In the recent case of James v James, a disinherited farmer's son brought a proprietary estoppel claim and attacked the validity of the will yet failed to gain anything from either challenge.
Charles and Sandra had three children, Karen, Serena and Sam.
Having heard numerous witnesses the Judge determined that Charles was a successful and 'formidable' man who had built up a farming and haulage business in Dorset. He was a man for whom 'money was God' who did not make decisions hastily, only when he was 'good and ready'. He did not confide in others.
In 2007, Charles gave three parcels of land to Karen. In 2009, he transferred another parcel of land and his business to Sam.
Charles made a will leaving his estate to Sandra, Karen and Serena (but not Sam) in 2010. He died two years later.
Upset at not being left the family farm, Sam brought two claims.
1. Proprietary estoppel
A proprietary estoppel claimant needs to show that they are entitled to property because it was promised to them, and they relied on that promise to their detriment.
Sam claimed that Charles had promised him both Karen's land and the land passing to his other sisters and his mother.
In 2004, Charles told Sam that he intended to leave most of his land to Sam and a will was drafted accordingly (but not signed). But, as the judge pointed out, 'making a will in favour of someone is not the same as promising to leave property to that person. It is…merely a statement of current intention'.
Sam also said that his father consulted him, at least twice, before buying further land because Sam 'would be farming it one day'. Considering all the evidence, not least as to Charles' and Sam's personalities, the judge decided that this was not a promise of the land and that 'Sam's eagerness to inherit the farmland from his father has caused him to persuade himself that he was being promised something when he was not'.
Sam said that he had been paid very little working for Charles and he had accepted that because of Charles' promises. However, the judge found that he was paid the same as other workers and Charles bought Sam cars as bonuses. Sam had not acted in reliance on any promise to his detriment.
The judge dismissed Sam's proprietary estoppel claim. He then addressed two tricky proprietary estoppel issues.
The Court of Appeal has held that even if someone establishes a proprietary estoppel, any award must still be proportionate to the detriment suffered and take into account the length of time since the promise was made. This is an important limitation on many proprietary estoppel claimants. However, here, the judge said that if Sam had established a successful proprietary estoppel claim, he would likely have awarded Sam everything that he had been promised, rather than considering proportionality.
The judge also considered what would have had happened to Sam's claim for Karen's land in circumstances where Charles promised the land to Sam but then gifted it to Karen. Karen said she had relied on the gift from Charles to her detriment, spending money improving the land. The judge questioned whether this meant that the Court could not award Sam Karen's land, even if he had a successful claim to it. He did not have to answer this so chose not to.
2. Testamentary capacity
Sam claimed that the 2010 will was invalid on the grounds of lack of testamentary capacity.
Medical and anecdotal evidence showed that Charles had been declining from 2004. A hospital patient record from January 2010 noted that Charles 'has dementia'.
Charles and Sandra met with a solicitor in May 2010 and gave instructions for new wills.
Sandra and the solicitor met again a week later, following which the solicitor noted that she 'was confident that at the end of the…meeting [Charles] did understand everything that [she] had discussed with him and [Sandra] agreed. [Sandra] explaining that it is really only his short-term memory which is not particularly good'. Sandra requested she telephone before posting draft documents, otherwise Charles might file the post 'in a mysterious place'.
Four months later, the solicitor visited the farm with the final drafts. Charles initially refused to sign anything as he 'could see little point in making a will as circumstances change so quickly'. He was concerned that 'if he signed the will, that this would mean that he would die'. The solicitor then talked Charles (alone) through the will twice. Sandra returned to the meeting and asked Charles if the children should be equally provided for (ie balancing lifetime gifts with legacies). Charles said they should. Charles then signed the will.
At trial, the solicitor explained that she did not obtain a medical opinion on Charles' capacity (following the 'Golden Rule') because she had met Charles who, in her view, was interactive and showed 'no signs of confusion or ill-health'.
There is said to be confusion as to the correct test for testamentary capacity, which the Law Commission is reviewing. There are two tests. That under the Mental Capacity Act 2005 is used by the Court of Protection to determine whether a living person lacks capacity to make a will. The traditional Banks v Goodfellow test governs whether a person has the capacity to make a will. The judge dismissed suggestions that the former test has supplanted the latter – so the Banks v Goodfellow test continues to apply almost a century and a half since it was handed down.
Both parties' medical experts agreed that Charles was suffering from moderate dementia in 2010. They also agreed that Charles had the capacity to understand the nature and effect of the consequences of making a will and that he appreciated the nature of his estate. They disagreed as to whether Charles appreciated the claims of his children on his inheritance (part of the Banks v Goodfellow test).
The judge noted that, despite the evidence of Charles' memory loss and confusion, 'there is also considerable evidence of normal behaviour and rational thought'. He concluded that Charles appreciated the claims of his children on his inheritance, particularly in light of Sandra's question on the need to redress the balance between the children. The judge noted that 'the simpler the estate and the fewer claimants, the less difficult it is to dispose of, and accordingly the less acute the faculties required to do so successfully'.
Charles had testamentary capacity and so the will was valid.
Sam failed to successfully navigate the challenging crossover between his traditional assumption that he, the only son, would inherit the family farm, with more modern attitudes to inheritance.
Yet, James v James also highlights that, with regards to the test for testamentary capacity, 19th century caselaw continues to prevail over 21st century legislation.