Loss of capacity – an issue for all advisers

Loss of capacity – an issue for all advisers
December 5, 2018 /

by Katerina Peiros, ATI, Hartwell Legal, and Christine Smyth, ATI, Robbins Watson Solicitors

Three cases about solicitor duty to ascertain if their client has capacity to give instructions in the conduct of litigation are informative to other advisers.

It is old news that mental and cognitive disorders are on the rise across the population. This will not improve in our lifetime.1

Those affected by the disorders are frequently undiagnosed or, having been diagnosed, continue to live fairly independent lives and to make important decisions, such as in relation to investments, business, tax affairs and legal matters.

A client with such a disorder (whether existing or new) poses extreme professional risk for advisers. Is the client able to retain the advice, evaluate it and give considered instructions to the adviser on the basis of it? Are the instructions reasonable? Are they based on informed evaluation? Are they given willingly and freely? Are the instructions appropriate in some contexts or on some questions, but irrational on others?2

Litigation lawyers have the benefit of being able to approach the court for a determination about whether their client has capacity to give instructions and in what contexts. Other advisers, such as lawyers in non-litigious matters, accountants and financial advisers, must fend for themselves when determining the level of acceptable professional risk and at what point the client requires protection from themselves and others.

Two significant and relevant cases are Goddard Elliot v Fritsch (Goddard),3  and Pistorino v Connell  (Pistorino).4

In Goddard,3  a firm of solicitors was successfully sued by a former client for acting on his instructions when his mental health had declined to such an extent as to make him incapable of giving informed and voluntary instructions. The firm represented the client in a complex family property proceeding over a long period of time and, as a result of his disorder (which was exacerbated by the stress of a pending trial), he accepted an unreasonably unfavourable settlement. When he recovered, he essentially sued his former solicitors for the difference between the reasonable financial position he should have maintained and what he actually received in the settlement. He said that his lawyers should have detected his mental deterioration, declined to act on his instructions, and protected him from himself and from his former wife. His huge legal costs were also the subject of dispute. The solicitors were represented by their insurer.

The court affirmed that a solicitor’s primary responsibility is to be reasonably satisfied that the client has the mental capacity to participate in litigation and to provide proper instructions. If the solicitor is not so satisfied, the solicitor’s authority is limited to making due enquiry with the court into the capacity of their client and, in such an enquiry, the solicitor’s role is to assist the court in their role as an officer of the court. The solicitor has a clear duty to raise their client’s questionable capacity with the court. In a cautionary statement, the court in Goddard held that:5

“If the party lacks mental capacity and the solicitor knew or should have known, the solicitor is at risk of having to pay indemnity costs even in the absence of impropriety … A solicitor who persists with representing a client who has lost mental capacity is liable to have costs awarded against them on an indemnity basis even if there is no impropriety.”

In Pistorino, the solicitor relied on the principles espoused in Goddard, applying to the court for  a declaration that his client did not have capacity to give instructions in a complex and protracted estate dispute due to age-related cognitive decline. The client opposed the application and refused to attend medical appointments to assess capacity. The solicitor gave evidence to the court of his client’s confused behaviour and her inability to withstand pressure and influence from her family members (who were the other parties to the litigation). The court concluded that the client did not have capacity to give instructions for the conduct of litigation, and appointed a litigation guardian from whom the solicitor was to take instructions from that point.

The court took into consideration the complexity of the issues in the various litigations in which Mrs Pistorino was involved, and found that they were so complex and the legal principles so substantial that Mrs Pistorino was unable to:6

“… properly comprehend her position as an income beneficiary for life of her late husband’s estate, of which her children are, effectively, the residual beneficiaries. I am satisfied that she does not properly understand the structure of the businesses and investments of the estate or

of the parties, particularly trusts. Mrs Pistorino’s incapacity is exacerbated by the complexity of the issues in these proceedings, especially the incidence of tax and debt …

On a consideration of all of this material I find that while Mrs Pistorino is competent to give general and broad instructions, she is relevantly incapable by reason of physical and mental infirmity of managing her affairs in relation to the proceedings.  I find for the purposes of Order 15 that Mrs Pistorino is a person under disability.”

Wembley & Wooten (Wembley)7  is a recent decision of the Family Court which brings together the principles in Goddard and Pistorino.

