Mace v Mace NSWSC 1659
This matter involved a real property transferred by a mother to her son in June 2009 for no consideration (no money). The mother then died in February 2011.
The other son brought a challenge to the transfer in the Supreme Court on the basis that his mother’s mental and physical condition were such that she was placed in a position of dependence upon his brother, and that his brother had unduly influenced her to transfer the property to himself. The grounds he effectively sought to rely upon were that a presumption of influence existed between the son and the mother, and that the son had taken advantage of and acted unconscionably towards his mother resulting in him receiving the property.
The Court considered the evidence of the mother’s wishes and instructions prior to the transfer and what happened after the transfer of the property was completed.
The Court took into account that the brother that received the property had lived there for a long period of time and had paid the outgoings and costs associated with the property from his own resources. Prior wills made by the mother also indicated that by around the year 2000, she had intended for the property to be left for the benefit of the brother she ultimately transferred the property to during her lifetime.
The brother that brought the challenge was assisted by the mother to purchase a house in 1986. She also loaned him money to start a business and had given money to him to hold for her, but which was never repaid.
The mother left a statement which she made at the same time as her last will setting out the reasons why she had prepared her will as she did, and indicating that she considered she had treated her children fairly.
The transfer of the property was effected with the assistance of a solicitor who gave evidence in the proceedings and could describe how the transfer was arranged. The solicitor was also able to give an account of what the mother had said during their conferences. The solicitor gave evidence that she considered the mother had testamentary capacity and was of sound mind, memory and understanding at the time she gave the instructions, and that she had no concern the mother was acting of her own free will.
When the solicitor was instructed by the mother to transfer the property, advice was given about valuations, stamp duty and the need for the mother to protect her own interests. A new will was also made for the brother who received the property which granted the mother a life interest in another property which had been bought to allow the mother to live in.
The evidence of the solicitor was important in allowing the Court to determine that the mother knew what she was doing when transferring the property to her son, and that she did so of her own free will. Evidence from the mother’s doctors was also considered in order to assess whether the son was in a position to influence or overbear his mother’s free will.
There is no general presumption that a child has undue influence over their parent, but a presumption may arise if a special relationship is shown to exist that involves reliance, dependency or trust.
The Court found that there was no evidence that would justify the finding that the intention to transfer the property to only one son came from any person other than the mother. In other words, there was no undue influence and the transfer was made at the mother’s informed and independent direction. Consequently, it could not be said that there was any unconscionable conduct by the son. There were no grounds to set aside the transfer and the gift was considered to be valid.
This case is unusual but not necessarily uncommon. The matters considered by the Court included a history of testamentary wishes, statements made to various people over time, questions of adequate provision in a will, fairness and equality between siblings, estate planning and questions of undue influence. These are matters that have the potential to arise in many families, estates and property transactions. It is important to ensure that any transactions and dealings in legal matters, no matter how simple they may appear, are conducted with the assistance of experienced wills and estates lawyers so as to avoid potential litigation and unnecessary costs.
Please contact Turner Freeman Lawyers if you think you may need legal advice and assistance with your wills, estate planning and estate litigation matters.