Curry v Johnson

• Jurisdiction: Bahamas
• Judge: Malone, SNR. J.
• Judgment Date: 16 June 1988
• Court: Supreme Court (Bahamas)
• Docket Number: Equity Side No. 721 of 1985
• Date: 16 June 1988

Supreme Court

Malone, Snr., J.

Equity Side No. 721 of 1985

Curry

and

Johnson

Appearances

V. Wallace-Whitfield, Jnr. A. Thompson with him for the plaintiff.

M. Barnett, C. Hepburn with him for the defendant.

Administration of estates - Executor — Testator's estate — Whether funds given by testator formed part of estate or were gifts to defendants — Testamentary capacity — Action for declaration that monies transferred held on trust and not as gift — Action dismissed.

Malone, SNR. J.

1 Captain Johnson - the testator - died on the 16 ^th June, 1983 at Spanish Wells, in the home of his elder son - the defendant. Little more than seven months before he died he effected by transfers considerable sums of money held by him on deposit at the Royal Bank of Canada, (“the bank”) at Spanish Wells a major reduction of his personal wealth. This administration action by the plaintiff – the sole executor of the Will of the testator - is about the making “of those transfers. The plaintiff contends that the bulk of the money transferred, if not all of it, was to be held on trust by the defendant to pay the testator's bills in his lifetime and after his death to come under his Will for division equally between the defendant and the testator's two other children - Basil and Betty - as directed by the Will. The defendant contends that the funds were transferred as an outright gift and were not intended to form any part of the testator's estate.

2 In his opening address, learned Counsel for the plaintiff spoke as follows:

“The contention will be that the testator was suffering. His mental or contractual capacity was impaired to some degree as it was never his intention that the defendant should have the sole use and benefit of the funds

…

The plaintiff will contend that the defendant was aware of his father's mental problems. That his father had difficulty remembering things from day to day. The defendant now seeks to capitalize on that to the detriment of the other beneficiaries. The plaintiff will contend that prior to the day the funds were withdrawn on the 15 ^th November, 1982 the testator had given the bank irrevocable instructions to hold all monies to which the testator was joint signatory to be held solely for him”.

Counsel then ended his opening address by describing what he termed the basic issues as follows:

• “(1) Mental capacity of the testator when he went to the bank and authorised the withdrawal of those funds to the defendant. Did he intend the defendant to have sole use of those funds or only intended the defendant to pay his - testator's bills - from those funds?

• (2) Whether the funds in the defendant's hands were trust funds to be divided equally between the defendant, his brother and sister or were not part of the estate”.

3 Evidence was then led on behalf of the plaintiff, for the purpose, it seemed, of showing forgetfulness on the part of the testator and that his mind was deteriorating but was, nevertheless, capable from time to time of recovery so as to be quite normal. The evidence of the latter aspect is as follows from the plaintiff. At the preparation of a Will in or about the year 1979, the plaintiff who drew the will noticed that the testator was subdued, which was uncharacteristic him. He noticed also that the plaintiff permitted the defendant to be his spokesman, which also was uncharacteristic, as according to the plaintiff, and indeed to all of the witnesses who spoke of the testator's character, the testator was a man of strong character. He would decide what he wanted to do and do it even against the advice of others, according to the plaintiff. About the middle of November, 1982 when the plaintiff was summoned to the testator's house where he found the testator with the defendant, the testator was weeping copiously. To such an extent that he could scarcely speak. When he had collected himself and was explaining what he proposed to do about his money in the bank, the plaintiff's impression was that the testator was very subdued and that he acted as if he was doing something he did not want to do. At the end of December, 1982 or early in January, 1983, the plaintiff again met the testator. On this occasion he was not in the presence of the defendant. He was behaving in so strange a manner that the plaintiff thought the testator's - “mind had snapped”.

4 The capacity of the testator's mind to recover was also observed by the plaintiff, as his description of the testator on the 8 ^th February, 1983 is as follows:

“I never saw him better. I have no doubt he had his right mind. He was intelligent. I was perfectly satisfied he was of sound mind. No one more sane than he”.

