Khan v Knox
[2022] NZHC 2577
•6 October 2022
IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY
I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE
CIV-2022-419-1
[2022] NZHC 2577
IN THE MATTER of an originating application under Part 19 High Court Rules 2016 IN THE MATTER
of an application to validate a Will
IN THE MATTER
of the Estate of Adrienne Judith Elizabeth Peacock
BETWEEN
JAMAHL SEAN KHAN and JOHN PEACOCK
Applicants
AND
SARAH KNOX, MURRAY DOWNS and SALEEM PAUL KHAN
Respondents
Hearing: 26 July 2022 Counsel:
D M O’Neill for Applicants
E A Schwikkard for Respondent Saleem Khan E C Macpherson and D P Shore for the Estate C M Earl for minor children
J Niemand for minor grandchildren
Judgment:
6 October 2022
JUDGMENT OF BREWER J
This judgment was delivered by me on 6 October 2022 at 2 pm pursuant to Rule 11.5 High Court Rules.
Registrar/Deputy Registrar
KHAN &PEACOCK v KNOX & ORS [2022] NZHC 2577 [6 October 2022]
Introduction
[1]Ms Adrienne Judith Elizabeth Peacock died suddenly on 17 September 2021.
[2]Ms Peacock made a Will in regular form in 2005.
[3] After her death, Ms Peacock’s computer was found to contain in electronic form three Wills each marked “Draft”. Two were drafted in 2014 and one was dated 20 September 2016. In addition, among her papers, was a handwritten document dated 30 July 2017 (the 2017 document). It says:
30th July 2017
I, Adrienne Judith Elizabeth Peacock, being of sound mind and body, do write this my Last Will and Testament should I become unable to communicate.
That my son Jamahl Sean Khan purchases my house for the sum of
$150,000.00. This amount is then to go to my son Saleem Paul Khan. [Signature of Ms Peacock]
[4] Mr Jamahl Khan and Mr John Peacock apply for orders that the electronic draft Will dated 20 September 2016 and the 2017 document are respectively Ms Peacock’s valid Will and a valid change to the Will.1
[5] The application is opposed by Mr Khan’s brother, Mr Saleem Paul Khan (who has changed his name to Samuel Jay Steel so I will refer to him as “Mr Steel”).
[6] Mr Steel’s position is that the 2016 draft Will represents Ms Peacock’s final testamentary intentions and the 2017 document should not be recognised as a valid change to them.
[7] Mr Earl and Mr Niemand appeared on behalf of Ms Peacock’s grandchildren (all minors). They abide the decision of the Court.
[8] As I will come to, both Mr Khan and Mr Steel, through affidavits, present the Court with their views of their somewhat fraught family history. Each does so in
1 There are other related orders sought. I will come to them as and if required.
support of their competing contentions on what Ms Peacock’s testamentary intentions were likely to be. As I said to counsel at the outset of the hearing, this is not a claim under the Family Protection Act 1955. It is a specific inquiry under the Wills Act 2007 (the Act). I will set out the nature of that inquiry before I turn to the parties’ cases.
The law
[9] A Will is a document made by a natural person which (relevantly) disposes of property to which she is entitled when she dies.2
[10] A valid Will must be in writing, and must be properly executed by the will- maker and at least two witnesses.3 A change to a Will must also have these characteristics to be a valid change.4
[11]It is evident that neither the 2016 draft Will nor the 2017 document are valid.
[12] However, the High Court may declare a document to be a valid Will (or a valid change to a Will) if it does not comply with the formal requirements, if the document appears to be a Will (or a change to a Will) and the Court is satisfied that the document expresses the deceased person’s testamentary intentions at the time of their death.5
[13]The Court may consider:6
(a)the document; and
(b)evidence on the signing and witnessing of the document; and
(c)evidence on the deceased person’s testamentary intentions; and
(d)evidence of statements made by the deceased person.
2 Wills Act 2007, s 8.
3 Section 11.
4 Section 15.
5 Sections 14 and 15(d). See Kato v Matthes [2018] NZHC 2551, [2018] NZAR 1916 at [45]; Re an application by Pan and Vanfau [2018] NZHC 2140 at [6]; and Palmer v Spencer [2019] NZHC 1808 at [32].
