Drummond v Davidson

[2016] NZHC 1888

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV 2014-485-603664 [2016] NZHC 1888

IN THE MATTER

of the will of WILLIAM FRANK

SHEWARD

BETWEEN

JOHN WINSTON DRUMMOND AND PETER JOHN CORDNER

Plaintiffs

AND

ALASTAIR ROBERT DAVIDSON AND NEROLI CHRISTINE DAVIDSON

First Defendants

AND

PRUNELLA ANN DOWNES Second Defendant

AND

GUARDIANS OF AKAROA HOSPITAL LIMITED

Third Defendant

Hearing:

9 March, 23 to 30 June and 1 July 2016

Appearances:

G M Brodie for Plaintiffs (9 March and 23 June) BRD Burke and M K Crimp for First Defendants

R W Raymond QC and A M Toohey for Second Defendant
No appearance for Third Defendant

Judgment:

15 August 2016

JUDGMENT OF DUNNINGHAM J

Re SHEWARD, DRUMMOND AND CORDNER v DAVIDSON [2016] NZHC 1888 [15 August 2016]

Table of Contents

Introduction ..........................................................................................................[1] Mr Sheward ........................................................................................................ [11] The Davidsons.....................................................................................................[23] Prunella Downes.................................................................................................[29]

The other people in Mr Sheward’s life .............................................................[40] Graeme Curry  [41] Frank Miessen  [43] Wiremu Tainui  [46] Joy and Henry Green  [48] David Beattie  [51] Michael Price  [54] Johnathan Ballantyne  [56]

Previous wills ......................................................................................................[61]

What happened from 2010 onwards? ..............................................................[66] Falling out with Wi Tainui  [67] The private care arrangements with Ms Downes  [74] The gift of the Subaru Forrester car  [81] Christmas 2011  [86] The 2011 will  [87] Sale of the Cabstand to the Davidsons  [92] Purchase of the 1997 Forrester  [94] Payment of the balance of the Cabstand purchase  [95] Mr Sheward’s accounts and wills  [101] Communication with Mr Walker’s firm  [108] The CRT account  [112] Christmas 2012  [115] Mr Sheward’s relationship with the Downes children  [122] Sarah Downes and the house at Rue Balguerie  [128] Subdivision discussions prior to making new wills  [136] The 14 April will  [138] Events leading to the execution of the 18 April will  [145] Ongoing discussions about subdivision  [158] Mr Sheward’s hospitalisation and death  [161] The commencement of proceedings  [165]

Want of knowledge and approval – legal principles .....................................[172] Was there knowledge and approval of the terms of the 18 April will? .......[175] Undue influence – legal principles ..................................................................[187] Was the 14 April will procured through undue influence? ..........................[200] Was the 18 April will procured through undue influence? ..........................[223] Outcome ............................................................................................................[234]

Introduction

[1]      William Frank Sheward, known to all as Frank, lived a long and full life.  He was born in 1925, spent his childhood in Christchurch and, at 18 was called up to serve in World War 2.  However, he loved Akaroa and ended up moving there after he returned to New Zealand.  At Akaroa he was able to foster his love of boats.  He also met his future wife Betty there and they married in 1948.  In due course they bought a two-storey wooden colonial house on Rue Balguerie on about 6.5 acres of land.  Mr Sheward then branched out into farming, breeding Murray Grey cattle on two blocks of land he acquired on Banks Peninsula.  Eventually he became the local harbourmaster and also served as the Marine Search and Rescue Adviser for the Police for many years.

[2]      Mr Sheward and his wife never had children of their own.   However, they developed a number of longstanding friendships and Mr Sheward was an active member of the Akaroa community, supporting the Guardians of Akaroa Hospital and being involved in projects such as the Akaroa lighthouse relocation.

[3]      However, two events significantly marred the last 10 years of his life.   In

2003 his wife Betty died and all those close to him said his health and mobility declined sharply after this and he became lonely.  The second experience was being taken, in 2007, to Woodchester, a senior care facility in Shirley, Christchurch, after being hospitalised because of ulcers he had developed on his legs.  Mr Sheward told all those close to him that he was placed there, without consultation, by relatives of his wife, the Newmans, and he was desperately unhappy there.  He was extremely relieved to return home, and he often expressed his fervent wish to remain in his own home thereafter, no matter what that took.

[4]      On his return home Mr Sheward was supported with services provided by Access Home Health (Access), a home-based healthcare and support provider.  It has a network of nurses and carers who are employed by Access and who are contracted to provide nursing, personal care and household assistance to clients.  Mr Sheward first became a client of Access in 2007, and was provided with both personal care and domestic assistance by that organisation.

[5]      In late 2009, the second defendant, Prunella Ann Downes, was assigned to work  with  Mr  Sheward,  although  she  was  not  the  exclusive  support  worker providing  services  to  Mr  Sheward  over  this  time.    In  late  2010,  Mr Sheward proposed that Ms Downes also work for him privately.  She agreed and commenced working for him for a further five hours a day, seven days a week, on top of the hours she provided him through the Access care arrangements.  Ms Downes said that she was paid $20 an hour for her services, but until the last few months of his life, when a direct credit arrangement was put in place, she received this payment by way of gifts and other financial support for her and her family.

[6]      In the last year of his life, Mr Sheward made two wills, in quick succession, on the 14th and 18th of April 2013. These wills progressively altered the beneficiaries of his estate to exclude the Guardians of Akaroa Hospital as a beneficiary and to reduce the share of the estate to be received by his longtime friends and neighbours, Alistair and Neroli Davidson.   Instead he preferred the Downes Family Trust, of which Ms Downes and her three adult children were the beneficiaries.

[7]      The  Davidsons  claim  that  Mr  Sheward  did  not  know  or  approve  of  the contents of the will dated 18 April 2013 and, in the alternative, that both of the April wills  were  procured  by  the  exercise  of  undue  influence  of  Ms  Downes  over Mr Sheward.

[8]      Ms Downes disputes these claims, saying that many matters raised by the Davidsons as seemingly suspicious have an innocent explanation.  In any event, the will made by Mr Sheward on 18 April 2013 clearly reflected his own wishes.  It was made  after  consultation  with  professional  advisors,  in  circumstances  where  he clearly knew of and approved the contents.

[9]      The issues to be determined are:

(a)       Was the deceased’s will dated 18 April 2013 procured by the second

defendant through undue influence?

(b)Did  the  deceased  have  the  requisite  knowledge  and  approval  in executing the will dated 18 April 2013?

(c)       Was the deceased’s will dated 14 April 2013 procured by the second

defendant through undue influence?

[10]     The  legal  principles  underpinning  the  claims  of  want  of  knowledge  and approval and undue influence are well settled, and the parties were largely agreed on these (save for a question of presumed undue influence, which I will return to later). It was common ground that the case would turn on findings of fact.   It is thus necessary to recount, in some detail, the evidence as to Mr Sheward’s personal circumstances,  and  of  the  events  which  occurred  in  the  last  few  years  of Mr Sheward’s life.

Mr Sheward

[11]     I was able to build up a relatively full picture of Mr Sheward’s personality and  characteristics  after  hearing  from  a  large  number  of  people  who  knew Mr Sheward.  This included evidence from people who had known Mr Sheward for most of his life, as well as from people who interacted with him in the important later years, whether in a professional or personal context.  It was particularly helpful to hear from those who had no particular association with either the Davidsons or the Downes, who are at the centre of this litigation.

[12]     The picture that emerged of Mr Sheward was of a man who liked company, who was hardworking and had many practical skills (although he was not able to demonstrate these in the last years of his life when he was plagued with ill health). Friends also attested to Mr Sheward being a “hard man”, who could be “testy” and strong-willed.  He also, particularly later in his life, could take umbrage easily if he thought someone had done something to offend him.   However, on the other hand, he made lifelong friends and was extremely generous to those who were helpful to him or supported him.

[13]     Ironically, for a man who was so capable in many aspects of his life, he had extremely limited reading and writing skills and it is likely he was dyslexic.  While

the evidence varied as to whether he could read at all, or could only read a little bit, it was clear that he could not read anything complex.  For example, Susan Wilson, the practice nurse at the Akaroa Health Centre, said that when he did his eyesight test, she used a chart with symbols, rather than letters and, as he could not read the writing  on  the  blister  packs  of  his  medication,  she  would  draw  sun  and  moon symbols on the packets to indicate whether they were to be taken in the morning or at night.   I therefore share Mr Cordner’s doubts as to whether Mr Sheward would have been able to read a legal document, such as a will, without assistance.

[14]     Mr Sheward  also  had  extremely limited writing skills.    His  writing  was uncoordinated and childlike, and he had difficulty spelling as demonstrated by the few entries he made in his address book.  He was able to hide this disability when his wife was alive as she would deal with their correspondence and accounts, but on her death he had to rely on others to assist him with paying bills and reading letters.

[15]     In the last years of his life, Mr Sheward was progressively plagued with health  problems.    While  he  had  led  an  active  life  as  an  adult,  farming  steep Banks Peninsula farm country, this eventually necessitated double knee replacement surgery.  His mobility decreased in the last 10 years of his life after he fractured his hip and developed arthritis.  This meant he would use the ride-on mower to go out to the letterbox and he could no longer climb the stairs in his two-storey house.  At times he used walking sticks or a mobility frame to walk.  Indeed, most people said that he spent the vast majority of his time sitting in one location in the kitchen of his home.  He developed ulcers on his legs which never healed.  His eyesight and his hearing deteriorated.  While he had a hearing aid, both his medical notes and various witnesses complained that he did not often use it, and he could only hear things if people spoke to him directly.  He also experienced at least two heart attacks in the last few years of his life and developed Parkinson’s disease, although this condition was not particularly debilitating.

[16]     In summary, Mr Sheward’s health progressively deteriorated in the last few years of his life and he was extremely dependent on others to assist him to continue living in his large, older style home.   Nevertheless, his brain remained lively and there was no question that he had testamentary capacity.  In 2010 at the request of

Mr Sheward’s lawyer, Michael Walker, Dr Howard Wilson assessed Mr Sheward’s mental state prior to him signing a new will.   Dr Wilson explained that he administered what he described as a Mini Mental State Assessment, and concluded that Mr Sheward had the requisite capacity to understand and execute a new will. There was no evidence to suggest a material change to Mr Sheward’s cognitive abilities in the following three years.

[17]     However, many of the professionals who attended Mr Sheward in this period recognised and recorded that Mr Sheward was vulnerable because of his social and physical circumstances.   By way of example, Mr Walker, who prepared a will for Mr Sheward in early 2010, researched the issue of undue influence as a precaution before  preparing  Mr  Sheward’s  will  and  spoke  to  Mr  Sheward’s  accountant John Drummond, and to Dr Wilson, about Mr Sheward’s vulnerability.  Mr Walker said “I recall that when I met with Frank he was excited by the attention he was receiving from Ms Downes” and, “I expressed some concern to John [Drummond] about Ms Downes’ influence over Frank and their relationship”.

[18]     Dr Wilson said that he shared Mr Walker’s concerns, saying that “Frank was a lonely,  vulnerable,  old  man who was  susceptible to  anyone who offered  him friendship”.   Mr Drummond, who was Mr Sheward’s accountant until July 2013, says he recalls “being somewhat concerned about the gift of a Subaru car and the amount of money that was being paid to or for the benefit of the second defendant’s family”.

