Are you doing enough to test testamentary capacity?

5 August, 2016

When acting for a testator, practitioners must always be satisfied the client has testamentary capacity. The following claim serves as a reminder of the steps practitioners need to take when preparing wills.

Before taking instructions, the practitioner obtained medical advice to the effect that the terminally ill testator had testamentary capacity. He arranged to meet with the testator five days later to take instructions.

Prior to that meeting, the executors provided him with a letter from a second medical practitioner indicating the testator did not have testamentary capacity. Notwithstanding this, the practitioner met with the testator in hospital as arranged to discuss the draft will he had prepared. The testator signed her will five days later in the presence of two law clerks employed by the practitioner, who was on leave at the time.

After the testator died, the executors disputed the will in favour of a previous will, alleging the testator lacked testamentary capacity. After that dispute settled, the executors sued the practitioner for compensation for costs incurred by the deceased estate in defending their claim. They alleged the practitioner failed to ensure the testator had testamentary capacity when making her will.

Although there were good prospects the court would find the practitioner took reasonable steps to satisfy himself that the testator had testamentary capacity, the case was not conclusive. There were competing medical opinions and no contemporaneous notes of any questioning of the testator to assess testamentary capacity. Consequently the claim settled.

Practitioners must be aware that the existence of testamentary capacity is a legal test. It is essential to ask the testator questions specifically designed to satisfy the various limbs of the test established in Banks v Goodfellow (1870) LR 5 QB 549. The questions need to test the testator’s knowledge and understanding of their estate and those entitled to claim upon it. They should be asked when taking instructions as well as attending execution of the will. Detailed file notes or recordings of the questions asked and the responses received are vital.

Despite being on notice that testamentary capacity could be disputed, questions of this nature were not asked. It could also have been helpful to have a legal practitioner attend the execution of the will to corroborate the assessment of testamentary capacity.

Where testamentary capacity is an issue, practitioners should also obtain a medical opinion contemporaneous to critical dates such as taking instructions and execution of the will. If contradictory medical opinions exist, a further opinion should be obtained. In appropriate cases, an updated opinion should be obtained immediately before the will is executed.

Testamentary capacity issues are particularly important when preparing a will for a client with a terminal illness. Further information can be found in LPLC’s Key Risk Checklist: Testamentary capacity and Practice Risk Guide: Weather-proofing wills and estates.