Testamentary capacity, knowledge, and approval are distinct requirements in probate law. Testamentary capacity refers to the legal and mental ability to make or alter a valid Will. The testator must understand the nature and effect of making a Will, the extent of their assets, and potential beneficiaries’ claims. Knowledge and approval require that the testator knows and approves the contents of the executed Will.
A Will may be invalid if it does not reflect the testator’s actual intentions, even if capacity is established. The Estate of Wilma Annette Pusterla [2026] NSWSC 951 illustrates this distinction.
The Banks v Goodfellow (1870) LR 5 QB 549 test remains the standard for assessing testamentary capacity. It addresses the testator’s ability to understand the nature and effect of making a Will, the property involved, and potential beneficiaries’ claims. Cognitive impairment or memory loss does not, by itself, establish a lack of capacity.
At the time of the deceased made their final Will in October 2023, the deceased was elderly, legally blind, physically frail, and experiencing short-term memory loss. Williams J found the deceased retained testamentary capacity. Evidence indicated the deceased was alert, communicative, understood her assets, and had prior experience making Wills. The Court distinguished between sound judgment and testamentary capacity.
Knowledge and Approval.
The deceased informed the plaintiff of her intention to leave him their Willoughby home. The executed Will, however, left the plaintiff the deceased’s entire estate, subject to certain exclusions. The plaintiff arranged for the new Will, and the solicitor did not take instructions directly from the deceased. Raising a well-grounded suspicion that the Will did not reflect the deceased’s intentions. Reading the Will aloud before execution was insufficient to establish understanding and approval. The plaintiff did not discharge the onus, and Williams J held the 2023 Will invalid.
The Estate of the late Wilma Annette Pusterla confirms that testamentary capacity, knowledge, and approval are distinct requirements. A testator may have capacity, but deficiencies in instruction-taking, drafting, or execution may prevent the Court from finding that the document reflects the testator’s intentions. The deceased died in December 2023, leaving an estate valued at approximately $3 million. The principal asset was her home in Willoughby.
Over many years, Wilma (the deceased) had made a succession of Wills benefiting friends and various charities. The deceased’s 2020 Will divided the residuary estate between a close friend and six charities (the defendants) . Philip Jeffrey Beaumont Smith ( the Plaintiff), the son of the deceased’s late de facto partner, was named as a substitute executor but received no beneficial interest in the estate.
By 2023, the deceased was 91, physically frail, legally blind, and experiencing short-term memory difficulties. After the death of the friend who had previously assisted her, the plaintiff became increasingly involved in her affairs. The plaintiff was appointed as her attorney and enduring guardian. The deceased’s estate comprises a property at Willoughby with an estimated value of $3,130,000 (the Willoughby property), shares with an estimated value of $9,370, and cash of approximately $23,886. The present value of the net assets of the estate is approximately $2,994,402.
The deceased told the plaintiff of their intention to leave them the Willoughby proprty. The plaintiff engaged a solicitor to prepare a new Will. The preparation and execution process, rather than testamentary capacity, was determinative. If the person propounding the will is unable to show the testator knew and approved of any part of the will, the Court will not admit the will to probate (or will revoke a grant already made). If the severance results in the will not reflecting the testamentary intention of the testator, then severance will not be permitted and the will not be admitted to probate (or the grant revoked) (Hobhouse v Macarthur-Onslow [2016] NSWSC 1831 at [476]).
The Deceased’s Instructions 2023 Will
The case highlights the importance of best practice for solicitors, particularly where a proposed beneficiary is involved in Will preparation. The following steps reinforce procedural integrity and address specific risks:
- Take instructions directly and privately from the testator, without any proposed beneficiary present. This helps avoid undue influence and ensures the instructions reflect the testator’s wishes.
- Confirm the testator’s identity, capacity, and understanding of their assets. Verification helps prevent fraud and supports informed decision-making.
- Record the testator’s intentions and clarify reasons for significant changes or new provisions. Proper records demonstrate the rationale for the Will’s terms and protect against later challenge.
- Provide a draft Will directly to the testator for review and allow time for questions or clarifications. This reduces the risk of errors or misunderstandings.
- Meet with the testator alone before execution to confirm understanding and approval of the Will. This safeguards against external pressure.
- Arrange for independent witnesses unconnected to beneficiaries. Independent witnesses support the validity of the Will and minimise allegations of impropriety.
- Keep detailed and contemporaneous file notes of all meetings, instructions, and steps taken. Effective file notes record the date, time, location, participants, topics discussed, instructions in the testator’s own words, observations of mental state, and documents provided. Comprehensive notes support procedural rigour and the validity of the Will if challenged.
