Richardson v Spivak [2016] NZHC 2637 (3 November 2016)

Last Updated: 14 December 2016

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV 2014-485-4595 [2016] NZHC 2637

UNDER	the Administration Act 1969
IN THE MATTER OF	the estate of Zivko Gvozdenovic
BETWEEN	PETER REGINALD RICHARDSON Plaintiff
AND	VALENTINA BORISONVA SPIVAK First Defendant
AND	ZORAN GVONZDENOVIC Second Defendant
AND	MITNIK SERGE Third Defendant
AND	JANNA SPIVAK Fourth Defendant

Hearing:	2 November 2016
Counsel:	S J Iorns for Plaintiff J G Gwilliam for First Defendant No appearance for other Defendants
Judgment:	3 November 2016

_{JUDGMENT OF SIMON FRANCE J}

[1] Mr Zivko Gvozdenovic died, aged 93, on 14 March 2014. He was survived by his wife. He had no children. Mr Gvozdenovic’s last will was made on

26 March 2012, and a question has arisen as to his testamentary capacity. His executor accordingly applies for probate in solemn form. Mr Gvozdenovic suffered a debilitating stroke in July 2012, so about four months after making his will.

_{[2] The will leaves such of his property as it deals with to his wife.}

RICHARDSON v SPIVAK [2016] NZHC 2637 [3 November 2016]

Relevant law

[3] The requirements of testamentary capacity were set out by the Court of

Appeal in Woodward v Smith:¹

(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 deposing;

(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 organisation, or by supervening physical infirmity or the 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.

¹ Woodward v Smith [2009] NZCA 215 at [19].

(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.

[4] Particularly relevant to this case are (3) to (9).

Facts

Living arrangements and wills

[5] Mr Gvozdenovic married Ms Valentina Spivak in July 1996 at Bondi Beach in Sydney. He was aged 74 years at the time, and she 60. They remained together until his death 18 years later.

[6] For most of the marriage they maintained separate bases – Ms Spivak at Bondi Beach, and Mr Gvozdenovic in New Zealand. Mr Gvozdenovic would spend the New Zealand winter in Sydney with his wife and return to New Zealand for some of the summer. Ms Spivak would come as well, but would arrive a few weeks later and leave earlier. It seems Mr Gvozdenovic would spend around three months in New Zealand.

[7] The limited evidence available² suggests Mr Gvozdenovic was a volatile man, prone to angry outbursts. He was a prolific will maker, having made 10 wills between 6 April 2000 and 26 March 2012. The difference between his last will and

_{its predecessor concerns the residual estate. In the penultimate will, made in March}

² A lack of testamentary capacity was raised by Mr Gvozdenovic’s nephew, who was the primary beneficiary under the immediately preceding will. However, the nephew took no part in the proceeding which was conducted on the basis of unchallenged affidavits.

2011, it was left to a nephew, but prior to the last will Mr Gvozdenovic made it plain he wanted to cut the nephew out altogether. He instructed his lawyer to cancel the will. A few days later he gave instructions about the last will.

[8] The oddity, if there be one, about the last will is that it only deals with Mr Gvozdenovic’s Australian property. Mr Gvozdenovic owned the Bondi Beach apartment in which Ms Spivak lived, and he left it to her. However, he declined at the time of making the last will to give his lawyer instructions about his New Zealand property. If the last will is valid, there is an intestacy concerning the New Zealand property.

[9] In the penultimate will, Mr Gvozdenovic only left Ms Spivak a half share of the Australian apartment. He left specific financial bequests to his wife’s daughter and her son ($10,000 each), and the balance to his nephew.

[10] A year earlier, in February–March 2010 there had been three wills made in quick succession. The first two were very similar. They were complete in the sense of dealing with all his property, and provided well for Ms Spivak. She received a share of the property in both countries, and a right to live in the Sydney apartment as long as she wished. The residue was divided across her family and his.

[11] Concerning the making of three wills at this time, Mr Gvozdenovic’s lawyer, the plaintiff Mr Richardson, says Mr Gvozdenovic wanted his wife present when the signed the first of the wills in which she was well provided for. However, he returned on his own the following day and gave fresh instructions which led to the later two 2010 wills, the last of which significantly reduced what his wife was to receive.

