendant to the liquidator’s action. He was not called as a witness in these proceedings. Neither party suggested that any inference should be drawn against the other as a result.
I have already referred to the evidence of the approaches made in the testator’s name from 2012 onwards to Peter, Roger and Hugh for reconciliation, or at least discussions about reconciliation. There was some cross-examination by counsel for David on the way in which these approaches were rebuffed. Some of Roger’s responses, in particular, were brusque to the point of rudeness. However regrettable this may be, I suspect that the responses reflect the belief on the part of Peter and Roger (which was probably correct) that the correspondence they received had been written by David or in accordance with his instructions.
There are some testamentary capacity cases in which the terms of the will are said themselves to bespeak a disturbance of mind so serious as to amount to a “delusion”. In such a case, it may be necessary to investigate the prior dealings between the testator and those who have been excluded from the will so as to see whether their conduct could rationally have led the testator to exclude them. But counsel for Peter indicated in the course of the opening that no such case was being made in these proceedings.
It followed that the way in which Peter and Roger responded to the overtures made in the testator’s name was of little, if any, relevance to any fact in issue. As I understood counsel for David, the cross-examination was put as being relevant to credit generally.
There were other points at which the evidence of the witnesses diverged on matters of detail. But I have been able to resolve the critical factual issues without the need to undertake a general analysis of credit.

Wills and further draft will prepared by Mr Thompson (2010-2011)

The first will prepared by Mr Thompson was signed by the testator on 19 May 2010 and replaced the testator’s January 2007 will.
The May 2010 will replaced Peter and Mr Bird as the testator’s executors with David and Roger. As already mentioned, there was no provision for any life interest in favour of Geoffrey if he survived the testator. Instead the testator’s estate was to be divided into five equal shares. Each of her sons was to receive one share. The remaining share was to be divided between her seven grandchildren. The grandchildren were not to receive their shares until they turned 25. Kate’s was to be held in trust for her by her brother Anthony.
The will did not mention the $250,000 loan to David from 2001. At the time, Geoffrey still being alive, the loan was a joint asset which the testator was not capable of releasing on her own, and the provision for the loan to be released if the testator survived Geoffrey was not carried forward from the 2007 will. The loan was not referred to again in the testator’s testamentary instruments until the December 2014 will (see [236] below).
Some indication of the thinking behind the will is given by a letter from Mr Thompson to the testator on 3 May which enclosed a draft. The letter referred to the fact that the Turramurra property was in Geoffrey’s name and the testator’s major asset was her half share of the Lewis Company. It stated:

The Will is forwarded as a discussion paper. In reviewing the assets and the family situation, you may decide to either increase or reduce any prospective share. We note that there is a desire to give to the grandchildren a sum of money and the discussions were along the line of using the value of the house.

However, the house is registered in your husband's name and should you predecease him, then value of the house is not available to you to incorporate into your Will. Your assets would then be governed by those assets that are in your name alone. This includes your shareholding in the company.

We also confirm that you are not fully aware of the provisions of your husband's Will and we note that there is some discussion about trying to obtaining copy of it. If, as we presume, you would receive the value of the home then if your husband predeceases you then you have an asset you can deal with separately. It might be appropriate at that time to re-do you Will. We could also re-do your Will on the basis that if you are the proprietor of the home because your husband has predeceased you then you give the whole of the value of the home to the grandchildren and divide the rest reside and remainder of your estate amongst the boys.

As we have now reduced the ideas to writing, we welcome the further opportunity to call on you to go through the Will and your requirements.

In his affidavit, David stated that his mother had obtained Mr Thompson’s name herself and asked him to go along with her to see Mr Thompson to explain the Lewis Company and the investments. He said that his mother told him:

(a)I don't know, with the way property prices are today and going all the time how my grandchildren will ever be able to afford to buy a property.

(b)I want to leave this house to my grandchildren so that after I die they can sell it and divide the proceeds equally amongst themselves and they can then use the money as a deposit to purchase either a house or a home unit.

(d) The gift of this house will not seriously disadvantage you and your brothers because of you four boys' share of the total value of the investments owned by the company.

(e) It will not disadvantage Peter because he hasn't had the expense of raising children and it will not disadvantage either you, Roger or Hugh because you three will not have the expense of providing your children with a deposit for a property.

Despite the reference to the draft being a “discussion paper”, and the invitation for the testator to provide further instructions, there is no evidence of any further discussions at the time. I infer that the draft provided with the letter was in substantially the same form as the will which was signed two weeks later.
The second will prepared by Mr Thompson was signed by the testator on 29 July. The will was in the same terms (or virtually the same terms: I have not conducted a word-by-word comparison), as the May will, except for the addition of a clause providing that any debt due by any of her sons was to be deducted from his share of the estate. Presumably this additional clause was intended to confirm that the $500,000 payment to Peter, made earlier that month, would be treated as an advance on his inheritance, in accordance with his acknowledgement (see [40] above).