In Wembley, the solicitor had become increasingly concerned as to his client’s ability to properly give instructions. In August 2017 (five months prior to the application), he wrote to the husband’s treating psychiatrist querying his client’s capacity. In September 2017, the psychiatrist reported that their mutual client did “not presently present with prominent cognitive impairment”.8

Nevertheless, the solicitor maintained his concerns, bringing an application before the court. The solicitor’s evidence included the husband being affected by alcohol consumption, heavy chain-smoking and reluctance to attend the solicitor’s office, the husband’s belief that the solicitor’s advice was incorrect, the husband’s behaviour at the conciliation conference, and inappropriate email communications.9

Having regard to the above and his duties to the court under the provisions of the Legal Profession Uniform Law Application Act 2014 (Vic)10, the solicitor brought an application for a case guardian to be appointed to conduct litigation on behalf of the husband.11  The husband did not oppose the application and, counterintuitively, he “indicated to the Court that he proposes to continue instructing the applicant in this case”,12  regardless of the outcome.

The court reinforced that the solicitor was under a duty to bring his concerns about his client’s capacity before the court for its determination and, having examined the evidence, said:13

“The husband in this case is not the first nor will he be the last litigant who thinks he is smarter than those advising him. Nor will the husband be the first or last litigant to make foolish decisions. That in my view does not make him a person with a disability.”

The court concluded:14

“In all of the circumstances,  I am not satisfied on the balance of probabilities that the husband is a person under a disability, as opposed to simply being a difficult  litigant. I am satisfied that he understands the nature of the proceedings and even if he were to choose to ignore that advice, understands the consequences of the litigation, including the cost consequences which are likely to follow if he persists in pursuing a course which is found to be without merit. The fact that a litigant, such as the husband in this case, may not follow advice is unfortunately not an uncommon aspect of many cases in this Court and is the very reason the Court has the power to manage the proceedings before it and if circumstances justify it doing so, make orders for costs. I am also satisfied that the husband is capable of giving adequate instructions when and if he chooses to do so.”

There is no adviser who has not come across an irrational, demanding, clamorous client. There is a presumption that such a client has capacity simply because they are an adult. However, such conduct can be exhibition of a cognitive or mental disorder, which may be extreme enough to prevent the person from being able to give rational and competent instructions to their adviser.

Historically, it has been succession and elder law practitioners who were predominantly concerned with, and educated on, issues associated with loss of capacity. Now lawyers and advisers across all practice areas are finding themselves faced with clients whose cognitive ability and mental health is in decline and the ability to take full and proper instructions comes into question.15

When faced with a client with questionable capacity, it is the adviser’s professional and ethical duty to properly conduct themselves by appropriate enquiry into capacity and client circumstances and to protect the vulnerable client from the client themselves and from others. For lawyers, this is entrenched in case law.16  For non-lawyers, these matters have not been the subject of litigation as yet, but it is only a matter of time.

Lawyers in non-litigious matters and other advisers do not have the benefit of seeking the direction of the court on the question of their client’s capacity. When in doubt, they may need to seek guidance from their experienced colleagues, professional bodies, medical practitioners, or to seek legal advice. To do this sensitively and discretely is a desirable skill, as is the ability to withdraw from a retainer where the client cannot give competent instructions.

Katerina Peiros, ATI

Incapacity, Wills and Estates Lawyer Accredited Specialist – Wills & Estates (Vic) Hartwell Legal

Christine Smyth, ATI

Partner

Accredited Specialist – Succession Law (Qld) Robbins Watson Solicitors

References
1    See https://blackdoginstitute.org.au/docs/default- source/factsheets/facts_figures.pdf?sfvrsn=8.
2    Gibbons v Wright [1954] HCA 17.
3    [2012] VSC 87 at [548]-[549].
4    [2012] VSC 438.
5    [2012] VSC 87 at [550].
6    Ibid at [26].
7    [2018] FamCA 334.
8    Ibid at [16].
9    Ibid at [22]. Much of the evidence was sealed due to client confidentiality.
10  Equivalent Queensland provisions are found in the
Australian Solicitors Conduct Rules 2012.
11   [2018] FamCA 334 at [1].
12  Ibid at [32].
13  Wembley & Wooten [2018] FamCA 334 at [31].
14  Ibid at [34].
15  For useful reference material to assist with capacity concerns, see: Queensland Law Society’s Ethics Centre, website at  Queensland Public Guardian, Guidelines for witnessing enduring documents, 2013; and The Law Society of New South Wales, When a client’s mental capacity is in doubt: a practical guide for solicitors, 2016.
16  Legal Services Commissioner v Ford [2008] QLPT 12;
Legal Services Commissioner v Comino [2011] QCAT
387; Legal Services Commissioner v de Brenni [2011] QCAT 340.

