Dear Colleagues;

Just in case my explanation of the case was not clear enough, in the actual decision the beneficiary B was suing the solicitor, not because the will as drafted did not reflect the testator’s intentions (it did, perfectly) but because the solicitor did not advise the testator to take other steps which would have meant that the operation of separate legislation giving rights to disappointed family members would be defeated. So the duty of care owed to the beneficiary, which previously could have been satisfied by drafting the will effectively, is now seen to extend to taking steps to see that the beneficiary receives “full value” from the gift. It strikes me, I must confess, that this is going a bit far. Does the duty to the beneficiary now extend to the solicitor advising the testator to wisely invest his money so any fund available to the beneficiary will not be reduced? What if the testator is proposing to make an unwise sale of property he owns? Does the solicitor have an obligation, in the interests of the beneficiary, to advise against the sale?

My “thought bubble” at the end of the previous email was not intended as a serious proposal, but to raise these sort of issues.

Regards

Neil

neil foster 

Associate Professor

Newcastle Law School
Faculty of Business and Law

T: +61 2 49217430
E: neil.foster@newcastle.edu.au

Further details: http://www.newcastle.edu.au/profile/neil-foster

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From: Robert Stevens <robert.stevens@law.ox.ac.uk>
Date: Tuesday, 28 July 2015 1:48 pm
To: Tracey Carver <t.carver@qut.edu.au>
Cc: Neil Foster <neil.foster@newcastle.edu.au>, "obligations@uwo.ca" <obligations@uwo.ca>
Subject: RE: Duty of care to beneficiary to advise re TFM application

That potential beneficiaries of the duty of care are limited to those it is intended will benefit from the solicitor performing his contract with his client, and does not extend to all those who it could be reasonably  foreseen may be left better (or worse) off, in my opinion reveals what is really going on.

It is really an exception to privity of contract. We are exceptionally  allowing a third party beneficiary to sue. The reason is that (very unusually) if we give the promisee the substantial claim for damages this will not lead to the nearest approximation now possible, insofar as money can do it, to the contract having been performed. This is because the testator/promisee  is dead, and giving the money to the estate will give recoveries to the wrong people. The estate/promisee has no choice about what happens to any recoveries.

I am not very keen on exceptions to privity, but here I can just about swallow it.

On 28 Jul 2015 04:30, Tracey Carver <t.carver@qut.edu.au> wrote:

Dear Neil,

 

My understanding is that the law in Australia may currently be seen to be limited to solicitors under wills owing duties of care to disappointed but “intended” beneficiaries.  I must admit not having read Calvert v Badenach [2015] TASFC 8 (24 July 2015) myself yet, but from the summary that you provide the decision would seem consistent with that principle – B was a someone that the testator intended to benefit, and therefore the solicitor owed them a duty of care as a third party (and although the solicitor was not in any prior or direct relationship with them).

 

Unless Calvert extends this principle, it may be argued, in the case of a disappointed family member who goes on to make a TFM claim, that they were never an “intended” beneficiary – and therefore that claimant falls outside the ambit of any current duty of care.

 

Kind regards

Tracey

 

Tracey Carver| Senior Lecturer
Coordinator, Torts Student Peer Mentor Program;
Member, Australian Centre for Health Law Research and Member, Higher Education Research Network

 

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From: Prue Vines [mailto:p.vines@unsw.edu.au]
Sent: Tuesday, 28 July 2015 11:41 AM
To: Neil Foster; obligations@uwo.ca
Subject: RE: Duty of care to beneficiary to advise re TFM application

 

Dear Neil,

This is very interesting especially since the TFM legislation in the Australian states contemplates such a broad range of possible claimants, especially in Victoria  where almost anyone who has ever had any kind of relationship with the deceased can be an eligible applicant – it doesn’t mean that they will all recover, but they can get in the door. The Full Court must be right about the duty of care owed to advise the testator about the possible TFM claim. Any will drafter would normally think about that and advise; but whether the plaintiff has actually lost anything thereby is dubious because a will is ambulatory anyway, and the testator could well have refused to change the will and just chance it.  I see no reason why anyone would bother to sue as a TFM claimant  because it is so much easier to bring a TFM claim than it is to bring a negligence claim.

Cheers

Prue

 

Professor Prue Vines 

Director of First Year Studies

Co-Director Private Law Research & Policy Group 

Faculty of Law

The University of New South Wales

UNSW Sydney NSW 2052, Australia 

Email: p.vines@unsw.edu.au •Phone: +61 (2) 9385 2236 • Fax: +61 (2) 9385 1175 •

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From: Neil Foster [mailto:neil.foster@newcastle.edu.au]
Sent: Tuesday, 28 July 2015 11:30 AM
To: obligations@uwo.ca
Subject: ODG: Duty of care to beneficiary to advise re TFM application

 

Dear Colleagues;

There is interesting decision from the Full Court of the Supreme Court of Tasmania in Calvert v Badenach [2015] TASFC 8 (24 July 2015) http://www.austlii.edu.au/au/cases/tas/TASFC/2015/8.html on the question whether a solicitor advising a testator about a proposed will leaving property to B, owes a duty of care to B which extends to advising the testator about a possible “family provision” (“testator’s family maintenance”) application by another party. Here the (now deceased) testator left half shares in property he owned as tenant in common with B, to B; 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. B 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 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. (Taking the view that even if the advice had been given, there were various responses the testator could have made.)

There are a number of interesting features to this case. One that strikes me, however, is this: if, as we know is accepted law, a solicitor owes a duty to the beneficiary under a will he or she is advising on, could it not be argued that he or she might owe a duty to persons in the testator’s family who will be deprived of a legitimate expectation of support by the way the will is framed? Of course it could be said that the solicitor is in no prior relationship with the family member; but it could also be said that he or she is not in any prior relationship with the beneficiary.

Regards

Neil

 

neil foster 

Associate Professor

Newcastle Law School
Faculty of Business and Law

T: +61 2 49217430
E: neil.foster@newcastle.edu.au

 

Further details: 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 

 

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