Mr Thompson was provided with a copy of Peter’s letter of September 2010 which commented on the July 2010 will. Peter’s comments concerned secondary issues such as the making of express provisions to govern where the beneficiaries’ shares would go if they died before the testator did. In Mr Thompson’s letter of March 2011, which followed a meeting with the testator, Roger and David, in about January (see [37] and [42] above), he provided a response to Peter’s comments. This appears to have been as far as Mr Thompson’s work went.
There was some, but very limited, evidence before me from Roger and David about the conferences between Mr Thompson and the testator. According to Roger, at the conference with Mr Thompson in about January 2011 the testator said she wished to include directions in the will stipulating how her grandchildren should spend the money which they would inherit. Mr Thompson replied that this was impractical and the testator was trying to rule from the grave.
Roger was not asked about the January 2011 conference in cross-examination and David did not address it in his evidence. Mr Thompson’s March 2011 letter does not contain any further detail.
Roger also gave evidence about the decision to terminate Mr Thompson’s instructions. He stated that he was told by Peter that David did not like Mr Thompson or his advice, thinking that he was too close to the testator’s sister (apparently the testator’s sister had said something to the testator about her affairs which must have come from Mr Thompson). Neither David nor Peter said anything about this in their evidence.

Will prepared by Peter (2011)

The 2011 will prepared by Peter was signed on 22 June. It appointed David, Roger and Mr Bird as the testator’s executors. The basic provisions under the will were the same as those in the wills prepared by Mr Thompson, namely that each son was to receive twenty per cent with the other twenty per cent to be shared among the testator’s seven grandchildren.
In addition:

There were provisions governing the destination of each son’s share in the event that he predeceased his mother, in the terms Peter had proposed in his letter of September 2000.

The gifts to the testator’s grandchildren who had not yet attained the age of 25 were to be held in trust and the grandchild’s trustee was given the power to release the amount held in trust for that grandchild provided that funds were used for the purchase of residential or investment real estate, or the retirement of existing mortgage debt.

Any early inheritance advance given to any of the testator’s sons was to be deducted from that son’s share of the estate.

In evidence is a letter from Peter to his mother dated 11 May enclosing a copy of the will he had prepared. The parties agreed that the enclosure was the same as the will signed on 22 June.
Peter’s affidavit account of preparing the 2011 will began with a conversation Peter said he had with his mother in 2010. He said that she handed him a draft will prepared by Mr Thompson and asked him to look at it. He said that he did so and pointed out to his mother that the will did not make provision for the spouses of her sons if any of them predeceased her. He offered to prepare a further draft and did so. In cross-examination he said that he based his draft on Mr Thompson’s.
Peter in his affidavit next referred to discussions with his brothers Roger, David and Hugh. Peter said that the letter he sent to his mother in September 2010 (see [143] above) incorporated some suggestions from David. Following further discussions, Peter sent the letter of 11 May 2011 enclosing the draft will.
Scrutiny of the documents to which Peter referred shows that his account was incorrect. The draft will prepared by Mr Thompson to which Peter referred was dated 2011, not 2010 (see [136] above). Moreover the draft had already had express provision for the testator’s daughters-in-law in the event that their husbands predeceased her, as suggested by Peter in September 2010, incorporated into it.
Peter was thus correct saying in cross-examination that he based his will on Mr Thompson’s draft, but it was a 2011 not a 2010 draft. The 2010 conversations described by Peter with his mother and his brothers cannot have taken place; what must have happened is that Peter came to draft the will after March 2011 because his mother ceased to retain Mr Thompson for reasons which Peter does not refer to.
But although Peter had the chronology wrong, there is no reason to doubt that he did prepare the 2011 will in consultation with his brothers. This was specifically confirmed by Roger in his evidence, and was not contradicted by David in his evidence or made the subject of cross-examination. Presumably there would have been discussions with the testator as well, although no account of them is given in the evidence.
Both Peter’s September 2010 letter and his May 2011 letter enclosing the will were addressed to his mother at her home address. When asked how he expected his mother would have been able to understand what he said given her macular degeneration, Peter said that she would have had assistance from the magnifier and from David. He acknowledged that at the time of the September 2010 letter, however, David was still in hospital or rehabilitation. Presumably that means his mother must have read the September 2010 letter, at least, using the magnifier. Peter said expressly that she was still using it at this time.
In his main affidavit, which was made in December 2018, Peter went on to give an account of the circumstances in which the testator signed the will. He said that after sending the letter of 11 May, he rang his mother and she told him she had received the will. He said he would drive up to Sydney to arrange for its execution.
According to the affidavit account, Peter drove to Sydney on 22 June, the date the will bears. He stated that he had organised for two of his mother’s neighbours, Peter and Juanita Brand, to come over in the evening and execute it. When he arrived, he read the will to his mother and handed it to her, telling her that the Brands would be coming over later to witness her signature. He then went out for a couple of hours. When he returned his mother had gone to bed, leaving the will, signed, on a table in the lounge room.
Peter stated that when the Brands arrived he told them that his mother had already signed the will and gone to bed. He told them:

This is not the right way to witness the will but I will have to deal with it at a later stage. Do you mind signing anyway?

