Rule v Rule
[2014] NZHC 1263
•4 June 2014
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2012-404-5837 [2014] NZHC 1263
IN THE MATTER OF the Estate of MURIEL GWENDOLINE
RULE
BETWEEN
DOUGLAS IAN RULE and ELIZABETH JANE BELCHER Plaintiffs
AND
LESLEY LOUISE RULE and ANTHONY CHARLES BENNETT COUPE as Executors and Trustees of the Estate of MURIEL GWENDOLINE RULE
Defendants
Hearing: 4 June 2014 Appearances:
A MacMillan for Plaintiffs
S R Houliston for DefendantsJudgment:
4 June 2014
ORAL JUDGMENT OF ASSOCIATE JUDGE BELL
Solicitors:
Barbara Knowles, Mairangi Bay, North Shore, Auckland, for Plaintiffs
McVeagh Fleming, Auckland, for Defendants
Counsel:
Alison MacMillan, Albany, Auckland, for Plaintiffs
J D Turner, Auckland, for Defendants
RULE and BELCHER v RULE and COUPE as Executors and Trustees of the Estate of MURIEL GWENDOLINE RULE [2014] NZHC 1263 [4 June 2014]
[1] The plaintiffs apply for an order for Mr Coupe, one of the defendants, to file further answers to interrogatories on the grounds that answers he has given are not sufficient, and in one case he has not answered interrogatories.
[2] This is a proceeding in respect of the estate of Muriel Gwendoline Rule who died at Auckland on 17 August 2011, leaving a will dated 19 July 2007. She appointed the defendants as executors. Under her will she left a life interest in a half share of a property at Rarere Road, North Shore, Auckland and the residue of her estate to her daughter, Louise. She had two other children, the plaintiffs. Under an earlier will made on 24 May 2007 she left to the plaintiffs her half share in the house property and left the rest of her estate to Louise.
[3] The plaintiffs run three causes of action:
(a) alleged lack of testamentary capacity;
(b) alleged undue influence on the part of Louise; and
(c) a claim under the Family Protection Act 1955.
[4] Ms MacMillan has identified these dates as relevant to the interrogatories:
(a) On 24 May 2007 Mrs Rule signed a will and power of attorney. That power of attorney appointed her son, Douglas.
(b) On 23 June 2007 she suffered a stroke and was hospitalised. (c) On 11 July 2007 she left hospital.
(d)On 12 July 2007 she signed new powers of attorney, this time revoking those appointing Douglas and instead executing powers of attorney in favour of Louise.
(e) On 19 July 2007 she signed the new will, effectively leaving all her estate to Louise, barring forgiveness of one debt owed by Jane.
[5] Mr Coupe is the lawyer who acted for the deceased. He prepared the wills and powers of attorney, both in May 2007 and in July 2007. The plaintiffs have interrogated Mr Coupe twice. The second interrogatories were served in December
2013. Mr Coupe did not give any response until January 2014 although he was required to do so within five working days. The plaintiffs say that they sought further clarification, but the defendants’ lawyers said that Mr Coupe was not going to provide any further answers.
[6] This application has been made to seek further responses from Mr Coupe. The complaints are essentially two-fold: that although he has given answers, he has not directed his answers at the exact point of the questions; and that he has refused to answer questions on the grounds that those matters are not relevant. The schedule to this decision shows the interrogatories in issue.
[7] Counsel referred me to relevant authorities: Marriott v Chamberlain,1
Broadcasting Corporation of New Zealand v Wilson & Horton Ltd,2 Todd Pohokura Ltd v Shell Exploration NZ Ltd,3 Icepak Group Ltd v QBE Insurance (International) Ltd4 and Commerce Commission v Air New Zealand (No. 6).5
Question 5.1(b)(i)
[8] The first question asks Mr Coupe to specify in detail what he advised Mrs Rule about her moral duty and her obligation to each of her children (other than Louise), their relative needs and the effect of the proposed will change on them. In reply, Mr Coupe simply referred to an answer he had given in his reply to the first set of interrogatories. That had indicated that as she was granting a life interest to Louise and leaving the residue to Louise, the will could be challenged by her other
children.
