Dear Neil

Many thanks for drawing this judgment to my attention.

In holding that the Plaintiff produced no evidence of what the
testator would have done, had he been properly advised, the Court's
disregard of what the testator actually did is (with respect)
striking. It will often be peculiarly difficult for the disappointed
beneficiary in a case like this to produce evidence of what a testator
who has died before proceedings were (or could have been) initiated
would have done, had they been given appropriate advice in
circumstances where their mind was never directed to an issue because
that advice was not given.

Here, the testator who was terminally ill left everything to the
Plaintiff, who he apparently treated as his son. He left nothing at
all to his estranged daughter.

If a solicitor had said to him, as the majority apparently accepts
would have been appropriate:

1. The will I have drawn up for you is valid at law; but
2. If you have children, there is a risk they might bring a claim for
provision under the relevant legislation and if they do, there is a
risk that the claim will be successful and a certainty that it will
cost your estate something to defend the claim (and your estate is
fairly small);
3. You can avoid that risk by entering into a joint tenancy of the
property with your intended beneficiary during your life - which
carries with it the risk that the intended beneficiary could sever the
joint tenancy if you fell out or that if he became indebted his
creditor could (presumably under relevant Tasmanian legislation) seek
partition and sale.

To me at least, the inference of what the testator would have done
seems clear, on the balance of probabilities, given his terminal
illness. I accept it might be otherwise if the testator were say a
middle aged person who might live for many years left. (In saying
that, I accept the risks in second guessing findings of fact but there
was here a lack of oral evidence and the inferences which the Court
drew, which I think simply wrong, were not based on an interpretation
of the credibility of oral testimony.)

On the question of duty of care toward a disappointed beneficiary, the
judgment is welcome in emphasizing the proper limits of the
solicitor's obligations.

However, on the particular facts the conflict which the Court refers
to as preventing any duty of care arising seems more apparent than
real.

The result of this case is that a solicitor who the Court seems to
accept was in breach of duty to his client and who's breach of duty
has caused readily quantifiable loss to a readily identifiable
individual in the contemplation of the solicitor and his client when
the will was drawn up and who had no means whatever of protecting
himself against the solicitor's breach of duty escapes liability. In
the absence of some compelling reason why the person who has suffered
loss (such as a real rather than fanciful difficulty which the
imposition of such a duty would cause the solicitor in advising) that
cannot be right. I fully accept the point that it could be crippling
for a solicitor if he were expected to take account of future and
contingent interests of every possible beneficiary, per Gadgeler J.
With respect, that simply is not the case at issue. What possible
difficult in advising or acting for the testator would a duty to the
disappointed beneficiary cause the solicitor in this case, on the
facts? The duty involved is simply to advise the testator correctly
about the risk of a family provision claim and the means of lawfully
avoiding that and to carry out the testators instructions. What those
instructions would have been is a question of fact, on which the Court
was entitled to (and in my view should have) drawn inferences based on
what the testator did, in the normal way.