Peter stated that after the Brands signed the will, he put it in an envelope and gave it to his mother the following morning, telling her to talk to David about its safekeeping.
When he came to give evidence at the trial, Peter made a correction to his affidavit account. He said that, by reference to his e-tag account, he had driven from Cooma to Sydney on 21 June, not 22 June. In fact, this correction appears to have been a response to David’s affidavit in reply; Peter’s car tag records had been produced on subpoena and David had pointed out the disparity.
Peter did not make any other correction to his account, although the result of it was that his visit to Sydney was actually spread over three days, not two. He said that the reading of the will, its signature by his mother and the visit by the Brands had still taken place on the afternoon of 22 June. He did not explain what else he had done between his arrival in Sydney on 21 June and the afternoon of 22 June.
Peter was cross-examined about the way in which he procured the purported witnessing of the will by the Brands. It was put to him, correctly, that he had knowingly procured false attestations from them. Peter did not seem especially troubled by this. He said that he had offered the Brands the choice and they could always have refused.
I found this aspect of Peter’s conduct, and his evidence about it, completely unsatisfactory. It is not clear from the evidence whether the Brands realised that Peter was a solicitor, but even if they did not, it was grossly improper of him to ask them to make solemn statements that they had witnessed the testator signing the will when in fact they had not. Nor should Peter have attempted to deflect blame on to the Brands for something he himself asked them to do.
Although, on his account in his affidavit, Peter said something to the Brands about fixing up the situation afterwards, that does not make sense. The only way in which the situation could be fixed up was by getting the testator to re-sign the will in the Brands’ presence. I suspect that what really happened is that Peter asked the Brands to sign as witnesses expecting that the falsity of their signatures would never be revealed.
The false witnessing of the will was not the only concern which I had about Peter’s evidence on the preparation and execution of the 2011 will. I have already referred to the problems with Peter’s affidavit account of the background. I was also troubled by the erroneous reference in the affidavit to Peter driving to Sydney from Cooma on 22 June. The affidavit account did not fit comfortably with a visit which extended over three days rather than two. I was left with the impression that Peter had little real recollection of the relevant events and that the account in his affidavit was a reconstruction.
The whole episode reflects very poorly on Peter’s credit. I treat his evidence with extreme caution. Nonetheless, on balance I am satisfied that his description of the sequence of events from 11 May 2011 onwards is correct. It is inherently believable and Peter’s evidence was not challenged or contradicted at the hearing. The extent to which I can draw further conclusions about the testator’s knowledge and understanding of the contents of the will is addressed when I deal with that issue below.

Testamentary instruments prepared by Mr Rickard (2012-2015)

Mr Rickard’s records concerning the testamentary instruments that he prepared for the testator were produced to the Court on subpoena. These included his file notes. But they were uninformative. They contained no details of the instructions Mr Rickard received, or any advice which he gave. It was clear that it was not Mr Rickard’s practice to take such notes.
Mr Rickard’s bills for his work on the testamentary instruments were also in evidence. But these too were relatively uninformative. They simply contained the times charged, and a brief description of the work done, on particular dates.
It was clear from the evidence that each of the testamentary instruments prepared by Mr Rickard for the testator was prepared on David’s instructions. In cross-examination, David initially went on to accept that the actual wording of those testamentary instruments was his, and Mr Rickard’s contribution was limited to formatting, formal parts and occasional wording suggestions.
But David then qualified his evidence in that regard. He said that he had not used email in his dealings with Mr Rickard until after he was released from hospital in June 2014 (this seems to have been a later admission to hospital, distinct from the extended period in hospital and in convalescence following his diabetic seizure in April 2010). He said that the wording of the September and December 2012 codicils came from Mr Rickard, although Mr Rickard discussed orally with him what the wording said. Although there was no direct evidence on this, if the June 2014 date was correct then the same qualification would apply to the March 2012 codicil, the April 2013 letter and the November 2013 codicil (see [184], [206] and [212] below).
Mr Rickard was admitted as solicitor in 1988 and has practised on his own account since 1991. He stated that he had frequently undertaken the preparation of wills and was aware of the capacity issues which could arise particularly with older testators.
Mr Rickard’s practice was to assume capacity unless he was aware of conduct by the client which indicated there might be a question about it. In the testator’s case, he did not have any concerns.
Mr Rickard was cross-examined about the guidance on this subject published by the Law Society of New South Wales (When a client’s capacity is in doubt: A Practical Guide for Solicitors 2009). Counsel asked whether he adopted the practice of reading parts of the will to the testator, and asking her to summarise the effect of what he had said. Mr Rickard said that he did not. As I understood it, Mr Rickard’s evidence was that he had “free ranging” discussions with the testator about her testamentary plans and that the practice suggested by counsel was unnecessary. Nor, it appears, did Mr Rickard adopt the other practices referred to by the Law Society, such as inviting the testator at the outset to state in her own words the testamentary plans she wished to make, and asking questions in open ended form, rather than in a leading form.
Counsel also asked whether Mr Rickard adopted the practice with the testator of sending her a letter summarising the effect of the will or codicil before she executed it. Mr Rickard responded that this would be futile because of the testator’s macular degeneration. I found this response surprising in the light of Mr Rickard’s own evidence that the testator could read using the magnifier. I think it is more likely that Mr Rickard simply did not bother. If he thought about it at all, he would have relied on David to relay that sort of information to the testator.
Counsel also asked Mr Rickard whether it was his practice, when presenting the testator with a codicil, to have the will (and any earlier codicils) being modified available so that they could be described or read to the testator in order for her to understand the nature of the change being made. Mr Rickard said that he could not recall. Mr Rickard said that he could not recall his practice in this regard. But Mr Rickard did not claim to have followed this practice with the testator and I think it is clear enough that, again, this is something that Mr Rickard did not bother with.
In Mr Rickard’s affidavit, he gave an account of each occasion on which he obtained the testator’s signature on the testamentary instruments which he prepared. But the account was formulaic. Mr Rickard simply recorded that he read the document in question to the testator, and at the end she said “that’s correct” or words to that effect.
In cross-examination, Mr Rickard was challenged about his recollection. Counsel made the point that his affidavit had been prepared in May 2020, more than eight years after he began acting for the testator and almost five years before the preparation of the last of the testamentary instruments which is in issue in this case.
In response, Mr Rickard said that at some earlier point he had prepared an affidavit for a barrister in connection with the case, implying that his recollection might have been better then. But the circumstances were not explained and the affidavit was not produced.
I thought it was clear from his evidence that Mr Rickard now has no useful recollection of the occasions on which he took instructions from, and obtained the testator’s signature on, the testamentary instruments which are the subject of these proceedings. And without meaningful notes of those occasions, he has nothing to trigger any such recollection.
Counsel for Peter also took up with Mr Rickard his account of merely reading the whole of each document to the testator and obtaining her consent at the end. Mr Rickard said that in fact, as he would read the document, the testator would stop him and ask questions, which he would answer.
Counsel pointed out that this was quite different from what Mr Rickard said in his affidavit, and invited me to disbelieve it. I do not think it is necessary to go as far as that. Even if the testator did sometimes ask for clarification of what was being read to her, there is no way on the evidence to identify which of the provisions in the various documents she asked about, and what she was told.
In his affidavit evidence, David provided an account of the discussions he had with his mother before some, but not all, of the testamentary instruments were drawn up and signed. I set those descriptions out when dealing with the relevant testamentary instruments below.
David was not present for the execution of five of the testamentary instruments prepared by Mr Rickard. He did give evidence about the execution of the other four. But that evidence was as formulaic as Mr Rickard’s (see [190], [195] and [201] below).
March 2012 codicil: The first codicil to the 2011 will was signed by the testator on 6 March 2012. The codicil arose out of the testator’s entitlement, as appointor under the trust deeds for each of the Hughes Trusts, to nominate a replacement appointor by will. The codicil exercised this power for the four trusts which were intended to hold the four sons’ shares, nominating the relevant son as the new appointor on the testator’s death. Except in David’s case, it provided that should the relevant son predecease the testator, his wife was to be the appointor.
In his affidavit, Roger described a conversation with his mother in February 2012 about a draft version of the codicil. Roger’s evidence was not disputed and was supported by a letter he wrote to David on 21 February. The letter stated:

At Mum's request I spoke with her at the weekend re the codicil for her will that has been drafted. I explained to Mum that although the clauses were straight forward I could not explain the reference to cl 52 of the trust deed nor without understanding the context of why the codicil was prepared in the first place could I advise her as to whether the codicil as drafted reflected her instructions. Mum stated that she also did not understand cl 52 and although there had been a detailed discussion with her on the context she could no longer remember the rationale.

Accordingly I do not believe any further action should be taken until we all understand the context and have our opportunity to express our views recognizing that it is Mum who is the final arbiter.

Roger’s opinion was ignored. As already stated, the codicil was executed on 6 March and Roger only found out that it had been executed afterwards, as a result of being sent a copy.
As I have described, Mr Rickard did not in his evidence descend in any detail about what was said concerning the codicil at the conference when it was executed on 6 March 2012. But he did give evidence of a discussion on another issue relevant to the testator’s testamentary plans.
Mr Rickard stated in his affidavit that an idea was floated to use the testator’s power of attorney from Geoffrey to transfer the Turramurra property out of Geoffrey’s sole name into the joint names of the testator and Geoffrey. Mr Rickard said that the power of attorney was not an enduring one and could not be used for this purpose. Presumably Mr Rickard reasoned that, not being an enduring one, the power of attorney was no longer valid because of Geoffrey’s dementia. According to Mr Rickard, the testator responded that Geoffrey would never have agreed to it anyway.
I infer from Mr Rickard’s description that the suggestion did not come from the testator. It must therefore have come from David, and it is consistent with David’s own view that the Turramurra property should form part of the testator’s estate so that she could dispose of it herself (see [442] below)
In his affidavit, David explained the background to the codicil as follows:

On or about February 2012 I said to my mother 'As part of the plan involving the Hughes companies and the trusts you are the appointor under the trust deeds for the trusts that control Peter, Roger, Hugh and my companies. You will need to appoint Peter, Roger, Hugh and me as replacement appointers so that after you die our companies can be transferred to us. What each of us will then want to do with our respective companies is then a matter for each of us and it should stop any arguments over Anne Lewis'. My mother, after considering my advice, said to me 'Yes I agree'.