Should you wish to download a copy of this article click HERE.

You are not god

You are not god
December 5, 2018 /

with Christine Smyth and Shane Budden

When instructions are clear, you must prepare the will

Earlier this year, Queensland Law Society invited me to co-present a webinar on the issue of testamentary capacity with ethics solicitor Shane Budden (with whom I also co-wrote this column).

This year, the QLS Ethics and Practice Centre noted a marked increase in enquiries around the theme of what is the role of a solicitor in taking will instructions?

This column extracts the key elements from our webinar and is designed to assist practitioners by providing a succinct guide to our role and responsibilities.1

Solicitors have a duty to follow their client’s lawful, proper and competent instructions,2 and all adults are presumed to have capacity unless otherwise proven.3  Generally speaking, a client who lacks capacity cannot provide instructions and a solicitor has a duty of care not to follow instructions when the client lacks the capacity to give them.4

However, will instructions occupy a more complicated space, in that they can often be given in circumstances in which capacity is in question (and not definitively established or ruled out). A solicitor’s duty is to take will instructions;5  if the instructions are not coherent, the solicitor is considered on notice that capacity may be impaired, and they must take steps to assess the client’s capacity.6

Capacity is a legal test, not a medical one.

The courts have provided guidance for solicitors faced with will instructions from clients whose capacity is not definitively established, and that guidance consistently favours the taking of the instructions and the drafting of the will if this is possible. In the Canadian decision of Scott v CousinsCollity J said:

“[C]areful solicitors…will not play God – or even judge – and will supervise the execution of the will while taking, and retaining, comprehensive notes of their observations on the question [of capacity].”

Similarly, in Petrovski v Nasev; The Estate of Janakievska,8 the New South Wales Court of Appeal cited with approval the advice concerning the taking of instructions contained in Mason & Handler’s Wills, Probate and Administration Service NSW (Butterworths):

“(i) The solicitor who is to draw the will should attend on the testator personally and fully question the testator to determine capacity – the questions should be directed to ascertain whether the testator understands that he is making a will and its effects, the extent of the property of which he is disposing and the claims to which he ought to give effect;

“(ii) One or more persons should be present, selected by the solicitor having regard to their calibre as witnesses if required to testify whether the issue of capacity is raised. Where possible, one of the witnesses should be a medical practitioner, preferably the doctor who has been treating the testator and is familiar with him, who should in making a thorough examination of the testator’s condition, question him in detail and advise the solicitor as to the capacity and understanding of the testator. The presence of other persons at this time would require the testator’s consent;

“(iii) A detailed written record should be made by the solicitor, the results of the examination recorded by the medical practitioner and notes made by those present.

“If after careful consideration of all the circumstances the solicitor is not satisfied that the testator does not have testamentary capacity he should proceed and prepare the will. It is a good general practice for the solicitor who took instructions to draw the will and be present on execution and this practice should not be departed from in these circumstances. On execution, the attesting witnesses should, where possible, come from those persons (including the solicitor) referred to above who were present at the time of instructions and, again, as at every stage, detailed notes of the events and discussions taken.

“If those questions and the answers to them, leave the solicitor in real doubt as to what should be done, other steps may be desirable. This may include obtaining a more thorough medical appraisal or, if the testator declines, considering whether the will can be properly drawn, should assurance on testamentary capacity fail to satisfy the test just quoted.”

Given that wills can be taken when the end of life is near, urgency is required and the opportunity for extensive testing of capacity is limited, it is imperative that solicitors draft a will if clear instructions can be obtained. However, as taking instructions from an enfeebled testator whose capacity may be questioned comes with significant risk, steps must be taken to protect the interests of all concerned.9 At the very least practitioners faced with this scenario would be assisted by the following:

take such steps as are possible to assess capacity in the circumstances

take instructions from the testator in person

have witnesses present who are not beneficiaries and who also make notes of the attendance

have the testator sign the notes of the attendance if possible.

It is a strange anomaly that we are in an era in which practitioners are burdened with downward pressure on costs and upward pressure on practice and process. There is no doubt that complying with these steps is time-consuming and increases the risk a solicitor will be called upon to give evidence on a will dispute.

Conversely, many clients are price, simplicity and time sensitive. Their expectations and demands do no often align. However, there remains scope for practitioners to educate clients on the cost/benefit value of having a solicitor  involved in the process, most importantly for when the testator passes and the will comes into effect.

