Determining testamentary capacity NSW

How is testamentary capacity determined when making a will?

There are no ifs, ands or buts; your will is a critical document. It is the primary guide to who inherits your assets upon your death, and it may ultimately control the destination of millions of dollars. It is therefore a priority that the foundation of the document – the will-maker’s capacity to draft a will – is beyond question.

Capacity refers to whether a will-maker has the mental capacity to outline their wishes. Given the alarming prevalence of diseases such as dementia in older Australians, projected to double by 2055, it is an increasingly important consideration. (AIHW dementia report). A natural consequence, therefore, is that issues of testamentary capacity will similarly increase in prevalence.

Testamentary capacity reflects the ability of a will-maker to dispose of their assets lawfully and without undue influence; essentially, they have a comprehension of what they are doing. That a will-maker suffers from a mental impairment or illness is not the sole consideration regarding capacity.

What is testamentary capacity?

A lack of testamentary capacity essentially amounts to an “inability to take into account and give due effect to the considerations which ought to be present to the mind of a will-maker in making [their] will and influence [their] decision as to the disposal of [their] property” (Banks v Goodfellow [1870] LR 5 QB 549).

Conditions that may influence testamentary capacity

Age: for example, if a will-maker is over 85 years old.

The time before death: a will drafted eight years before death may not appear to have been made without capacity, notwithstanding other factors. However, a will executed near death may indicate a weakened mental or physical state, or familial pressure.

Health: a will-maker with a mental disorder or physical disability at the time of drafting could lack capacity.

Financial circumstances: a will-maker who doesn’t understand their financial affairs may not have testamentary capacity. This may differ given the level of complexity of these affairs.

Family situation: varying complexities of family situations may impact capacity, as a will-maker must have regard to who may be a beneficiary of their estate and may have a claim upon their assets.

How is testamentary capacity determined?

The general principle is that, provided a will is rational and executed lawfully, the will-maker is presumed to have been mentally competent (Tobin v Ezekiel (2012) 83 NSWLR 757).

A practitioner, upon preparing a will, will consider the factors outlined in the seminal ruling of Banks v Goodfellow, being that a will-maker must:

• understand the nature of creating a will and what their will may do
• understand the ‘bounty’ (assets) of their estate
• understand those who may be able to claim for provision upon their estate
• not be impacted by any disorder or delusion of the mind.

Evidence which suggests that any of the above factors were not present may prompt an argument for a lack of testamentary capacity.

Tests of capacity

Mental capacity is always a contextual consideration; different legal professionals will take a different approach depending on each client’s affairs and circumstances.

If you or a loved one is attending a meeting with a solicitor to draft a will, there are several ways the practitioner will go about this appointment:

• The will-maker will usually be asked what they want to do at the start of the meeting, open-ended questions will be utilised, and leading questions will be avoided.
• Rather than asking a will-maker, “So your main asset is your home, do you want to leave this to your son?”, the practitioner would instead ask, ”who would you like to leave your home to?”.
• The practitioner will also generally ask about the family situation to ascertain if the will-maker has a rationale for including or excluding various people, or if they know for whom they have made provisions.
• Sometimes it may be necessary that the appointment be conducted in the absence of family members who may explicitly or implicitly pressure the will-maker.
• Warning signs that the practitioner will look out for that indicate a potential lack of capacity include:
  • slurred speech
  • memory loss
  • vague, unspecific instructions

They may also refer the will-maker to a medical professional to assist with ensuring that they do have the requisite capacity.

Contesting a Will due to a lack of testamentary capacity

If you think a will may be invalid due to a lack of testamentary capacity, general considerations are:

• Whether the will-maker was in poor health at the time of signing
• Whether there were family issues at the time of signing, including their separation from family members, or a significant reliance on certain persons/family members
• Whether the will-maker passed away shortly after executing a new will
• If a family member or other person were present at the time of the instructions or signing of the will
• Whether the will is signed consistent with the will-maker’s signature; and
• Whether the will-maker’s will is inconsistent with their actual financial and family situations

When contesting the will, you should first consider lodging a caveat against the probate of will through the Supreme Court of NSW. Proceedings may then be commenced to obtain a declaration that the will is invalid.

Having a qualified and experienced legal practitioner assist you when making a will can help avoid messy litigation or court proceedings after you pass away. Legal advice is similarly invaluable when a loved one passes away, in the event you suspect that there may be issues with the will that you would like to challenge or where you suspect someone else may challenge.

At Turnbull Hill Lawyers, we have a dedicated Wills and Estates team and a Contested Estates team so you can access expert legal advice at any stage of the process.

Contact us today if you want to get your will in place or have any issues relating to the recent passing of a loved one.