In the present case, complexity of the testamentary instruments and complexity of the estate are factors in play because of the provisions concerning the companies and trusts. So too is the testator’s sophistication (which I take to include her experience and understanding of such structures).
David played a part (indeed, the leading part) in the preparation of the December 2014 will and the 2015 codicils. However, counsel for David suggested, as I understood him, that this was not a case where “particular vigilance” was required on that account. Counsel pointed out that the will gave David extensive powers but did not directly provide him with additional benefits. The basic structure remained throughout that David and his brothers each received one-fifth of the residue.
In my view this argument is not realistic. The December 2014 will conferred on David immunity from the claw-back provisions, which no other beneficiary had. Of itself I think this was a “substantial benefit”.
Furthermore it was clearly contemplated that David would be the Trustee. In that capacity there were conferred on him broad discretionary powers which were intended to allow him to make substantial reductions to (and possibly even defeat entirely) the legacies to other beneficiaries. He could also exercise the power to distribute to himself up to 80% of any monies clawed back. And, if the clauses purporting to allow the Trustee to “deal with” the shares in the Lewis Company and the beneficiaries’ interests in the Hughes Trusts were valid, he could exercise those powers in his own favour as well. In my view the conferral of such powers should also be seen as a “substantial benefit” for relevant purposes.
In the end, the point may not matter very much. Counsel for David accepted that the onus lay on him to demonstrate the “righteousness of the transaction”.
Counsel for David conceded that the claw-back provisions in the August codicil (clauses 7 to 9) should not be admitted to probate. Counsel accepted that they were too complex to be understood when the testator was not given the existing claw-back provisions to compare them against (see [175] above). Counsel submitted however that the Court could exclude the clauses from probate but admit the rest of the codicil (which counsel submitted was unexceptionable), as in Hobhouse v Macarthur-Onslow [2016] NSWSC 1831 at [539].
Counsel made no equivalent concession concerning the claw-back provisions in the December 2014 will. Those provisions appeared in a free-standing will and, according to counsel, no question of comparing them with earlier provisions arose. If the Court was nevertheless against the admission of those provisions to probate, counsel’s fall-back position was again that the rest of the will could, and should, be admitted to probate.
December 2014 will: Considered on their own, clauses 1 to 11 of the December 2014 will present no difficulty. No further comment is required concerning clauses 1 and 2, which deal with revocation of previous testamentary instruments and the appointment of David (or in his absence, his son) as Trustee. However unwise this may have been, its effect would have been plain to, and understood by, the testator.
The substance of the bequests in the will is contained in clauses 4 and 5. The specific bequests in clause 4 raise no concern. The bequest in favour of Kate follows the earlier informal provision in April 2013, and was clearly something close to the testator’s heart. The bequests in favour of the testator’s daughters-in-law are relatively modest and perfectly understandable. The division of residue in clause 5 follows the pattern established by the earlier wills in 2010 and 2011.
Clauses 6 to 9, which make alternative provision in the event that the principal beneficiaries die before the testator, likewise raise no questions. Clauses 10 and 11, which deal with the treatment of gifts and early inheritance advances, are mechanical.
Clauses 12 to 16 give rise to different considerations. They all involve, in one way or another, the disposition of interests in, or the exercise of rights over, the Lewis Company, the Hughes Companies or the Hughes Trusts. I have concluded at [387]-[397] above that the testator lacked a general understanding of the company and trust structures established as a result of the implementation of the “succession plan” in 2012. At a minimum, it would have been necessary to ensure that the testator had the key features of those structures in mind when she was being asked to approve the clauses in question.
In the circumstances, I think this would have required an explanation sufficient to convey to the testator that: the cash and securities formerly held by the Lewis Company had been transferred to the four sons’ trusts and the grandchildrens’ trust, and the testator no longer had any direct or indirect interest in those assets; the assets were held under the terms of the relevant trust deeds, which could not be altered by the testator or anyone else; the sons’ trusts (which included the unit-holdings in the grandchildren’s trust, and thus the beneficial interest in that trust as well) were held on terms which allowed the trustee to distribute both capital or income to any of the defined class of beneficiaries, which was not confined to the relevant son and his family; effective control of the trust lay with the trustee (the and thus with ownership of the Hughes Parent Company); but this was subject to the appointor’s power to nominate a new trustee, or to nominate a new appointor by will.
Most importantly, the testator would have needed to understand that by nominating the Trustee as the appointor the testator would be conferring on the Trustee (who would probably be David) virtually complete control over all of the former investment assets of the Lewis Company; the only substantial asset in the estate would be the dividend received by the testator from the liquidation of the Lewis Company; and that dividend would depend upon the liquidator successfully unwinding the “succession plan”, if the liquidator’s action succeeded, or, if the liquidator’s action failed, upon the liquidator requiring repayment of the loans made by the Lewis Company to the Trusts.
At [309] to [321] above I have summarised the evidentiary difficulties in the way of proving that a full and proper explanation was given to the testator of the testamentary instruments prepared by Mr Rickard. Those difficulties are particularly acute so far as clauses 12 to 16 are concerned.
Clause 12(vii), which purported to confer on the Trustee the power to “deal with” the testator’s shares in the Lewis Company, reflected a provision first introduced in the December 2012 codicil to the 2011 will. I have explained at [313] to [317] above the deficiencies in the explanation David claims he gave his mother at that time about the purpose of the provision. Even on his own account, David did not bring out the potential for the provision (if valid) to be used to defeat the testator’s other bequests.
There was no evidence of any further explanation of the provision when the December 2014 will was prepared. And there was no evidence of any explanation of any of the other provisions at all. In particular, there was no evidence of what the testator was told about clause 12(iv), which nominated the Trustee as the appointor of the sons’ trusts. Arguably this is the most far-reaching and important single provision in clauses 12 to 16.
Furthermore, for the reasons given in [319] to [321] above, some of the provisions (in particular, clauses 12(iii), 12(v), 12(vi) and 12(vii)) are framed in such a way as to suggest that the features of the will which I have just summarised were not even properly understood by David (or Mr Rickard). Had the testator asked questions about where the boundary lay between the assets of her estate and the assets of the Hughes Trusts, it is at best doubtful whether David (or Mr Rickard) could have given her an accurate answer.
Such evidence as there is of the testator’s intentions only raises further questions about whether she fully understood the terms of the clauses in question. Five months later, in May 2015, the testator made it clear, in the instruction which David relayed to Mr Rickard, that despite everything she did not wish to cut Peter or Roger out of her will. It seems she never even contemplated the possibility of Hugh or the grandchildren being cut out. It is difficult to reconcile this with the provisions in clauses 12 to 16 which purported to allow David to assume complete control of the family assets, including those in his brothers’ trusts.
