Capacity is a general word, used to refer to the ability to form the necessary testamentary intent when creating a will.
For a Will to be valid, the will-maker must be able to understand the nature and extent of what they own, and the competing claims on it from dependent relatives. If a will-maker lacks testamentary capacity, the will is likely to be invalid and because of that, the wishes will not be carried out.
When deciding whether a will-maker had the necessary capacity to make a will, the Courts consider four things that arose out of a very old case called Banks v Goodfellow (1870). Colloquially, the four things are whether the will-maker:
- Understood that they were making a Will and what the effect of that document would be;
- Understood the nature and extent of what they owned;
- Understood who had a claim on their estate and was able to consider the competing claims of those people (usually a spouse and children),
- That they did not suffer from a mental disorder preventing them from undertaking the above considerations.
Some 146 years later, the courts in 2016 discussed the topics of sanity and mental impairment in relation to testamentary capacity. In the matter of Estate Sue  NSWSC 721, the courts decided that the above test in Banks and Goodfellow is still a good way to consider things and so the 1870 case remains good law.
In the 2016 case, the applicant daughter contested her mother’s last Will. The circumstances were that the deceased mother had made a will in 2012 which was accepted by the court. The daughter argued that it was invalid and that a Will made in the year 2000 should be preferred. The reasons included that during the 12 years that spanned the 2 wills, her mother’s mental health began to steadily decline, as she started to suffer from delusions and paranoia that only become worse as the years continued.
It was not in dispute that the Will-maker clearly understood the significance of the act of making a will as well as the nature, extent, and value of her estate. Thus, fulfilling the first two elements of the test set out in Banks v Goodfellow (1870).
What was being contested in the 2016 case were the other two elements:
- Firstly; that the deceased was not able to comprehend and appreciate claims to her estate i.e, who deserved a larger share; and
- Secondly, that at the time of creating the 2012 Will, the deceased suffered from a disorder of the mind that poisoned her affections towards her applicant daughter and prevented an exercise of her natural faculties.
The court noted that the two Wills were very different. The 2000 will left the bulk of the estate to the applicant daughter. The 2012 Will divided the estate into quarters, with one quarter of the deceased’s estate to the daughter; another quarter to a niece; and a third quarter to another niece; with the remaining quarter divided between yet another niece, a nephew, and the two brothers.
After the Courts reviewed the evidence, they again referred to the decision in Banks v Goodfellow (1870) which was presumably written with quill and ink, and said:
“At the time the 2012 will was made, the deceased lacked testamentary capacity because a disorder of the mind poisoned her affections, perverted her sense of right and prevented an exercise of her natural faculties – influencing her will in disposing of her property and bringing about a disposal of it which, if her mind had been sound, would not have been made”.
The court held that due to the close nature of the of relationship held between the plaintiff and the deceased, and the menial relationships the deceased held with her nieces and nephews, and the deceased’s history of recent decisions influenced by her deteriorating mental health, the 2012 Will lacked validity due to the Will maker not adequately comprehending the matters required for a valid Will, as decided by the courts in 1870.
As a result, the estate was then administered according to the 2000 Will, which left the bulk of the estate to the daughter.
In simple terms it can be a fine line in deciding whether or not a Will is valid. In circumstances where there is a question of whether a Will-maker has capacity, it is important that certain steps be taken to give the Will the best chance of being found to be valid by the court.