To assist practitioners, the QLS Ethics and Practice Centre is developing an Ethics Note on the role of a solicitor in regard to the question of testamentary capacity. Any feedback from practitioners is welcome – please email e[email protected] .

Christine Smyth is Immediate Past President of Queensland Law Society, a QLS Accredited Specialist (succession law) and Partner at Robbins Watson Solicitors. She is a member of the QLS Council Executive, QLS Council, QLS Specialist Accreditation Board, the Proctor Editorial Committee, STEP, and an Associate Member of the Tax Institute. Shane Budden is a QLS ethics solicitor.

Should you wish to download a copy of this article please click HERE.

Notes
1  A more extensive analysis of a practitioner’s role and duties is available through the Queensland Handbook for Practitioners on Legal Capacity. 
2  Rule 8, Australian Solicitors Conduct Rules 2012.
3  Murphy v Doman (2003) 58 NSWLR 51.
4  Goddard Elliott v Fritsch [2012] VSC 87 at
paragraph 418.
5  Ryan v Public Trustee [2000] 1 NZLR 700; see also WA Lee and AA Preece, Lee’s Manual of
Succession Law, fifth edition, LBC, page [307].
6  GE Dal Pont, KF Mackie, Law of Succession (LexisNexis Butterworths, 2013) 750.
7  (2001) 37 ETR (2d) 113 at [70].
8  [2011] NSWSC 1275 (17 November 2011) at 89.
9  Pates v Craig and Public Trustee, Estate of Cole
[1995] NSWSC 87 [142]-[148].

The transition from law student to lawyer

The transition from law student to lawyer
November 18, 2018 /

By Allison Kelly

Law Clerk

Graduating from your law degree is a momentous achievement especially after the numerous long nights spent on your laptop frantically trying to finish your assessment due the next day or those dreaded 3 hour end of semester exams where you need to cram everything you know onto an exam paper. But once you receive your testamur and throw your mortar board in the air for the essential Instagram photo you may be thinking what now? If you speak to any law graduate their first answer will probably be to obtain a job in a top tier law firm and be granted a generous salary.

But before you can unleash everything you learnt at university and embark on your legal career you must first obtain valuable practical skills, which will form the foundation in which you will build your legal career.

Some important practical skills are as follows:

Communication

Communication is key! As a fresh law graduate you need to be able to communicate effectively with your colleagues and clients. Communication is not limited to verbal but also extends to your body language and the way you convey your message to your listeners. Being a good communicator means you also need to be a good listener. It is no good telling a client everything you know about a particular area law if you haven’t listened to the facts and how that law can be applied to their case.

Time management

This is essential to ensure you not only complete your work but you complete your work on time. To perfect your time management skills you need to ensure that you can prioritize your workload and delegate if needed. Find something that works for you, by either writing a to-do-list or adding reminders in your phone to help you work out what is urgent and what can wait.  In practice strict time limits apply and must be adhered to, to ensure you can aim to achieve the best outcome for your client.

Decision making

Decision making is a skill that will continue to develop throughout all aspects of your life. Our day is full of decision making, the key is to determine what is the right and just decision to make. As lawyers our clients seek our advice on which decision to make, although we cannot make the decision for them, it is our job to provide them with the information they need and guide them to make an informed decision.

Resilience and self-confidence

These are arguably the most important skills a law graduate can develop early in their career. The legal profession is a tough industry especially in your first few years while you are trying to find your feet and develop your professional identity. The key is not to be too hard on yourself, no one expects you to know everything. Be respectful of your peers and listen to your mentors they are there to guide you and help you transition from student to lawyer, their feedback is important! Lastly, be confident in yourself and try your best, remember this is only the beginning of an exciting and rewarding career.

Should you wish to download a copy of this article click HERE.

DISCLAIMER:
The information on this blogpost is of a general nature, not intended to be specific professional advice.
  1. Please seek the opinion of a professional to advise you of your situation.
  1. The author’s opinions are his/her own and do not represent the views of any other person, firm or entity.
  1. The author is not responsible for the accuracy or appropriateness of third-party comments or articles, including those of guest authors and editorial contributions.
  1. Any comments, letters, and other submissions are moderated and may be edited or withheld at the sole discretion of the author.