Adhering to these practices safeguards the testator’s intentions, supports Will validity, and reduces the risk of disputes. Direct instructions, excluding beneficiaries from discussions, and detailed file notes help courts confirm that the Will reflects the testator’s intentions and resolve challenges efficiently.
The solicitor did not take instructions directly from the deceased. The plaintiff provided instructions and was to become sole beneficiary. The plaintiff’s correspondence referred to the deceased’s intention to leave the plaintiff their house, but the 2023 Will left the plaintiff the deceased’s entire estate.
Under cross-examination, the solicitor accepted they had not taken instructions from the deceased, had not confirmed the document reflected their intentions, and had not provided the deceased with a draft for review. Additionally the solicitor was not present at execution.
The plaintiff arranged for two colleagues, unknown to the deceased, to act as witnesses. The Will was read aloud and signed shortly after.
Testamentary capacity was not in dispute.
The charities benefiting under the earlier Will challenged the 2023 Will on several grounds, including testamentary capacity, knowledge and approval, and undue influence.
Significantly, Williams J found that the deceased retained testamentary capacity. Although evidence showed short-term memory difficulties, no diagnosis established that they lacked capacity. During the relevant period, the deceased remained alert and communicative, continued to engage with political issues, and could express her own views.
The Estate of the late Wilma Annette Pusterla [2026] NSWSC 951 illustrates the distinction in probate law between testamentary capacity and knowledge and approval. A person may have capacity to make a Will but may not know and approve the contents of the executed document. Capacity concerns the ability to make a Will, while knowledge and approval concern whether the document reflects the will-maker’s testamentary intentions.
A testator may have capacity to make a Will but lack knowledge and approval if not properly informed about the document’s contents and effect. The distinction is significant: capacity concerns the ability to make a Will, while knowledge and approval require that the testator understands and approves the dispositions made.
The central question was whether the Will reflected the deceased’s intentions.
Where a person has testamentary capacity and a Will has been duly executed, knowledge and approval of its contents may ordinarily be presumed. That presumption, however, is not conclusive.
It may be displaced where the circumstances surrounding the preparation or execution of the Will give rise to a well-grounded suspicion that the document does not truly reflect the will-maker’s intentions. Once such circumstances arise, the person seeking to propound the Will must satisfy the Court that the deceased actually knew and approved its contents.
The Estate of the late Wilma Annette Pusterla [2026] NSWSC 951, concerned the circumstances surrounding the 2023 Will. The plaintiff arranged for the Will and was the sole beneficiary. The solicitor received no instructions directly from the deceased. Evidence indicated the deceased intended to leave the plaintiff the Willoughby property, but the Will left the plaintiff the deceased’s entire estate. The plaintiff selected witnesses unknown to the deceased, and the execution meeting was brief. No evidence showed the deceased understood the Will disposed of the deceased’s entire estate to the plaintiff.
Reading the Will aloud before execution did not resolve these concerns. Hearing the document being read to the will maker is not the same as understanding and approving its dispositions.
Her Honour confirmed a well-grounded suspicion that the 2023 Will did not reflect the deceased’s testamentary intentions. The plaintiff could not establish that the deceased had knowledge of and approval of the 2023 Wills contents. Williams J held the 2023 Will invalid and admitted the 2020 Will to probate.
The Estate of the late Wilma Annette Pusterla [2026] NSWSC 951 demonstrates that testamentary capacity is only one element of Will validity. Where a beneficiary initiates contact, provides instructions, and stands to benefit, the Will maker must provide instructions independently. A prudent solicitor:
- meets privately with the will maker,
- obtain written confirmation of intentions,
- provide draft Wills directly for review, and
- ensure execution is witnessed by individuals unconnected to the beneficiary.
These measures confirm the testator’s wishes and reinforce procedural integrity.
The central issue in The Estate of the late Wilma Annette Pusterla was whether the executed Will reflected the deceased’s testamentary intentions. Williams J also determined the appropriate costs order.
Although the plaintiff failed to obtain probate of the 2023 Will because they could not establish that the deceased knew and approved its contents, the charities (the first through sixth defendants) had not succeeded on every ground. Williams J rejected their alternative arguments that the deceased lacked testamentary capacity and executed the Will under undue influence.
Costs
The usual rule is that costs follow the event. Probate proceedings can differ. Where the circumstances surrounding a Will reasonably require investigation, the Court may depart from the ordinary costs rule and, in an appropriate case, require each party to bear their own costs.
In The Estate of the late Wilma Annette Pusterla [2026] NSWSC 1070 Williams J accepted that the circumstances surrounding the deceased’s 2023 Will required investigation. However, the plaintiff contributed to those circumstances by arranging the Will and its execution. The suspicious circumstances did not justify relieving him of the ordinary costs consequences. He was ordered to pay the charities’ costs.