6 Section 14(3).
Background
Ms Peacock
[14]Ms Peacock was the mother of Mr Khan and Mr Steel.
[15]Both sons were born in Australia.
[16] Ms Peacock was married briefly to the sons’ father but they separated shortly after Mr Khan was born. Ms Peacock then brought her sons to New Zealand where she remained for the rest of her life.
[17] Ms Peacock met and married Mr Peacock in 1994. They separated in 2013 and divorced in 2017, but remained friends. Mr Khan says that Mr Peacock has been a part of his life ever since the marriage, and that Mr Khan’s children view Mr Peacock as their grandfather.
[18] At the time the 2017 document was written, Ms Peacock owned one property in Hamilton. This is the property referred to in the document. The property’s rating valuation was $1,460,000 in 2021 and there is an outstanding loan of approximately
$168,000 to a bank.
[19] Ms Peacock purchased a second property in 2019. It is located in Tīrau. The property’s rating valuation was $765,000 in 2021 and there is an outstanding loan of approximately $500,000 to a bank.
[20] Ms Peacock maintained a relationship with both of her sons. However, her sons became estranged from one another following Mr Steel’s criminal convictions. The details of the convictions are scarce. Apparently they concerned indecencies with children and were incurred in or about 2006, 2010 and 2017. Mr Steel served three terms of imprisonment.
[21] Ms Peacock compartmentalised her dealings with her sons and their children in the sense that she kept her contacts with each of them largely hidden from the other.
Mr Steel
[22] Mr Steel is 48 years old. He is unemployed. He has two children aged three and four respectively.
[23] Mr Steel says that he has always been very close with his mother. They were very involved in each other’s lives and spent many hours together each week. He says they depended on one another for emotional support, and that Ms Peacock continued to be there for him after his convictions. He says that she relied on him for day-to-day chores, helping with maintenance and renovations of her Hamilton property. He says he also acted as a property manager for her properties and worked with Ms Peacock as a team to build up the wealth of the family.
[24] Mr Steel deposes that his brother, Mr Khan, has had far less contact with their mother since leaving home. He says that Ms Peacock’s relationship with Mr Khan has been difficult and there were periods of time where Mr Khan cut contact with her completely. He says Ms Peacock was often prevented from seeing her grandchildren (Mr Khan’s children) and she found this very upsetting. He says she would be subject to very strict conditions whenever she did visit Mr Khan’s children. He points out that Ms Peacock went to the effort of drafting a letter to Mr Khan and his ex-wife regarding their treatment of her when she visited her grandchildren. At one stage she was considering getting a formal arrangement put in place for her to access Mr Khan’s children.
[25] Mr Steel deposes also that even though their relationship was troubled at times, Ms Peacock supported Mr Khan over the years including by making his mortgage repayments at times and supporting him when he was stood down from his place of work.
[26] Mr Steel says that his mother was always minded to keep things fair between her sons. He says that is evident from the Will she made in 2005 in which she was careful to leave $30,000 to himself but made no specific bequest to Mr Khan, who had previously received $30,000 from her. In his view, it was his mother’s intention right up until the time of her death that he would receive the benefit of the Tīrau property.
Mr Khan
[27] Mr Khan is 44 years old. He works as a teacher in Hamilton. He has two children aged 15 and 17 respectively.
[28] Mr Khan deposes that Mr Steel was not always close with their mother. He says Mr Steel moved away in his twenties and thirties. But he agrees that Ms Peacock was supportive of Mr Steel following his convictions. He says she wanted to “fix” Mr Steel. He also says that far from helping to renovate Ms Peacock’s properties, Mr Steel “often wrecked the properties”.
[29] Mr Khan says he did not have a lot to do with Mr Steel following the latter’s first conviction. He distanced himself, not wanting him or his children to be exposed to Mr Steel.
