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Cody v Cody (No 3)

Cody v Cody (No 3)

Case [2016] VSC 499 23 August 2016

Costs

Limitation Periods

Trustee Act 1958

Civil Litigation & Procedure

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

TRUSTS, EQUITY & PROBATE LIST

S CI 2012 05489

PATRICIA ADRIENNE CODY and PATRICK FRANCIS CODY (as executors of the estate of Pierce Thomas Cody, deceased)	Plaintiffs
v
PIERCE PATRICK CODY (as executor of the estate of Pierce Thomas Cody, deceased)	Defendant

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JUDGE:	McMillan J
WHERE HELD:	Melbourne
DATE OF HEARING:	On the papers, plaintiffs' written submissions dated 20 June 2016 and defendant's written submissions dated 17 and 29 June 2016
DATE OF RULING:	23 August 2016
CASE MAY BE CITED AS:	Cody & Anor v Cody (No 3)
MEDIUM NEUTRAL CITATION:	[2016] VSC 499

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COSTS—Where parties are executors of deceased estate—Where proceeding compromised without hearing on merits—Where both parties achieved a result—Whether costs of proceeding be paid personally or from the estate—Trustee Act 1958, s 36(2)—Supreme Court (General Civil Procedure) Rules 2015, r 63.26— Re Beddoe [1893] 1 Ch 547— Nolan v Collie (2003) 7 VR 287

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr S P Newton	Wisewould Mahony
For the Defendant	Mr T P Warner	Strongman & Crouch

HER HONOUR:

Background

The plaintiffs are two of the executors of the estate of Pierce Thomas Cody, deceased. The defendant is the third executor of the estate.

In 2012, the plaintiffs sought orders against the defendant that the executors of the estate take all steps to effect the sale of an estate asset, being an apartment in Falls Creek. Judgment in the proceeding was delivered on 5 June 2013.[1] Orders made 24 June 2013 provided for the apartment to be placed on the market for sale at the end of the 2014 ski season unless a majority of the six persons named in those orders agreed that the apartment be retained by the estate. The apartment was listed for sale in 2014. It was subsequently sold by contract of sale dated 8 April 2016, with settlement to be effected on 29 April 2016. Both the plaintiffs and the defendant signed the contract of sale as the executors of the deceased’s estate. The settlement date was subsequently extended to 20 May 2016 due to the defendant not signing the settlement documents.
[1]Cody v Cody [2013] VSC 274 (5 June 2013) (McMillan J).

The plaintiffs’ solicitors forwarded the settlement documents for signing by the defendant on 2 May 2016. The plaintiffs sought the execution and return of the settlement documents on several occasions without success and their attempts to serve the defendant were unsuccessful.

Plaintiffs’ application

On 18 May 2016, the plaintiffs wrote to the defendant informing him that they intended to seek orders from the Court on the basis that he had not signed and returned the documents to enable settlement to proceed. The plaintiffs’ affidavits in support were filed at the Registry with a notice to produce the file for hearing on 10 June 2016 in the Trusts, Equity and Probate List. The plaintiffs also sought an order for…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Cody v Cody (No 3)

Details

AGLC: Cody v Cody (No 3) [2016] VSC 499
Case: [2016] VSC 499
Decision Date: 23 August 2016

CaseChat Overview and Summary

The case of Cody v Cody (No 3) involved the executors of a deceased estate, with the dispute centring on the allocation of costs incurred during the proceedings. The matter was heard in the Supreme Court of Victoria, with the parties ultimately reaching a compromise without the need for a hearing on the merits of the case. The primary legal issue before the court was whether the costs of the proceedings should be borne personally by the parties or should be paid from the estate of the deceased. This issue was governed by section 36(2) of the Trustee Act 1958, alongside rule 63.26 of the Supreme Court (General Civil Procedure) Rules 2015. The court considered the principles set out in Re Beddoe and Nolan v Collie, which respectively established that costs of litigation may be charged to the estate if the parties' actions are beneficial to the estate, and that the executors are entitled to be indemnified for their expenses from the estate.

The court examined the nature of the compromise and the resultant benefits to the estate, ultimately concluding that the costs should be borne from the estate. The reasoning was grounded in the understanding that both parties, as executors, were acting in the best interests of the estate. Given that the compromise achieved a beneficial result, the court found it appropriate to charge the costs to the estate, thereby protecting the personal financial interests of the executors. This decision aligns with the principles that seek to ensure that executors are not personally liable for costs unless it is in the best interests of the estate to do so. The court's ruling also provided clarity for future proceedings involving executors, ensuring that they are indemnified for costs incurred in the course of their duties.

In light of the findings, the court ordered that the costs of the proceeding be paid from the estate of the deceased. This decision was consistent with the statutory provisions and the precedents cited, providing a clear direction for similar future cases involving executors and the allocation of costs. The ruling not only resolved the immediate issue but also reinforced the legal framework governing the financial responsibilities of executors in estate matters.

Orders