[19]     Mr Cordner also recorded his concerns when making Mr Sheward’s will of

14 April 2013.  His file note dictated at the time that will was executed, included the following observation:

… Mr Sheward now sees the Downes family as “his family” and my concern is that he is being groomed, not only by Mrs Downes but the other Downes family members in such a way that he is prepared to forget about other parties who have done him favours in the past and ensure that the bulk of his estate goes to the Downes family.

[20]     Shortly before Mr Sheward’s death, Ms Downes contacted Mr Cordner’s law

firm again to have yet a further will made (although that never eventuated).   The

solicitor who took the call, Mr Hill, e-mailed Mr Cordner, who was away at the time, expressing  his  misgivings,  saying  “apparently  the  new  instructions  will  be  that [Ms Downes’] trust gets the lot.  I am very uncomfortable with that … I also wonder about undue influence”.

[21]     In addition, Access staff, as early as 2009, recorded concerns about another support worker being in a position to take “gifts” from Mr Sheward.  These concerns were raised by Mrs Newman, Mr Sheward’s relative by marriage. Access staff noted that Mr Sheward wanted to sell his farm and buy a house for his support worker, and observed that “he appears very lonely and needy” and “has become very dependent” on  his  carer.    As  a  consequence,  when  Ms Downes  became  his  carer  shortly afterwards, she was warned by her supervisor, Ms McMillan, not to do any extra for Mr Sheward as he “becomes too dependent on his carers”.  Ms McMillan also spoke to Mr Sheward about observing boundaries with his newly assigned carer.

[22]     It is noteworthy, in my view, that every professional person dealing with Mr Sheward in the period in question, identified Mr Sheward’s vulnerability, and the risk that he could be subject to undue influence.

The Davidsons

[23]     Alistair and Neroli Davidson, the first defendants in these proceedings, were friends and neighbours of Frank and Betty Sheward.   They moved to Akaroa in December  1993  when  Mr  Davidson  became  the  officer-in-charge  of  the  two constable Police station at Akaroa.   Mr Davidson met Mr Sheward at that time in Mr Sheward’s capacity as the Marine Search and Rescue Adviser to the Police. Thereafter, the Davidsons had regular contact with Mr Sheward and his wife Betty. Although Mr Sheward retired from his search and rescue advisory role in 2001, the Davidsons stayed in close contact and, in 2003, they bought a large rear section on Rue Balguerie that abutted Mr Sheward’s property.

[24]     Mr Davidson left the Police force in July 2007 and began developing his business  interests.    This  meant  he  was  also  able  to  spend  more  time  visiting Mr Sheward  who, after  his  wife’s  death  in  2003,  had  no  immediate family left around him aside from the Newmans, who were distant relatives of Betty Sheward.

In  about  2009,  the  Davidsons  started  building  a  house  on  their  Rue  Balguerie section.  This meant they saw Mr Sheward often, as they would catch up with him whenever  they were visiting the building site.    Mr Davidson,  in  particular,  did numerous chores around Mr Sheward’s property, including maintaining his vegetable garden, mowing his lawns, putting in fences and undertaking repairs to his property.

[25]     It was a mark of the confidence Mr Sheward reposed in Mr Davidson that, in January 2010, he asked Mr Davidson if he would act as his enduring power of attorney in relation to both his property and his personal care and welfare.  This was to replace Mrs Newman, who was his previous attorney, but whom Mr Sheward had distanced himself from since she placed him in the Woodchester senior care facility.

[26]     While  Mrs  Davidson  did  not,  in  the  early  days,  have  contact  with  the Shewards as frequently as her husband, by the time they moved into their newly built house in February 2011, she saw Mr Sheward much more often, sometimes several times a week.

[27]     It is clear that Mr Sheward had a long-standing and close relationship with the Davidsons, and with their two sons, James and Glen, whom he saw grow up.  In

2010 Mr Sheward advised Mr Davidson that he intended to leave his property and assets to the Davidsons.  In Mr Davidson’s words he was “shocked” by this proposal saying “until that time I hadn’t realised how much our friendship meant to him”. Mr Sheward also started to speak about their son Glen living in his house after he was gone, noting that Glen, who was by then a builder, did a lot of work around Mr Sheward’s place for him at no cost.

[28]     After Ms Downes commenced caring for Mr Sheward on a private basis, the Davidsons became concerned about the interactions between her and Mr Sheward. They  commenced  making  diary  notes  in  early  2012  of  their  interactions  with Mr Sheward, and those they observed with Ms Downes.  I consider these notes to be accurate recordings of what occurred from that time through to Mr Sheward’s death as they recall matters which are both favourable and unfavourable to Ms Downes and themselves.   While Mr Raymond QC sought to suggest there was something calculating and self-serving in this form of record keeping, I consider that, given

Mr Davidson’s background and training, he saw this as a natural thing to do when he became concerned about the interactions between Ms Downes and Mr Sheward. This  was  accentuated  by  the  fact  Mr  Davidson  held  power  of  attorney  over Mr Sheward’s property and, as a consequence, felt he should take an active interest in Mr Sheward’s affairs.

Prunella Downes

[29]     The second defendant, Prunella Downes, or Pru as she was more commonly referred to, had also led a full and interesting life.   She married and had three children before divorcing her first husband in the early 1980s.  She was involved in a number  of  businesses  over  the  years,  including  operating  a  boarding  house  in Opawa, Christchurch, owning a craft shop in the Arts Centre at Christchurch and then running a fabric shop in Merivale, before moving to Akaroa in the early 1990s. With her then partner, she commenced operating a water-ski and parasailing business in Akaroa, which was when she first met Mr Sheward, who was the harbourmaster at the time.

[30]     She started working for Access in the mid-1990s as a support worker.  This involved her assisting elderly clients with such tasks as showering and associated personal and medical needs.

[31]     Ms Downes struck me as a capable, energetic and resourceful woman, whose physical  appearance  belied  her  75  years  of  age.    Her  sons  described  her  as  a “trooper”, with “endless amounts of energy”.   She was highly regarded by Access as a carer, and many witnesses commented favourably on the level of care she provided to Mr Sheward, saying Mr Sheward spoke highly of the care he received from Ms Downes, and they saw that he put on weight with the regular nutritious meals which she provided for him.

[32]     She began providing care to Mr Sheward in late 2009 on his discharge from hospital.   She was assigned to visit him twice a week as a support worker for

45 minutes at a time. At the same time he also had a separate person assigned to him by Access to provide domestic assistance.

[33]     Ms  Downes  recalls  that  from  about  May  2010,  her  responsibility  for Mr Sheward through Access increased to five days a week to allow her to shower him and dress his ulcers.  After several months of caring for Mr Sheward through Access, she also agreed to work for him in a private capacity, and this likely commenced around the end of 2010.

[34]     Once she became Mr Sheward’s privately contracted carer, she become an indispensable part of his life.  She prepared his lunch and dinner, assisted him with showering, dressing and grooming, kept the key parts of his house clean, bought his groceries, arranged his medical and other appointments, ensured his bills were paid and took him on social trips and drives.

[35]     Ms Downes also had three adult children, all near to or in their fifties, who got to know Mr Sheward during the period their mother cared for him.  Her daughter, Sarah, lived in Palmerston North, but flew down, sometimes at Mr Sheward’s expense,  and  visited  Mr  Sheward  in Akaroa,  while  her  two  sons,  Michael  and Antony, lived locally and got to know Mr Sheward through their mother’s role in his life.

[36]     While Ms Downes had many positive characteristics, I consider her honesty and credibility was called into question by the evidence that was given.  In particular, she was unable to explain some of the expenditure on Mr Sheward’s CRT card satisfactorily, including expenditure on fuel and on clothing of different sizes, when only she had access to the card.   She also could not explain why her claims for payment  for  Mr Sheward’s  care  from Access  included  claims  for  periods  when Mr Sheward was in hospital.   While she said that Access was always notified if a client was in hospital, Access payments at the time were based on timesheets which the carer submitted.  She could not explain why there were entries for claims in these periods.

[37]     Her  timesheet  entries  for  her  Access  contracts  were  also  sufficiently inaccurate to suggest she either did not do all the hours she claimed for Access, or she did not do all the hours she claimed for Mr Sheward.  By way of example (and there were numerous such examples), on 12 December 2011, Ms Downes claimed

for 45 minutes attending Mr Sheward at 7.00 am, 45 minutes with each of four other clients at 8.00, 8.30, 8.45 and 9.15 am, 30 minutes with each of two further clients at

9.15 am and 11.00 am, and one hour with a client at 2.00 pm.   This added up to nearly  six  hours’ work,  without  taking  account  of  travel  time,  along  with  the five hours of paid care she claimed she provided to Mr Sheward on a private basis each day.  This accorded with the Davidsons’ concerns that Ms Downes did not work the  full  hours  Mr  Sheward  paid  her  for,  and  Mr  Ballantyne’s  observation  that Ms Downes was not always there when he rang at 7.00 pm and Mr Sheward would be waiting for his tea.   Despite her undoubted work ethic, I think it unlikely she worked all the time she claimed payment for, whether from Mr Sheward or her Access clients.

[38]     Finally, and most importantly, for reasons I go on to discuss, I do not accept her denials of any knowledge of the content of Mr Sheward’s wills or how she was to benefit under them.

[39]     As a consequence, when I have had to consider competing versions of the same event, I have come to the view that Ms Downes’ version was not always reliable.

The other people in Mr Sheward’s life

[40]     Mr Sheward and his wife Betty made a number of good friends in their lifetime and, even after Betty’s death, Mr Sheward was fortunate to continue many of these friendships.  A number of these people were able to give evidence recalling Mr Sheward as he was during his life, and of what he said to them, particularly during the critical last three years of his life when Ms Downes began caring for him on a private basis.

Graeme Curry

[41]     Graeme Curry had known Mr Sheward for approximately 70 years.  He first met Mr Sheward when he was around two years old when Mr Sheward moved to Akaroa and began working for his parents on their farm.   He records that after Betty’s death Mr Sheward became a very lonely and ill man and he would visit him

more  regularly  at  that  time,  at  least  once  or  twice  every  month.    He  became concerned for Mr Sheward following Betty’s death because his health and mobility deteriorated and he became heavily dependent on other people for company and to help him do things.  He recounted how, after his stay in Woodchester, Mr Sheward would say that he did not want to go into a home again and that, “no matter the cost”,  he  would  stay  in  his  own  home.    Once  Ms  Downes  started  caring  for Mr Sheward, Mr Curry’s concern for him increased as he described Mr Sheward as “obsessed with Pru and how good she was being to him”.

[42]     While Mr Curry was clearly supportive of the Davidsons,  I nevertheless considered him an honest witness.

Frank Miessen

[43]     Mr  Miessen  was  also  an  Akaroa  resident  who  had  known  Frank  and Betty Sheward since 1992 when he purchased a farm property on Banks Peninsula near to the Shewards’ farm, the “Cabstand”.  He also knew Mr Curry who lived in the  same  area.    He  reinforced  Mr Curry’s  account  of  Mr  Sheward’s  unhappy experience at Woodchester and how afterwards Mr Sheward frequently said how happy he was to be at home and how he would do anything to stay in his own home.

[44]     Mr Miessen had a set weekly routine which included seeing Mr Sheward every Sunday morning for at least one hour, but occasionally up to three hours.  He, too, assisted Mr Sheward with the occasional task around his house, because of Mr Sheward’s physical disabilities.  Mr Sheward was fairly open with Mr Miessen about his arrangement with Ms Downes and his intentions for his wills.

