Public Trust v Coutts

[2021] NZHC 3620

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV 2021-404-1183

[2021] NZHC 3620

IN THE MATTER OF

The Estate of AILEEN AGNES BIRDLING

BETWEEN

PUBLIC TRUST

Applicant

AND

AILEEN ELIZABETH COUTTS

First Respondent

PAUL DOUGLAS BIRDLING
Second Respondent

KEVIN STUART BIRDLING
Third Respondent

DONNA CHRISTINE CURTIS
Fourth Respondent

BARRY ALAN BIRDLING
Fifth Respondent

MARK GREGORY BIRDLING

Sixth Respondent

On the papers
Counsel:	C Stanley and N D Moore for the applicant
Judgment:	23 December 2021

JUDGMENT OF CAMPBELL J

This judgment was delivered by me on 23 December 2021 at 2:00 pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar

PUBLIC TRUST v COUTTS [2021] NZHC 3620 [23 December 2021]

[1]    Aileen Agnes Birdling died on 16 September 2019. The Public Trust, as executor, has applied for probate in solemn form of a will of Ms Birdling dated 22 March 2017 (the 2017 will) or, alternatively, her previous will dated 5 February 2008 (the 2008 will).1

[2]    The respondents are Ms Birdling’s six children. They are the beneficiaries of both wills. They have all been served with the proceedings, including the affidavits filed in support of the application. None of the respondents have filed a notice of opposition or statement of defence. They have not taken any steps in relation to the application. The application is to be dealt with on the papers by way of formal proof.

Background facts

[3]The assets of the estate have been valued at approximately $120,000.

[4]    Under the 2008 will, Ms Birdling’s estate was to be divided in three ways. First, all her personal effects, including jewellery and watches, were left to her daughter Aileen Elizabeth Coutts (Aileen). Second, a loan from Aileen and her husband, Desmond Coutts, of $12,000 (or any part still owing) would be repaid. A gift of $500 was also provided for in lieu of interest if the loan was still owing at the time of death. Finally, the residue of the estate was to be divided equally between each of Ms Birdling’s surviving children.

[5]    The 2017 will provided for a different distribution of the assets of the estate. First, Ms Birdling’s son Paul Douglas Birdling (Paul) and Aileen would each receive a cash gift of $30,000. All personal effects, including jewellery and watches, were to go to another daughter, Donna Christine Curtis (Donna). The residue of the estate was to be divided equally among four of her six children. They were Donna, Kevin Stuart Birdling (Kevin), Barry Alan Birdling (Barry) and Mark Gregory Birdling (Mark).

[6]    There was also a draft will prepared in 2014 (the draft 2014 will). It was prepared on the basis of instructions from Ms Birdling but never executed. The terms

1      High Court Rules 2016, r 27.6.

of this draft will provided for her personal effects, including jewellery and watches, to be left to Aileen. The residue of the estate was to be left to Aileen, Kevin, Donna and Mark in equal shares. No provision was made for either Barry or Paul.

[7]    Public Trust has applied for probate in solemn form because there are doubts about whether Ms Birdling had testamentary capacity when she executed the 2017 will. Adrienne Jessie French is a senior trustee at Public Trust who is dealing with Ms Birdling’s estate. Ms French has sworn an affidavit in support of the application. She records that Aileen advised Public Trust in 2014 that Ms Birdling did not have testamentary capacity to execute the draft 2014 will, which did not proceed. Further, Aileen contacted Public Trust in June 2017 expressing doubts in relation to the 2017 will as she was of the view Ms Birdling had not had testamentary capacity for some time.

[8]    Mrs Birdling’s death certificate lists one of the causes of death as “Advanced Alzheimers Disease More than 10 Years”, suggesting she may not have had testamentary capacity from September 2009. Ms French indicates that the six beneficiaries of the two wills and the draft will could not agree on which should be admitted for probate. In late 2020, Public Trust commissioned an expert retrospective assessment of Ms Birdling’s testamentary capacity. This was completed by Dr Gary Cheung, who provided his report in early November 2020.

[9]    Dr Cheung holds appropriate medical qualifications and advanced degrees and other relevant qualifications. His specialist expertise and prior experience are not described in the report. He was provided with various Public Trust records relating to the two wills and the draft will and extensive documentation recording Ms Birdling’s clinical history from 2006.