[30] Mr Khan says for a time he lived physically close to his mother and they saw each other regularly — for dinners, birthdays and Christmas. He says his mother would come and watch his children play soccer. This continued when he built a new home in Tauwhare and his mother purchased the Hamilton property, with her travelling to watch the children play sport. He agrees that Ms Peacock was disappointed that he was not supporting Mr Steel. But, broadly speaking, they never spoke about Mr Steel when she came to visit her grandchildren. He did not know that Mr Steel had children until after their mother passed away.
[31] Mr Khan says that Mr Steel was in and out of their mother’s home for about 15 years. That is why he did not visit his mother at her home — he wanted to keep his children away from Mr Steel. But Ms Peacock would come to their place instead, and she would go away on trips with Mr Khan’s family, including in the last five years. He only ever ‘cut contact’ with Ms Peacock for around a year following Mr Steel’s convictions. Mr Khan says that in general his relationship with his mother was “very strong”. He also has a close relationship with Mr Peacock.
[32]Mr Khan deposes that the only money he ever received from his mother was
$30,000 to help with the deposit on his first home. That is why the 2005 Will made a specific bequest of $30,000 to Mr Steel to ‘even up’ the situation. He says he was
never supported by Ms Peacock when he was stood down from his place of work, because he was stood down on full pay.
[33] Mr Khan also says that Ms Peacock told him shortly before Christmas one year, either in 2017 or in 2019, that Mr Steel had received more than his fair share of financial and emotional support and that she was saying “no more”. Mr Khan says she told him that he would be getting the Hamilton property after her death.7
Mr Peacock
[34] Mr Peacock deposes that he remained close to Ms Peacock following their divorce in 2017. He says that Ms Peacock was not as close with Mr Steel as Mr Steel suggests. Mr Steel overstated the work he did for Ms Peacock in renovating her Hamilton property. He does not agree that Mr Steel managed Ms Peacock’s properties and says she managed her own properties. In Mr Peacock’s view, Mr Steel overstated the work he did with Ms Peacock to build the wealth of the family.
[35] Mr Peacock’s understanding was that Mr Steel would inherit the Tīrau property, but only if Ms Peacock lived to an old age and the mortgage was less than what it is.
[36] Mr Peacock does not agree that Mr Khan saw a lot less of Ms Peacock once he left home. It was Mr Peacock’s observation that they saw a lot of one another, especially when Mr Khan was living in Arapuni. While their relationship cooled for a time during Mr Khan’s divorce, Mr Peacock says there was “a lot more contact” between them subsequently.
[37] Mr Peacock says that the 2017 document fits with what Ms Peacock subsequently told him was her intention, namely to ease Mr Steel out of an inheritance. He says Ms Peacock thought for a time that she could “fix” Mr Steel but later concluded that she could not. He says the timing of the 2017 document coincides in this respect with Ms Peacock coming to the end of her tether with Mr Steel, following his latest criminal conviction.
7 Mr Steel says that Ms Peacock never mentioned this to him which is “strange” given that they shared most things with each other.
The Wills
The 2005 Will
[38]The 2005 Will was executed in accordance with the Act.
[39] Ms Peacock left her entire estate to Mr Peacock, provided that he survived her for 14 days.
[40]If Mr Peacock did not survive Ms Peacock for 14 days, then she bequeathed
$30,000 to two of Mr Peacock’s daughters; $30,000 to her son, Mr Steel; and $500 to another of Mr Peacock’s daughters. The 2005 Will notes that her other son, Mr Khan, had already received $30,000 from Mr and Ms Peacock.
[41] The residue of her estate was then left to two of Mr Peacock’s daughters, Mr Khan, and Mr Steel.
The first 2014 draft Will
[42] Ms Peacock made no specific bequests in the first 2014 draft Will and simply left the residue of her estate in equal shares to any grandchildren living at the time of her death. At the time this Will was drafted, only Mr Khan had children.
The second 2014 draft Will
[43] The second 2014 draft Will made no change to the first 2014 draft Will other than to remove one of the two executors. The residue of Ms Peacock’s estate was again left to her grandchildren.
The 2016 draft Will
[44] The 2016 draft Will represented a marked departure from the two 2014 draft Wills.
[45] Ms Peacock left one third of her estate to each of her sons, Mr Khan and Mr Steel, and the remaining third in equal shares to specified grandchildren living at the time of her death, namely Mr Khan’s two children.