[45]     Again, I consider Mr Miessen was a reliable witness who knew Mr Sheward well and recalled his observations accurately and without putting any unnecessary gloss on them.

Wiremu Tainui

[46]     Another   longstanding   friend   of   Mr   Sheward   (albeit   estranged   from

Mr Sheward in the last three years of his life) was Wiremu Tainui, known to his

friends as Wi.  Mr Tainui had known Mr Sheward for his entire life and had lived just down the road, on Rue Balguerie, for 50 years.  He said that Mr Sheward and he became very close and he saw Mr Sheward and his wife Betty almost weekly.  After Betty’s death in 2003 he continued to see Mr Sheward regularly and did a number of odd jobs for him for which Mr Sheward would pay him $20 an hour.

[47]     He  met  Ms  Downes  when  she  started  working  for  Mr  Sheward  and  he observed that, when she came along, “she took over the reins around Frank’s house”. His evidence was that he believed Ms Downes lied to Mr Sheward on a number of occasions and that it was over one such occasion, where Mr Sheward  believed Ms Downes over him, that their longstanding relationship completely broke down and he did not see Mr Sheward again before his death.  In his view, Ms Downes had Mr Sheward “twisted around her little finger” and he “believed everything she told him  without  question”.     Again,  Mr  Tainui  struck  me  as  a  straightforward, no-nonsense  person  who  endeavoured  to  recall  events  honestly  and  accurately, though clearly his view of Ms Downes was coloured by the events which led to the end of his friendship with Mr Sheward.

Joy and Henry Green

[48]     Dr  Henry  Green  and  his  wife  Joy  had  been  friends  with  Frank  and Betty Sheward since about 1972.  Although they lived in Ashburton where Dr Green had a general practice before he retired, they also had a holiday home in Akaroa and met Mr Sheward through boating.  The Greens would spend time with the Shewards when they were on holiday and knew the Shewards well.  Like many other witnesses they recounted how Mr Sheward hated his experience in Woodchester home and how this distanced him from the Newmans, who he thought had “put him in there to die”.

[49]     During the period when Ms Downes was caring for Mr Sheward, the Greens would call in to see him in Akaroa, usually visiting him after church on a Sunday. This occurred perhaps six to eight times a year in this period.   Their visits would often coincide with those of Mr Miessen, who also visited on a Sunday.  They, too, recall Mr Sheward speaking appreciatively of Ms Downes and saying he intended to leave her money in his will to thank her for what she was doing.  They spoke highly

of the care that Ms Downes gave Mr Sheward and talked of his gratitude that he was being so well looked after by her.

[50]     Again, I consider the Greens were honest witnesses who endeavoured to recall  their  conversations  with,  and  observations  of,  Mr  Sheward  accurately. However, due to the infrequency of their visits, they did not have such a comprehensive perspective of what was occurring in Mr Sheward’s life as those who had weekly contact with him in this period such as Mr Miessen and Mr Ballantyne.

David Beattie

[51]    Mr Beatttie was also someone with a longstanding connection with the Shewards.  Mr Beattie first met Mr Sheward in about 1970 in his role working for Hutchinson Ford Motors when Mr Sheward was a customer.  Mr Beattie and his wife built a holiday house in Akaroa and it was through this, and their common interest in boats, that Mr Beattie got to know Mr Sheward and his wife.   In the last years of Mr Sheward’s life he said the frequency of his visits would vary from between once a fortnight to once every two months.

[52]     Mr Beattie explained that Mr Sheward was a nice guy who wanted to provide for the people he cared about, although, if he perceived that someone had offended him  in  some  way,  it  would  be  within  his  character  to  react  to  that  reasonably strongly.

[53]     Like many other witnesses, he was told by Mr Sheward that Ms Downes’ care made life a lot more comfortable for him and that he intended to leave her money in his will.

Michael Price

[54]     Mr Price was the only relative of Mr Sheward to give evidence.   He was Mr Sheward’s second cousin and his mother, Winnifred Price, was Mr Sheward’s cousin.  Although Mr Price and his mother both live in the North Island, Mr Price said that he regularly visited his uncle because his son was based in Christchurch and he had met Ms Downes on a number of occasions.

[55]     He spoke favourably of the care Ms Downes gave Mr Sheward and of the fact  that  Ms  Downes  would  keep  him  and  his  mother,  as  Mr  Sheward’s  only relatives, appraised of any developments with Mr Sheward’s health.  He explained that Mr Sheward discussed with them his intentions to change his will to benefit Ms Downes   and   he   considers   that   that   was   appropriate   and   represented Mr Sheward’s wishes.

Johnathan Ballantyne

[56]     Mr Ballantyne’s association with Mr Sheward placed him in a particularly good  position  to  give  independent  evidence  about  what  Mr  Sheward  said. Mr Ballantyne never met Mr Sheward in person, nor the Downes or the Davidsons. His only contact with Mr Sheward was as a volunteer phone carer with St John.  In this role he spoke with Mr Sheward by telephone once a week, for about an hour.  He commenced his weekly calls to Mr Sheward in about September 2008 and last spoke with him shortly before his death in September 2013.

[57] Ms D	His ownes (a)	recollections  of   Mr  Sheward’s   conversations,  as  they  related   to , were that: he had purchased a brand new Forrester motor vehicle for Ms Downes
as she had told him that her own vehicle was not reliable;
(b)	he gave Ms Downes a ride-on lawn mower after she asked for one;
(c)	Ms Downes had arranged for two relations of hers to fix up his boat for him and he was disappointed that they only did a little bit before
disappearing without finishing the job;
(d)	he signed blank cheques at Ms Downes’ request and was worried
about his finances because he seemed to be going through money. This prompted Mr Ballantyne to suggest Mr Sheward get in touch
with his accountant, which he subsequently did;

(e)       he did not want to go into a home and he wanted to stay in his own home, especially after his experience at Woodchester; and

(f)       he and Ms Downes had fish and chips together on a regular basis and he paid for her meal.

[58]     In   speaking  about   his   neighbours,  the  Davidsons,   Mr  Sheward   told Mr Ballantyne that they were “good neighbours and watched out for him”.  He also said that, until Ms Downes became his caregiver, Mrs Davidson helped him keep his finances in order.   He said that Mr Sheward told him he intended leaving some money to the Akaroa Hospital and had been involved as a trustee or guardian of the hospital.  Indeed, after the earthquakes, when Mr Sheward was to receive $27,000 from EQC, he said he was going to leave that to the hospital.

[59]    When Mr Ballantyne learned that Mr Sheward had been hospitalised in September 2013  he  tracked  down  Ms  Downes’ telephone  number  and  rang  her asking her to keep him informed of Mr Sheward’s progress.  As she did not do this, he made contact with the hospital directly and managed to speak with Mr Sheward himself    for    about    five    minutes.       He    was    eventually    telephoned    on

10 September 2013 by Ms Downes to tell him that Mr Sheward had passed away. He said that at that time Ms Downes also said “you can’t believe everything that Frank told you and the fact that I wrote out all of his cheques” or something along those lines.  Understandably he said he found this a strange thing for her to say.  It was unsolicited and he had no idea why she said it.

[60]     I placed considerable reliance on Mr Ballantyne’s evidence as he struck me as a careful and honest witness.  His contact with Mr Sheward was regular, and it was not tainted by interaction with either the Davidson or the Downes family.  While he did meet with the Davidsons after Mr Sheward’s death I accept his evidence that his recollection of what was said in the telephone calls was not influenced by his discussion with the Davidsons.

Previous wills

[61]     Mr Sheward had made wills prior to making the wills of 2011 and 2013 which are the subject of these proceedings.   Two of these earlier wills need to be mentioned for completeness, as these wills play some part in the narrative of events from 2010 onwards.

[62]     The first will was made with Guardian Trust on 15 January 2004 following Betty’s death.  In that will, Mr Sheward gave his house and land at Rue Balguerie, Akaroa, to his wife’s cousin, Warren Newman, and his wife Vonda.  The balance of his estate was to be held on trust, with the income to be split, with one quarter to go to the Royal New Zealand Foundation for the Blind, Guide Dog Division, and the other three quarters to the Akaroa Hospital Guardians.

[63]     Subsequently, in mid-2009, Mr Sheward’s then lawyer, Michael Walker, was asked to update Mr Sheward’s enduring powers of attorney and his will, primarily because of his falling out with the Newmans.   Mr Walker met with Mr Sheward while he was in hospital in Akaroa in October 2009.  Mr Sheward’s instructions were that he wished to leave his home, contents, vehicles and tools to the Davidsons, with the balance of his estate to go to the Guardians of the Akaroa Hospital Incorporated. He explained that he felt his obligation to the Newmans had been discharged by the fact he had purchased them a brand new Subaru Forrester motor vehicle.

[64]     The preparation of this will was not a hasty process.  It was during this period that Dr Wilson was consulted to confirm that Mr Sheward had testamentary capacity. The  will  which  was  drafted  was  not  executed  until  12  February  2010,  after Dr Wilson’s letter confirming testamentary capacity was received (“the 2010 will”). It was at the same time that the new enduring powers of attorney in respect of Mr Sheward’s property and personal care and welfare were executed, transferring these powers from Mrs Newman to Mr Davidson.

[65]     In October 2010 Mr Sheward again contacted Mr Walker to revise his will.  It seems he had softened  his views somewhat on  the Newmans  and decided they should have a legacy in the order of $100,000.  However, a will embodying those instructions was never executed.

What happened from 2010 onwards?

[66]     Having introduced the key people in Mr Sheward’s life I now turn to the sequence  of  events  in  the  critical  years  from  2010  to  the  end  of  2013,  when Mr Sheward died.

Falling out with Wi Tainui

[67]     The first event of significance occurred in April 2010, around two months after the 2010 will was executed.   In this month  Mr Sheward was admitted to hospital and, during this time, he fell out with his long term friend Wi Tainui, over a dispute which related to Ms Downes.

[68]     Mr Tainui’s explanation is that when Mr Sheward was in hospital, Mr Tainui and his wife went around to collect Mr Sheward’s house key which was normally in a gumboot at the back door.  He needed the house key so he could get the key to Mr Sheward’s Subaru motor vehicle, as Mr Sheward kept his Shell fuel card in the Subaru.  Mr Tainui used the fuel card to fill up the mower, tractor and truck so that he could mow Mr Sheward’s lawn and do the other odd jobs around the property. On this occasion, the key was not in the gumboot where it should have been and he told Mr Sheward this.

[69]     The next time Mr Tainui visited Mr Sheward in hospital, Mr Sheward said he had spoken to Ms Downes about the key and she had said that the key was not missing and was in the gumboot where it should have been.  Mr Tainui said he knew the key had not been there as his wife and he had spent a considerable time looking for it.  He was upset that Mr Sheward did not believe him.  On his way home he said he saw Ms Downes drive up to Mr Sheward’s property, then, shortly afterwards, leave it again and subsequently return with Mr Sheward in the car.

[70]     When Mr Tainui next spoke to Mr Sheward in hospital he said Mr Sheward abused him about the key and said that Ms Downes had shown him that the key was in its usual place in the gumboot.  Mr Tainui said he had seen Ms Downes go to the property and that she must have put the key back, but again Mr Sheward did not believe Mr Tainui.  Mr Tainui accepted that he reacted angrily to this incident and the

fact that his lifelong friend believed Ms Downes over him.  He also accepted that the hospital record of the incident was probably correct, which recorded “Frank rather upset with neighbour who has firey temper” and “he [was] also distressed by his neighbour’s outbursts – particularly where they have been directed to/at Pru”.