Creditor’s Statutory Demand – When to stick your head in the sand (and when not to)

Creditor’s Statutory Demand – When to stick your head in the sand (and when not to)
November 14, 2018 /

By Sylvia Hoefnagels

Associate

If you have a company, chances are that sometime throughout the life of your business, you will receive (or issue) a creditor’s statutory demand.

It may be enticing to ignore any demand received, especially if it seems without any basis, but you should not ignore a creditor’s statutory demand: there are very strict deadlines (in general, 21 days from the date you received it) and your company could be placed in liquidation if appropriate steps are not taken within that time.

Similarly, if you issue a creditors statutory demand on a company – and then ignore any submissions made in response to that demand, you may find yourself on the other end of a court hearing and be ordered to pay costs on the indemnity basis. An example involving Robbins Watson is Corio Homes Pty Ltd and Sailor Venus Pty Ltd where a costs order on the indemnity basis was made in our client’s favour.

If you are not sure whether a demand can be ignored, or whether you can use a creditor’s statutory demand, contact us for an initial consultation. 

Should you wish to download a copy of this article click HERE.

DISCLAIMER:
  1. The information on this blogpost is of a general nature, not intended to be specific professional advice.
  2. Please seek the opinion of a professional to advise you of your situation.
  3. The author’s opinions are his/her own and do not represent the views of any other person, firm or entity.
  4. The author is not responsible for the accuracy or appropriateness of third-party comments or articles, including those of guest authors and editorial contributions.
Any comments, letters, and other submissions are moderated and may be edited or withheld at the sole discretion of the author.

Executors’ Commission

Executors’ Commission
November 12, 2018 /

It seems to be a widely known anecdote that the executor of an estate can claim commission for their work – though in actual practice, it occurs relatively infrequently.  But executors should be aware that they are entitled to claim commission for their “pains and troubles” in administering an estate.  Under Queensland law, claiming executors’ commission is actually the rule – not the exception. 

Executors’ commission is not precisely calculated through some mathematical formula.  There is a wealth of case law as to general rules that may be applied, but there is no agreed formula to be applied, and so each claim for executors’ commission will be based on its facts.

Robbins Watson has successfully claimed executors’ commission for our executor clients.  Where possible, we seek the agreement of estate beneficiaries to the award of commission – however if a court application is required, we stand ready to file proceedings and obtain court orders for executors’ commission on behalf of our clients.

Should you wish to download a copy of this article click HERE.

DISCLAIMER:
  1. The information on this blogpost is of a general nature, not intended to be specific professional advice.
  2. Please seek the opinion of a professional to advise you of your situation.
  3. The author’s opinions are his/her own and do not represent the views of any other person, firm or entity.
  4. The author is not responsible for the accuracy or appropriateness of third-party comments or articles, including those of guest authors and editorial contributions.

How to win your court case – evidence

How to win your court case – evidence
November 5, 2018 /

The answer to this question starts with “evidence”. It is not necessarily who is right and who is wrong, but who can prove the allegations.

When we first ask someone how they are going to prove their case, they often say ‘someone told me’. This is considered hearsay which is not admissible (other than in a few select situations).

The best evidence is where there is an original document supporting your case. Any witness giving evidence, must do so from their own observations (I saw, I heard, etc). Also, even though it may be with the best of intentions, if the witness does not remember something, they should say so. Otherwise, the witness may come undone in cross examination and the Court will have no other option but to place less weight on their evidence, if at all.

So, the best way to win your case is to prepare your evidence early, and to try find the best evidence possible. Not only will this increase your chances of winning your court case, it will also reduce your legal costs in the long run – the better your evidence is, the more likely you can achieve an agreed outcome.

By Sylvia Hoefnagels

Associate

Should you wish to download a copy of this article click HERE.

'The boomer triangle' – wealth, ageing and vulnerability

'The boomer triangle' – wealth, ageing and vulnerability
November 5, 2018 /

By Christine Smyth

On 7 August 2018 the Australian population reached 25 million. We are 33 years ahead of schedule. One of the reasons for reaching this milestone sooner than predicted is thunexpected increase in longevity. We now have 4,000 centenarians, and 12 per cent of the population  falls within the baby boomer  demographic  and 16 per cent within the builderdemographic  of 65+. Collectively, 28 per cent of Australias population  controls 53 per cent of its wealth.

Ageing doesnt just entail physical decline, but an increase in cognitive decline. Around 425,416 Australians currentllive with dementia and this number is expected to increasto 500,000 by 2025 and exceed 1   million by 2056.3  52 per cent of all residents in aged care facilities have some form of dementia.4  While not all ofus will lose capacity, we are all susceptible to frailty and vulnerability as we age. Thcombination of increased age, diminishing capacity and vast wealth threatens the independence and dignity of a significant proportion of our community.

