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High Court of New Zealand Decisions |
Last Updated: 28 June 2019
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IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
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CIV-2018-404-2864
[2019] NZHC 1450 |
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IN THE MATTER
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of the estate of LORNE ANTHONY
CROWLEY of Auckland, Company Director (Deceased)
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AND
IN THE MATTER
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of an application for Probate in Solemn Form by MICHELLE VANESSA ALMA
CROWLEY and ANTONIA JOSEPHINE ADA CROWLEY
Applicants
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Hearing:
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19 June 2019
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Appearances:
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R Connell and R J Hallas for the Applicants
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Judgment:
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25 June 2019
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JUDGMENT OF GAULT J
This judgment was delivered by me on 25 June 2019 at 4:30 p.m. pursuant to r 11.5 of the High Court Rules 2016.
Registrar/Deputy Registrar
..........................................
Solicitors:
Mr R Connell and Ms R J Hallas, Connell & Connell, Auckland
RE ESTATE OF LORNE ANTHONY CROWLEY [2019] NZHC 1450 [25 June 2019]
[1] This is an application for probate in solemn form of the will of Lorne Anthony Crowley executed on 7 August 2018. Mr Crowley died on 6 October 2018. The applicants are Mr Crowley’s two adult daughters, Michelle and Antonia, who are the executors under the will.
[2] The application was served on Ms Lyudmila Shegarenko, who was Mr Crowley’s partner at the time he executed a prior will. Ms Shegarenko has taken no steps to oppose the application.
[3] The matter was set down for a formal proof hearing. In the meantime, the Court appointed Mr Lucas, an Auckland solicitor, as temporary administrator of the estate to take only those steps necessary to preserve the estate on an interim basis.
[4] The issue to be determined is whether Mr Crowley had testamentary capacity to make the will dated 7 August 2018.
Background
[5] Mr Crowley was an industrial chemist. He was a director and shareholder of Polymer Group Ltd. He was 69 years’ old when he died. Mr Crowley had been married three times. The last marriage was dissolved on 9 February 2018.
[6] Around June or July 2017 Mr Crowley met Ms Shegarenko. Their relationship developed quickly, and on 21 December 2017 Mr Crowley executed a will leaving a substantial part of his assets to Ms Shegarenko. They commenced living in a de facto relationship in January 2018. In early 2018 they jointly purchased a house in Ellerslie, using Mr Crowley’s Waiheke Island property as security.
[7] Mr Crowley suffered from depression. In April 2018 he was admitted to the Fraser McDonald Unit (FMU), the in-patient old-age mental health unit at Auckland City Hospital, with clinical depression. This was associated with varying degrees of agitation, psychosis, and cognitive impairment. A trigger for this episode was Mr Crowley’s decision to purchase the Ellerslie house using his Waiheke property as security. Mr Crowley was stressed about his financial situation (at times to the point of delusion). He was resident in the FMU between April 2018 and 21 September 2018.
[8] During his admission in the FMU Mr Crowley was treated with a variety of psycho-tropic medications, and a course of electroconvulsive therapy (ECT) between April and August 2018.
[9] Ms Shegarenko visited Mr Crowley in the FMU regularly during April and May 2018, but her visits reduced in June and July 2018, according to hospital records. Her last visit was on 2 August 2018. Hospital notes recorded Mr Crowley questioning the status of his relationship with Ms Shegarenko from mid-June 2018 onwards. Mr Crowley told FMU staff the relationship was likely or probably over on several occasions between mid-June and 23 July 2018, and that the relationship was over between early July 2018 and early September 2018.
[10] While in the FMU Mr Crowley’s daughters assisted him with his finances. He regretted purchasing the Ellerslie house, and when he and Ms Shegarenko agreed to sell it, he arranged with his solicitor, Ms Law, to execute an enduring power of attorney (EPA).
[11] The consultant psychiatrist at the FMU, Dr Jones, was asked to assess Mr Crowley’s capacity to appoint his daughter Michelle as his EPA for financial matters, including managing the sale of the Ellerslie property. Dr Jones examined Mr Crowley’s capacity to make such an appointment on 2 August 2018 and considered that Mr Crowley had sufficient understanding of the attorney arrangement to make such an appointment. Dr Jones did not examine Mr Crowley’s testamentary capacity.