[46]At the time this Will was drafted, only Mr Khan had children.
[47] The Will appointed Mr Murray Downs and Mr Peacock as executors and trustees.
The 2017 document
[48] The 2017 document, set out at [3] above, would remove Ms Peacock’s Hamilton home from the residue of the estate. It provides that Mr Khan would pay the sum of $150,000 in exchange for the house, with that sum then being paid to Mr Steel.
The parties’ cases
The applicants
[49] Mr O’Neill, for the applicants, submits that the 2016 draft Will and the 2017 document should be assessed as two stand-alone documents.
[50] With respect to the 2016 draft Will, he submits that it meets all the formal requirements of a Will apart from being signed and witnessed and is indicative of Ms Peacock’s testamentary wishes. He submits it appears Ms Peacock gave a deal of thought to her Wills and sometimes changed her mind — as evident by the various wills she made in the two decades preceding her death. But, he submits, the 2016 draft Will represents a “full outline” of what she wanted to do with her property after her death.
[51] Mr O’Neill submits that the 2017 document also gives effect to the intentions of Ms Peacock. He says this can be inferred from the surrounding circumstances, including that:
(a)Ms Peacock told Mr Khan in either 2017 or 2019 that she was leaving him the Hamilton property;
(b)the 2017 document was made at a time when Ms Peacock was “at the end of her tether” because of Mr Steel’s latest criminal conviction;
(c)Ms Peacock was looking to ease Mr Steel out of an inheritance following his latest criminal conviction and the timing of the 2017 document appears to coincide with Mr Steel’s release from prison; and
(d)Ms Peacock had financially supported Mr Steel for many years, including by providing him the Tīrau property to live in.
[52] Mr O’Neill submits that the evidence of Mr Khan, when coupled with the evidence of Mr Peacock (whom he describes as a dispassionate observer), is a strong indication of what Ms Peacock was thinking at the relevant time. He submits that the bequest of the Hamilton property to Mr Khan was balanced against 15 years of financial assistance to Mr Steel, alongside Ms Peacock generally being “at the end of her tether” with Mr Steel. He therefore submits the 2017 document accurately reflects Ms Peacock’s testamentary intentions in 2017.
The respondents
[53] Ms Schwikkard, for Mr Steel, does not in principle oppose validation of the 2016 draft Will on the understanding that it represents the testamentary intentions of Ms Peacock. But she submits that Mr Steel’s two children ought to be included as beneficiaries on the understanding (agreed by all parties) that Ms Peacock loved all four of her grandchildren equally. She notes that Mr Steel’s two children were not yet born at the time the 2016 draft Will was written, but submits the Court has jurisdiction to give effect to the deceased’s testamentary intentions through ss 31 and 32 of the Act to correct the 2016 draft Will to include all four grandchildren.
[54] With respect to the 2017 document, Ms Schwikkard submits that it must represent Ms Peacock’s testamentary intentions at the time of her death, rather than her intentions when the note was drafted in 2017.8 Section 14 should also “not be utilised when there are substantial doubts about what those intentions were”.9
8 See Kato v Matthes, above n 5, at [45]; Re an application by Pan and Vanfau, above n 5, at [6]; and Palmer v Spencer, above n 5, at [32].
9 Mason v Mason [2022] NZHC 491, [2022] NZFLR 64 at [31].
Concerns about Ms Peacock’s testamentary capacity or the presence of undue influence are therefore relevant.10
[55] Ms Schwikkard submits that the Court may take into account a number of factors in assessing Ms Peacock’s testamentary intentions, including the circumstances in which the document came to be prepared;11 the reason why the document had not been properly signed or witnessed;12 any prior representations of the deceased;13 and who found the document and where it was discovered.14 The reason why the document was not validly executed prior to Ms Peacock’s death will also be relevant.15
[56] Ms Schwikkard submits that the applicants have not shown on the balance of probabilities that there is clear evidence of Ms Peacock’s testamentary capacity, which is particularly important in light of her diagnosis of Small Vessel Disease (SVD) in 2010.