It is an environment that effectively fosters elder abuse. Commentators speculate that the causes of such abuse involve ageism, ‘inheritance  impatience, and lack of proper sociaand legal  infrastructure investment. Other causes include lack of awareness about rights and recourses, social isolation and the increase in fragmented families. Estimates put the annual cost of elder financial abuse at a minimum of $1.8 billion in Queensland alone.5

Tackling elder abuse is particularly difficult because the perpetrators are typically family members; often the very family members that our elderly rely on for support.  Whilwe collectively need to raise awareness, we must also provide a safe environment in which e
lderly people can seek advice and assistance. The objective must be to minimise the risk of alerting the perpetrators while preserving family relationships as much as possible.

It was in this context, during my presidency of the Queensland Law Society, that I advanced a combined initiative of QLS Policy Division, QLS Marketing and QLS Elder Law Committee, working in conjunction witAustralian Medical Association Queensland and the UnitinCare Elder Abuse Prevention Unit to develop and implement an Elder Abuse Awareness Campaign. We focused on providing information and developed posters and wallet cards detailing various helplines available and placed them in general practitioner surgeries. The campaign sought to create a mechanism that would allow elderly people to express their concerns and seek guidance and education as to their options, in a confidential environment without fear of retribution from family members. General medical practices were a natural fit for this objective.

Indicators identified that the campaign was successful, with an increase in calls to thUniting Care Elder Abuse Hotline.

This year I became aware of a further gap in the systerequiring greater scrutiny:  the provision of services to elderly people in  their own homes.  While there are checks and balances in institutions catering for elderly people around  staff and their conduct, there is no equivalent in the private freelancing sector. Earlier this year,  in an effort to combat opportunistic predators preying on elderly people, I suggested that a similar system to the Queensland Blue Card for people who work with children should be extended to vulnerable people such as our elderly. The Blue Card system not only checks criminal history locally but also nationally, checks employment history and disciplinary history and is regularly monitored and updated.7

In this edition of Precedent we have the good fortune of learning from many wellrespected and highlregardepractitioners  as to the numerous issues faced by elderly people and the myriad of remedies available.  I congratulate our profession for showing leadership on such an important social and legal issue, which is now being taken up by the federal government in the from of an aged care Royal Commission, recently announced.

Christine Smyth is the immediate past president of the Queensland Law Society, an Accredited  Specialist  (Succession  Law)  and  partner at Robbins Watson  Solicitors.

P: (07)  5576  9999

E: [email protected].

Should you wish to download a copy of this article click HERE.

Notes:
1    M McCrindle,  Australia‘s population  to reach 25 rrnlhon, McCrindle  Research  (2018)  <https://mccrindle.com.au/insights/blog/ australiaspopulationtoreach25million/>.  2 T Edwards,  Australia‘s generations by wealth and income,  McCrindle  Research,  <https:// mccrindle.com.au/insights/blog/australiasgenerationswealthincome/>.  3 Dementia Australia,  Dementia statistics (January 2018<https://www.dementia.org.au/statistics>. 4 Ibid.  5 QueenslanElder Abuse  Prevention  Unit,  The cost of elder abuse: Who pays and how much (June 2009)  3. 6 R  Kaspiew,  R  Carson and  H  Rhoades, Elder Abuse, Australian  Government Australian  Institute of Family Studies (November 2016)  <https://aifs.gov.au/publications/family• matters/issue-98/elder-abuse>.  7 C Kane, “‘Senior Sitter”  ad  sparks call for better vetting of aged care workers  to reduce el
der abuse’, ABC Gold Coast News (online),  25 July 2018,  <http://www.abc.net. au/news/2018-07-25/elder-abuse-blue-card-solution-for-aged-care• workers/10029304>.< /span>

Loss of capacity an issue for all lawyers

Loss of capacity an issue for all lawyers
November 2, 2018 /

with Christine Smyth

“The husband in this case is not the first nor will he be the last litigant who thinks he is smarter than those advising him. Nor will the husband be the first or last litigant to make foolish decisions. That in my view does not make him a person with a disability.”1

Many of us have irrational, demanding, clamorous clients, often when involved in complex legal matters. However, we also know that cognitive decline frequently involves this kind of conduct. So, at what point does the behavior of a client raise questions as to their capacity and invoke our duty to the court to bring  it to the court’s attention?

