Elder Financial Abuse: Unconscionable Conduct
Unconscionable conduct is when a person in a relationship takes advantage of the other person’s disadvantage and uses it for their benefit.
The most common example would be when an elder has a friend or a grandchild who helps support them in an emotional or physical way, to the extent that the elder begins to rely on the person. At this point, the friend or grandchild may begin to suggest things to the elder, such as purchasing a house or giving a gift.
Using the elder’s vulnerability against the elder and to the benefit of the friend or grandchild is an example of unconscionable conduct. More often than not, a gift to a grandchild in the form of a lump sum payment in order to purchase a property is harmless. It is when this transfer or gift was against the original intentions of the elder, or the elder did not have capacity in order to understand the consequences of the transfer or gift.
Family members are often the closest to an elder, especially the elder’s children. An elder can be dependent on their children emotionally and for all activities of their lives, which may lead to decisions made by the elder under the influence of the child. One such case is Hayward (as Executor of Felton Estate) v Speedy and Felton (2021), the child encouraged her father’s behaviour towards her brother, who was estranged. Under her encouragement, the father’s antagonism towards his son became open to characterisation as delusional and led to the parent’s living in isolation.
This allowed the daughter to encourage the parents, in a negligent manner on her part and recklessly on the parents part, to transfer their wealth to her. Due to their reliance on their daughter, they did not seek independent advice regarding the transfers of property to the daughter. Most of the wealth at the time of their passing had been transferred to the daughter, even though their wills had stated that it was to be distributed equally between the children.
Even potential partners or a remarriage can be suspect of such behaviour. In the case of Ip v Chian (2021), a couple who had been married, had seen the wife in a short space of time, have the family home transferred solely in her name.
The mental capacity of the husband was called into question, that being one of his disadvantages due to his old age, where it was shown that the husband lacked the capability of understanding the consequences of transferring the property. The other factor of the husband’s vulnerability being the low level of communication the husband was capable of, namely being unable to speak much of another language other than Cantonese. This meant that he was dependent on his wife to make enquiries on his behalf and trust that her judgement was in his best interest.
In each of these cases, an elder had a weakness and it was taken advantage of. At Matthews Folbigg, we are able to assist in different aspects of law and therefore can provide advice as to the consequences of transfers or the impact that this may have on your will. In order to ensure that your wishes are reflected in your will and the assets mentioned in the will are in your name to be distributed, we recommend getting independent advice whenever considering transferring or gifting your assets.
More Information
If you wish to obtain further information, advice or assistance in updating your Will, please contact one of our Will Lawyers in our Estate Planning team at Matthews Folbigg on 9635 7966, email us at estates@matthewsfolbigg.com.au or through the website www.matthewsfolbigg.com.au
DISCLAIMER: This article is provided to readers for their general information and on a complimentary basis. It contains a brief summary only and should not be relied upon or used as a definitive or complete statement of the relevant law. Liability limited by a scheme approved under Professional Standards Legislation.