Hugh’s note of 30 July 2015 about the testator consoling herself with the thought that all families have disputes about estates (see [385] above) also suggests that she did not appreciate the extent to which her will allowed for the rights in favour of her sons to be defeated. It is clear that, in spite of everything her other sons had said, the testator was determined to allow David to do what he wanted. But she does not appear to have appreciated that this went beyond relatively minor adjustments to her other beneficiaries’ entitlements, and potentially extended so far as to potentially eliminate Peter’s or Roger’s gifts entirely.
Underlying all of this is the testator’s apparent lack of interest in the structure and workings of the family investments, and her willingness to leave such matters to David. It is all too easy to imagine the testator having clauses 12 to 16 read to her and treating them as the auditory equivalent of David “droning on and on” (see [373] above). On balance I am not satisfied that the testator had sufficient knowledge and paid sufficient attention to satisfy the knowledge and approval requirement.
Clauses 17 to 21, the claw-back provisions, are even further along the scale. Understanding the verbiage as it was read to her, just as a matter of English, is unlikely to have been easy for the testator. But that is only the beginning of the problem.
As noted at [365] to [397] above, the testator’s lack of understanding of the company and trust structures following the implementation of the “succession plan” in 2012 meant that she could not have had a proper appreciation of the objectives or likely effect of the litigation challenging that plan. Yet such an understanding and appreciation was critical to a proper understanding of the claw-back powers conferred on the Trustee (in effect, David) under the will.
In my view it is too simple to say that because the December 2014 will was a stand-alone testamentary instrument, the previous provisions were irrelevant to the testator’s knowledge and understanding of the claw-back provisions of that will. They formed part of the context in which the testator would, or at least may, have considered those provisions.
Whatever the deficiencies in the drafting of the claw-back provisions in the November 2013 codicil, they were confined to the legal costs of proceedings brought against the testator, or the companies and trusts. To impose the unrecovered costs of those proceedings on Peter by deducting such unrecovered costs from his share of the estate, even if it was punitive, and may well have been unreasonable having regard to the merits of the litigation, was a relatively simple idea. It might well have stuck in the testator’s mind.
As appears from [257] to [262] above, in the December 2014 will the scope of the claw-back provisions extended far beyond the unrecovered costs of the proceedings brought by Peter. In my view, the requirement of knowledge and approval meant that it was necessary to bring home to the testator the full scope and implications of the extended claw-back powers. Otherwise there would have been a risk of the testator treating the new provisions as mechanical ones with a relatively confined effect, and being of a type she had already approved.
In these circumstances, I think that knowledge and approval would have required explaining to the testator that the claw-back provisions purported to allow David, as Trustee, a broad and uncontrolled power to identify “additional expenses” in some way associated with the implementation of the succession plan or the subsequent litigation. These “additional expenses” would not be confined to legal costs but might extend to tax liabilities and accounting or other professional fees. David would then be entitled to impose liability for these “expenses” on any beneficiary who he considered, again in the exercise of the broadest possible discretion, had in some way been responsible. As ar result, Peter or Roger, at least, could be deprived of his inheritance, which could then be re-distributed according to David’s discretion.
The observations I have made about clauses 12 to 16 apply with still greater force to the claw-back provisions in clauses 17 to 21. I am not satisfied that the knowledge and approval requirement is satisfied.
As appears below, counsel for Peter did not contest the applicability of Hobhouse v Macarthur-Onslow. For these reasons, I will admit clauses 1 to 11 of the December 2014 will to probate but exclude the other clauses.
May 2015 codicil: The sole effective provision of the May 2015 codicil is the gift to David of the entire shareholding in the Hughes Parent Company. That might have been comprehensible to the testator as a disposition of property. The problem is that the gift of the shareholding carried with it the potential to control the sons’ trusts (at least in the absence of the exercise of the testamentary power to select a fresh appointor). Essentially the same considerations apply as for clauses 12 to 16 of the December 2014 will. In my view the May 2015 codicil should not be admitted to probate.
August 2015 codicil: I have already noted that counsel for David abandoned any attempt to propound the claw-back provisions (clauses 7 to 9) in the August 2015 codicil. Clause 3 deals with the alternative executor if David is unable or unwilling to act. It raises no issue of knowledge and approval. Clauses 5 and 6 are consequential on clauses 2 and 4, but make no difference to the operation of the codicil anyway. Clauses 10 and 11 are mechanical.
Clause 2 is in substance the same provision as was introduced by the May 2015 codicil, which I have rejected. It should not be admitted to probate. The principal issue concerns clause 4, which provides for a gift in favour of the grandchildren of an amount equal to the value of the Turramurra property.
In form, the gift in clause 4 is not tainted by the complexities concerning the companies and trusts, or the claw-back provisions. The concept of increasing a gift, with a consequent reduction on the value of the residue, is easily understood.
The problem is with the overall effect of the gift on the testator’s estate. The gift would on any view make a substantial difference to the value of the residuary legacies to the testator’s sons. The question is whether the testator really intended that.
It is clear from his evidence that David resented the fact that the Turramurra property fell into his father’s estate and his mother received no share of it. Given the amount which he and his brothers were to receive from their father’s estate, it was understandable that David considered that the benefit to the grandchildren should be increased.
In his affidavit evidence David attributed the same view to the testator. This was most clearly set out in David’s account of the conversation with his mother before her visit to Mr Thompson in 2010 (see [140] above). The difficulty is that, while I have no doubt that the statements attributed to the testator in that alleged conversation represent David’s view, I only have David’s word for saying that they represented the testator’s view.
The objective evidence is far less impressive. Mr Thompson’s letter says only that the testator wished to give her grandchildren “a sum of money” and “using the value of the house” was discussed. If the testator had truly wanted to leave her grandchildren a sum of money equal to the value of the house, there was nothing to stop such a gift from being written into the will. But it was not, and I think the context suggests that what may have been discussed was an inter vivos gift financed in some way from the house, which was rejected as impracticable.
The objective evidence surrounding the $350,000 gift the testator made to her grandchildren in July 2012 does not assist David’s case. Again, I only have David’s word that gift was intended as an instalment towards a gift of the full value of the property. If that had been so, it would have been logical to deduct the $350,000 when the full gift was made in the second codicil. Instead, by clause 5, the codicil went out of its way to provide that the $350,000 was to be in addition to the gift made in the codicil.
There is also the evidence from Roger to the effect that the $350,000 gift represented a unilateral increase by David in the amount which had been intended by the testator (see [369] above). As I have already pointed out, that evidence was not contested by David.
Counsel referred me to Hoff v Atherton [2004] All ER (D) 314, where Chadwick LJ said (at [64]):

