Public Trust v Niemann
[2024] NZHC 934
•26 April 2024
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2023-404-002268
[2024] NZHC 934
IN THE MATTER of the Estate of ROSE LAURA FAUSER of Auckland, Retired (Deceased) BETWEEN
PUBLIC TRUST
Plaintiff
AND
RAELENE NIEMANN
First Defendant
PHOEBE LILLIAN URLICH
Second DefendantALONA MAUD COVICH
Third Defendant
PUBLIC TRUST, as Executor of the Estate of ALAN RAYMOND FAUSER
Fourth Defendant
Hearing: 18 April 2024 Appearances:
G M Cairns for Plaintiff
A W Johnson for Defendants
Judgment:
26 April 2024
JUDGMENT OF ANDERSON J
This judgment was delivered by me on 26 April 2023 at 12.00 pm pursuant to r 11.5 of the High Court Rules 2016.
……………………………… Registrar/Deputy Registrar
Solicitors:Thomas Dewar Sziranyi Letts, Lower Hutt Martelli McKegg, Auckland
PUBLIC TRUST v NIEMANN [2024] NZHC 934 [26 April 2024]
[1] Public Trust is the named executor of two wills executed by Mrs Rose Fauser. It applies for grant of probate in solemn form for the will dated 6 April 2016 (Last Will). If the Court determines Mrs Fauser did not have the requisite capacity to make the Last Will, Public Trust seeks a grant of probate of Mrs Fauser’s earlier will, dated 6 October 2010 (Previous Will). The Public Trust brought the proceeding because of a potential challenge to Mrs Fauser’s testamentary capacity when she made the Last Will on 6 April 2016.
[2] The second and third defendants, Ms Phoebe Urlich and Ms Alona Covich, filed notices of appearance. They reserved their rights in the event that another person became a party to the proceeding or took any step against their interest. No such steps have been taken.
[3] Accordingly, I heard the Public Trust’s application in a formal proof hearing. Mr Cairns for the Public Trust advised that the present value of the estate is in the vicinity of $110,000.
The wills
[4] Public Trust is named as executor in both the Last Will and the Previous Will which have been put before the Court.
[5]Mrs Fauser’s Last Will gives:
(a)a one third share of the estate to her husband’s sister, Ms Raelene Niemann (the first defendant);
(b)a one third share of the estate to her sister, Ms Urlich; and
(c)a one third share of the estate to her late brother’s wife, Ms Covich.1
1 The Last Will refers to Ms Covich as being Mrs Fauser’s husband’s wife. This is patent error. Moreover, it is clear from the drafting notes that Mrs Fauser was well aware that Ms Covich was her late brother’s wife.
[6] The Previous Will gives the entire estate to Mrs Fauser’s husband, Mr Alan Fauser, if he survives her by 30 days. If he does not, by the terms of the Previous Will the estate goes to Ms Niemann and Mrs Fauser’s brother, Mr Ivan Covich. However, Mr Covich had died by the time Mrs Fauser prepared the Last Will. Hence as at the time Mrs Fauser executed her Last Will, the substitutional gift under the Previous Will had become a gift of the whole estate to Ms Niemann.
[7] Mr Fauser did survive Mrs Fauser by more than 30 days. He died on 10 August 2022. The Previous Will and Mr Fauser’s will were mirror wills, with the same substitutional beneficiaries in the event Mrs Fauser pre-deceased him (as she did). Accordingly, the difference in the effect between the Last Will and the Previous Will is that under the Last Will Mrs Fauser’s estate is split three ways between her husband’s sister, her sister and the wife of her deceased brother. The effect of the Previous Will in combination with Mr Fauser’s will is that the whole estate will go to Mr Fauser’s sister (Ms Niemann).
General principles
[8] To establish testamentary capacity, the will-maker must have a sufficient understanding of four things:2
(a)that he or she is making a will and the effect of doing so;
(b)the extent of the property being disposed of;
(c)the moral claims to which he or she ought to give effect when making the testamentary disposition; and
(d)that he or she was free from any disorder of the mind that might distort feelings or judgement relevant to making a will.