1 Marriott v Chamberlain (1896) 17 QBD 154 (CA).
2 Broadcasting Corporation of New Zealand v Wilson & Horton Ltd HC Auckland CP1814/87,
21 September 1992.
3 Todd Pohokura Ltd v Shell Exploration NZ Ltd [2009] NZCA 561.
4 Icepak Group Ltd v QBE Insurance (International) Ltd [2013] NZHC 3511.
5 Commerce Commission v Air New Zealand (No. 6) [2012] NZHC 2113.
[9] Mr Houliston says that questions of this sort are really trying to elicit a brief of evidence from Mr Coupe ahead of the trial. He also says that Mr Coupe is going to give evidence at trial anyway and he can be questioned about these matters then.
[10] For her part, Ms MacMillan explains the purpose of the question. The matter is not directed so much at checking whether Mr Coupe gave adequate advice to Mrs Rule as to her obligations under the Family Protection Act, but rather to seeing whether moral duty questions were put to her so that she could consider them and rationally give an informed response to them. In other words, these questions go to her testamentary capacity.
[11] As I put to counsel, in cases involving questions of testamentary capacity, the parties will inevitably rely on expert evidence. That expert evidence will need to be based on factual findings. Those matters of fact will turn not on what the expert is personally aware of, but on facts established by the testimony of other people. In cases involving testamentary capacity, obviously the deceased is no longer available and the expert will have not had the opportunity to assess first-hand his or her capacity. Information given by others has to be passed on to the expert to give informed evidence. It is therefore understandable that information should be sought ahead of trial to enable that expert to give informed consideration to the question of testamentary capacity. From that point of view, it is surely helpful that Mr Coupe, who was present at the signing of the will and who spoke to Mrs Rule on a matter which required informed consideration of duties under the Family Protection Act, should be asked about these matters and he should give answers. Those answers may give useful information to establish whether the deceased did have testamentary capacity when she signed the will.
[12] The problem with Mr Coupe’s answers is their generality. While he seems to have addressed the Family Protection Act in some way by indicating that the will could by Mrs Rule’s children, he has not gone into the particular matters raised which were directed at seeing whether the question of moral duty was put to Mrs Rule, and at her ability to assess her obligations under that duty with regard to her children, taking account of their needs and the effect of the proposed will change on them. Mr Coupe does need to re-address the question so that he can respond
directly to the points it raises. Specifically he needs to say what he advised Mrs Rule about her moral duty under the Family Protection Act, and what her obligations were; what responsibilities she would have to her children; how their needs were to be assessed. He needs to say how he put that to her, so that her responses can then be gauged.
Question 5.1(b)(ii)
[13] Again, this is aimed at whether Mrs Rule could direct her mind to the fact that the proposed life interest in favour of Louise would amount to a disinheritance of Doug and Jane. They are older children who will not receive the residue, except if they survive Louise. In his answer Mr Coupe has said that the effect could be that the will could be challenged by the plaintiffs. But he has said whether he put to Mrs Rule what the legal effect of the life interest might be on Doug and Jane. He has not answered the question directly.
Question 5.1(b)(iii)
[14] To this question, Mr Coupe has simply repeated his answers given to the first question. Again, this does not actually address what was asked - what Mrs Rule’s response was to the advice that Mr Coupe had given her. He simply reiterates what his initial instructions were, rather than responding to the particular points bearing on moral duty as put to her by Mr Coupe.
[15] I bear in mind that it is now a long time since Mr Coupe spoke to Mrs Rule. I accept that he may have difficulty remembering exactly what was said in that conversation. All the same, if he has difficulties remembering, he can address that in his answer by saying that he cannot now clearly state what her particular responses were. That would be a direct response to the particular questions asked. The present answers, however, tend to be a generalised reaction – possibly a defensive one – to the suggestion that he may not have advised her adequately. His statement that he had clear instructions from his client does not cast any light on the questions which the plaintiffs want to have addressed, which concern her capacity to apply her mind to the question of moral duty.