[71]     Ms Downes’ version was that Mr Tainui accused her of using the Shell fuel card, the implication being that she had taken it as Mr Sheward was in hospital at the time, and she took umbrage at that.   She went up to the hospital and spoke to Mr Sheward about it because she was very upset.  She then got permission to take Mr Sheward from the hospital to the house and showed him that his fuel card was in the glove box of the Subaru where it was always stored.  She says that Mr Sheward broke off the friendship with Mr Tainui because he put his fist in Mr Sheward’s face and Mr Sheward’s view was that “no man does this to me”.

[72]     Despite the slightly different thrust of each story (Mr Tainui focused on the presence of a key in the gumboot, whereas Ms Downes focused on the Shell card in the glove box), I am satisfied they are both referring to the same incident.  I accept that Mr Tainui is truthful when he recounts that the key was not in the gumboot where it should have been, so he could not get access to the fuel card and that he was hurt when Mr Sheward preferred Ms Downes’ version over his.   I do not need to decide whether she in fact used the Shell Card.  The issue is that the key was not where it should be, and the only likely person to have moved it was Ms Downes, but she denied this and Mr Sheward supported her over Mr Tainui.

[73]     This event was relied on by the Davidsons to illustrate that, even before she commenced  working  for  him  full-time,  Mr Sheward  was  already  sufficiently influenced by Ms Downes that, rather than enquire into the  matter, or question Ms Downes to get to the bottom of the matter, he accepted her version uncritically, at the expense of a long-term friendship.

The private care arrangements with Ms Downes

[74]     In the year before Ms Downes came to work for Mr Sheward privately he had several periods of care in Akaroa Hospital.   These included a two-month period following hip surgery in late 2009, a six week period in April through to May 2010

following an angioplasty, a further three weeks in November 2010 following a heart attack, and an overnight stay in early December 2010, following an operation for removal of a skin lesion.  It is when he was last discharged from hospital in 2010 that Ms Downes commenced working privately for Mr Sheward.  The Davidsons say that Mr Sheward told them he was engaging Ms Downes for $20 an hour, five hours a day, seven days a week and Ms Downes also says that was what was agreed so that she would receive $700 a week.

[75]     However,  that  payment  was  not  made  in  a  conventional  way.    Instead Ms Downes says she received gifts, and other benefits in lieu of wages until the position was regularised in early 2013 when an automatic payment of $700 a week from Mr Sheward’s account was set up.   The reason for the unusual arrangement which applied until then was never revealed, for example, whether it was designed to avoid paying income tax.

[76]     It seems possible that Mr Sheward’s decision to pay Ms Downes in kind may have been motivated, at least in part, by the fact that, initially, he did not see the relationship as a strictly commercial one.   It seems that for a period Mr Sheward entertained the idea that he and Ms Downes could become romantically involved and she may even marry him.

[77]     A number of witnesses referred to Mr Sheward’s romantic aspirations for Ms Downes.   For example, Mr Sheward’s lawyer, Mr Walker records “we have concerns  as  to  a  claim  by  Pru  as  having  relationship  [with]  FS”.    Mr  Curry considered Mr Sheward “became increasingly obsessed with Pru and how good she was being to him”.  On top of this, she often called Mr Sheward “dear” and “darling” in front of Mr Curry.   He said that she also once kissed him in a way which he thought was “entirely inappropriate” for a carer or even a friend, especially knowing how lonely and fragile he was.  Mr Beattie recalled Mr Sheward saying he would not mind having Pru move in with him.  Mr Price, Mr Sheward’s second cousin, recalled Mr Sheward telling him that he wanted to marry Pru Downes and that he was going to leave Pru everything in his will with the exception of 7.5 acres, which Mr Price understood to be the land behind Mr Sheward’s house in Akaroa.

[78]     I accept that Ms Downes did not share Mr Sheward’s romantic aspirations and, at some stage, must have made it clear to Mr Sheward that she was not a potential romantic partner.  However, the fact he openly expressed these aspirations should have made Ms Downes, as an experienced carer, even more alert to the risks which arose if she did not place the relationship on a more formal and professional footing.

[79]     Some of the gifts and benefits Ms Downes received can be seen in the cheque butt records for Mr Sheward’s cheque account.   By way of example, Ms Downes received a payment on 13 December 2010, of $2,000, which was described as “cash for Christmas”.  Another payment in lieu of wages was made on 11 January 2011 of

$100  and  was  described  as  being  for  “Rachael’s  birthday”  (being  Ms Downes’ granddaughter).  Other payments made in 2010 from Mr Sheward’s cheque account to Ms Downes were described as for “housekeeping”, for “rates”, for Rachael’s school fees, for Ms Downes’ dental care, and as donations to the Downes Family Trust.  Ms Downes also received gifts such as having a new heatpump installed in her house and being given a nearly new ride-on mower.   While this last gift was explained as being given to her because Mr Sheward did not like it and decided to buy a new version of his previous model of ride-on mower, it was still a gift which was of value to Ms Downes.  I also consider that Mr Ballantyne’s evidence which recalled Mr Sheward saying that she asked for the mower, shows she encouraged the transfer.

[80]     While the cheque butts for the payments are available and are notated with descriptions such as “housekeeping”, “Nga Tawa College” or “dentist”, they only sometimes identify that they are for the benefit of Ms Downes, except where they are described as a gift or donation.   Examples of the latter type of payment include a payment of $10,000 made on 2 July 2012 and described as a “gift for Pru’s medical expenses” and a payment of $2,800 made on 18 November 2011 described as “Downes  Family Trust  donation”.    Ms  Downes  also  accepted that  some  of the cheques made out to cash were used to pay her, and she was also able to charge groceries to Mr Sheward’s CRT account, which she was not required to reimburse.

The gift of the Subaru Forrester car

[81]     A gift which took particular precedence in the hearing was Mr Sheward’s purchase of a new motor vehicle for Ms Downes.  Mr Sheward made no secret of the fact that he wished to buy Ms Downes a car for her use.  On 6 December 2010 he spoke to his lawyer, Mr Walker, about it.  He said it would cost him around $40,000. After speaking with Mr Walker he came to the view that he would buy the car himself for Ms Downes to use, and would subsequently gift it to her under his will.

[82]     A new Subaru Outback, was duly purchased in mid-December 2010 for just under  $50,000.    However,  inadvertently,  the  car  was  not  transferred  into  either Mr Sheward’s or Ms Downes’ name at the time of purchase.   This was revealed when almost a year later, when a representative of the car dealership telephoned Mr Sheward and advised him of this error.  The dealer asked in whose name the car should be registered.   Mr Sheward asked for it to be registered in the name of Prunella Downes and that was duly done in November 2011.

[83]     Mr Drummond, Mr Sheward’s accountant, commented that, when he was preparing  Mr  Sheward’s  accounts  to  the  year  ended  31  March  2012,  he  had  a “distinct recollection … of being somewhat concerned about the gift of a Subaru car and the amount of money that was being paid to or for the benefit of [Ms Downes’ family]”.  He said “this stood out so much so that I made a note of that expenditure in the annual accounts for that year and also drew his attention to the total amount in [his] reporting letter dated 11 June 2013”.  That letter observed that “payment/gifts to Pru Downes or the Downes Family Trust are also listed and total $81,498 for the year, which include the Subaru Forrester gifted at its original cost $49,895”.   In July 2013 Mr Sheward dispensed with Mr Drummond’s services based, it appears, on the fact that his account for that year was higher than usual and more than he expected.

[84]     Mr Raymond pointed out that if one leaves aside the car, the various gifts and other benefits Ms Downes received did not exceed, in value, the amount it had been agreed she would receive in payment for this arrangement.  I accept that appears to

be the case when the value of the gifts and payments known to be received by

Ms Downes is calculated.

[85]     However, it was clearly an unwise method of seeking reimbursement and it showed a considerable lack of judgment. As Ms Downes accepted, she was required to observe strict ethical boundaries under her contract with Access.  These included not becoming involved in the client’s financial or legal business, not accepting gifts, other than gifts of nominal value such as edible items or plant cuttings, and not crossing the boundary from personal carer to friend.  Ms Downes’ repeated response to questions about why she crossed such boundaries was to say that her role in providing care services to Mr Sheward privately was separate from her ongoing role of  providing  care  services  to  him  under  the  umbrella  of Access,  and  she  was therefore not subject to the same policies and requirements as she was as an Access carer.    She  did  not  appear  to  accept  that  the  risks  which  arose  through  her attendances as an Access caregiver, and which that organisation sought to address through these policies, also arose in her private care arrangements and should also have been managed appropriately.

Christmas 2011

[86]     There was some divergence in the evidence as to where Mr Sheward spent Christmas 2011, with Ms Downes saying he spent one of his last Christmases with her family at Takamatua.   However, I am satisfied that the evidence demonstrates that Christmas 2011 was spent at the Davidsons as this was the first Christmas the Davidsons celebrated after moving into their house at Rue Balguerie and they gave evidence which was not contradicted, that Mr Sheward spent that Christmas with them.     The  previous  Christmas,  in  2010,  the  Davidsons  were  overseas  and Mr Sheward had Christmas by himself, with his builder, Danny Ferrario, being the only visitor that day.  That accords with the fact that, at that time Ms Downes had only just started caring for Mr Sheward privately and would not have invited him to her home on Christmas Day.

The 2011 will

[87]     In  May 2011,  Mr Sheward went  to  a new lawyer,  Mr Peter Cordner of Cordner Hill Law, to prepare a new will.  Although Mr Cordner’s legal practice was based in Christchurch, he also had a connection with Akaroa because his wife’s family had a holiday home in Rue Balguerie, near Mr Sheward’s home, and the two of them enjoyed a casual acquaintance with Mr Sheward.  This was, however, the first time Mr Sheward had approached him to provide professional legal services.

[88]     The initial contact was made by Ms Downes, and Mr Cordner arranged to see Mr Sheward in Akaroa on Saturday, 14 May 2011.  Mr Cordner made a detailed file note  of  the  instructions  he  received.     He  records  that  he  was  shown  the Guardian Trust will and the 2010 will.   Mr Sheward explained that the primary reason for wishing to change his will was to remove the Newmans as beneficiaries. At that stage Mr Sheward understood that the Newmans were to receive $100,000 as a consequence of a will made in late 2010.  That appears to relate to the instructions given to Mr Walker for a new will after the 2010 will was completed, but which never eventuated.

[89]     Mr Sheward discussed his assets with Mr Cordner, including the fact he owned a 98 acre property, known as the Cabstand, on Banks Peninsula.  He also said that he had given a Subaru Forrester to Mrs Newman three years previously and he felt that that gift had discharged any duty he had to her for her assistance prior to him being  placed  into  Woodchester  Home.    He  extolled  the  work  that Alistair  and Neroli Davidson had done for him over the years without reward, and said he wanted to leave them the property in Rue Balguerie and to provide Mr Davidson with an option to purchase the Cabstand.   He also explained that, as in his 2010 will, he wished the residue of the estate to go to the Guardians of Akaroa Hospital, which he had been involved with for 23 years.

