Does a person have capacity to make a Will?

Does dementia or another medical condition mean you don’t have capacity?

Most people don’t know that the medical question of capacity and the legal question of capacity are not the same thing. Even a person who has dementia may be capable of making or changing their will. Each circumstance will be different and has to be assessed at the time of taking instructions from the client.

Legal history of the test

The legal test as to whether a person has the capacity to make a will comes from the old English case of Banks –v- Goodfellow (1870). In this case the deceased person was suffering from delusions; chiefly that his butcher was trying to kill him, even though this butcher had been dead for 11 years. In coming to its decision the court determined that for a person to have capacity to make a will there are five things which need to be established. The person making the Will:

(i) Understands the nature of a Will;
(ii) Understand what property they have;
(iii) Understands the people who would ordinarily be provided for under a will (the moral duty aspect);
(iv) Gives consideration to those people who would normally benefit under the will;
(v) Does not suffer delusions about any person who would expect to receive an entitlement under the will.

The result in the case was the deceased did have capacity to make the will in question because the delusions he suffered were not about a person who would have normally benefited under his will, i.e. people don’t usually leave part of their estate to their butcher.

Current legal test for capacity

Moving forward to the current tests for capacity, we see the case law has evolved. The legal position now suggests that just because a person suffers from dementia, it will not automatically mean they are unable to make a Will.

In general, lawyers must determine whether the person wishing to make or update a Will:

1. Fully comprehends what they want to do (make or update a will) and the ramifications of doing so.
2. Is aware of certain details regarding the ‘property’ they are distributing through the will (such as the type of property and how much of it is being allocated).
3. Has a solid understanding of who he/she should make provisions for in the will, and why.
4. Is of ‘sound mind’, meaning that he or she is not suffering from mental illness or any other medical/psychological condition that could impair his or her decision-making.

The complexity of the property and the complexity of the Will being drafted also determine the the level of understanding that the person making the Will must have. Sometimes a person will be referred to their medical practitioner for supporting evidence about their capacity, however it is still up to the lawyer to make a decision regarding legal ability to make or change a Will.

Taking instructions from persons who may lack capacity

In the case of Ryan v Dalton; Estate of Ryan [2017] NSWSC 1007 the Judge issued the following advice:

when there are doubts as to capacity a starting point for dealing with this increasingly prevalent issue is:

1. The client should always be interviewed alone. If an interpreter is required, ideally the interpreter should not be a family member or proposed beneficiary.
2. A solicitor should always consider capacity and the possibility of undue influence, if only to dismiss it in most cases.
3. In all cases instructions should be sought by non-leading questions such as: Who are your family members? What are your assets? To whom do you want to leave your assets? Why have you chosen to do it that way? The questions and answers should be carefully recorded in a file note.
4. In case of anyone:

• over 70;
• being cared for by someone;
• who resides in a nursing home or similar facility; or
• about whom for any other reason the solicitor might have concern about capacity,

the solicitor should ask the client and their carer or a care manager in the home or facility whether there is any reason to be concerned about capacity including as a result of any diagnosis, behaviour, medication or the like. Again, full file notes should be kept recording the information which the solicitor obtained, and from whom, in answer to such inquiries.

5. Where there is any doubt about a client’s capacity, then the process set out in sub-paragraph (3) above should be repeated when presenting the draft will to the client for execution. The practice of simply reading the provisions to a client and seeking his or her assent should be avoided.
6. These are suggested basic precautions which may identify problems which need to be addressed.
7. In many cases which do come before the Court the evidence of the solicitor will be critical. For that reason, it is essential that solicitors make full, contemporaneous file notes of their attendances on the client and any other persons and retain those file notes indefinitely.

Case Law

One NSW case dealing with this issue is  Apice v Gutkovich – Estate of Abraham (No . 2) [2010] . This case was about whether a 93 year old lady, Irene Abraham who had suffered from dementia for 5 years, had the capacity to make a will. At the time of making a will she was subject to Guardianship Tribunal Orders (orders that someone else should manage her financial and lifestyle decisions, because she was under disability).

Interestingly in the 15 months before her final will, the deceased made four other wills and codicils (an amendment to an existing will). On some of those occasions Ms Abraham’s doctor said she did not have the capacity to make any such will.

Nevertheless Ms Abrahams health improved somewhat and her doctor changed his opinion, while her solicitor was also of the opinion that she now had the capacity necessary to create a will. This evidence ultimately led to the court finding that she had capacity to make her will.

There are some very interesting parts of this case, which include finding that even though a person connot manage their day to day affairs and do not have capacity to make decision regarding their finances and lifestyle choice, they can still make a will.

Rachel Carter is the Principal Solicitor of Carter O’Neill Legal and has acted in many cases where the issue of whether a person has capacity to make a will has arisen.

Please contact Rachel Carter on 02 9151 7339 or 02 4308 8892 if you have an enquiry on capacity or making a Will.