2 Banks v Goodfellow (1870) LR 5 QB 54 cited with approval by Woodward v Smith [2009] NZCA 215 at [19].
[9] Mental soundness is a question of degree.3 The Court of Appeal has held that the mere existence at the date of the will of a delusion or partial unsoundness of the mind not affecting the general faculties and not operating on the mind of the will-maker regarding his or her testamentary dispositions does not render the will-maker incapable of disposing of their property by will.4
[10] The party propounding the will must show that at the time of making the will, the testator was free from delusion or its influences; or that it was of such a character that it could not reasonably be supposed to affect the disposition of the will-maker’s property.5
[11] In Woodward v Smith, the Court of Appeal held that testamentary capacity does not require a sound or disposing mind and memory in the highest degree, as these things exist on a spectrum. The will-maker’s mind may be affected, but there may be enough capacity left to understand and make a sound assessment of all those things and circumstances which enter the nature of a rational, fair and just will.6
[12] If a will is rational on its face and has been properly executed, it is presumed to have been made by a person of competent understanding. However, if there are factors telling against that presumption, the Court must decide against the validity of the will unless the evidence, on the whole, is sufficient to establish that the will-maker was of sound mind when the will was signed.7
[13] In Simpson v Kirkwood it was held that dementia alone is not enough for testamentary incapacity to be found.8 There, notwithstanding that the deceased had lived with dementia for several years prior to her death, she had testamentary capacity based on several factors including that her most recent will was similar to her previous wills and it “came as no surprise”; and that the lawyer present at the signing of her last
3 John Earles and others (eds) Dobbie’s Probate and Administration Practice (6th ed, LexisNexis, Wellington, 2014) at [49.7.8].
4 Re White (dec’d) [1951] NZLR 393 (CA).
5 The executor adopts a neutral stance as to which of the wills should be admitted to probate, but I need to conclude on the balance of probabilities that the will being propounded was executed with capacity.
6 Woodward v Smith, above n 2, at [19].
7 Dobbie’s Probate and Administration Practice, above n 3, at [49.7.11].
8 Simpson v Kirkwood [2019] NZHC 454.
will had no concerns in respect to her capacity, describing her as “reasonably lucid” in a file note.9
[14] Medical evidence will be given due weight. A doctor examining an intending will-maker as to testamentary capacity should make notes of the examination and ask questions to test mind, memory and understanding of persons entitled to claim on the will-maker’s assets and the extent of the estate.10 Less weight should be given to a retrospective assessment.
[15] Where the medical evidence is equivocal or the will-maker had a fluctuating level of capacity, the Court is entitled to place weight on the observations and views of the persons who took the will-maker’s instructions.11
[16] The Court will typically place greater reliance on the views of an experienced officer (professional) who had previous dealings with the will-maker. Conversely, the views of an inexperienced officer who had no prior dealings with the will-maker ought to carry less weight.12
Circumstances surrounding execution of the Last Will
[17] In the present case, the estate was not complex and nor were the will provisions. The only assets of significance were money in a bank account and Mrs Fauser’s car. The remaining asset, a licence-to-occupy was jointly held by Mr and Mrs Fauser and would pass to him.
[18] It is plain from the will instructions taken by a Public Trust officer at the time Mrs Fauser executed the Last Will, that she had the ability to understand that she was making a will, the effect of this, the extent of the property disposed of and moral claims against her. Accordingly, in terms of the various matters required for testamentary capacity, the key question is whether Mrs Fauser was free from a disorder of the mind which could have affected her judgement when she signed the Last Will.
9 At [9].
10 Lincoln v Public Trustee HC Wellington, A 4/76, 15 December 1976.
11 See generally, Woodward v Smith, above n 2; Public Trust v Dollimore [2018] NZHC 3316; Public Trust v White [2012] NZHC 230; and Leppien v Public Trustee HC Nelson CP21/00, 26 July 2002.
12 See generally Public Trust v Atwool [2020] NZHC 1228.
[19] The difference between the two wills is significant, with the deceased disinheriting her husband, Mr Fauser, entirely. However, the changes made were rational and indeed, reasonable:
(a)As recorded in a Family Protection note made in the will instructions, Mrs Fauser recognised that her licence-to-occupy was jointly held. The changes were made based on Mrs Fauser’s recorded view that she considered her husband would not need her funds as he would be in full-time care and unable to live in their apartment after her death in any event. The deceased felt her beneficiaries would benefit more from her estate.