Kind regards

Ger

On 5/11/16, Neil Foster <neil.foster@newcastle.edu.au> wrote:
> Dear Colleagues;
> The High Court of Australia in Badenach v Calvert [2016] HCA 18 (11 May
> 2016) http://www.austlii.edu.au/au/cases/cth/HCA/2016/18.html today upheld
> an appeal against a decision of the Full Court of the Supreme Court of
> Tasmania in a case dealing with the existence of a duty of care owed by a
> solicitor to an intended beneficiary of a client’s will. The Court also made
> some interesting comments in passing about the test for causation in tort
> law.
> The facts were that the testator left half shares in property he
> owned as tenant in common with C (his former de facto wife’s son, with whom
> he was very close), to C; the will was later successfully challenged by the
> testator’s daughter, who had received nothing under the will, and the
> daughter received a $200,000 payment. C claimed that the solicitor ought to
> have advised the testator to have arranged his affairs before death so that
> the daughter would not have been able to make such a claim (the most obvious
> technique would have been to transfer the property into joint tenancies so
> that it would not have formed part of the estate.)
> Over-ruling a trial decision by Blow CJ, the Full Court of the Tasmanian SC
> held that there was a duty of care in the circumstances, and that it had
> been breached. They did not, however, order the payment of the full amount
> taken from the estate by the daughter; they all took the view that what B
> had made out was “loss of a chance” to money, and hence that the matter
> should be sent back to a trial judge for calculation of the chance.
> The High Court all held that the FC was wrong to find a duty of care
> here. They acknowledged that, of course, in the particular circumstances
> where a beneficiary loses a direct gift that a testator has meant to provide
> due to a solicitor’s carelessness in execution of a will, Hill v Van Erp
> (like other decisions at high levels in the common law world) holds that the
> solicitor can he held liable to the intended beneficiary. But they all said
> that this only flowed because the interests of the testator, and the
> intended beneficiary, completely co-incided. Here the solicitor had done
> exactly what he had been asked to do, prepared a will leaving the property
> to C.
> The HC suggested that the solicitor may have owed a duty to the client
> to advise about the possible impact of a TFM claim by a family member. But
> they said that this duty did not extend to protect the interests of the
> beneficiary. In particular it was not proven on the balance of probabilities
> that if the relevant warning had been given that the testator would then
> have done what it was claimed should have been done to protect the
> beneficiary. The daughter had not seen the testator for some years, so it
> was not clear what attitude she would take or whether she would make a
> claim, still less whether the claim would succeed.
> I thought that Gageler J’s concurring comments on the reasons why a
> solicitor does not have a duty to protect beneficiaries against all
> foreseeable outcomes of a gift quite persuasive.
>
> [58]…..The duty plainly cannot extend to requiring the solicitor to take
> reasonable care for future and contingent interests of every prospective
> beneficiary when undertaking every action that might be expected of a
> solicitor in the performance of the solicitor's duty to the testator. If the
> tortious duty of care were to extend that far, it would have the potential
> to get in the way of performance of the solicitor's contractual duty to the
> testator. Extended to multiple prospective beneficiaries, it would be
> crippling.
>
> On the issue of causation I found paras [40]-[41] interesting:
>
> [40] It remains necessary to prove, to the usual standard, that there was a
> substantial prospect of a beneficial outcome[1]. This requires evidence of
> what would have been done if the opportunity had been afforded. The
> respondent has not established that there is a substantial prospect that the
> client would have chosen to undertake the inter vivos transactions.
> Therefore, the respondent has not proven that there was any loss of a
> valuable opportunity.
>
> 2 [41] The onus of proving causation of loss is not
> discharged by a finding that there was more than a negligible chance that
> the outcome would be favourable, or even by a finding that there was a
> substantial chance of such an outcome. The onus is only discharged where a
> plaintiff can prove that it was more probable than not that they would have
> received a valuable opportunity. To the extent that the majority in Allied
> Maples Group Ltd v Simmons & Simmons[2] holds that proof of a substantial
> chance of a beneficial outcome is sufficient on the issue of causation of
> loss, as distinct from the assessment of damages, it is not consistent with
> authority in Australia and is contrary to the requirements of s 13(1)(a) of
> the Civil Liability Act.
>
> ________________________________
>
> [1] Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 at 355,
> 367‑368.
>
> [2] [1995] 1 WLR 1602; [1995] 4 All ER 907.
>
>
> In a concurring judgement Gordon J at [99] also ruled that the majority
> comments in Allied Maples were not good law in Australia.
>
> Regards
> Neil
>
>
>
>
> Associate Professor Neil Foster
> Newcastle Law School
> Acting Assistant Dean, Teaching and Learning
> Faculty of Business and Law
>
> O: MC177, McMullin Building
> T: +61 2 4921 7430
> E: neil.foster@newcastle.edu.au<mailto:neil.foster@newcastle.edu.au>
> W: http://www.newcastle.edu.au/profile/neil-foster
> My publications: http://works.bepress.com/neil_foster/ ,
> http://ssrn.com/author=504828
> Blog: https://lawandreligionaustralia.wordpress.com
>
> The University of Newcastle (UON)
> University Drive
> Callaghan NSW 2308
> Australia
>
> CRICOS Provider 00109J
>
> [The University of Newcastle]<http://www.newcastle.edu.au/>
>
> [width=]
>
>
>