Clitheroe v Bond – lessons on testamentary capacity
and the importance of good advice at the outset of a claim
Alison Parry, Partner at JMW Solicitors, discusses testamentary capacity and the recent judgment that demonstrates 150-year old law is as relevant as ever.
On 21 May 2020, judgment was handed down on the sad but interesting case of Clitheroe v Bond. Permission was granted to appeal, with the much-anticipated judgment handed down on 4 May 2021.
This is a significant case, with notable bearing on the law in relation to testamentary capacity. The key question considered on appeal centred on the correct test – is it that of Banks v Goodfellow, as has been applied for many years, or is it the test under the Mental Capacity Act 2005?
There was also the additional question relating to the proper test for establishing an insane delusion if Banks v Goodfellow did indeed remain good law.
Jean Clitheroe died in 2017, leaving her estate to be administered in accordance with her last Will, made in 2013, which excluded her daughter, Susan. It cited her reasons for doing so as a belief that Susan would spend it all, and because they were no longer close. Jean’s earlier Will, made in 2010, included Susan to the extent that she would inherit several chattels only. Both Wills left the residuary estate to Jean’s son, John.
A significant fact in this particular dispute is the existence of another daughter, Debs, who had died in 2009. It was argued that Jean couldn’t cope due to grief after her daughter died and that, as a result, she suffered from insane delusions which affected her capacity when making both the 2010 and 2013 Wills.
Jean also blamed Susan for her relationship breakdown with her husband (whom she divorced), thought that Susan had stolen from her and was not good with money. The Court had to examine these beliefs and, based on substantial evidence, concluded that none of these were true. The most significant issue related to her former husband. Specifically, Susan had been abused by her father – Jean’s husband – and it was this, with substantial evidence at the time – which Jean had discovered – that had caused Jean’s divorce. The Court found that Jean’s belief otherwise was irrational to the point of being delusional.
John brought a claim to propound the validity of both the 2010 Will and 2013 Will – however, Susan disputed the validity of both wills, arguing that Jean lacked testamentary capacity by virtue of her reaction to and after Debs’ death.
Where there is reason to doubt capacity (as was the case here), the onus is on those claiming that the Testator had capacity, to prove it. Therefore, in this case, the burden was on John to prove that Jean did have the relevant capacity when she made both the 2010 Will and the 2013 Will.
The key issue to be determined by the Court was whether Jean had the relevant testamentary capacity when she made the 2010 and/or the 2013 Will. The Court had to consider whether Jean was suffering from an affective disorder and whether, as a result, she suffered insane delusions which affected her capacity in making both wills.
The relevant test, as set out in the case of Banks v Goodfellow is that a Testator must understand the nature of making a will and its effect, the extent of their property, have an understanding of those who may have a claim against their estate, and must not be affected by a delusion or disorder of the mind.
The Court also had to consider whether there had been fraudulent calumny (a deliberate poisoning of Jean’s mind against Susan) – specifically whether John had induced or encouraged Jean to exclude Susan.
First Instance Decision
The Court at first instance concluded that Jean did suffer from an affective disorder, namely a complex grief reaction as a result of Deb’s death and that John had failed to discharge the burden in proving her capacity. As such, the Court held that the 2010 and 2013 Wills were not valid.
It was further held that, as a result of the affective disorder, Jean suffered insane delusions in relation to Susan, which influenced her when making both the 2010 and 2013 Wills.
The fraudulent calumny claim was not successful and was not appealed.
The key issue for consideration on appeal, and one which is of interest to all practitioners in this field, was the relevant test for testamentary capacity and whether that remained as set out in Banks v Goodfellow or whether the MCA was now the appropriate test.
One of the important distinctions between the two is the effect on the burden of proof in capacity cases.
At first instance, based on Banks v Goodfellow and previous case law, the burden was on John to show Jean had capacity. If the MCA were to apply, there would be a presumption of capacity and therefore the burden would have been on Susan to show a lack of capacity. While in many cases this distinction may be of little practical effect, in others it could be the difference between success and failure.
It was argued that at first instance the case was presented (correctly) on the basis of the Banks v Goodfellow test, but would have been run differently if the MCA was the appropriate test because the burden of proof would have been different. It had involved a lengthy, costly and bitter trial with several witnesses, plus a capacity expert on both sides.
There was an issue raised as to whether the cross examination of at least one of the experts would have been different if the position as to the burden were reversed. The appeal Judge considered that the trial would have been conducted differently had the position on the burden of proof been different and so concluded that it would not be right to allow the question of which test was appropriate to be considered on the appeal.
However, the Court did not shy away from addressing the arguments on the appropriate test and it confirmed why it considered that the existing test, which goes back to the 1870 case, remains good law.
Regarding the appeal point on establishing an “insane delusion”, the Court clarified that the relevant false belief must be irrational and fixed in nature. However, it did adjourn the appeal on this issue for three months to allow the parties to reflect on their positions and consider whether any agreement could be reached. It also set out several observations designed to assist the parties with the assessment of their positions in an attempt to encourage agreement.
Significance of the Decision
The burden of proof can be key in cases of this nature and can pass backwards and forwards between disputing parties. Under the Banks v Goodfellow test, the starting position is that the person who wishes to show capacity (the propounder of a Will) has the burden to prove capacity. Where a Will is duly executed and appears rational on its face, the Court will presume capacity. Thereafter the evidential burden shifts to those seeking to challenge the Will to raise a real doubt as to capacity. If that hurdle is overcome and a real doubt is shown, the burden shifts back to the propounder to establish capacity.
One of key principles of the MCA is that a person should be presumed to have capacity unless it is established otherwise. There are also distinctions between the Banks v Goodfellow test and the MCA in relation to the degree of understanding and retention of information required to make a decision/make a Will as well as an understanding of the consequences of the options available.
This shows the tension between Banks v Goodfellow relating to Will making and the position (usually relevant in a person’s lifetime) to determine capacity for any particular decision under the MCA.
It could be argued that the door has been kept open for future challenges to the test to be applied in testamentary capacity cases, particularly given that it has been highlighted how it could theoretically be possible under the current law for a situation to arise where no valid Will could be prepared for an individual. Someone may not have capacity under Banks v Goodfellow to make a Will but be deemed to have capacity under the MCA, meaning that a statutory will could not be made.
However, for now, the historic case of Banks v Goodfellow and the well-established principles set out therein, which have been applied in numerous cases since, remains good law.
The decision highlights the importance both of the role of solicitors involved in the preparation of Wills (especially where there are potentially questions of capacity or a family dynamic such that a challenge may be made) and also for considering very carefully at the outset of a dispute whether or not to pursue a claim to trial or consider alternative ways in which resolution can be achieved.
This was an estate of limited value and it is not unrealistic to consider that the combined legal fees of both sides will have amounted to a significant proportion of what was being argued about.
The Court took the opportunity to stay certain issues, encouraged attempts at resolution and even set out a number of “observations” intended to assist in those discussions. There couldn’t be a clearer indication of the Court’s view as to matters like this being put before them when the estates are of limited value and the legal costs are inevitably going to be high.
The costs risk for both sides of being at the wrong end of a judgment and being responsible for both party’s costs is huge and so it is an important reminder that good advice at the outset of a potential claim is essential to getting the best outcome.