[90]     When  the  will  was  prepared,  it  gave  the  Davidsons  the  property  at Rue Balguerie.  It also gave them the option to purchase the Cabstand at $200,000. The remainder of his estate (which included a $200,000 bank deposit) was to go to the Guardians of Akaroa Hospital Incorporated.

[91]     That will was then executed the following weekend on 22 May 2011, with Ms Downes and another lawyer, Mr van Schreven, witnessing the will (the 2011 will).  The 2011 will is the will which will prevail if the Davidsons succeed in their claim that both wills made in 2013 should be set aside.

Sale of the Cabstand to the Davidsons

[92]     The next event of note is the sale of the Cabstand property.  As Mr Davidson explains, sometime in late 2011 Mr Sheward decided to sell the Cabstand, effectively bringing forward the option to purchase he had given the Davidsons in his 2011 will. He asked Mr and Mrs Davidson whether they would be interested in purchasing it from him at $200,000.  They agreed and an agreement for sale and purchase was entered into on 31 January 2012.  As the Davidsons were not in a position to pay for it in full at the time, the terms of the agreement included that they would pay an immediate deposit of $20,000 and that Mr Sheward would leave $180,000 in the property until February 2013.

[93]     While Mr Raymond suggested this was a “great deal” for the Davidsons, and they  had  somehow  obtained  an  advantage  from  Mr Sheward,  I  consider  the Davidsons had conducted themselves appropriately.   The Davidsons had earlier discussed purchasing it and in 2006 they had a formal valuation prepared which valued it at $180,000 (or $400,000 if a resource consent could be obtained to build a house on the property).  Mr Sheward set the price at $200,000, which reflected the terms of the option to purchase he gave the Davidsons in his 2011 will.   While

$200,000 might have been a favourable price, there was no evidence to suggest it was significantly undervalue, although obviously the interest-free loan in respect of the unpaid balance was advantageous to the Davidsons.

Purchase of the 1997 Forrester

[94]     At  about  the  same  time  in  late  January  2012,  Ms  Downes  purchased Mr Sheward’s older motor vehicle, a 1997 Subaru Forrester, for $2,000.  She says he wanted to give it to her but she insisted that she pay something towards it.  As there was no evidence as to the market value of this car, I draw no adverse conclusions about this transaction.

Payment of the balance of the Cabstand purchase

[95]     In February 2013, when the balance for the Cabstand purchase was due, Mr Davidson says he spoke with Mr Sheward in person and asked whether they could keep the mortgage going on the basis they paid him a little more interest than he would get at the bank.  Mr Davidson said that Mr Sheward was happy with that as he did not need the money.   However, later that day, the Davidsons received two phone  messages  from  Ms  Downes  telling  them  that  Mr  Sheward  wanted  the

$180,000 put into his bank account.   Mrs Davidson says that when she retrieved these  messages  she  telephoned  Mr  Sheward  and  explained  that  they  could  pay

$50,000 that night, which they did, and would pay the balance as soon as they could. Again, the Davidsons’ evidence was that Mr Sheward was happy with that, with him saying it was “no problem” and to just pay “whenever”.

[96]     Mrs Davidson said that, on visiting Mr Sheward the following day, she saw a deposit form filled out by Ms Downes with Mr Sheward’s bank account number in it. She said Mr Sheward would have known that a deposit form was not necessary as they had his bank account number, and that is how they paid the $50,000 the night before.  By implication she suggested that Ms Downes had prepared the deposit form on her own initiative.

[97]     Similarly,   when   Mrs   Davidson   spoke   with   Mr Sheward’s   solicitor, Mr Cordner, he said he had been told by Ms Downes that Mr Sheward was agitated that the Davidsons had not paid the balance of the money back.  Mr Cordner had not been told that $50,000 had been paid nor that Mr Sheward had agreed that the balance could be paid in due course.

[98]     When Mrs Davidson spoke to Mr Sheward the next day she says he reiterated that  he  was  not  upset  that  the  rest  had  not  been  paid  back.    When  she  asked Mr Sheward why Ms Downes had made the call to Mr Cordner, he initially feigned confusion  and  forgetfulness.    However,  she  says  he  then  admitted  that  it  was Ms Downes  who  was  annoyed  and  that  it  was  she,  not  him,  who  wanted  the Davidsons to pay the money back.

[99]     Ms Downes’ accounts of these events was that she was “unaware until I read Alistair Davidson’s  brief  about  the  arrangements  …  [for]  leaving  money  in  the Cabstand property”.  She said she did not recall either leaving the messages on the Davidsons’ telephone or calling Mr Cordner to say how upset Mr Sheward was. However, she accepts that she may have done so, but says if she did, it would have been on Mr Sheward’s instructions.

[100]   The incident was outlined in evidence by the Davidsons to demonstrate that, in their view, Ms Downes was taking over Mr Sheward’s financial affairs and going beyond simply carrying out his instructions.   I accept that Ms Downes took the initiative to call Mr Cordner and it was not done at Mr Sheward’s request, although he may have acquiesced to her suggestion that she do this.  I consider she did this based  on  her  own  review  of  the  terms  of  the  written  agreement  and  on  the assumption it was in Mr Sheward’s best interests to enforce payment so he had the cash available to him. Whatever the motive, this incident had the effect of increasing the Davidsons’ concerns about the level of control Ms Downes was exerting over Mr Sheward’s life.

Mr Sheward’s accounts and wills

[101]   Shortly  after  the  Davidsons  entered  into  the  agreement  to  purchase  the Cabstand property, Mr Sheward asked Mrs Davidson if she would do his books for him as his accountant was costing too much and he said Ms Downes had told him that he did not need one any more.  By this stage he had sold his farmland and retired from farming altogether and, as Mr Drummond explained, 2012 was the last year

that required a full set of farm accounts to be prepared.1    To do this Mrs Davidson

uplifted a box containing all his statements, accounts and cheque books.  She said that when she went through them she could see large amounts which were recorded on the cheque stubs for rates, specialist fees and dentists which she did not think were expenses Mr Sheward had incurred, particularly when she could see on the statements that Mr Sheward’s rates were paid out of his account automatically.  She

says that, seeing this, she felt uncomfortable about doing Mr Sheward’s accounts.

1      Which accounted for the increased costs Mr Sheward incurred for that year, which led him to

terminate Mr Drummond’s services as an accountant.

[102]   She worked out that he had spent $117,000 in total in one year, including the purchase of the Subaru Outback car, and was concerned that he may not realise how much he had been spending.  She was told by Mr Sheward that the payments were likely to be payments to Ms Downes but that he was not aware he had spent so much.  However, he also expressed concern, saying “what would I do without Pru?”

[103]   The next day, Mr Sheward contacted Mr Davidson saying he was angry that Mrs Davidson was trying to get rid of Ms Downes.  He suggested that Mrs Davidson stay away as Ms Downes was going to cause problems.

[104]   I consider the questions raised by Mrs Davidson did trouble Mr Sheward, but by then he was dependent on Ms Downes to stay in his home and was committed to retaining  Ms  Downes’ services.    He therefore  saw these  enquiries  as  implicitly questioning the appropriateness of the arrangement.  In order to retain the services of Ms Downes, I consider he felt he had to distance himself from the Davidsons, and particularly Mrs Davidson, to avoid such questioning.

[105]   In the boxes Mrs Davidson uplifted from Mr Sheward in order to look at his accounts, she also found copies of the Guardian Trust will and the 2010 will.  She noted that there were handwritten annotations  on the  copies which  were not in Mr Sheward’s handwriting.  She said she showed them to her husband because he held the power of attorney at the time.  He said that she should ask Mr Sheward if he would allow her to take a copy of them to hold on file, which was what she did.

[106]   Curiously, the original versions of these annotated wills were not found with Mr Sheward’s papers or other possessions and therefore not provided in discovery by the plaintiffs.  The only discovered versions were the copies taken by the Davidsons. It  seems  that  they were  removed before the trustees  and  executors  uplifted  the documents and I consider this was done to remove evidence of Ms Downes’ active involvement in discussing Mr Sheward’s wills with him.

[107]   Ms Downes accepts that some of the handwritten notations on the two wills are hers, so it was clear that she discussed the contents of Mr Sheward’s wills with him sometime prior to February 2012.  This undermines her evidence that she did

not know what Mr Sheward’s arrangements were in terms of his wills.   She had clearly discussed the previous wills with Mr Sheward and made notes on them in preparation for him making a revised will.

Communication with Mr Walker’s firm

[108]   In early 2012 Mr Walker’s law firm merged with another and clients, such as

Mr  Sheward,  were  contacted  advising  them  of  the  merger.    On  2  March  2012

Mr Walker’s firm received a call from a woman on behalf of Mr Sheward saying that Mr Sheward had received the firm’s letter and wanted his papers returned to him. The legal executive taking the call made a file note of the call.  When she suggested that Mr Sheward may wish to speak with Michael Walker, she recorded that the woman making the call said “NO he does not want to speak with Michael”.  The file note then recorded “she put Mr Sheward on the phone and said to him ‘just say yes’”.  The legal executive, in her file note, noted that the lady “sounded irate” and she responded telling the caller “not to be angry” and that the firm would send the papers out but just needed an authority signed by Mr Sheward.

[109]   Her  evidence  was  that  she  found  the  conversation  with  the  woman concerning and it gave her “the impression that the woman was coercing Frank into transferring his files and that he was uncomfortable with this”.

[110]   Ms Downes’ explanation was that Mr Sheward had asked her to make the phone call to Mr Walker to change lawyers and this was because Mr Walker was based in Christchurch and Mr Sheward did not see him that often.  She also said that Mr Sheward “often asked me to handle unpleasant phone calls because he did not like conflict”.  She accepts that she was probably a little impatient during the phone call but said this was because Mr Sheward would not do it himself.  She also said she felt  uncomfortable  about  making  the  call  because  she  was  not  working  for Mr Sheward fulltime at that stage.   However, that was incorrect, as she had been working for him privately for well over a year by then.  She said that her “impatience and anxiety around dealing with this call may have come across badly”.

[111]   While this is one of several incidents which are recounted to suggest that

Ms Downes actively, and even aggressively, managed Mr Sheward’s affairs, I think,

in the circumstances, any impatience or curtness on her part was adequately explained.

The CRT account

[112]   In September 2012, Mr Sheward’s CRT account, through which he could charge expenditure at the CRT farm supplies store, and at other outlets, including service  stations  and  New World  supermarkets,  was  put  into  Mr  Sheward’s  and Ms Downes’ joint names.   Up to that point she was entrusted with Mr Sheward’s CRT card and incurred expenditure on it, some of which she expressly identified on the statement as her own and for which she says she reimbursed him.   However, other expenditure, such as expenditure at the New World supermarket for her own purposes, was not, as she acknowledged, necessarily repaid by her.

[113]   There  was  also  expenditure  on  fuel  which  was  not  explained.    While Ms Downes said she was allowed to buy fuel on the CRT card for errands she ran for Mr   Sheward,   there   were   periods   when,   as   Ms   Downes   acknowledged   in cross-examination,  the  amount  of  fuel  bought  exceeded  what  was  reasonably required   for   this   purpose.      For   example,   between   5 January 2012   and

27 January 2012 over $400 worth of petrol was recorded as purchased on the CRT card.  Furthermore, it was not of the same type so must have been used for different vehicles.  There is no credible explanation for how this much fuel was put on the card except to conclude that Ms Downes used it more often than was required for the purposes of assisting Mr Sheward.