… it may well be that where there is evidence of a failing mind - and, a fortiori, where evidence of a failing mind is coupled with the fact that the beneficiary has been concerned in the instructions for the will - the court will require more than proof that the testator knew the contents of the document which he signed. If the court is to be satisfied that the testator did know and approve the contents of his will - that is to say, that he did understand what he was doing and its effect - it may require evidence that the effect of the document was explained, that the testator did know the extent of his property and that he did comprehend and appreciate the claims on his bounty to which he ought to give effect. But that is not because the court has doubts as to the testator's capacity to make a will. It is because the court accepts that the testator was able to understand what he was doing and its effect at the time when he signed the document, but needs to be satisfied that he did, in fact, know and approve the contents - in the wider sense to which I have referred.

In Estate of Stanley William Church [2012] NSWSC 1489 White J commented (at [66]):

In other words, the will-maker may have testamentary capacity, but it may be found that he or she did not know and approve of the contents of the will, notwithstanding that he or she understood its contents, if the person did not exercise his or her capacity to comprehend and appreciate the claims to which he or she should give effect. If there are suspicious circumstances, evidence will be required that the deceased not only knew the contents of the will, but approved them, and proof of approval may require evidence that the deceased not only was capable of weighing the claims to which he or she might be expected to give effect, but did so.

His Honour went on to say that it was not necessary in the case before him to determine whether this view of the law is correct. He made similar observations in Estate of George Aeneas McDonald; Howard v The Sydney Children’s Hospital Network (Randwick & Westmead) [2015] NSWSC 1610.
Determining the actual financial impact of the gift in clause 4 of the codicil is not easy. There is no evidence of what the house was worth at the time, let alone what the testator may have thought it was worth. The ultimate sale price in 2017 ($2.55 million) can only give the roughest indication.
Furthermore the value of the residue, overall, was unclear. The testator’s half share of the Lewis Company’s investment portfolio had been worth about $4.5 million in 2012. Under White J’s judgment (assuming there was no appeal) the portfolio would be recovered by the liquidator, but the amount the testator would have to pay by way of compensation and costs, and the quantum of the eventual distribution, would have been quite uncertain. There is of course no evidence that this question was ever considered by David or Mr Rickard. Clearly the testator would not have done so.

If the “wider view” expressed by Chadwick LJ is correct, it is difficult to see how clause 4 could be sustained. But I think that it is not necessary to adopt that wider view to resolve the issue in this case.
David’s account of the rationale of the $350,000 gift, while not reliable as evidence of his mother’s actual wishes, is some indication of his thinking at the time and raises an arguable inconsistency with the absolute gift in clause 4. Furthermore, as a result of the judgment of White J, the value of the testator’s assets and the extent of her liabilities were both in a state of flux. As I have already explained, it is unclear whether the testator even understood the factors which bore on what her residuary estate would ultimately be worth. Nor is it clear that her previous gift of $350,000 would have been present to her mind.
I have no confidence that David’s account of the testator’s wishes is correct. I have no evidence of any explanation of clause 4 to her. What I am left with is the bare fact of due execution of the codicil. I think it is insufficient to dispel the doubts. I am not satisfied that the knowledge and approval requirement was satisfied for clause 4.
In Hobhouse Robb J considered that only parts of two clauses in a large and complex will should not be admitted to probate. The present case is the opposite. I have concluded that none of the provisions should be admitted to probate except clause 3 (concerning the alternative Trustee) and the mechanical provisions in clauses 10 and 11.
Counsel submitted that if I decided that clauses 7 to 9 should be rejected, then the codicil should be rejected in whole. But I did not understand counsel to be arguing that the Hobhouse decision was distinguishable on the ground that the invalid provision is represented only a minor part of the will in question.
It appeared to me that counsel was trying to have the Court reject clause 4 along with clauses 7 to 9, even if that clause standing on its own would otherwise have been accepted. As I have found that, even standing on its own, clause 4 should not be admitted to probate, I do not propose to take the issue any further.
I have therefore concluded that clauses 3, 10 and 11 (only) of the August 2015 codicil should be admitted to probate.
Further issues: Even if the June 2011 will, the codicils to that will, and the April 2013 letter, had been validly executed, they were revoked by the December 2014 will, which I have found to be valid (even if only in part). The same applies to the July 2010 will: that will was revoked by the June 2011 will, if valid, or was otherwise revoked by the December 2014 will. Nevertheless I intend for completeness to give my conclusions on the validity of the June 2011 and July 2010 wills. I do not however propose to deal with the validity of the codicils to the June 2011 will or with the April 2013 letter.