Wembley & Wooten (Wembley),2 a recent decision of the Family Court, examines the capacity of a client to conduct litigation and the duty of the acting solicitor to bring their concerns before the court. It draws on the decisions of Goddard Elliot (a Firm) v Fritsch [2012) VSC 87 (Goddard’) and Pistorino v Connell [2012) VSC 438 (Pistorino),3 distinguishing the facts of Pistorino, while affirming the applicable legal principles enunciated in both decisions.

All adults are presumed to have capacity, unless the contrary is established on the balance of probabilities.4 Rule 8 of the Australian Solicitors Conduct Rules 2012 requires a solicitor to follow a client’s lawful, proper and competent instructions.

Here we are concerned with “competent”. Capacity is to be determined according to the context.5 When certain factors are present. solicitors have a duty to ensure the client has the requisite legal capacity before either taking instructions or assisting them to make a legal decision which will affect their interests.6

In Wembley, the husband’s solicitor became increasingly concerned as to his client’s ability to properly give instructions. In August, 2017 (five months prior to the application) he wrote to the husband’s treating psychiatrist querying his client’s capacity. In September, 2017 the psychiatrist reported that their mutual client did “not presently present with prominent cognitive impairment”.

Notwithstanding, the solicitor maintained his concerns, bringing an application before the court. The solicitor’s evidence included the husband being affected by alcohol consumption, his heavy chain-smoking, reluctance to attend the solicitor’s office, believing his solicitor was wrong, the husband’s behaviour at the conciliation conference, and inappropriate email communications.7

Talk sense to a fool and he calls you foolish.”

– Euripides, The Bacchae

Having regard to those factors and his duties to the court under the provisions of the Legal Profession Uniform Law Application Act 2014 (Vic.).3 and Goddard, the husband’s solicitor brought an application for a case guardian to be appointed on behalf of his client. 9 The husband did not oppose the application, counterintuitively, he “indicated to the Court that he proposes to continue instructing the applicant in this case”, 10 regardless of the outcome.

In Goddard. Bell J articulated the solicitor’s duty as follows:

“ …the primary responsibility of a lawyer is to be satisfied the client has the mental capacity to instruct. Doubts about this issue in the mind of the lawyer can also have important consequences for the conduct of legal proceedings. If the issue cannot be resolved to the reasonable satisfaction of the lawyer, as occurred in the present case, the lawyer must raise the issue with the court. It is the court which has the final responsibility to determine the issue.11

There was supporting evidence from the wife’s affidavit material exhibiting the husband’s medical history,12 which included “Chronic Post Traumatic Stress Disorder (PTSD), Major Depressive Disorder-Recurrent and Alcohol Use Disorder and a history of prominent longstanding intermittent depressive symptoms, low moods associated with despondency (not suicidal), disturbed sleep, social avoidance and symptoms of anhedonia and amotivation”. 13

Upon the application being made, the court ordered that the husband attend further medical examination. The medical evidence was that the husband could “adequately conduct and give adequate instructions for the conduct of the case”14 with the caveat that the doctor was not privy to the privileged sealed evidence of the husband’s solicitor.15

Ultimately, the court found that the husband had the requisite capacity.

The difficulty with these matters is not that the client must have completely lost capacity, to the extent of invoking an enduring power of attorney, but rather ‘[Tlhe standard of capacity which is required for a person to participate in legal proceedings is the same standard of capacity which is required for a person to enter into legal transactions.”16

One in five people between the ages of 16 and 85 suffer a mental illness in any year, 17  which, while not impacting their overall capacity, may impact their capacity to engage in legal matters. Practitioners may now, more than ever before, need to be live to their duties in this context. It is an onerous duty and one that may call for the practitioner contemplating such applications within the client retainer.

Christine Smyth is immediate Past President of Queensland Law Society, a QLS accredited specialist (succession law) and partner at Robbins Watson Solicitors. She is a member of the QLS Council Executive, QLS Council, QLS Specialist Accreditation Board, the Proctor Editorial Committee, STEP, and an associate member of the Tax Institute.

Should you wish to download a copy of this document please click HERE.