[57] Ms Schwikkard submits that the 2017 document, for which there is no corroborating evidence,16 was inconsistent with Ms Peacock’s previous testamentary intentions,17 and can accordingly be considered an outlier in “what is a history of clear and consistent testamentary intent by the deceased where she treats [Mr Khan] and [Mr Steel] equally”.
[58] She notes that on 28 March 2019, the law firm that assisted Ms Peacock in preparing the first 2014 draft Will contacted Ms Peacock again, indicating that the file would be closed if they did not hear back from her by 2 April 2019. Ms Peacock took the positive step of calling the firm on 1 April 2019 and telling them to close the file.
10 See Harris v Taylor [2015] NZHC 3190, [2016] NZAR 363 at [133].
11 Re Campbell (deceased) [2014] NZHC 1632, [2014] 3 NZLR 706 at [15].
12 At [15].
13 Kelsey v Taniora (as the Executor and Trustee of the estate of Perkinson) [2017] NZHC 3234 at [26].
14 Palmer v Spencer, above n 5, at [31].
15 Wardill v Anderson [2016] NZHC 3114 at [20]–[21].
16 She observes that Mr Khan could not recall the date of the conversation in which Ms Peacock allegedly told him that he would receive the Hamilton property, being unable to say whether it took place in either 2017 or 2019. This evidence was not corroborated by any other witnesses nor did Ms Peacock mention it to anybody else.
17 The brothers were treated equally in the 2005 Will, the two draft Wills in 2014 and in the 2016 draft Will.
Ms Schwikkard submits that Ms Peacock evidently chose, after four days of reflection, not to execute any of her draft Wills or notes at that time.
[59] Ms Schwikkard submits that Ms Peacock knew the requirements for validating a Will, the 2017 document is inconsistent with her previous testamentary intentions and should be considered an outlier, there was a four year delay between the drafting of the 2017 document and her death, and accordingly it can be concluded that the 2017 document does not express her testamentary intentions.
[60] Ms Schwikkard observes that the 2017 document may have been written in haste at a time of heightened emotion, and Ms Peacock had ample opportunity to have it formalised as a valid Will in the four years between its drafting and her eventual death. Ms Schwikkard submits it is more likely that Ms Peacock deliberately chose not to incorporate the 2017 document into a Will or that she forgot about it because it no longer represented her testamentary intentions.
[61] Ms Schwikkard submits that in essence the evidence before the Court shows a mother caught between two estranged sons, trying to maintain a relationship with both of them. The evidence suggests she always strove for equality between her sons. Ms Schwikkard submits it was not Ms Peacock’s testamentary intention to favour one son over the other: Ms Peacock was not “at the end of her tether” with Mr Steel, they maintained a close relationship right up until Ms Peacock’s death, and there is nothing to suggest that she would favour Mr Khan over Mr Steel. There is also no evidence to suggest that she would favour one set of grandchildren over the other, which would be one consequence of the 2017 document.
Discussion
[62] The onus is on the applicants to satisfy me, on the balance of probabilities, that the 2016 draft Will and the 2017 document represent Ms Peacock’s testamentary intentions at the time of her death.18
18 The applicants also have to satisfy me that Ms Peacock had testamentary capacity when she made these documents. They have discharged this onus. A diagnosis in 2010 of SVD is meaningless without expert opinion. There are no observations of Ms Peacock’s cognitive abilities which would imply she lacked testamentary capacity.
[63] The factors that are in favour of the 2016 draft Will and the 2017 document, together, representing Ms Peacock’s testamentary intentions at the time of her death are:
(a)The 2005 Will clearly no longer represented Ms Peacock’s testamentary intentions once she separated from Mr Peacock in 2013. Mr Peacock, against his interest, does not suggest otherwise and propounds the 2016 draft Will and the 2017 document as representing Ms Peacock’s testamentary intentions. Ms Peacock set out to make a new Will in 2014 by instructing her lawyers accordingly. The lawyers sent her a draft.
(b)Thereafter, Ms Peacock drafted and re-drafted her Will depending on the changing circumstances of her life and using as a template the draft sent to her by her lawyers in 2014.