[114]   Once the account was placed in joint names she was issued with her own card and, on Mr Sheward’s death, the CRT shares, and the accumulated points obtained through spending on the card, became Ms Downes’ by survivorship.  It was clearly a mark of the trust that Mr Sheward reposed in Ms Downes that he was prepared to do this.  However, it also indicated that no professional boundaries were maintained in the relationship and Mr Sheward allowed her use of this account as if she were a family member.

Christmas 2012

[115]   The events of Christmas 2012 featured strongly in the evidence.  Ms Downes’ evidence was that her entire family, including her daughter Sarah and Sarah’s family, were instructed by Mr  Sheward to  come down  and  spend Christmas with  him. Indeed, Mr Sheward paid $1,500 to Sarah Downes for her “flight tickets and Christmas present”.   Shortly before that, on 14 November 2012, Mr Sheward had also given a cheque for $700 to Sarah Downes with the notation on the cheque butt being “Sarah Downes, new dress/shoes”.

[116]   During the course of this day, members of the Downes family gave evidence that Mr Sheward announced that he wanted to be a godfather to the three children Antony, Michael and Sarah.  This was described as an emotional moment and, on the same occasion, he gave his war and Police medals to the Downes children as gifts. This announcement was of some moment in the hearing, because it was submitted that taking on the role of godfather added to  Mr Sheward’s increasing sense of obligation to look after the Downes as if they were his own family.

[117]   The evidence of the three children was that this proposal was not suggested by  them  and  was  entirely  unsolicited.    However,  contrary  evidence  was  given. Mrs Davidson  says  that  Mr  Sheward  told  her,  in  early  2013,  where  they  were discussing the misunderstanding over the Cabstand repayment, that “Pru’s children wanted him to become their godfather” and that “they had asked if they could call him their godfather because they did not really have a father”.  She said this was not the first time that he had told her this.   Furthermore, she recalled him saying that now he was their godfather, he would change his will and that he was going to speak with his lawyer, Mr Cordner, about this.

[118]   Mr Davidson also said that Mr Sheward told him that he had agreed to be godfather to Ms Downes’ children.  However, Mr Sheward also said that he did not know what it meant to be a godfather, which suggested he had not proposed this idea.

[119]   The Davidsons were not the only people Mr Sheward told that he was not the instigator  of  the  suggestion  that  he  be  godfather  to  Ms  Downes’  children.

Mr Cordner says that Mr Sheward told him that Ms Downes’ children “want me to be their godfather”.   Mr Cordner’s reaction to this was that it was “very strange”, especially given the children were all around 50 years old.  I am satisfied that this was an accurate recollection by him, and not something he had mistakenly recalled after having read the other parties’ evidence.

[120]   I accept that Mr Sheward did make an announcement at Christmas dinner that he wanted to be the children’s godfather and that, at least for Michael and Tony (whom I considered were credible witnesses on this issue), the proposal was unsolicited, and came as a surprise.   However, I also accept the evidence of the Davidsons,  and  of  Mr  Cordner,  that  Mr  Sheward  was  not  the  instigator  of  the proposal  to  become  the  children’s  godfather  and,  as  someone  who  was  not particularly religious, that he expressed some uncertainty about what it meant to undertake this role.

[121]   Having heard the evidence, my conclusion is that a suggestion was made to Mr Sheward by a member of the Downes family that the Downes children wanted him to be their godfather.  As a consequence of this suggestion, he made the announcement  that  he  wished  to  be  their  godfather  at  the  2012 Christmas  Day dinner.    I  also  consider  that,  having  received  the  suggestion  he  should  act  as godfather to the Downes children, he acted on it and the sense of moral obligation Mr Sheward already felt to Ms Downes and her family was increased by this act.

Mr Sheward’s relationship with the Downes children

[122]   In terms of the relationship Mr Sheward had with the three adult children in the period prior to his death, I think the level of contact they had with him, and the depth of their relationship, was overstated in their evidence.  I consider the contact the Downes children had with him was mainly in the last year of his life and, even then, was intermittent.

[123]   I accept the two boys did, at Mr Sheward’s request, spend some time working on his old motor boat at his home, with a view to getting the motor running, albeit unsuccessfully.      This   is   consistent   with   Mr Ballantyne’s   recollection   that Mr Sheward told him that the boys “only did a little bit” before disappearing and not

finishing the job.  I do not consider they spent many days at his house working on this project.   That said, I accept that what work they did do was not done in the expectation they would be given the boat.  The boat was rather run down, neither of them had a need for the boat, and Anthony, in particular, was not interested in boats.

[124]   In terms of Mr Sheward’s relationship with Sarah Downes, I think this, too, was overstated.  Sarah Downes lives in Palmerston North.  She has a husband and daughter and runs a landscaping business which employs nine people.   She gave evidence that she visited her mother at least twice a year and, during those visits, she would spend a week in Akaroa and would visit Mr Sheward on a daily basis and spend time with him.   However, her records of the visits refer first to a visit in March 2010 to attend the Ellerslie Flower Show.  This was before her mother was working privately for Mr Sheward, and at that stage Ms Downes only saw him for two 45 minute sessions a week.  I think it highly unlikely that Sarah Downes had any interaction with Mr Sheward on that occasion, given the purpose of her visit, and her mother’s limited relationship with him as an Access carer.

[125]   She then says she attended Christchurch for a week in January 2011 for the Ellerslie Flower Show.  However, that is clearly mistaken as the Flower Show was scheduled  for  March  and  was  cancelled  that  year  as  a  consequence  of  the

22 February earthquake.  That aside, I am sceptical that she saw Mr Sheward on a daily basis during that trip as Ms Downes had only just begun working for him full time.    The  next  visit  was  when  her  business  paid  for  her  to  come  down  on

4 March 2012 for the Ellerslie Flower Show.  It is not clear how long she stayed and, again, if attending the Flower Show was the purpose of her visit, it seems unlikely she spent significant periods of time in Akaroa with Mr Sheward.

[126]   She then says she returned on 16 April 2012 doing a road trip to Akaroa via Hanmer.  I accept she would have visited Mr Sheward when she arrived in Akaroa on this occasion.  Finally, there is no dispute that she attended Mr Sheward’s place on Christmas 2012, albeit at his insistence, and because he paid for it.

[127]   She also provided evidence that there were telephone calls to Mr Sheward’s

place from December 2012 through to 15 March 2013 which showed she called on

two or three days per month in that period.  It is unclear whether she rang to speak to her mother or Mr Sheward on  those  occasions,  although  the  calls  just  prior  to Christmas were likely to be related to the plans for Christmas day.  This contact was shortly  before  he  made  his  new  wills.    There  is  no  evidence  this  contact  was sustained after March 2013 to Mr Sheward’s death in September 2013.

Sarah Downes and the house at Rue Balguerie

[128]   A particularly  important  issue  which  related  to  this  period  was  whether Sarah Downes led Mr Sheward to believe that if she were to get the house, she would come to look after him if her mother was not in a position to do so.

[129]   The Davidsons’ evidence is that Sarah Downes told Mr Sheward that she liked his house.  This led to him saying, on 3 March 2013, that he had spoken with Mr Cordner and was going to survey off the back of his property, from the fence behind the carport, and give it to the Davidsons, but give the house and buildings to Ms Downes’ daughter, Sarah.

[130]   Two days later the Davidsons’ diary notes record Mr Sheward as saying he was  putting  the  subdivision  of  his  property  on  hold,  but  that  he  wanted Sarah Downes to have his house as she would not move into it unless she owned it. Mr Davidson took from this that Sarah Downes had offered to come down to live in Akaroa to help look after him but that she would not do this unless she had certainty of tenure in the home.

[131]   Similarly, Mrs Davidson gave evidence that Mr Sheward said he had been told by Ms Downes that she would not always be able to look after him, as she was getting old, and that when he needed someone to live in, Sarah would look after that. Mr Sheward then told Mrs Davidson how much Sarah loved his house and that if she lived with him, he would not have to go to a rest home.  She says that Mr Sheward told her and her husband, on a number of occasions, that Sarah would not move in unless she owned the house.

[132]   Importantly, Mr Ballantyne also recalled Mr Sheward saying this to him in their weekly telephone calls.   He was clear in his recollection that Mr Sheward

mentioned that Sarah Downes would not stay in the house unless she owned it. Mr Miessen also recalled Mr Sheward telling him that Sarah Downes “would stay in the house after he died” and that he had “spoken to [Sarah] on the phone a few times and  that  she  was  gonna  be  coming  to  live  in Akaroa  …  and  look  after  him”. Mr Miessen’s understanding was that Sarah Downes was proposing to “do what her mother was doing”.

[133]   Sarah Downes said that the reason Mr Sheward had said he wanted to leave the house to the Downes family was because he knew that they would not change it. Sarah Downes  and  her  mother  gave  evidence  that  Mr  Sheward  took  offence  at Glen Davidson and his fiancé walking around the house and pointing out the changes they would  make when  they lived  there.    In  their  view  this  is  what motivated Mr Sheward   to   change   his   will   regarding   who   would   inherit   the   house. Sarah Downes also said that she did offer to come and live in the house at this point, in order to alleviate stress on her mother and help Mr Sheward stay in his own home. However, she adamantly denied saying to him that she would not move into the house unless it was left to her.

[134]   Having considered the evidence I am satisfied that Sarah Downes and her mother said things to Mr Sheward during this period around Christmas 2012 which left Mr Sheward with the clear impression that Sarah Downes would be willing to provide continuity of care if her mother was ever unable to care for him, and that in return, Sarah Downes, or the Downes family, should be rewarded by having certainty of  tenure  in  the  house.    I  also  consider  that  this  was  not  a  promise  which Sarah Downes could or would have carried out, except on a very short term basis, given her business and family commitments in the North Island. As even her mother acknowledged in evidence, it was never “a realistic proposition” that Sarah Downes would come down from the North Island to look after Mr Sheward.

[135]   As a consequence of these discussions regarding Mr Sheward becoming a godfather  to  the  Downes  children,  and  regarding  Sarah  Downes  taking  over  if Ms Downes could not continue in her role as carer, I consider Mr Sheward felt obligated to make provision for his house to go to the Downes family, and this is why Mr Sheward made contact with his lawyer, Mr Cordner, to discuss a mechanism

for  effecting  this  desired  outcome.    In  my view,  the  proposal  to  subdivide  the property was Mr Sheward’s attempt to honour, at least in part, the promises made to the  Davidsons,  while  also  ensuring  that  the  support  he  had  received  from Ms Downes to keep him in his home would be ongoing.

Subdivision discussions prior to making new wills

[136]   When the Davidsons became aware of Mr Sheward’s proposal to subdivide his property, they did not try to dissuade him from this.  Indeed they suggested they would be prepared to purchase the top block from him rather than inherit it.  They did, however, alert him to some of the practical issues that may arise on subdivision. These  included  the  possibility  that  a  reserve  would  be  required  along  the Balguerie stream  which  crossed  the  property,  as  had  been  required  when  the neighbouring  property  was  subdivided,  and  also  that  there  would  need  to  be provision for legal access to the rear block.  This was because even if the Davidsons acquired the rear lot, their existing right of way over the section in front of them to their property would not provide legal access to the rear lot to be created.