Notes
I   Wembley & Wooten (2018] FamCA 334 at (31].
[2018] FamCA334.
See page 40 of the October 2013 edition of Proctor
for a previous article by this writer on these cases.
Hawkes v Wi’kie 12012] NS{>{SC 1039the queslion was v,melher the eldeny persoo had the capacity to create a trust by whidi she QaYe $300,000. l..p)l1
the death of the eldeny person. the question o1 her
capacity to make the gifts d to c,eate the trust was
litigated and very mvch tw>ed on the evidence.
See also: Eg. Re Bridges 1200111 Od R 574; Re T
11992] 4 Afl ER 649, 664 (lord Donaldson MR}.
Gibbons  v Wright (1954) 91 CLR 423.
Legal Services Commissioner v Ford 12008] LPT
12; Legal Services Commissioner v Corooo 12011 J
OCAT 387; Legal Services Commissioner vde
Brenni 12011] OCAT 340.
At 122] much o1 the ew:ler1ce was sealed due
to client confidentialtty.
Equivalent Queensland provisions are fowd
in the Aus1ralian Solicitor Conduct Rules.
At [1].
At [32].
 At[6].
At[11).
At[13].
All17].
Atl17].
Aij23] citing the passage from Goddard at 554555.
blackdoginstituta.org.au/docs/dafaultsource/factsheets/facts_figures.pdf?sfvrsn=8

Handy tips for making a claim for further provision – how you can reduce your legal costs

Handy tips for making a claim for further provision – how you can reduce your legal costs
October 31, 2018 /

By Vy Tran – Solicitor

When a loved one passes away, it can be an emotionally erratic time in your life.  In our experience, we notice that clients often book an appointment with us a few days after someone passes away. 

Clients are often relieved to hear our advice that there is no rush, and for them to take some healing time to mourn for the loss of their loved one.  Once you overcome the shock of your loss, if you feel that you have unfairly been treated in the will, these are some helpful suggestions on what you should do to prepare for your initial consultation with our office:

  • Have a look at our RW Blog (https://www.robbinswatson.com.au/?s=further+provision) and read our articles on claims for Further Provision – this will give you a general understanding on how claims are undertaken.  We understand that there may be confusing legal terminology out there and you may feel an overwhelming sense of information overload –  that is where we come in, we are here to assist you in navigating through the complex legal principles and solidifying your understanding of your claim.
  • Be organized! At your appointment, locate a copy of the will, bring a list of assets/liabilities of the estate and be prepared to answer some personal questions about your own finances – this saves you legal fees on the cost of investigating what is in the estate for you. Please note that if you are dealing with an unreasonable executor and are having difficulty in obtaining the information, we can assist you.

***Remember your time limitations – make sure that if you are thinking of making a claim for further provision that you contact us within 6 months of the date of death of your loved one.

If you want to know more, please contact me for a complimentary consultation on 07 5576 9999.

Should you wish to download a copy of this article click HERE.

DISCLAIMER:
  1. The information on this blogpost is of a general nature, not intended to be specific professional advice.
  2. Please seek the opinion of a professional to advise you of your situation.
  3. The author’s opinions are his/her own and do not represent the views of any other person, firm or entity.
  4. The author is not responsible for the accuracy or appropriateness of third-party comments or articles, including those of guest authors and editorial contributions.

What is Probate, and is Probate necessary

What is Probate, and is Probate necessary
October 26, 2018 /

One of the most common questions for a new executor is whether they will need a grant of probate – and for that matter, what is probate?

Put simply, a grant of probate is a court order made to an executor, naming the executor as the person to deal with on behalf of the deceased person’s estate.  For completeness, it also annexes a copy of the will admitted to probate so the last valid will of the deceased is readily apparent.

So why bother?  Under Queensland succession law, obtaining a grant of probate is not strictly required (in contrast to many of the other Australian States and Territories).  However, many banks and estate asset holders require the executor to obtain a grant – this way the asset holder can rely on a Supreme Court order (i.e. probate) to deal with the executor, rather than relying on the executor alone.  Obtaining a grant also provides many other protections to the executor.

Robbins Watson regularly assist executors in estate administration and obtaining probate, and can happily assist in answering your questions and guiding you through the court process of applying for a grant of probate.

Should you wish to download a copy of this article click HERE

DISCLAIMER:
  1. The information on this blogpost is of a general nature, not intended to be specific professional advice.
  2. Please seek the opinion of a professional to advise you of your situation.
  3. The author’s opinions are his/her own and do not represent the views of any other person, firm or entity.
  4. The author is not responsible for the accuracy or appropriateness of third-party comments or articles, including those of guest authors and editorial contributions.
  5. Any comments, letters, and other submissions are moderated and may be edited or withheld at the sole discretion of the author.