[12] On 6 August 2018 Ms Law rang Mr Crowley to finalise his instructions regarding the EPA, which he was to sign the next afternoon. During the telephone call Mr Crowley instructed Ms Law that he wished to change his prior will by appointing his two adult children to be his executors and leaving all of his estate to them. Ms Law said that Mr Crowley gave full and complete instructions to her regarding the terms of his will during the telephone conversation. Ms Law made an appointment to meet with Mr Crowley the next day at 4:00 pm. She prepared a will based on his instructions.
[13] On the morning of 7 August 2018 Mr Crowley had an ECT treatment. As is not uncommon with ECT treatment, Mr Crowley was confused, stating that he could not recall where he lived, if he owned a house, and why he was in the FMU. However, by early afternoon he indicated to staff that these memories were slowly coming back.
[14] Ms Law met with Mr Crowley sometime after 4:00 pm on 7 August 2018 and Mr Crowley executed the will at approximately 5:00 pm. Dr Jones considers that by 5:00 pm the acute cognitive effects of ECT earlier that day had likely largely resolved.
[15] Another consultant psychiatrist, Dr Casey, was not involved in Mr Crowley’s care but provided expert evidence. She reviewed the clinical records:
On the morning shift of 6 August, it is noted that Mr Crowley’s mood appeared ‘low’, although ‘some reactivity’ was noted. He kept ‘a low profile this shift’, went out for a walk with staff and daughter Michelle, and was accepting of medications and nursing cares. There was ‘nil overt psychotic phenomena’.
Dr Jones reviewed Mr Crowley, presumably in the early afternoon. He reported Mr Crowley’s mood to be ‘pretty low’, and he was hopeless about improvement. He was also ‘convinced Ellerslie home won’t sell’. Mr Crowley had the subjective complaint that his brain is ‘mush’. His daughter Michelle thought that there had been ‘ongoing slow improvement in mental state, noting that he is more active, able to do activities and is occasionally smiling’. In the Mental Status Examination, under ‘Thought Content’ it is noted ‘Ongoing over-valued ideas re financial ruin. Less concerned re clothing. Pessimistic. No current suicidal ideation’. Informed consent was obtained for commencing a new medication. Dr Jones noted that the lawyer would come to the ward the following afternoon for Mr Crowley to sign document appointing his daughter as EPOA.
On the afternoon nursing shift, the concern about the Ellerslie home and whether or not it would sell was further voiced. The associated agitation did not appear to persist, and in the early evening he ‘appeared to be relaxed for the rest of the shift’.
On the morning of 7 August 2018, Mr Crowley proceeded to a treatment of ECT, his 17th treatment. He was noted to be disorientated subsequent to this treatment, verbalising his concern that he could not remember where he lived. This post-ictal confusion lifted as the day went on and he was able to engage in a baking group and a group walk. There was a note written by Dr Jones at the time of 16:52. Dr Jones recorded that he had not assessed Mr Crowley’s capacity to make changes to the Will, and he expressed his reservations to both the lawyer and Mr Crowley about the timing of the Will revision. Dr Jones also noted that the lawyer wanted to proceed stating ‘She was confident Mr Crowley had testamentary capacity’.
It is recorded in the nursing notes of this shift that the visit by the lawyer ‘did not appear to induce anxiety for Lorne, aside from when Michelle mentioned
how much the lawyer cost’. The notes goes on to say that Mr Crowley ‘voiced that he did not think that he wanted to continue relationship with Mila, and Michelle spoke of how Mila is now very keen for the Ellerslie house to be sold’. The nursing assessment also goes: ‘No agitation this shift, denied thoughts of self-harm, no delusions of poverty expressed’.
Legal principles – testamentary capacity
[16] The principles relating to the assessment of testamentary capacity are well settled. They have been set out by the Court of Appeal in Woodward v Smith and Loosley v Powell,1 restating the principles laid down in the often-cited judgment of Banks v Goodfellow:2
(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.
...
(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.
2 Banks v Goodfellow (1870) LR 5 QB 549 at 565-568.
(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.
