Testamentary Capacity & Undue Influence

With Australia’s elderly population on the rise due to the wonders of modern medicine, general improved living standards and the ageing baby boomer generation, how the legal system deals with issues pertaining to the elderly is becoming increasingly more apparent and relevant for us all.

It has long been the case that the law recognises the vulnerabilities of many aged persons when entering into legal transactions including the making of a will and the legal system seeks to protect any vulnerable persons from being financially exploited by unscrupulous individuals.

Lawyers have a fundamental role to play in ensuring that the elderly are not exploited in this regard. The test for whether a Will Maker has Testamentary Capacity to make a will is one such method that lawyers must employ when taking instructions from a person who may appear to lack capacity for reasons including their age. The question of whether a Will maker is being “unduly influenced” when making a will is another issue that requires careful consideration.

The validity of a will may be contested on the grounds that it was made as a result of “undue influence” being exercised over the Will maker.

The case of Dickman v Holley (NSWSC) is a perfect example. In this case, Vera May Simpson, aged 102 years, died when she was a resident of an aged care facility run by The Salvation Army. The Deceased had no living relatives at the time of death and she made her last will and testament 6 years prior to her death when she was aged 96 years. Pursuant to her Will, she revoked all previous wills she had made and she appointed the financial secretary of the Salvation Army to be her Executor and she gave the whole of her Estate including a property at Mona Vale (on Sydney’s Northern Beaches) to The Salvation Army. The solicitor for the Salvation Army drafted her Will.

An old neighbour of the Deceased, Mr Dickman (who was the Executor and sole beneficiary of the Deceased’s Estate pursuant to an earlier will of the Deceased) applied to the Court to set aside the last Will of the Deceased on the basis that the Deceased lacked Testamentary Capacity at the time that she made her last Will and that she was unduly influenced by The Salvation Army when making her last Will.

The Court found in favour of Mr Dickman on the basis that whilst the Deceased might have had general capacity, her testamentary capacity was affected by the pressure which was put on her by The Salvation Army and the solicitor who prepared her Will (and also acted for The Salvation Army). The solicitor had a clear conflict of interest.

The Court therefore set aside the Grant of Probate based on the last Will of the Deceased and instead admitted the earlier will to probate. The Court found that the last will of the Deceased “was not the offspring of her own volition but the record of someone else’s.”

The Deceased’s age, her frail health and the fact that she was reliant on The Salvation Army for her accommodation and to meet her daily needs were all factors considered by the Court when making its decision.

The degree of influence required to constitute undue influence depends upon the circumstances of each case. It can have varied forms ranging from violence and threats towards the Will maker to more subtle forms, such as a Will maker being approached to change their will in the last stages of life whilst quite weak and feeble.

Undue Influence is a complex area of the law, however the old adage of “if it looks fishy…“ is often a good initial rule of thumb to apply when considering whether you need legal advice regarding the Will of a family member or friend.

Here at Carew Counsel, our experienced Wills and Estates Team can be contacted directly via phone on 03 9670 5711 for advice in regard to this topic and other Estate issues.