June 2011 will

I have already concluded that the testator had testamentary capacity at the time of the December 2014 will (and the 2015 codicils). This conclusion applies with greater force to the 2011 will, which was executed over three years beforehand. The potential qualification concerning the nature of the testator’s assets arose from the “succession plan”, which post-dated the 2011 will. I also note in passing that it does not seem to have occurred to Peter when preparing the 2011 will that his mother might have lacked capacity at the time.
There is no direct evidence of the will having been read by, or to, the testator. Nevertheless, I think I can be satisfied that it was understood and approved by her.
The 2011 will in substance was no different from the 2010 wills which were unexceptionable and clearly represented the testator’s intentions. I also think that it is very likely that the testator either read the 2011 will, or it was read to her by David, in the month between when it was sent to her and when she executed it. There is no doubt that David was consulted about the terms and approved of them. There is every reason to think that he would have told his mother of that. Thus, in spite of the false attestation, I consider that the 2011 will was validly executed and would have been admissible to probate if it had not been revoked by the December 2014 will.

July 2010 will

Finally, I record that if I had concluded that the 2014 and 2011 wills were invalid, I would have admitted the July 2010 will to probate. The conclusions I have reached concerning the testator’s testamentary capacity at the time she executed the June 2011 will apply with equal or greater force to the July 2010 will. The will was properly proved in accordance with the Rules. Its essential provisions were relatively simple, and rational. There is nothing to displace the presumption of knowledge and approval which results from proof of due execution.

Conclusions and orders

I have concluded that:

clauses 1 to 11 of the December 2014 will and clauses 3, 10 and 11 of the August 2015 codicil should be admitted to probate;

neither the other clauses of the 2014 will, nor the other clauses of the August 2015 codicil, nor the May 2015 codicil should be admitted to probate;

both the July 2010 will and the June 2011 will satisfy the testamentary capacity and knowledge and approval requirements, but should not be admitted to probate, on the ground that each was revoked by a subsequent valid will;

it is unnecessary to consider whether the first three codicils to the June 2011 will, the April 2013 testamentary letter, or the fourth codicil to the June 2011 will satisfy the knowledge and approval requirement, since even if valid they would have been revoked by the December 2014 will.

David’s claim propounding the 2014 will and its codicils therefore succeeds, but only in part. Peter’s cross-claim propounding the 2011 will fails and must be dismissed.
I will direct David to bring in a minute of order giving effect to my judgment. That minute should also provide for orders for costs between the parties. Should there be any disagreement, or should any party seek an order for payment of costs out of the estate, I will hear further argument.
Finally, I return to my concern about Peter’s conduct in connection with the attestation of the 2011 will. On the face of it, that conduct may justify the referral of the papers to the Law Society for consideration of disciplinary action against Peter as a solicitor. I will afford Peter an opportunity make submissions as to whether I should take that course.
The orders of the Court are:

Adjourn the proceedings for a period of 14 days, or such other period as may be arranged with my Associate.

Direct that the plaintiff consult with the defendant and, not later than 2 working days before the adjourned date, bring in a proposed minute of order giving effect to my judgment, and dealing with costs inter partes.

Direct that any party seeking an order for costs out of the estate notify his application not less than 2 working days before the adjourned date.

Direct that not less than 2 days before the adjourned date, the defendant file and serve written submissions on whether the Court should refer his conduct in connection with the execution of the testator’s will dated 22 June 2011 to the Law Society of New South Wales to consider possible disciplinary action.

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Decision last updated: 25 September 2020

Medium Neutral Citation:	Lewis v Lewis [2020] NSWSC 1306
Hearing dates:	15, 16, 17, 18 June 2020; further submissions ending 1 July 2020
Date of orders:	25 September 2020
Decision date:	25 September 2020
Jurisdiction:	Equity - Probate List
Before:	Parker J
Decision:	See [464]-[468]
Catchwords:	SUCCESSION – contested probate – testamentary capacity – soundness of mind, memory and understanding – litigious dispute between testator and family members concerning restructuring of family investments – testamentary provisions giving control of family companies, unit trust and discretionary trusts – testamentary provisions for claw-back of monies from bequests to beneficiaries – knowledge and approval
Legislation Cited:	Corporations Act 2001 (Cth), s 247A Succession Act 2006 (NSW), s 8
Cases Cited:	Banks v Goodfellow [1870] LR 5 QB 549 Estate of George Aeneas McDonald; Howard v The SydneyChildren’s Hospital Network (Randwick & Westmead) [2015] NSWSC 1610 Estate of Stanley William Church [2012] NSWSC 1489 Hobhouse v Macarthur-Onslow [2016] NSWSC 1831 Hoff v Atherton [2004] All ER (D) 314 Tobin v Ezekiel (2012) 83 NSWLR 757
Texts Cited:	Law Society of New South Wales, When a client’s capacity is in doubt: A Practical Guide for Solicitors 2009
Category:	Principal judgment
Parties:	David Grant Lewis (Plaintiff/Cross Defendant) Peter Howarth Lewis (Defendant/Cross Claimant)
Representation:	Counsel: C Vindin (Plaintiff/Cross Defendant) LJ Ellison SC (Defendant/Cross Claimant) Solicitors: Walker and White (Plaintiff/Cross Defendant) L Rundle & Co Solicitors (Defendant/Cross Claimant)
File Number(s):	2017/130576
Publication restriction:	Nil