[137]   On 11 March 2013 Mr Davidson recorded that Mr Sheward was “now talking about Neroli and I buying top block and survey to start at top of hill.  I told him I would still help him with survey and he can let me know how much he wants and that I preferred survey to be done along fence line behind carport as he has talked of”.   Two days later, Mr Davidson recorded that Mr Sheward “talked more about survey line, easement in front of shed on east side of boundary.  He wants Sarah to live in the house.  She loves this house”.

[192]   Elias  J,  however,  thought  that  Parfitt  did  not  necessarily  exclude  a presumption of undue influence in all cases of testamentary gifts, and nor did she think it desirable to do so, saying:22

For myself, had the matter been left free of significant authority, I would have considered that a presumption of undue influence arising from a relationship of confidence can arise in circumstances where the party whose influence the testator is under is instrumental in the creation of the will. Such approach was however rejected by the Privy Council in Craig v Lamoureux.

In particular, she observed it seemed “a pity that the prophylactic benefit of the presumption, imposed for sound reasons of public policy, is not available in the case of testamentary dispositions”.23

[193]   Mr Burke invited me to apply those observations in this case, given the more recently expressed doubt on the issue of whether decisions of the Privy Council on appeals from other jurisdictions (such as the decision in Craig v Lamoureux) are binding on the New Zealand Courts.24    In Breuer v Wright, Woodhouse P made a clear statement as to the binding effect of the Privy Council’s decisions on appeals from other jurisdictions (subject only to the exceptional need to take account of the local development of some aspect of law).25    However, there has been subsequent judicial and academic comment which recognises a lack of clarity around the extent

to which New Zealand Courts are bound by such Privy Council decisions.26

20     Norton v Carey, above n 18, at 50; citing Parfitt v Lawless (1872) LR 2 P & D 462.

21     Parfitt v Lawless, above n 20, at 469.

22     Norton v Carey, above n 18, at 51-52 (citations omitted).

23     At 53.

24     R v Chilton [2006] 2 NZLR 341 (CA) at [112] - [113].

25     Breuer v Wright [1982] 2 NZLR 77 (CA).

26     R v Chilton, above n 24, at [113].

[194]   In my view, this issue does not engage an area of law where there are likely to  be  local  developments,  and  so  a  departure  from  the  authority  of  Craig  v Lamoureux cannot be justified on those grounds.   The ability to exercise undue influence is a recognised aspect of the human condition.   As a consequence, it is desirable for the applicable legal principles to be consistent from jurisdiction to jurisdiction, as they are driven by the same policy imperatives.

[195]   While I understand the rationale for recognising a presumption of undue influence where the party influencing the testator is instrumental in the creation of a will, I do not consider I need to rely on such a presumption in the present case given the findings I go on to make.   Furthermore, the factors which give rise to a presumption of undue influence in an inter vivos disposition will, in any event, be important factors to be considered by the Court in determining whether undue influence was actually exercised in the case of a testamentary disposition.

[196]   For all  these reasons,  I do  not  consider it  is  appropriate to  depart  from established authority that undue influence cannot be presumed in cases of a testamentary disposition.   However, the circumstances which give rise to a relationship of trust and confidence are, nevertheless, a relevant part of the factual matrix in considering whether undue influence was exercised.

[197]   Thus,  I  approach  this  claim  on  the  basis  that  the  onus  is  on  the  first defendants to prove the allegations they make of undue influence in respect of both the 14 April will and the 18 April will.  The standard required is that explained by Elias J in Norton v Carey:27

The proof required of the plaintiff is proof on the balance of probability. Because want of probity is not an ingredient, the standard need not reflect the gravity implicit in a finding of unconscientious conduct.  Direct evidence as to lack of free and informed judgment by reason of influence will often be lacking,  but  proof  on  the  balance  of  probabilities  may  be  found  by reasonable influences from all the facts.

[198]   The  issue  is  whether  it  is  established  that  Mr  Sheward’s  judgment  was

impaired to the extent that the will executed no longer represented his independent and informed judgment.

27     At 55-56.

[199]   Applying these principles, I now turn to the claims that each of the 2013 wills were  brought  about  by  the  exercise  of  undue  influence  on  Mr Sheward  by Ms Downes and her family.

Was the 14 April will procured through undue influence?

[200]   The first defendants identified a whole range of circumstances which were relevant to the question of whether Ms Downes exercised undue influence over Mr Sheward. These included:

(a)      Mr Sheward was a lonely man still bereaved from the death of his wife.

(b)He was desperate to stay in his own home and was fearful of returning to a rest home such as Woodchester.

(c)      Ms  Downes  crossed  boundaries  as  Mr  Sheward’s  primary  carer, taking into account his vulnerability and her position of trust and confidence.  In particular, while caring for Mr Sheward:

(i)she introduced her children to Mr Sheward who were not previously known to him;

(ii)Mr Sheward provided Ms Downes with gifts throughout the course of their relationship which were accepted by her;

(iii)Mr Sheward became totally dependent on Ms Downes.  In this respect,   Ms   Downes   was   warned   by   her   supervisor, Ms McMullin, not to let Mr Sheward get too dependent on her, and it was the normal practice of Access to have a different person attend to the domestic chores from the person who attended to the personal care of a client, in order to avoid overdependence on one person, such as resulted in the present case.

(d)The care Ms Downes provided went beyond household cleaning and personal  care,  and  included  shopping,  reading  and  writing  for Mr Sheward, transporting him and arranging appointments for him.

(e)     Ms Downes was involved in the deceased’s financial affairs as demonstrated  by  her  contact  and/or  correspondence  with  CRT, Mr Walker’s law office, Mr Drummond and Mr Cordner’s office and included her interventions in relation to the Cabstand transaction.  It also included her use of the CRT card which was subsequently transferred into a joint account.

(f)      Ms Downes was involved in discussing the deceased’s testamentary intentions.  This is shown by her handwriting on the Guardian Trust Will and the 2010 will.  I note it is also confirmed by my findings in relation to the 18 April will and her contact with Mr Cordner’s law firm, shortly before Mr Sheward’s death.

[201]   In all these circumstances, the first defendants say that Mr Sheward was so dependent on Ms Downes that it would not have required a significant amount of influence from her to have unduly influenced him.  She was in a position where she could exert significant influence over him and any suggestion, request or even hint by her, or on her behalf, could impair the deceased’s judgment and overbear his will.

[202]   In relation to the 14 April will, the first defendants say that the circumstances of it  should  be regarded  as  highly suspicious.    In  particular,  they say that  any suggestion that her care of him could be withdrawn would have been sufficient to overbear his will.   In that regard, they refer to the hospital records in April 2010 where it was recorded “Frank tearful and upset this morning after Pru told him she would not be his carer once he went home – says he hasn’t been able to rest or sleep since her phone call last night”.   Ironically, I note that in the same hospital notes Ms Downes records that she was limiting the further appointments she took him to because “she is weaning Frank off his dependence on her”.  Despite recognising this she went on to become his fulltime carer on a private basis.

[203]   The  first  defendants  say  the  fact  that  Mr  Sheward  saw  his  solicitor, Mr Cordner, and provided him with instructions was not sufficient to counteract the influence that the second defendant had over the deceased.

[204]   The response on behalf of Ms Downes is that, despite the general factors identified that showed Mr Sheward was highly dependent on Ms Downes, that, on its own, did not establish undue influence.   While it was obvious that Mr Sheward wanted to stay in his own home, he was not “desperate” to keep Ms Downes looking after him “at any cost”.  Rather, he was a man who was being cared for, paying for that care at a rate he agreed and which was known to many others and where he had every opportunity to convey any concerns to all those with whom he regularly spoke. No such concerns were expressed.

[205]   In the lead up to the execution of the 14 April 2013 will, it was clear from the Davidsons’ diary notes, and from other witnesses, that Mr Sheward was open in his intention to benefit Ms Downes and that he proposed to do so by subdividing the property and giving her part of it.

[206]   Ironically, the real criticism by Ms Downes is that the will that was prepared and signed on 14 April was “completely inconsistent with his discussions with the Davidsons,  and  the  instructions  he  provided  to  Mr  Cordner  as  recorded  in  his

15 April file note”.   Indeed it is suggested that Mr Cordner improperly persuaded Mr Sheward to execute the 14 April will, even though it did not incorporate the subdivision discussed.

[207]   In other words, the position of Ms Downes is that Mr Sheward’s decision to benefit her family trust was not the result of his dependency on Ms Downes and his desire to retain her services.  It was something he voluntarily wished to do, and the will he signed on 14 April 2013 did not fully reflect his wishes in that regard.

[208]   The question of whether the will signed on 14 April was procured by the undue influence of Ms Downes and her family, rather than as a consequence of the exercise of Mr Sheward’s own free will, must be examined in light of Mr Sheward’s own personal characteristics and circumstances.

[209]   In this regard, I consider that Mr Sheward’s sizeable asset base and the lack of any close relatives must be taken into account.  A gift in a will that might seem inappropriate  in  other  circumstances,  and  therefore  more  likely  to  have  been procured  by  undue  influence,  may  not  be  as  surprising  in  the  circumstances Mr Sheward was in.

[210]   I also take into account Mr Sheward’s personal characteristics including his nature and his strong sense of obligation.   Mr Sheward was a man who liked to reward those who had assisted him and he was fortunate enough to have the means to do so.  In this regard I note that before he changed his will in 2010 to remove the Newmans  as  beneficiaries,  he  rationalised  this  to  his  lawyer  by  saying  he  had brought  them  a  new  motor  vehicle.    He  therefore  felt  he  had  discharged  his obligation to them for the assistance they had rendered him prior to placing him in the Woodchester Home.

[211]   Mr Sheward’s decision to make a will in 2011 which benefited the Davidsons and the Guardians of the Akaroa Hospital reflected the significant role which both the Davidsons and the hospital had played in his life to that point. The Davidsons, as neighbours and friends, assisted Mr Sheward in a number of ways, with no expectation of payment or reward, whereas other people, such as Wi Tainui and Danny Ferrario, were paid for the work they did maintaining his property.  He clearly also had a long association with the Akaroa Hospital and had been hospitalised there on a number of occasions.

[212]   However, Mr Sheward’s generosity could easily be taken advantage of.  For example, when he became attached to a former Access support worker and had offered to sell his farm and buy her a house, as she was going to care for him privately when he came home from hospital, Access had to step in and prevent that from proceeding.

[213]   I have no doubt that the care which Ms Downes provided to Mr Sheward in the last three years of his life was at some expense to her personal life, because she cared for him seven days a week, and immeasurably supported Mr Sheward during that time.  While I consider the evidence shows she did not necessarily provide five

hours’ care each and every day, she did ensure he was cared for on a daily basis, and made arrangements which ensured he was adequately cared for and fed when she was unable to do so.

[214]   While  the  Davidsons  were  still  there  providing  support  and  company  to Mr Sheward, particularly when Ms Downes was not around, she largely met his needs in the last three years of his life.  While she was amply rewarded for that care by the gifts and other payments that Mr Sheward made to her, I consider that no matter how rigidly she observed the boundaries of carer, he would have wanted to reward her generously for her commitment to him over this period of time.  That was his nature and he had a limited number of competing moral claimants to consider.

[215]   The most troubling issue in relation to the 14 April will was whether he was unduly influenced to exclude the Guardians of the Akaroa Hospital, which had been a beneficiary of his will at least as far back as the Guardian Trust will made in 2004. His sense of moral obligation to the hospital might be considered to have increased over time given the frequency with which he was hospitalised there in the last years of his life, so it is necessary to consider whether he removed the hospital as a beneficiary  as  a  consequence  of  an  independent  decision  or  did  so  because Ms Downes persuaded him to.