[12] Finally, on the topic of wills, Mr Gvozdenovic could not read or write, so each will was carefully read out to him by Mr Richardson to ensure understanding and compliance with his instructions.

Capacity events preceding the last will, and capacity evidence

[13] It seems that over the summer period of 2011–12, Mr Gvozdenovic decided he did not wish to return to Australia. Ms Spivak was concerned about his ability to cope on his own and so convinced Mr Gvozdenovic to visit the GP (presumably for home care assistance). Ms Spivak says the idea was not born of any concern about Mr Gvozdenovic’s mental health.

[14] Mr Gvozdenovic’s doctor, Dr Andrew Narayan, has provided a brief affidavit relating to this visit on 13 January 2012. The affidavit refers to a review of the doctor’s notes, but provides no details of them. Dr Narayan says he recorded at the time that Ms Spivak said Mr Gvozdenovic had become forgetful. Dr Narayan observed that Mr Gvozdenovic was angry and aggressive and said he did not want to go back to Australia. Dr Narayan had not seen him like that before.

[15] Dr Narayan notes he referred Mr Gvozdenovic to Elderly Services where he saw a Dr Contractor. Dr Narayan concludes:

Based on my recollection of events and the notes I have on record, I am of the opinion that Mr Gvozdenovic was not of sound mind and body to have either cancelled his will or drafted a new will on 26 March 2012.

[16] Turning next to Dr Contractor, he saw Mr Gvozdenovic, together with Ms Spivak, on 2 February 2012. His report makes it plain Mr Gvozdenovic was not willing to participate in any assessment. He is described as:

... clearly a very disturbed man. He was quite manic, spoke loudly to people and was very friendly and certainly inappropriate at times.

Mr Gvozdenovic repeatedly said there was nothing wrong with him and declined to answer questions. It is noted Ms Spivak’s concern was that he would be on his own, and she was hoping to organise someone to look in on him once a week.

[17] Dr Contractor felt Mr Gvozdenovic exhibited symptoms of frontal lobe impairment, and had significant short term memory issues. He concluded:

As far as assessment of his cognition, a formal assessment is very difficult since he is declining [to be assessed]. In my opinion it might be possible that he lacks capacity, however without a formal assessment and since he is

functioning as per history from his wife, his is all we can go by. They declined having any further input through a Social Worker with regards to these issues. At this stage I’m afraid there is nothing more we can do. I also had a discussion with the Older Persons’ Mental Health Services.

[18] The other three witnesses are Ms Spivak, Mr Richardson, and

Mr Gvozdenovic’s Australian doctor.

[19] It is relevant when assessing Ms Spivak’s evidence to bear in mind she has a considerable personal interest in the outcome. That said, it is not her fault that no-one wishes to cross-examine her, or challenge her evidence.

[20] Ms Spivak says she was surprised by Dr Contractor’s assessment as her husband seemed to her like he always was. It was his normal nature to talk loudly and aggressively. She says that Dr Contractor asked him about the war, and this was a particularly traumatic experience for Mr Gvozdenovic. During the war, Mr Gvozdenovic lost his mother and sister, and was himself detained in a German labour camp for three years. It always upsets him to think about it.

[21] Ms Spivak says she had no concerns about Mr Gvozdenovic’s mental health at the time. She notes that subsequent to these events he obtained a limited driving licence. He also completed matrimonial property agreements in both New Zealand and Australia, each of which involved instructing solicitors.

[22] Concerning the content of the will, Ms Spivak says that around this time Mr Gvozdenovic fell out further with his own family. There had been on-going issues since he married her as they did not accept her. During this more recent period Mr Gvozdenovic said to her many times he wished to rip up his 2011 will as he wanted nothing more to do with his extended family.

[23] The next witness is the plaintiff, Mr Richardson. He has been Mr Gvozdenovic’s solicitor for 30 years. He has taken a neutral role in the proceeding as Mr Gvozdenovic’s executor under all the wills. Mr Richardson says that across the two or three visits in March 2012, he had no concerns about Mr Gvozdenovic’s capacity.

