Stacks Law Firm is a leading Australian legal service provider with more than 250 people operating locally in many Australian communities.
We are committed to supporting the legal needs of everyday Australians and businesses across every stage of life.
Prior to his death he had owned a farm in Queensland.
He had bought the farm in the 1970s and for many years spent his
weekends there.
When his wife passed away in August 2003, he relocated to the
farm permanently.
In 1988, Mr and Mrs A purchased the property adjoining the
man's farm.
Over the years that followed, the man became close friends with
Mr and Mrs A.
Man leaves token amount to children and grants power of
attorney to Mr A
On 6 November 2003, the man executed an enduring power of
attorney, appointing Mr A as his attorney for financial, personal
and health matters.
On 11 March 2004, the man made his final will. It was prepared
by Mr and Mrs A's solicitor and named Mr and Mrs A as
executors.
The will left $200 to each of the man's five children, his
financial shares to his grandchildren and the residue of the estate
to Mr A. The will included the following statement.
I HAVE SPECIFICALLY EXCLUDED my
children from any substantial provision out of my estate due to the
fact that I do not have a normal father/child relationship with
them as I have had very limited sporadic contact with them for many
years.
Farm removed from estate by transfer to neighbour's
sons
At around the same time, the man entered into a series of
transactions with Mr A and his sons.
These transactions had the effect of transferring the farm to Mr
A's sons, to be held on trust for Mr A.
In return, the man was granted a life estate in the farm.
These transactions removed the farm from the man's estate,
so that even if his children successfully challenged his will after
his death, they could not lay claim to this valuable asset.
Children challenge transfer of farm on basis of undue
influence
After the man's death, three of his five children made a
claim for provision out of their father's estate.
However, since the estate was not worth much without the farm,
the children also sought to bring the farm back under the umbrella
of the estate.
The children therefore made a claim in the Supreme Court of
Queensland that their father's gift of the interest in the farm
to Mr A's sons as trustees was induced by undue influence.
They asked the court to order the neighbour's sons to
transfer the farm to the executors of their father's
estate.
CASE B
The case for the deceased's children
CASE B
The case for Mr A's sons, as owners of the farm
There was an inequality in the relationship between our father
and Mr A, due to Mr A's stronger position. Mr A relied on this
to exercise undue influence on our father to transfer ownership of
the farm to Mr A's sons.
As Mr A admits, from the time our father went to live
permanently on the farm, his reliance on Mr and Mrs A was
substantial. Almost all his social contact was with or through
them. His physical needs in terms of transport, shopping, meal
preparation and the like depended on them.
With respect to the property transaction, Mr and Mrs A had the
benefit of advice of their lawyers and financial advisors. Not only
that, but our father also dealt with their lawyers and financial
advisors. At no point did anyone suggest that he should get
independent legal or financial advice.
Our father saw a geriatrician to undergo an assessment
regarding his capacity to make the transfer. Although on his first
visit the geriatrician thought that our father's mild cognitive
impairment did not impair his decision making, by the second visit,
the doctor found that our father's cognitive function had
significantly deteriorated.
Our father had no reason to disinherit us. Although we all
lived in different states, we still phoned each other regularly and
saw each other when we could. For example, our father spent
Christmas 2003 in Brisbane with one of us. Another of us visited
him in May 2006 and took him out to lunch and one of us visited him
a few times in the retirement home in the last year of his
life.
Mr A made seeing our father more difficult, as he told our
father not to let us come to the farm. Mr A also knew that our
father had not told us about his intention to transfer the
property, but said nothing. Presumably, he wanted to keep us away
from our father so that he could maximise his influence over
him.
Given that our father was induced to transfer the farm to Mr
A's sons by the undue influence of Mr A, the court must order
that the farm be transferred to the executors of our father's
estate.
It is not surprising that the deceased transferred the farm to
us, because our parents looked after him for nearly 20 years. He
depended heavily on them for transport, shopping and meal
preparation.
His relationship with us was like that of family. He came to
our family gatherings and went on outings and holidays with my
parents.
We created a community together, between us, the deceased and
his friends. We all supported each other.
The care that our parents gave the deceased was the kind of
care that a loving child would give an aging parent, not a sinister
plan to exercise undue influence over his estate planning.
It's true that on his second visit to the geriatrician, the
deceased's cognitive capacity had deteriorated. However, his
capacity was fine on the first visit, which took place after the
final will and power of attorney had been executed. On that first
visit, the geriatrician was of the opinion that the deceased
"had sufficient capacity for the validity of his will dated 11
March 2004 and sufficient business acumen to transfer his property
to [Mr A's sons]".
Our father did the right thing by urging the deceased to get
his own financial and legal advice, but the deceased, who was quite
headstrong, chose not to do so.
Further, as the evidence shows, the deceased had an intention
from at least May 2002 to disinherit his children. This was well
before the property transfer occurred.
Since the deceased transferred the farm to us free of any undue
influence, the court must reject the application by the
deceased's children to have us transfer the farm to the
estate.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