[10]   Ms Birdling’s short term memory loss and forgetfulness were first recorded by her general practitioner in 2014. Moderate dementia was diagnosed in April 2016 by Dr Astell, a specialist geriatrician. Dr Astell noted that Ms Birdling’s memory had been deteriorating for 10 years and she lacked insight into her cognitive impairment. A Montreal Cognitive Assessment was undertaken by Dr Astell and Ms Birdling’s score was 13 out of 30. A score between 10 and 20 suggests moderately severe

cognitive impairment. Dr Astell recorded Ms Birdling had given away money in the past and Aileen was managing her financial affairs.

[11]   Dr Cheung noted other evidence which supported Dr Astell’s diagnosis. In August 2016, Aileen had mentioned to another GP that Ms Birdling was withdrawn and her interactions with others were limited. She was not eating and had left the front door open without realising it. Ms Birdling was admitted to an aged residential care facility in September 2016 but was removed from it by Donna who was concerned about the quality of her care. An enduring power of attorney for personal care and welfare granted to Aileen was revoked in September 2016 and replaced with a new one conferring this power on Kevin with Donna as successor. In June 2017, Ms Birdling was assessed as requiring hospital level care as she was unable to manage her activities of daily living due to advanced dementia. It appears one of those was her capacity to toilet independently.

[12]   Donna seems to have cared for Ms Birdling at home with support at this time. In late 2017, a general practitioner formed the view that Ms Birdling did not have the cognitive capacity to make financial decisions owing to her advanced dementia and lack of insight. She was admitted to Middlemore hospital for just under two weeks in mid-2018. She had an indwelling urinary catheter and was confined to bed. An assessment again found that she required hospital care. She was admitted to a hospital care facility shortly afterwards. Dr Cheung notes an opinion by another physician, Dr Nigel Brown, in January 2020, made in reliance on Dr Astell’s April 2016 assessment, that Ms Birdling did not have testamentary capacity in 2017.

[13]   In the absence of any medical record of cognitive issues in 2008, Dr Cheung’s opinion was that Ms Birdling was competent to make the 2008 will. Although there was medical record of a history of deteriorating memory for 10 years prior to the 2016 diagnosis of dementia, there is risk of recall bias in a retrospective report and, for this reason, Dr Cheung discounted this observation in forming his opinion.

[14]   As to the draft will prepared in 2014, Dr Cheung noted Aileen’s communication to Public Trust that Ms Birdling was not competent to make a new will. Two years later, she was diagnosed with dementia of moderate severity. Dr

Cheung describes dementia as a neurodegenerative disorder which presents with a gradual loss of cognitive function and deterioration in day-to-day functioning. He notes that Ms Birdling’s GP observed short-term memory impairment. While there is no clinical evidence which directly addresses the severity of her dementia in 2014, Dr Cheung’s opinion is that it was likely she had mild to moderate dementia at that time. It could not be presumed that she had capacity and a medical assessment ought to have been undertaken. There is otherwise insufficient clinical evidence to determine whether Ms Birdling was competent to make a will in 2014.

[15]   In respect of the 2017 will, Dr Cheung notes Ms Birdling was diagnosed with moderate dementia in 2016. Given the severity of her dementia and extent of her functional impairment (for example, Aileen was managing Ms Birdling’s financial affairs at the time of the 2016 diagnosis), Dr Cheung’s opinion is that she was not competent to make the 2017 will.

[16]   Ms Birdling’s signature on the 2017 will was witnessed by Ms French and Meera Jairam, then an associate trustee at Public Trust. Ms Jairam had taken the instructions for the will. Public Trust did not provide an affidavit from Ms Jairam; Ms French did not address, in her affidavit, any recollection she had of Ms Birdling when the 2017 will was executed. On 24 November 2021, I issued a minute requesting affidavits from them, if available, addressing their recollection (if any) of their assessment of Ms Birdling’s testamentary capacity at the time of the preparation and execution of the 2017 will.

[17]   A further affidavit sworn by Ms French was subsequently filed. She explained that she had merely witnessed the 2017 will but had not taken instructions on it or prepared it. All she could recall was that Ms Birdling had “a little trouble signing the document”. Ms French said that at the time of the 2017 will she had been in her role with Public Trust for two years and her experience with assessing testamentary capacity was modest.