That impression is confirmed by a note from Dr. Biney - the medical officer for the area. He recorded that he had examined the testator on the 10 ^th March, 1983 - “and found him to be mentally fit”.

5 The aspect of forgetfulness, is in part to be found in the evidence the plaintiff's witness, Abner Pinder. He told of an occasion in the latter part of 1981, when he made enquiry on behalf of a foreign principal as to whether the testator was willing to sell a property own as Pond Point for $200,000.00. Mr. Pinder was then under the impression that Pond Point was owned by the testator. In fact, it was not, as the testator and his wife had given the property to the defendant and his wife in 1970. The testator, however, reacted to Mr. Pinder is if he did own the property and indicated he was prepared to enter into negotiations. It was then that the defendant told the testator that he, the testator, could not sell the property. According to Mr. Pinder, the testator looked very shocked when the defendant explained that the property belonged to him. Forgetfulness it was submitted was also shown when the testator's behaviour in July, 1982 was contrasted with his behaviour in November, 1982. In July, he was displeased with the defendant. Accused him, according to the plaintiff, of stealing the Pond Point documents from his safe and making use of money of the testator without the latter's permission. His displeasure was such that he deprived the defendant of the authority he had given him to draw on his bank accounts both at Spanish Wells and in Miami. It was then, too, that the testator gave to the bank the letter described by his Counsel as his irrevocable instructions. In November, however, the testator has again being cared for by the defendant and the “irrevocable instructions” were forgotten with the transfer of his money at the bank to the defendant and/or the defendant's wife.

6 Having regard to the content of the opening address of Mr. Wallace-Whitfield and the evidence that has been related, the closing address of Counsel come as a surprise. The relevant portion of it is follows:

“We are not saying he - the testator - was deranged or out of his mind. It is easier to say he was manipulated. I am not saying he did not have the mental capacity to change his mind …

…

This evidence is simply to show that he could forget something or at a later stage he had changed his mind. It's only purpose is to provide a background. To lay the foundations that here was a man prone to lapses of memory or here is a man who changed his mind”.

7 As Counsel's position on mental capacity is not clear to me, I think I should make a finding on the matter, in particular, as regards the mental capacity of the testator in November, 1982. Mr. Kelly is and was in November, 1982 the manager of the bank. He is obviously a man of probity, with the caution that one associates with bank managers. He was not in Spanish Wells on the 15 ^th November, 1982 when the testator and the defendant went to the bank to transfer the money which has given rise to this action, but he was there the 22 ^nd November, 1982 when the testator and the defendant returned the bank, and he was expecting them. Mr. Kelly's evidence thus supports the evidence of the defendant that the transactions were not completed on the 15 ^th November, 1982. The reason being, according to the defendant, that in the absence of Mr. Kelly, his assistant did not wish to accept the responsibility for the transfer from the control of the testator of the very large sums proposed to be transferred. She permitted $70,000.00 to be transferred to the defendant, $75,000.00 to the defendant's wife, and $73,421.96 to be withdrawn from the testator's savings account. The balance of $419,820.66 was transferred to an account in the names of the testator and the defendant. Coupled to Mr. Kelly's evidence that on the 22 ^nd November, 1982, the testator showed no sign of mental incapacity and to use Mr. Kelly's words: “was as normal as ever” the evidence recited is of high importance on the question of mental capacity. For it shows that on a day when he was normal, even accepting Gpi plaintiff's evidence that there might be days when the testator not his normal self, the testator was continuing a transaction he had commenced a week before. As he was under no obligation to continue the transaction but did so, the rational conclusion can only be that on the 22 ^nd November, 1982, he saw nothing wrong with what he had done on the 15 ^th November, 1982. From which it follows that he was mentally unaffected on the 15 ^th November, 1982, even if he was distraught as the plaintiff described. Without the evidence of Mr. Kelly and Mrs. Marchiony, who accompanied the testator and the defendant to the bank on the 22 ^nd November, 1982, I still would reach the conclusion that when the transfers were made on those days in November, the testator was mentally fit. In the first place it is not until the Aid of December, 1982 or early January, 1983 that the plaintiff came to the conclusion that the mind of the testator had snapped. So that there a no evidence that it had snapped in...