[24] The instructions to “rip up” the previous will were clear (although out of

prudence he kept the original). The revocation instruction was given on

2 March 2012, and was confirmed at the time of signing the new will on

26 March 2012.

[25] The final witness is Dr Maria Opacic, who had been Mr Gvozdenovic’s GP in

Australia since 1999. She saw Mr Gvozdenovic four times between

3 November 2011 and 14 December 2011. She next saw him on 13 June 2012 (he only returned to Australia in May 2012). Dr Opacic is also aware that around that time Mr Gvozdenovic saw a specialist as regards treatment for osteoarthritis in his knee. Dr Opacic records that when she saw him in December 2011, Mr Gvozdenovic showed no signs of mental illness or cognitive decline.

Analysis

[26] The report of Dr Contractor raises an issue about capacity, although it has to be observed it goes no further than observing “there may be a capacity issue”. That said, I am satisfied that there is an issue and the onus does fall on the proponent of the will to satisfy the Court that Mr Gvozdenovic had testamentary capacity.

[27] I am not inclined to place much weight on Dr Narayan’s evidence. He does not explain why, based on his interaction in January 2012, he considers Mr Gvozdenovic would lack testamentary capacity in late March 2012. Further, an assessor who saw Mr Gvozdenovic subsequently did not reach that conclusion. It is not known what aspect of capacity Dr Narayan was referring to, nor what test was being applied.³

[28] Reflecting on the passage from Woodward v Smith, there are several aspects that are supportive of capacity:

(a) Mr Gvozdenovic was very familiar with will making. He plainly had a detailed awareness of his financial position, and knew the

_{consequences of including or excluding beneficiaries.}

3. There is however no reason to consider that Dr Narayan, as a GP, would be applying anything other than the orthodox approach.

(b) The content of the will is consistent with his moral obligations.

Indeed Ms Spivak is the only such obligation, so there is nothing about the content of the will to cause concern.

(c) Dr Contractor’s report suggests some frontal lobe deterioration, but nothing else points to a loss of capacity to such a degree as to undermine his ability to make a will. As the Court of Appeal observes, the rules do not require a sound and disposing mind in the highest degree.

[29] The evidence suggests Mr Gvozdenovic was a mercurial man, prone to being voluble and at times angry. It seems as if he and Ms Spivak were having issues around the time of the visit to Dr Contractor, not least about returning to Australia. It was a time of tension, and the introduction of the war topic seems to have exacerbated matters. None of this is to question Dr Contractor’s assessment, but to note that some of Mr Gvozdenovic’s mannerisms may have been exaggerated by the context.

[30] Dr Contractor wanted to do an assessment, and could not, so one must assess the other available material against the background of his conclusion there “might” be a capacity issue.

[31] Weight is properly given to the views of Mr Gvozdenovic’s lawyer and his Australian doctor, although as regards the latter there is the contrary view of the New Zealand equivalent, Dr Narayan.

[32] Ultimately it is necessary to return to the test and assess where the lack of capacity may lie. Mr Gvozdenovic clearly knew his estate, and understood very well the implications of will making. He had changed many times over the years as regards how he would leave his estate, so little from a capacity viewpoint can be read into yet another change in 2012. Mr Richardson records in correspondence that Mr Gvozdenovic has long been estranged from members of his extended family, so again that which happened in 2012 is consistent. And finally, and in a similar vein, the diffidence over what to do with his New Zealand property is not unusual but

reflects a pattern over the years of changing his mind. Mr Gvozdenovic had in his

2012 will met his primary moral obligation by leaving his Australian property to

Ms Spivak, so hesitancy about his New Zealand property is not remarkable.

[33] Subsequent to making the will, Mr Gvozdenovic was able to pass a driving test, and engage with New Zealand and Australian lawyers as regards his matrimonial property arrangements, culminating in the making of executed agreements. There is no evidence of any concern emerging from these events.

Conclusion

[34] I am satisfied on the balance of probabilities that Mr Gvozdenovic had capacity at the time he made his will in March 2012.

[35] The application for probate of the will of Zivko Gvozdenovic dated

26 March 2012 is granted. It is declared to be his valid will.

[36] The reasonable costs and disbursements of both the plaintiff and first defendant are to be met from the estate.

Simon France J