STEPHEN COTTRELL & ORS (ACCORDING TO THE ATTACHED SCHEDULE)
Applicants/Cross-respondents
v
LISA MIGLIC & ORS (ACCORDING TO THE ATTACHED SCHEDULE)
Respondents/Cross-applicants
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JUDGES:
McLEISH, LYONS and KENNY JJA
WHERE HELD:
Melbourne
DATE OF HEARING:
29 April 2025
DATE OF JUDGMENT:
27 June 2025
MEDIUM NEUTRAL CITATION:
[2025] VSCA 145
JUDGMENT APPEALED FROM:
Re Miglic [2024] VSC 20; Re Miglic [Nos 2 and 3] (Supreme Court of Victoria, Gorton J, 8 February 2024)
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WILLS AND ESTATES – Mutual wills agreement – Husband and wife made wills in substantially mirror form leaving estate to survivor or if no survivor to respondents being children of husband – Husband’s will less favourable to respondents than prior will – Wife made five subsequent wills leaving increasingly generous dispositions to applicants – Husband not consenting to subsequent wills – Husband predeceasing wife – Whether judge erred in finding husband and wife intended to be bound by mutual wills agreement – Respondents testified to meeting with husband and wife who described testamentary arrangements and mutual wills agreement – Wider context supporting testimony – Not in issue that husband considered agreement binding – Judge’s finding correct.
TRUSTS – Tracing – Aunt inherited share of residuary estate with life interest in income and capital sum passing to applicants upon her death – Expert evidence showing capital sum growing to $900,000 if invested in mixed investment portfolio – No evidence how capital sum treated – Applicants argued aunt mixed trust property with own property – Judge could not exclude possibility capital sum held in term deposit – Judge found no basis for tracing to specific assets – Whether basis for tracing to mixed assets in aunt’s estate upon principle that where fiduciary mixes trust property with their own whole is treated as trust property – Mixed assets in aunt’s estate $1,136,099 – Subject property capable of pro rata division – No basis for remedy in excess of capital sum – No error in judge rejecting tracing claim.
APPEAL – New point on appeal – Claim for equitable compensation or constructive trust arising from various breaches not advanced at trial – Resolution of claim requiring consideration of factual issues and expert evidence – Not expedient in interests of justice to permit claim to be raised on appeal.
COSTS – Order for costs to be paid out of estate – Whether error in judge’s order – Probate rule justifying costs out of estate where testator cause of litigation – Testator’s conduct may be relevant to costs discretion in non-probate cases – Open for judge to treat controversy as other than ordinary adversarial litigation between beneficiaries – Relevant to consider whether defendants acted reasonably in conducting litigation – Relevant to consider size of estate – No error in judge’s approach.
APPEALS – Costs – Leave to appeal – Exceptional to grant leave to appeal costs orders – Matters of general principle – Specific kind of costs…
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.
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AGLC
Cottrell v Miglic [2025] VSCA 145
Case
[2025] VSCA 145
Decision Date
CaseChat Overview and Summary
In Cottrell v Miglic, the Court of Appeal of Victoria examined a complex web of disputes concerning wills, estate distribution, and trust property tracing. The case involved a mutual wills agreement between a husband and wife, whereby they left their estate to the survivor, with the residue going to their children. The husband passed away before the wife, and the wife had made several wills with varying bequests. The children of the husband contested the validity of the wills and the tracing of trust property within the estate.
The legal issues before the court included whether the husband and wife intended to be bound by the mutual wills agreement, and if so, whether the wife was entitled to deviate from it by making subsequent wills without the husband's consent. Additionally, the court had to determine if the applicants were entitled to trace trust property within the estate of the aunt who had inherited a portion of the residuary estate. The court also considered whether new claims raised on appeal, such as a claim for equitable compensation, could be entertained.
The Court of Appeal found that the judge was correct in his assessment that the husband and wife intended to be bound by the mutual wills agreement, based on the evidence of a meeting where they discussed their testamentary arrangements. The court rejected the tracing claim as there was no evidence to support that the aunt had mixed trust property with her own. Regarding the new claim for equitable compensation, the court held that it was not expedient in the interests of justice to allow it to be raised on appeal as it required consideration of factual issues and expert evidence. Lastly, the court upheld the judge's order for costs to be paid out of the estate, noting that the judge had appropriately considered the relevant factors.
The Court of Appeal granted leave to appeal on the costs order, finding that there was a real prospect of success given the exceptional circumstances and the specific nature of the costs order. The decision underscores the importance of clear testamentary intentions, the strict requirements for tracing trust property, and the limited circumstances under which new claims can be introduced on appeal.