[18]   Ms French also explained that Ms Jairam was no longer employed at Public Trust and now resided in Ireland. Ms Jairam had been employed at Public Trust for

two years at the time of the 2017 will. Ms Jairam had informed Ms French that she did not remember Ms Birdling.

Application for probate in solemn form

[19]   Public Trust seeks an order for probate in solemn form of either the 2008 will or the 2017 will. Its view on which will should prevail is properly neutral.

[20]   However, Ms Moore, for Public Trust, submitted that the 2008 will should be admitted to probate. This is because, on the balance of probabilities, it could not be shown that Ms Birdling had testamentary capacity in 2017, either in giving instructions for drafting the will or when she executed it.

Applicable legal principles

[21]   The legal principles relating to an assessment of testamentary capacity were set out by the Court of Appeal in Woodward v Smith and repeated in Loosley v Powell.2 They have their origins in Banks v  Goodfellow3  and  are  well  settled.  In  Woodward v Smith, the Court of Appeal said:4

(1)Because it involves moral responsibility, the possession of the intellectual and moral faculties common to our nature is essential to the validity of a will.

(2)It is essential to the exercise of such a power that a testator:

[i]understands the nature of the act and its effects; and also the extent of the property of which he is disposing;

[ii]is able to comprehend and appreciate the claims to which he ought to give effect;

[iii]be free of any disorder of the mind which would poison his affections, pervert his sense of right, or prevent the exercise of his natural faculties; that no insane delusion shall influence his will in disposing of his property and bring about a disposal of it which, if the mind had been sound, would not have been made.

(3)Unsoundness of mind arising from want of intelligence caused by defective organization, or by supervening physical infirmity or the

2      Woodward v Smith [2009] NZCA 215; Loosley v Powell [2018] NZCA 3, [2018] 2 NZLR 618.

3      Banks v Goodfellow (1870) LR 5 QB 549.

4      Woodward v Smith [2009] NZCA 215 at [19].

decay of advancing age, as distinguished from mental derangement is equally cause of incapacity. But

[i]though the mental power may be reduced below the ordinary standard, yet if there be sufficient intelligence to understand and appreciate the testamentary act in its different bearings, the power to make a will remains.

[ii]It is enough if the mental faculties retain sufficient strength fully to comprehend the testamentary act about to be done.

(4)It is not necessary that the testator should view his will with the eye of a lawyer, and comprehend its provisions in their legal form. It is sufficient if he has such a mind and memory as will enable him to understand the elements of which it is composed, and the disposition of his property in its simple forms.

(5)In deciding upon the capacity of the testator to make his will, it is the soundness of the mind, and not the particular state of the bodily health, that is to be attended to. The latter may be in a state of extreme weakness, feebleness or debility and yet he may have enough understanding to direct how his property shall be disposed of; his capacity may be perfect to dispose of his property by will, and yet very inadequate to the management of other business, as, for instance, to make contracts for the purchase or sale of property.

(6)A testator who has reflected over the years on how his property should be disposed of by will is likely to find it less difficult to express his testamentary intentions than to understand some new business.

(7)Testamentary capacity does not require a sound and disposing mind and memory in the highest degree; otherwise, very few could make testaments at all;

(8)Nor must the testator possess such capacity to the same extent as previously. His mind may have been in some degree weakened, his memory may have become in some degree enfeebled; and yet there may be enough left clearly to understand and make a sound assessment of all those things, and all those circumstances, which enter into the nature of a rational, fair, and just testament.

(9)But if that standard is not met, he will lack capacity.

[22]These are guiding principles rather than a formula.5

[23]   In Loosley, the Court of Appeal addressed the onus and standard of proof where testamentary capacity was in doubt, citing the following from Bishop v O’Dea:6

5      Loosley v Powell [2018] NZCA 3, [2018] 2 NZLR 618 at [19].

6      At [20]; and Bishop v O’Dea (1999) 18 FRNZ 492 (CA).

[3]        In probate proceedings those propounding the will do not have to establish that the maker of the will had testamentary capacity, unless there is some evidence raising lack of capacity as a tenable issue. In the absence of such evidence, the maker of a will apparently rational on its face, will be presumed to have testamentary capacity.

[4]        If there is evidence which raises lack of capacity as a tenable issue, the onus of satisfying the Court that the maker of the will did have testamentary capacity rests on those who seek probate of the will.