[16] Mr Coupe’s response to this question is simply to refer to the earlier answers he had given, that Mrs Rule was able to read the will, listen to his explanation, and she discussed the will with him. But the question tries to elicit from Mr Coupe what the contents of her discussion about the will were with him. Again, that would bear on whether she was able to give considered answers to this issue. I direct that under question 5.1(b)(iv) Mr Coupe is to address what Mrs Rule did discuss about the will.
Question 5.1(c)
[17] Mr Coupe’s answer is directed at most of the matters raised in the question but he has not addressed the question of value. The question is also directed at the value of assets, not only owned by Mrs Rule but also owned by Louise and by the plaintiffs. Mr Coupe is required to address this question. If he did not know the values in July 2007, he is entitled to say so. But the question of value should at least be addressed. The answer is simply insufficient on that point.
Question 5.1(f)
[18] The question is directed at who proposed the change of executors and why. Mr Coupe’s response that Mrs Rule instructed him does not directly address the question who proposed. It may be that Mrs Rule initiated that change. If so, Mr Coupe should say so. But his answer is unclear at present because, while it records the instructions, it does not say whether they were in response to a proposal by somebody else or whether they were her own idea.
[19] The question also asks why the change was made. In submissions, Ms MacMillan proposed an amendment so that the question as to the change of executors in the will of 19 July 2007 would be:
Who proposed the change of executors and why did that person propose it?
Mr Coupe is to answer that question, in so far as he is able to recall.
[20] Mr Coupe’s response is that he does not have any record of any contact with Louise and he therefore cannot answer the question. He is not asked about his records but about what contact he had with Louise. There is circumstantial evidence suggesting that he may have had some contact with her as she lived with her mother. Louise is shown as having witnessed the power of attorney on 12 July 2007. That is contact with Louise during the period in question. On the face of it, it is doubtful that Mr Coupe has given a correct answer. The matter can be left there. He may be incorrect in saying he has no record. Having had the matter pointed out to him by the plaintiffs, he may wish to file an amended affidavit so as to provide a more informed and fuller answer. But that is a matter that lies with him. As an officer of the court, he would want to ensure that he does give correct information on affidavit. If he chooses not to do so, he will leave himself to be exposed by cross-examination as being not completely reliable. I leave the matter with him to address.
Question 5.1(h)
[21] These questions are directed at the change in powers of attorney on 12 July
2007. Mr Coupe’s objection to answering these questions is that they are not relevant: what is in question in this case is the execution of the will rather than the execution of powers of attorney. I accept the submission of Ms MacMillan that the matter is relevant. She referred to the leading statement on interrogatories of Lord Esher MR in Marriott v Chamberlain:6
The right to interrogate is not confined to the facts directly in issue, but extends to any facts the existence or non-existence of which is relevant to the existence or non-existence of the facts directly in issue.
[22] Information about the capacity of the deceased to give a power of attorney may have a bearing on her capacity to make a will one week later. Similarly, if it were shown that she was under the influence of Louise on 12 July 2007 when she made her power of attorney, that might be relevant to the question whether she was
under the influence of her daughter when she made her will, which favoured her
6 Marriott v Chamberlain , above n 1, at 163.
daughter. The question is therefore relevant to the matters to be decided in this case. I direct that that the questions in 5.1(h) be answered.
[23] Mr Houliston accepts that the answers can be provided by 18 June 2014. [24] I give these timetable directions:
(a) Mr Coupe is to answer the questions as directed above by 18 June
2014, but is not required to answer question 5.1(g).