[17] As the Court of Appeal has said, it is important to treat these Banks v Goodfellow criteria as guiding propositions rather than as a formula.3
[18] It is not only the date of the signing of the will that is relevant to the issue of capacity.4 Under the rule in Parker v Felgate,5 if, when the instructions were given by a will-maker, that will-maker had testamentary capacity, the will can be valid even though that testamentary capacity had been lost by the time of execution. As the Court of Appeal noted in Loosley v Powell,6 Parker v Felgate has often been applied and accepted as good law in English decisions but it has been criticized.7 It has been accepted by this Court.8 Under the rule the court must be satisfied that there has been no revocation of the earlier instructions when the will is signed, all the more so when the earlier instructions involve a significant change from an earlier will for no apparent rational reason.9 In Loosley v Powell the Court of Appeal did not consider that case was the appropriate occasion to review the rule’s application in New Zealand.10
[19] The relevant onus and standard of proof in a testamentary capacity case has been described by the Court of Appeal as follows:11
3 Loosley v Powell [2018] NZCA 3, [2018] 2 NZLR 618 at [19].
4 At [22].
5 Parker v Felgate (1883) 8 PD 171 at 173-174.
6 Loosley v Powell [2018] NZCA 3, [2018] 2 NZLR 618 at [23].
9 Loosley v Powell [2018] NZCA 3, [2018] 2 NZLR 618 at [24].
10 At [25].
11 At [20], citing Bishop v O’Dea (1999) NZCA 239; [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.
Discussion
[20] There is evidence that raises Mr Crowley’s lack of capacity as a tenable issue, namely that he made the will while a patient in the FMU and on the very day that he received ECT treatment, which affected his cognition at least temporarily. That being so, the onus of satisfying the court that Mr Crowley did have testamentary capacity rests on the applicants who seek probate of the 7 August 2018 will.
[21] There was no medical assessment of Mr Crowley’s testamentary capacity at the time of making the will on 7 August 2018, but I consider that Mr Crowley did have testamentary capacity to make that will, for the following reasons.
[22] Ms Law gave evidence that when she discussed the terms of the will with Mr Crowley on 7 August 2018, he was adamant that he wished his daughters to be his sole beneficiaries and did not want the prior will to stand. Ms Law said that prior to executing the will, Mr Crowley conveyed a clear understanding of the extent of his property and his wish to leave his property equally to his two adult children. Ms Law said she would not have witnessed Mr Crowley executing his will if she had any doubt about his capacity to do so.
[23] Although Dr Jones noted when he witnessed the will that he had not examined Mr Crowley’s testamentary capacity, his evidence was that at the time of the will change Mr Crowley had some cognitive impairment but his performance on cognitive testing at the time was consistent with mild cognitive dysfunction, which neither excludes nor supports his having testamentary capacity. Dr Jones acknowledged that Mr Crowley’s depressive symptoms potentially could have influenced his attitude
towards the relationship with Ms Shegarenko, and the decision to remove her as the principal beneficiary of his well. At the time of the will change, Mr Crowley’s depression had partially improved, but not remitted. Psychotic beliefs regarding Ms Shegarenko had apparently remitted by the time of the will change. Dr Jones noted that Mr Crowley’s comments and actions at the time, and subsequently, were consistent with the change in beneficiaries specified in his new will. In particular, Dr Jones noted that Mr Crowley’s comments and actions in relation to Ms Shegarenko before and after the will change indicated that he believed their relationship had finished.
[24] Also, Dr Jones had examined Mr Crowley’s capacity to make an EPA on 2 August 2018 and considered that he had sufficient understanding to do so. Dr Jones’ assessment was still of some relevance notwithstanding that testamentary capacity involves different considerations from an EPA and that Mr Crowley had ECT treatment subsequently. As Mr Connell submitted, the current ADLS EPA form contains strict instructions for witnesses. In relation to the ECT treatment, Dr Casey’s independent expert opinion was that Mr Crowley experienced confusion in the morning after ECT, which is not uncommon, but is short-lived and reversible, and by the afternoon this state had lifted.
[25] Dr Casey’s overall independent expert opinion, based on a good understanding of the legal test, was that Mr Crowley would have had the requisite capacity to understand and make a consistent and sound assessment of his circumstances and the consequences of his decision-making, and therefore had testamentary capacity at the time of revising his will on 7 August 2018.
[26] While the change from the prior will was significant, it was relatively straightforward and consistent with the end of Mr Crowley’s relationship with Ms Shegarenko and with Mr Crowley’s moral obligation to his two adult children.
[27] Finally, if it were necessary because of concern about the residual effect of the ECT treatment on the morning of 7 August 2018, I would have applied the rule in Parker v Felgate on the basis Mr Crowley had testamentary capacity when he gave instructions to Ms Law on 6 August 2018.
Result
[28] The application for probate in solemn form in respect of the will of Lorne Anthony Crowley dated 7 August 2018 is granted.
[29] The order is to take effect once a sealed copy of the order is served on Mr Lucas, the temporary administrator.
[30] The powers of Mr Lucas as temporary administrator will cease from service of a sealed copy of this order on him.
Gault J
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