[5]        That onus must be discharged on the balance of probabilities. Whether the onus has been discharged will depend, amongst other things, upon the strength of the evidence suggesting lack of capacity.

[24]   The Court of Appeal in Woodward7 also referred its judgment in Nijsse v Squires where it was said:8

[T]he case cannot be left finely balanced … The Judge must be able to find that the reasonable inference relating to testamentary capacity can and should be drawn, otherwise the attempt to propound the will must fail.

[25]   In Loosely, citing the same case, the Court of Appeal expressed the view that the Court had to be satisfied there was testamentary capacity. Where there was doubt

– “[i]f the issue was left hanging in the balance” – testamentary capacity would not be established.9

Analysis

[26]   As to the 2017 will, I am satisfied that Ms Birdling’s diagnosis by a specialist geriatrician in April 2016 of moderate dementia and the evidence which indicates progression of her condition in the months afterwards raises lack of capacity as an arguable point. Dr Cheung’s report and retrospective opinion support this assessment. If probate is to be granted of the 2017 will, executed eleven months after the diagnosis, I must therefore be satisfied on the balance of probabilities that Ms Birdling did have capacity.

[27]   Ms Jairam, the Public Trust officer who met with Ms Birdling (and Kevin and Donna), made a file note during or after that meeting. The file note provides some evidence of testamentary capacity. Ms Jairam met with Ms Birdling on 13 March

7      Woodward v Smith [2009] NZCA 215 at [22].

8      Nijsse v Squires CA53/04, 15 December 2004 at [12].

9      Loosley v Powell [2018] NZCA 3, [2018] 2 NZLR 618.

2017. Ms Jairam completed a will questionnaire with Ms Birdling. Ms Birdling was supported at this meeting by Kevin and Donna. Ms Jairam recorded that both assisted by “explaining and asking questions”. Ms Jairam interpreted this to be because Ms Birdling’s “hearing wasn’t good at times”. Ms Jairam also recorded Ms Birdling’s distress in explaining why Paul and Aileen were to be “removed” from the will.

[28]   However, this file note is only weak evidence of Ms Birdling having capacity. Ms Jairam had been in her role only two years. She did not have long experience in assessing testamentary capacity. Ms Jairam apparently had no prior dealings with Ms Birdling. She had no opportunity to recognise changes in her capacity over time.

[29]   All other evidence points to lack of capacity at the time Ms Birdling executed the 2017 will. Most compelling is the medical evidence, which is all one way. She was diagnosed with moderate dementia by a specialist geriatrician in April 2016. This was eleven months before the will. Dr Cheung’s opinion that Ms Birdling was not competent is based on detailed records. No evidence has been put forward to challenge his opinion.

[30]   Other evidence that indicates a lack of capacity is Ms Birdling’s treatment of Barry. Under the 2017 will he is treated equally with the other children entitled to the residue of the estate. However, in a December 2017 statutory declaration (which records gifts to Kevin, Donna and Mark) Ms Birdling described Barry as “a stranger”. Such a significant change over a short period of time indicates a lack of capacity at the time the will was signed.

[31]   In these circumstances, I am not satisfied on the balance of probabilities that Ms Birdling had capacity to make the 2017 will.

[32]   As to the 2008 will, Ms Birdling’s death certificate records, among other things, “Advanced Alzheimers Disease More Than 10 Years”. Ms Birdling died in September 2019. Dr Cheung notes that the clinical record created at the time of the diagnosis of dementia in 2016 states Ms Birdling had suffered memory loss for ten years prior.

[33]   However, Dr Cheung’s opinion is that the 2016 clinical record is a retrospective report subject to recall bias. He also notes there was no clinical record suggesting any cognitive issues in 2008. I accept Dr Cheung’s view that the statement in the 2016 record can for those reasons be discounted. The same is true of the statement in the death certificate.

[34]   Ms Birdling’s short term memory loss and forgetfulness were first recorded by her general practitioner in 2014. There is no other evidence of cognitive impairment before that date. The will divided the residue of her estate between her six children and is apparently rational. For these reasons, I am satisfied that lack of capacity at the time Ms Birdling executed the 2008 will is not a tenable issue.

Result

[35]   The application for probate in solemn form of the will of Aileen Agnes Birdling dated 5 February 2008 is granted and an order to that effect is made.

Campbell J