(b) The plaintiffs are to file and serve their evidence by affidavit by
16 July 2014.
(c) The defendants are to file and serve their evidence by 13 August
2014. Mr Houliston is concerned that he may need more time to deal with medical evidence. If he requires an extension of time he should consult Ms MacMillan or he should seek a telephone conference for further directions.
(d) The plaintiffs’ evidence strictly in reply is to be filed and served by
27 August 2014.
(e) There will be a settlement conference on 12 September 2014.
I would prefer not to take part in that conference myself, so that, if required, the matter can come back to me to give further case management directions.
(f) The close of pleadings date is 19 September 2014.
(g) The case is to be heard in the fourth quarter of 2014 for no more than
three days.
(h)The plaintiffs are to file a casebook and opening 10 working days before the hearing, plus any notices to witnesses to attend for cross- examination. The casebook shall be in two volumes, following Court
of Appeal practice, with the narrative portions of affidavits in one volume, and the exhibits, arranged in chronological order, in a separate volume.
(i)I expect the parties to confer as to a chronology, which is to be filed and served with the plaintiffs’ bundle of documents for the hearing. The chronology will record any significant differences of fact between the parties.
(j)The defendants are to serve their openings and to give any notices of cross-examination at least five working days before the hearing.
(k) I reserve leave to the parties to apply for further directions.
Costs
[25] Ms MacMillan asks for costs on the application. Mr Houliston accepts that costs must follow the event. I make an order for costs on the application on a category 2 basis. The order for costs is only on this application, including the application for leave. There is a separate question as to costs for vacating the previous fixture. On that, I hold the defendants responsible because there was a failure to answer interrogatories fully, which necessitated this application. I do not order costs on that now but reserve that question so that costs for vacating the fixture can be addressed later on the final outcome of the proceeding.
...................................................
Associate Judge R M Bell
Schedule of Interrogatories attached
Schedule of interrogatories
Question 5.1(b)
In question 5.1(h) of the plaintiffs’ first notice to answer interrogatories you were asked what advice you gave Mrs Rule in relation to her moral duty to each of her children. You answered (at 3(h)) that you advised her the will could be challenged by her other children. This did not answer the question. Please specify -
(i)In detail, what you advised Mrs Rule about her moral duty, and her obligation and responsibility to each of her other children (other than to Louise), their relative needs and the effect of the proposed will change on them?
(ii) What you advised her might be the effect of the life interest on
Doug and Jane?
(iii) What was Mrs Rule’s response to each piece of advice?
(iv)What did Mrs Rule discuss about the will with you (as referred to in paragraph m(ii) of your reply to plaintiffs’ first interrogatories)? Please specify?
Question 5.1(c)
Please outline what you discussed with Mrs Rule in relation to the extent of her property/assets and its value, the extent of Louise’s property/assets and its value, and the extent of the plaintiffs’ property assets and its value?
Question 5.1(f)
Please specify who proposed the change of executors to you and Louise in the will of 19 July 2007, and why that change was made?
Question 5.1(g)
Please outline –
(i)All contact you or your firm had with Louise Rule between the execution of the will on 24 May 2007 and the will of 19 July 2007.
(ii) Specify what each contact was for.
(iii) What was said or done at each contact?
Question 5.1(h)
Please specify in relation to the change of powers of attorney for Mrs Rule dated 12 July 2007:
(i) How did the change of powers of attorney from Doug to Louise on
12 July 2007 relate to the change of will of 19 July 2007?
(ii)Was the change of will discussed or proposed at the time the powers of attorney were proposed or executed and if so by whom?
(iii) Who proposed that Doug Rule’s power of attorney from Mrs Rule be
revoked and for what reason? (iv) Why was Doug not told?
(v)Who made the contact to change the attorney, where and when was it made?
(vi) Who was present or knew about it?
(vii)Who proposed an attorney be granted in favour of Louise and for what reason?
(viii)When was that proposal made and who was present and knew about it?
(ix) When were the revocation and new attorney drafted and when were they signed?
(x) Where were they signed and who was present for each?
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