(b)As well, as noted above, the Previous Will (then current) would have the effect that if Mrs Fauser survived her husband, the whole estate would go to one person, Ms Niemann, now that Mrs Fauser’s brother had died. It is not surprising that Mrs Fauser wished to change that position to the three-way split she settled upon.
[20] An experienced Public Trust officer with eight years’ experience took instructions and was present with a witness (another Public Trust staff member) when the Present Will was explained to Mrs Fauser and it was executed. No issues of concern about Mrs Fauser’s capacity were raised. The Public Trust officer had inputted instructions for the Last Will on 29 March 2016 and these were reflected in the will executed in that officer’s presence on 6 April 2016. It is significant that on 24 March 2016, just two weeks prior to this, Mrs Fauser had executed an enduring power of attorney. The same experienced Public Trust officer had certified, when witnessing this, that she had no reason to suspect that Mrs Fauser was or may be mentally incapable to execute that document.
Available medical information
[21]The medical information available to me is as follows:
(a)In June 2021, the Public Trust requested the opinion of Mrs Fauser’s general practitioner on Mrs Fauser’s capacity at the date of her Last
Will. On review of the medical records, he expressed the view that Mrs Fauser would have been incompetent on 6 April 2016. The doctor referred to a discharge summary in May 2016 that Mrs Fauser was then incompetent to understand the effect or nature of an enduring power of attorney as well as notes showing significant dementia by January 2016, and an assessed Addenbrooke’s cognitive assessment (“ACE-III”) and score. As to the ACE-III, on 13 April 2006, Mrs Fauser had a score of 49/100. A score of less than 82 generally indicates likely dementia.
(b)On 26 April 2016, Dr Vivien Yong, a doctor whose scope of practice includes the assessment of a person’s mental capacity, activated the 26 March 2016 enduring power of attorney. She assessed Mrs Fauser as not wholly competent to manage her own affairs in relation to property on that date. The basis for this view was that Mrs Fauser had dementia and lacked capacity to make decisions regarding her property as she did not have cognitive ability to foresee the consequences of her actions.
Analysis
[22] It is evident from the medical evidence that Mrs Fauser had dementia. But the case law I discussed above demonstrates that this alone is not determinative. I have given careful consideration to whether the medical evidence is such that I cannot be satisfied on the balance of probabilities that Mrs Fauser had testamentary capacity when she executed her Last Will.
[23] The general practitioner’s opinion is that Mrs Fauser lacked capacity, yet this opinion was provided in retrospect rather than an assessment at the time of will execution. It has its limitations for this reason. The ACE-III score is low. However, this is not directed at the specific enquiry required for capacity to make a will.
[24] As at 24 March 2016, an experienced Public Trust officer considered Mrs Fauser had capacity to make an enduring power of attorney. That requires that a person understand the consequences of signing the attorney, viz that management of
their property and affairs ought to be in the hands of someone else.13 This is a somewhat lower threshold than for testamentary capacity but provides some support for relevant capacity to execute a will two weeks later under the oversight of the same officer. Dr Yong’s opinion on 26 April 2016 activating the enduring power of attorney relates to a different test that Mrs Fauser could not manage her own affairs.
[25] Accordingly, despite giving the general practitioner’s views appropriate weight, in all the circumstances I do not consider they lead me to a finding that Mrs Fauser failed to understand the contents and effect of the Last Will. Nor is there a proper basis to say that at the time Mrs Fauser executed it, she suffered a disorder of mind which would distort her feelings or judgement, or as Simon France J put it, that would “poison her affections” or “distort her sense of right”.14
[26] The changes made by Mrs Fauser were logical and the accompanying will notes support her reasons. The Public Trust officer was experienced and was there at the time to assess Mrs Fauser’s capacity when she executed the Last Will. It is implicit that the Public Trust officer did not see cause to obtain a medical certificate to confirm capacity. She had also recently assessed Mrs Fauser competent to sign her enduring power of attorney.
[27] Having considered and compared the two wills, the medical information provided and the instructions accompanying the Last Will, I am satisfied on the balance of probabilities that at the time the Last Will was executed, Mrs Fauser had testamentary capacity. I grant probate in solemn form to the Last Will, being Mrs Fauser’s will dated 6 April 2016.
Anderson J
13 See the test as set out in Re “Tony” (1990) 5 NZFLR 609 (FC) at 621.
14 Public Trust v Dollimore, above n 11, at [96].
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