[216]   The  evidence  of  the  first  defendants  suggested  that  Ms  Downes  had influenced him to exclude the hospital from his will.  She had attended some of the public meetings of the Guardians of the Akaroa Hospital when Mr Sheward became physically unable to and, as Mr Curry recounts in evidence, following one particular meeting, Mr Sheward advised him that Ms Downes had reported back to him that “the hospital was going nowhere, the meeting was a shambles and that everyone spent the time at the meeting disagreeing and arguing”.   Mr Curry said that what Ms Downes  had  told  Mr  Sheward  did  not  represent  what  had  occurred  at  the meeting, but the outcome was that Mr Sheward believed Ms Downes’ report and, as a result, he decided not to leave his money to the hospital.

[217]   However, as Mr Miessen explained, after the Christchurch earthquakes, the hospital closed and there was uncertainty over its future.  If it was to be rebuilt there

was a question over whether it was going to be rebuilt on the same site.  He said that as a result, Mr Sheward “got his back up” and told Mr Miessen he had decided that the hospital was not having any money and that he would rather give it to St John’s Ambulance.

[218]   Mr Curry was a member of the relevant committee making decisions about the hospital at the time (albeit he had subsequently stepped down) and he said that rebuilding on the existing site was “never ruled out”.  Mr Beattie’s recollection was that, in 2013, Mr Sheward was still intending to leave money to the hospital.

[219]   I accept that there was uncertainty about the future of the Akaroa Hospital. While Mr Curry was adamant that the hospital would always be rebuilt, I consider there was real uncertainty over this period as to where a replacement hospital would be built,  and  the extent  of services  it  could  provide.   While it  is  possible that Ms Downes may have misrepresented the extent of uncertainty and discord over the hospital’s future when she reported back to Mr Sheward, I am satisfied that there was a  material  change  in  the  hospital’s  circumstances  which  could  reasonably  have caused Mr Sheward to reconsider leaving his money to the hospital.

[220]   Thus, on the balance of probabilities, I am not satisfied that the decision to remove the hospital as a beneficiary was as a consequence of Ms Downes’ influence. It is equally plausible that, given the uncertainty of the hospital’s future after the earthquakes, Mr Sheward felt relieved of his earlier promised commitment to assist the hospital, freeing up funds to meet what he felt was his obligation to Ms Downes, in addition to that he felt he owed to the Davidsons.

[221]   A further factor which bears on my decision is the fact that Mr Sheward made the 14 April will following legal advice.   It is clear that Mr Cordner was acutely aware of the risk that Ms Downes could be unduly influencing Mr Sheward.  I have no doubt that he tested Mr Sheward in respect of his intentions and the will of

14 April 2013 reflected the position that Mr Sheward had reached at the time, which was to benefit the people who most assisted him to continue living in his home, being the Davidsons and Ms Downes, but that he deferred the decision as to whether to  make  any  further  provision  to  the  Downes  Family Trust  until  the  option  of

subdivision had been considered by a surveyor and the practicalities of completing a plan of the subdivision had been addressed.

[222]   To set aside the will on the basis of undue influence, I must be satisfied that there was an exercise of undue influence, and that the will would not have resulted but for the exercise of such influence.  Weighing up all the circumstances, including Mr Sheward’s large estate, his lack of immediate relatives and his generous nature, as well as the fact he was legally advised on this will, I consider this will represents his independent wishes.  Whether or not Ms Downes was able to take advantage of his vulnerability and generous nature, I think he would have wanted to reward her for her efforts in any event.  Thus, while I hold many concerns about the influence Ms Downes was having over Mr Sheward at this time, I am unable to conclude this will would not have been executed in its present form but for her influence.

Was the 18 April will procured through undue influence?

[223]   Unlike  the  14 April  will,  the  18 April  will  was  executed  in  unorthodox circumstances and the same issues which led me to find that there was a want of knowledge and approval are relevant to the question of whether it was procured through undue influence.

[224]   As I concluded earlier, when the copy of the 14 April 2013 will was sent out to  Mr  Sheward,  Ms Downes  proceeded  to  discuss  it  with  him.    Having  heard Mr Sheward discuss a proposed subdivision, which would leave the front lot with the house on it to her family trust, I consider Ms Downes was disappointed that the will which Mr Sheward executed did not give effect to that proposal and leave the house to her or her family trust.  The amendments made to the copy of the will did not, however, attempt to implement that proposal.   They simply inserted the Downes Family Trust  as  the  recipient  of  the  property at  Rue  Balguerie  in  place  of  the Davidsons.   There is no evidence at all as to why Mr Sheward would suddenly choose to delete the Davidsons entirely from his will, when only two days earlier he made a will giving them the entire property.   I am satisfied that either he was not aware of the impact of the effect of the alteration or he made the alteration at the

behest of Ms Downes even though he did not wish to remove the Davidsons as beneficiaries.

[225]   It also concerns me that the decision Mr Sheward had made, only two days earlier, to continue with Mr Davidson as one of his executors and trustees was suddenly overridden, as a consequence of these discussions.  There is no explanation why Mr Sheward’s views on having Mr Davidson as a trustee and executor of his will should have changed so dramatically in two days unless it was as a consequence of Ms Downes’ influence.

[226]   I consider it  was  clear,  from  the evidence,  that  the relationship  between Ms Downes  and  the  Davidsons  progressively  cooled.    The  Davidsons  viewed Ms Downes’ role in Mr Sheward’s life with suspicion and I have no doubt she was aware of it.   Consequently, and perhaps understandably, she sought to ensure that Mr Sheward did not see the Davidsons uncritically either.   This mutual suspicion manifested itself on a number of occasions.   For example, when the Davidsons sought to engage Mr Sheward on some of the practical aspects of his proposed subdivision, Ms Downes intervened, rejecting the issues they raised, such as the need to provide legal access to the rear lot from Rue Balguerie.  Similarly, in terms of the payment for the Cabstand, she intervened in an attempt to overrule the outcome of the discussions between the Davidsons and Mr Sheward as to the terms of payment.

[227]   Perhaps most disturbingly though, I consider that Ms Downes intervened in the last days of Mr Sheward’s life to keep the Davidsons away from Mr Sheward.  It is noteworthy that, at this time, she was attempting to have Mr Sheward revise his will to leave all the property to her family trust.  Although she denied doing anything more than contacting Mr Cordner’s firm to advise them Mr Sheward wanted to change his will, I am satisfied she had also discussed the content of the changes with Mr Sheward.  This is clear from the content of Mr Hill’s record of her call to him where he records her saying that all the property is to go to her family trust.

[228]   I consider that at this time she was attempting to have the will rewritten to reflect the terms of the will she had discussed with Mr Sheward between the making of the 14 and 18 April wills.  The fact that she denied any knowledge of Mr Sheward

leaving her something in his will and denied knowing that the purpose of subdivision was to divide the property between the Downes Family Trust and the Davidsons and, in particular, denied knowledge of the intended change in content of Mr Sheward’s will which he discussed making shortly before his death, when it is clear from Mr Hill’s record that she knew exactly what was intended, demonstrates she was actively influencing Mr Sheward in a way which she knew to be inappropriate.   I consider  that  she  was  deliberately  trying  to  keep  the  Davidsons  away  from Mr Sheward at this time, or at least putting them in a bad light, until the point came when she realised he was too ill to make any further change to his will.  However, there was no evidence that, between 14 and 18 April, anything had occurred between Mr Davidson and Mr Sheward that would warrant such a change, and I consider the change proposed was as a consequence of Ms Downes’ intervention.

[229]   I also consider that, in the four months prior to making the April wills, there were events which occurred which, whether intended to or not, had an effect on a vulnerable man like Mr Sheward and were instrumental in persuading him to look at giving his house at Rue Balguerie to the Downes, despite his earlier decision to leave it to the Davidsons.  In particular, I consider that the discussions which took place around Christmas 2012 about the risk that Ms Downes could not always continue to look after Mr Sheward and that if he wanted continuity of care, Sarah Downes could step in, led him to consider giving the house to the Downes family.  I have already concluded that things were said to Mr Sheward which made him believe that to achieve this commitment to his care, Sarah should be given the house.  This was a belief which he accepted and communicated to others, even though, at best, Sarah could only ever have relieved her mother on a short term and temporary basis.

[230]   I also consider that, having taken up the role of godparent to Ms Downes’ adult children, he felt a strong sense of obligation and this, too, influenced him to consider giving more to the Downes family than he would have, had he brought his independent judgment to bear, taking account of the payments and gifts he had already made to Ms Downes during her lifetime.

[231]   Thus, had I held that the 18 April will embodied Mr Sheward’s instructions to give the house and surrounding land and buildings to the Downes family, in my

view, those instructions would have been given as a consequence of undue influence being exercised over Mr Sheward by Ms Downes and her family.   Ms Downes encouraged the high level of dependency which Mr Sheward had on her services, and encouraged Mr Sheward to regard her family as a surrogate family.  Discussions then occurred around Christmas 2012 and into the New Year which had the effect of leading Mr Sheward to believe the Downes family either needed or deserved to receive  the  house  to  guarantee  continuity  of  the  services  which  Ms  Downes provided, and which allowed Mr Sheward to stay in his home.

[232]   I consider that when the draft will arrived on 17 April 2013, Ms Downes was disappointed it did not reflect the amendments which had been noted on the marked up copy of the 14 April will, but she nevertheless considered it imperative to secure at  least  the  benefit  which  that  will  gave  her  over  the  14  April  will.    As  a consequence, she took Mr Sheward to the pharmacy to execute that will in draft form, rather than allow him the opportunity to discuss it with his lawyer, where his rationale for making the changes could be more fully explored and tested before he committed to them.

[233]   In summary, had I not decided that the 18 April 2013 will was invalid for want of knowledge and approval, I would, in any event, have set it aside as being procured through the exercise of undue influence.

Outcome

[234]   For the reasons given, the will of 18 April 2013 is declared to be invalid.

[235]   A  grant  of  probate  in  solemn  form  in  favour  of  the  first  defendant Alistair Robert Davidson and the plaintiff Peter John Cordner is granted in respect of the will of the deceased dated 14 April 2013.

[236]   There will be issues as to costs.  These include the plaintiffs’ entitlement to claim costs incurred in the interim administration work they have performed and the costs of preparing for and participating in the trial.   This is because the second defendant  had  raised  an  issue  as  to  whether  the  conduct  of  Mr  Cordner  was

blameworthy in the circumstances, and so should have consequences in relation to recovery of his costs.

[237]   In order that all costs issues are placed before the Court, I direct the following exchange of submissions on costs:

(a)       Costs submissions by the plaintiffs are to be filed and served within

20 working days of the date of this decision.

(b)Costs submissions from the first defendants are to be filed and served within 25 working days of this decision.

(c)       Costs submissions for the second defendant are to be filed and served within 30 working days of the date of this decision.

(d)Any submissions in reply are to be filed within 35 working days of this decision.

[238]   Costs will be determined on the papers unless I require to hear from counsel.

Solicitors:

Dallison Stone, Christchurch

Harmans, Christchurch
Anderson Sandford Allen, Christchurch

Saunders Robinson Brown, Christchurch