Testamentary Capacity (ACT)
A fundamental principle of estate law is that a person has the freedom to write their will as they wish. However, in order for these wishes to be valid and impervious to challenge, the will-maker must have testamentary capacity. A testator must understand their testamentary actions, have a good recollection of their assets, and understand the needs of their dependents. A testator’s capacity will also be called into question if they suffer from a disorder or delusion that is detrimental to their ability to make a rational decision. This article explains how the court assesses testamentary capacity and how a will may be challenged on the basis of testamentary incapacity.
The term testamentary capacity refers to a person’s mental and legal ability to make or alter a will. A testator must be of sound mind, memory and comprehension in order to be able to legally dispose of their property in a will. It is assumed that all testators have the requisite mental acuity, but this is a rebuttable presumption. That is, someone with standing to do so can produce evidence that proves that the testator lacked testamentary capacity at the exact time that they executed the will. The onus is on the challenger to convince the Supreme Court that there is sufficient evidence to invalidate the will.
Succession law in the ACT uses a well-known test to assess testamentary capacity, based on the 1870 British decision of Banks v Goodfellow. The court, in this case, found that the will was valid even though the testator suffered from a mental illness because it benefited a close relative and was therefore rational. This case established that a testator can suffer from a type of mental disorder and still have the testamentary capacity as long as he or she could satisfy a four-part test:
- Does the testator understand the consequences of making a will?
- Does the testator remember (in general terms) the assets contained in their estate?
- Does the testator understand who is entitled to claim against the deceased estate?
- Does the testator have a condition or disorder that will prevent them from rationally making decisions about the disposition of their assets?
Recent case law on testamentary capacity has clarified the limitations of this test. For example, the requirement that a testator remembers the particulars of their property may conflict with the realities of their financial management. Some people only have a general knowledge of their holdings because an investment or financial company manages their wealth.
It can also be difficult to tell from a will whether a testator failed to comprehend potential claims on their estate, or was aware of these claims but chose to ignore them. A testator has the freedom to leave their property to whomever they like and they are not legally obligated to acknowledge anyone in their will. An eligible claimant who is left out of a will can contest the distribution of the estate, but leaving an eligible claimant out of a will is not in itself sufficient evidence of a lack of testamentary capacity.
Family members will often approach solicitors with concerns about the validity of a will due to a medical condition of the testator. Close relatives are often on hand to see symptoms of mental incapacity in their grandparents or parents, such as disorientation, delusion or forgetfulness.
Certainly, a testator’s testamentary capacity may be adversely affected by a mental disorder or illness, such as dementia, a neurological or psychiatric disorder, psychosis, or personality disorder. However, even if a testator suffers from a degenerative or psychotic mental illness, he or she is not automatically incapable of establishing testamentary capacity. The court will assess capacity on the basis of the type and severity of the illness and the relative impact on the testator’s judgment, insight and decision-making ability. It is therefore up to a challenger to present to the Court sufficient evidence to prove that the testator’s mental condition precludes them from making a rational, valid will.
Challenging A Will
In the ACT, a person with a legal “interest” in an estate can challenge the will. Those who are eligible to challenge or caveat a will include a beneficiary of a previous will or those who are entitled to inherit under intestacy legislation. The first step in challenging the validity of a will on the basis of testamentary incapacity is to file a probate caveat with the Court.
If the Court is convinced that a testator lacked testamentary capacity, they can revoke a will and probate a previous will. In the event that there is no prior will, the deceased estate is subject to the intestate provisions of the Administration and Probate Act 1929.
How To Establish Testamentary Capacity?
There are some options for a testator to establish their testamentary capacity and hopefully prevent a challenge to their will. It is a good idea to have a full mental assessment on or around the day of signing the will. A medical certificate can be shown to any family members who have concerns about the validity of the will. Also, if the will is challenged the executor can submit the medical report as evidence of the testamentary capacity of the deceased.
The contested wills team at Armstrong Legal can help if you have concerns about the testamentary capacity of a family member. Our solicitors can also guide you through making a will that is resistant to challenge on the basis of testamentary capacity. Please get in touch with our friendly team or call 1300 038 223 to make an appointment to discuss the particulars of your case.