Morris presents at New Zealand Law Society conference on the Testamentary Promises Act

On 16 February 2021, Sally Morris and Georgia Angus presented an NZLS In Short seminar “Enforcing Promises – the Testamentary Promises Act”. Sally and Georgia’s presentation covered the history of the Law Reform (Testamentary Promises) Act 1949 (TPA), which is legislation unique to New Zealand. The seminar addressed the elements of a TPA claim, analysed recent decisions and provided practical guidance on bringing and avoiding claims. The recent decisions covered in the presentation are detailed below.

Recent decisions under the Testamentary Promises Act

Section 3(1) of the TPA sets out the legal test for a claim under the Act. The essential elements of a TPA claim are:

• the deceased made an express or implied promise to make testamentary provision for the claimant;
• the claimant rendered services to, or performed work for, the deceased in the deceased’s lifetime;
• there is a nexus between the services or work performed and the promise; and
• the deceased failed to make the promised provision or otherwise remunerate the claimant.
  

The TPA has recently been applied by the Court of Appeal in Le Couteur v Norris [2018] NZCA 572 and the High Court in Hill v Waddingham [2019] NZHC 3505.

Le Couteur v Norris

In Le Couteur v Norris, the claimant daughter sought an award under the TPA on the basis that her mother had promised to leave her house to her and, during the mother’s life, the daughter had performed services above what would normally be expected of a daughter. In the deceased’s will, her house was left to the claimant and the rest of her estate was to be divided equally between her three children. However, by the time of the deceased’s death, her house had been sold, meaning the gift failed.

In the High Court, the Judge found that there was no qualifying promise to the claimant. Further, although the Judge accepted that the claimant had provided support to her mother, his Honour was not satisfied that the ongoing care and support provided by the claimant was, in the circumstances of her relationship with the deceased, work or services for the purposes of the Act.

The Court of Appeal overturned the High Court’s decision. The Court found that the claimant’s oral evidence about the deceased’s promise was supported by the deceased’s will and a later handwritten note purporting to bequeath her house to her daughter. The Court was therefore satisfied that the deceased had made a testamentary promise.

In considering the claimant’s services, the Court concluded the claimant had provided services that “far exceeded the normal services that a dutiful child might provide their aged parent”. In particular, the Court found that the following services rendered by the daughter went beyond that which may normally be expected of a daughter and constituted a “service” under the TPA:

• Not taking up full-time work in order to be available to support her mother, take her to medical appointments and attend to her other needs.
• Purchasing a property for the mother to live in so that her mother might live independently while living in the house next to her daughter and family.
• Taking her mother out to lunches, dinners, school events and on shopping trips and holidays.
• Visiting her mother in her rest home every Saturday and Sunday for eight years.
  

The Court held that while family ties may have influenced the deceased, her handwritten note and diary entries from the time confirmed that the gift of the home was made because of her daughter’s services, establishing the nexus.

Ultimately, the Court determined that the deceased failed to make the testamentary provision promised to the claimant for the services and work she carried out. In considering the quantum of the award, the Court took into account the benefits that the claimant enjoyed, acknowledging that the services were provided in the context of a strong mother/daughter relationship, which the claimant also benefitted from. The Court concluded that a reasonable sum was $590,000, from a total estate of between $2.4 million and $3 million.

Hill v Waddingham

In Hill v Waddingham, the deceased and the claimant were friends for 36 years. Over the course of their friendship, the claimant assisted the deceased by working on his farm and providing companionship. The deceased told the claimant that “there would be something in [his will] for her” but only left her $100,000 from an estate valued at around $6 million. The claimant brought a claim under the TPA seeking an additional $400,000.

The Court accepted the claimant’s evidence that there was a promise. Analysing the services provided by the claimant, Justice Mander considered the critical question was whether the work and services the claimant undertook during the three decades of her relationship with the deceased went beyond what might ordinarily be expected of a person sharing the type of relationship she had with the deceased. There were a number of qualifying services identified by the Court, including:

• the claimant’s companionship, which his Honour found to be of considerable intangible value to the deceased;
• domestic help, including grocery shopping, providing some meals for the deceased and doing some of his washing;
• travelling almost 100 kms return to visit the deceased; and
• driving out to the farm nearly every day and completing numerous jobs around the farm for no pay.
  

Overall, his Honour was satisfied that the claimant provided a range of qualifying services and work that benefitted the deceased and went beyond that which could normally be expected of a friend or companion.

It was accepted by the parties that if the Court found the deceased had made the alleged promise, there would be a nexus. Therefore, the final matter for the court to consider was whether the promise had been fulfilled. The Court found that the deceased’s frugal attitude and modest way of life, spending very little on himself despite being a relatively wealthy person, likely influenced his appreciation of the adequacy of the $100,000 bequest. Having assessed the evidence, the Court held that the bequest and reciprocal benefits the claimant received from having access to the deceased’s farm did not adequately fulfil the testamentary promise. The Court awarded the claimant $350,000 in addition to the $100,000 she received under the will, finding that $450,000 was reasonable compensation for the services she provided.

Although TPA cases are inherently fact specific, these recent decisions demonstrate that where there is a significant imbalance in the services provided by the claimant and the benefits that claimant received from his or her relationship with the deceased, it is open to the court to order a relatively large payment from the estate.

For more information about bringing a claim under the TPA or protecting your estate from possible claims under the Act, contact Morris.