(c)The 2016 draft Will is a fair and balanced testamentary instrument. It treats her sons equally, but favours Mr Khan by giving his children one third of the residue.
(d)Mr Steel’s third conviction in 2017 was a material change in circumstances. Mr Peacock’s evidence that Ms Peacock was at the end of her tether and wanted to ease Mr Steel out of his inheritance is credible.
(e)Mr Khan’s evidence as to the extent of Ms Peacock’s financial and emotional support of Mr Steel over the years is also credible given the pattern of Mr Steel’s convictions, prison sentences and lack of employment.
(f)In 2019 Ms Peacock’s lawyers contacted her about her Will. After four days’ reflection, Ms Peacock told them to close the file. It might be inferred that Ms Peacock was content with the testamentary intentions she had expressed.
(g)Mr Khan’s evidence that Ms Peacock told him in 2017 or 2019 that he would have the Hamilton house has not been challenged by evidence and is consistent with the existence of the 2017 document.
[64]The factors that go against the applicants are:
(a)To be validated, the 2016 draft Will and/or the 2017 document must, on the balance of probabilities, represent Ms Peacock’s testamentary intentions at the time of her death. Ms Peacock died four years after making the 2017 document. Her circumstances changed in those four years.
(b)One of the principal changes in Ms Peacock’s circumstances was the births of Mr Steel’s children. They were born on 21 December 2017 and 27 March 2019 respectively. The evidence is clear that Ms Peacock loved all her grandchildren equally.
(c)There is force in Ms Schwikkard’s observation that the 2017 document may have been written in haste at a time of heightened emotion. It is clear that she and Mr Steel were close during the last four years of her life. In 2019 she bought the house at Tīrau so he could have a place to live, and her intention, as attested by Mr Peacock, was that eventually it would become Mr Steel’s.
(d)Ms Peacock died suddenly. She had no time to recognise that her life was coming to an end and therefore no time to put her affairs in order.
[65] I consider it relevant that Ms Peacock did not print out the 2016 draft Will and sign it. Instead it remained on her computer and continued to be marked “draft”. Ms Peacock knew how a Will is made. If the 2016 draft Will and the 2017 document represented her testamentary intentions in 2019 when she was contacted by her lawyer, it would have been simple for her to instruct her lawyer to formalise her Will. Instead, after four days for reflection, she told him to close the file. An available inference is that she was not sure, at that time, what she wanted to do with her estate.
[66] I have considered whether the 2017 document, since it contains the introductory passage “do write this my Last Will and Testament”, was intended by Ms Peacock to take the place of the 2016 draft Will. I am satisfied that was not Ms Peacock’s intention. Ms Peacock knew very well what a complete Will looks like. The 2017 document deals with only one of her assets, albeit the most significant.
[67] Considering all these factors, I am not satisfied, on the balance of probabilities, that either or both of the 2016 draft Will and the 2017 document represent Ms Peacock’s testamentary intentions at the time of her death.
Result
[68]The application is dismissed.
[69] The applicants’ memorandum as to costs is to be filed and served no later than 11 November 2022. The respondents’ reply is to be filed and served no later than 9 December 2022. Mr Earl and Mr Niemand may also file and serve memoranda by 9 December 2022.
[70]By way of addendum, I make the following observations:
(a)My decision means that the 2005 Will is Ms Peacock’s valid Will and it can be submitted for probate.
(b)However, it is clear that the 2005 Will did not represent Ms Peacock’s testamentary intentions at the time of her death. Mr Peacock, the sole beneficiary under the 2005 Will, recognises that.
(c)Claims by Mr Khan, Mr Steel and their children under the Family Protection Act 1955 would undoubtedly succeed.
(d)The best outcome would be a Deed of Family Arrangement giving effect to Ms Peacock’s long history of treating her family members as equally as possible.
Brewer J
Solicitors/Counsel:
Clark and Brown (Hamilton) for Applicants
Grayson Clements (Hamilton) for Respondent Saleem Khan McCaw Lewis (Hamilton) for the Estate
C Murray Earl (Hamilton) for minor children
Niemand Peebles Hoult (Hamilton) for minor grandchildren
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