The offer of compromise was rejected.
The consequences were heightened because the defendants made a formal offer of compromise, which the plaintiff rejected. The offer was more favourable than the trial outcome. Under the Uniform Civil Procedure Rules 2005 (NSW), that meant the defendants were presumptively entitled to indemnity costs from the day after the offer expired, unless the plaintiff could persuade the Court to order otherwise.
The plaintiff advanced two arguments:
- that the litigation resulted from the solicitor’s conduct, particularly the failure to prepare a Will reflecting Wilma’s instructions. The Court rejected this, noting Jeff’s involvement in preparing the Will, arranging execution, and selecting witnesses.
- that the Court’s findings could have supported rectification under s 27(1)(b) of the Succession Act 2006 (NSW), so that the plaintiff received the Willoughby property rather than the deceased’s entire estate.
Consider rectification promptly where appropriate.
Rectification is available when a Will fails to carry out a testator’s true intentions because of a clerical error or misunderstanding, but practitioners must identify this issue promptly. Awareness of potential discrepancies as soon as a practitioner reviews the Will, particularly where instructions mismatch the executed document. Rectification requires an application within 12 months of the grant of probate and clear evidence of the deceased’s intentions. Practitioners should advise clients on possible rectification as soon as they discover inconsistencies, to meet the strict time limits and preserve available evidence. The key steps for seeking rectification are as follows:
1. Identify the apparent error in the Will, such as a clerical mistake or misunderstanding by the person who prepared it.
2. Gather clear evidence of the testator’s true intentions at the time the Will was made.
3. File an application to the Court for rectification within 12 months of the grant of probate.
4. Provide evidence to the Court showing both the intended dispositions and the nature of the error.
5. Satisfy the Court that the Will fails to carry out the testator’s true intentions because of the error.
6. If the Court is satisfied, it may order rectification so the Will reflects the testator’s actual wishes.
The fundamental problem with that argument was that Jeff had never sought rectification.
Throughout, the plaintiff sought probate of the 2023 Will, which gave him the entire estate. The possibility of a different claim did not overcome his failure to establish knowledge and approval.
In The Estate of the late Wilma Annette Pusterla [2026] NSWSC 1070 Williams J consequently ordered the plaintiff to pay the defendant’s costs on the ordinary basis up to and including 5 September 2025 and on the indemnity basis thereafter.
It was common ground that the defendants’ offer constituted a valid offer of compromise under r 20.26 of the UCPR and was more favourable to the plaintiff than the judgment ultimately obtained. Consequently, r 42.15(2) presumptively entitled the defendants to have the plaintiff pay their costs on an indemnity basis from 6 September 2025. The plaintiff bore this discretion to depart from that presumptive costs order: Leach v Nominal Defendant [2014] NSWCA 391 at [46]–[48]; Perisher Blue Pty Ltd v Nair-Smith (No 2) [2015] NSWCA 268 at [28], [32]–[36]; Bassett v Bassett [2021] NSWCA 320 at [253]. The onus of establishing circumstances sufficient to justify the Court exercising its d
The costs order confirms that suspicious circumstances may justify investigating a Will, but do not necessarily protect a party from costs consequences if they contributed to those circumstances. Courts retain discretion to depart from the usual costs rule in probate matters. In some cases, the Court may order each party to bear their own costs if the investigation was necessary and neither party acted unreasonably. Practitioners should note that while costs often follow the event, exceptions may arise where genuine questions about a Will’s validity exist.
Practitioners should assess the practical implications of offers of compromise in probate disputes. Accepting or rejecting an offer may have significant financial consequences, particularly where the offer is more favourable than the trial outcome. Prompt case assessment, clear communication of risks, and thorough documentation of advice are essential. Written summaries of costs and risks ensure clients understand potential outcomes. Careful management of offers of compromise is critical in probate litigation.
To assist practitioners in documenting advice about offers of compromise, it is recommended to use a brief checklist or protocol:
1. Record the date the offer of compromise was received or considered.
2. Summarise the terms of the offer and compare them with the likely outcome at trial.
3. Clearly outline to the client the potential cost consequences of accepting or rejecting the offer, including the risk of an indemnity costs order.
4. Retain a copy of all written communications advising the client about the offer and confirming their instructions on how to proceed.
5. Note the client’s informed decision, including their reasons for accepting or rejecting the offer.
6. Update the file promptly with any changes in advice or further settlement discussions.
A consistent approach to documenting advice helps practitioners meet professional obligations and reduces the risk of disputes in contentious matters.