Badenach v Calvert

The High Court has allowed an appeal against a decision of the Supreme Court of Tasmania on the professional duties of lawyers in the context of a will dispute. The first appellant, a solicitor, prepared a will that was to pass all of the testator’s estate to the respondent. After the testator died it emerged that the appellant’s firm (the second appellant here) had prepared two wills in 1984, one of which included a bequest to an estranged daughter. The daughter successfully sued for a maintenance provision out of the estate and was awarded a significant portion of it plus legal costs. The respondent then sued the appellant and the appellant’s firm for professional negligence. At trial, Blow CJ found in favour of the solicitors, holding that while the solicitor owed a duty of care to the testator and breached that duty, Blow CJ was not satisfied that on the balance of probabilities that even if the duty had been properly discharged the testator would have accepted that advice and precluded the possibility of a maintenance claim being made. The Full Court allowed the beneficiary’s appeal, holding that the trial judge confined the ambit of the duty unnecessarily (see at [19]ff) and that the duty of care extended to advising the testator about possible maintenance claims (see at [21], [59], [70]ff). Before the High Court, the appellants sought to argue that the Full Court erred in extending the duty of care.

The High Court unanimously allowed the appeal. After discussing Hill v Van Erp [1997] HCA 9 (see [14]–[24]), the plurality (French CJ, Kiefel and Keane JJ) noted that because the matter involved a failure to advise a client, the court’s focus should not be on what did occur but instead what would have occurred if the solicitor had acted with requisite professional skill and care (at [26]). Here, the original instructions required inquiring about family members, which would have revealed the existence of the daughter and the details of her estrangement, and given rise to a duty to advise the client on the variety of options available, and about the claims that might be made upon the client’s estate (see details at [27][30]). But the original retainer did not extend to specific advice about how to avoid possible claims by making an inter vivos transaction of property interests (at [31]):

From the solicitor’s perspective it could not be assumed that the client would need this latter advice. The respondent’s case, understandably, is not put on the basis that the client, on hearing that a claim by the daughter was a mere possibility, would have instructed the solicitor that he wished to take all lawful steps to defeat such a claim. Such an approach is understandable because there is no way of knowing what the client’s instructions would have been.

The plurality then rejected the respondent’s argument that the solicitor should have volunteered this advice because the solicitor, without more information, had no reason to think that the eventual claim was likely to occur or that the client wanted to take steps to defeat any such possible claim (at [31][33]). The plurality also concluded that even if the duty did extend that far, the respondent could not meet the statutory causation requirements of showing that but for the solicitor’s failure the respondent would have received the client’s estate (see [34][41]). Finally, the plurality returned to the respondent’s arguments on the analogy with Hill v Van Erp, concluding that while Hill v Van Erp found a more limited duty to give effect to testamentary intentions, this matter related to the more general duty to advise on a client’s property interests and estate, and was thus not analogous to Hill v Van Erp (see [42][49]).

Gageler J agreed with the orders of the plurality, but held that the central flaw in the reasoning of the Full Court of the Supreme Court of Tasmania was in treating the scope of the duty of care owed by the solicitor to the respondent as co-extensive with the scope of the duty owed to the testator (at [56]). Gageler J emphasised that the duty owed to a testator is ‘more narrowly sourced and more narrowly confined’ to performing the specific action of preparing the will on the basis of the testator’s instructions to confer an intended benefit to particular beneficiaries, rather than a broader duty to take reasonable care for future contingent interests of a range of possible beneficiaries (see at [57][59], and also at [62][63]). Here, the solicitor’s duty was to carry out the client’s instructions, namely to ensure that the respondent was given a legally effective testamentary gift of the client’s estate (at [64]). While that duty may have been wider, and extended to inquiring further about the daughter and her possible claims, it did not extend to advice to avoid such possible claims, and even if it were an omission, that advice was not within the scope of the duty owed to the respondent (at [66][68]).

Gordon J also agreed with the orders of the plurality, but reasoned that the appellants did not owe a duty of care to the respondent because at that time it could not be said that the interests of the client were the ‘same, consistent or coincident’ as those of the respondent: the will had not been drawn, it was not clear what the client would have done had he inquired about other family members, and the client might have made a different decision (at [83][91]). But even if a duty was owed to the respondent and had been breached, the respondent also failed to adduce any evidence to establish what the client would have done but for that breach, and only managed to show that it was more probable than not that he would have received the entirety, or even more than he did ([92]ff).

High Court Judgment [2016] HCA 18 11 May 2016
Result Appeal allowed
High Court Documents Badenach
Full Court Hearing [2016] HCATrans 44 2 March 2016
Special Leave Hearing [2015] HCATrans 279 26 October 2015
Appeal from TASFC [2015] TASFC 8 24 July 2015
Trial Judgment, TASSC
[2014] TASSC 61 24 November 2014
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About Martin Clark

Martin Clark is a PhD Candidate and Judge Dame Rosalyn Higgins Scholar at the London School of Economics and Political Science and Research Fellow at Melbourne Law School. He holds honours degrees in law, history and philosophy from the University of Melbourne, and an MPhil in Law from MLS. While at MLS, he worked as a researcher for several senior faculty members, was a 2012 Editor of the Melbourne Journal of International Law, tutor at MLS and various colleges, a Jessie Legatt Scholar, and attended the Center for Transnational Legal Studies Program.