CT v JT
[2025] NSWSC 1304
•5 November 2025
|
New South Wales |
Case Name: | CT v JT |
Medium Neutral Citation: | [2025] NSWSC 1304 |
Hearing Date(s): | In chambers, on written submissions |
Date of Orders: | 5 November 2025 |
Decision Date: | 5 November 2025 |
Jurisdiction: | Equity - Protective List |
Before: | Lindsay J |
Decision: | (1) ORDER that the plaintiff’s costs of these proceedings, assessed on the ordinary basis, be paid: |
Catchwords: | PROTECTIVE JURISDICTION – Costs – Principles to be applied |
Legislation Cited: | Succession Act 2006 NSW |
Cases Cited: | CAC v Secretary, Department of Family and Community Services [2014] NSWSC 1855 |
Category: | Costs |
Parties: | Plaintiff: CST, a son of the first defendant |
Representation: | Counsel: |
File Number(s): | 2024/00368226 |
JUDGMENT
These proceedings, which have been determined save for the question of costs, involved management of the estate of the first defendant (a person incapable of managing her own affairs), and consequently the interests of her husband the second defendant and, incidentally, the interests of their adult children, the plaintiff (a son) and the third defendant (a daughter).
The proceedings principally involved an exercise of the Court’s protective jurisdiction which, incidentally, required an exercise of both its equity jurisdiction (to recover property) and its statutory jurisdiction (to authorise the making of a statutory will, under the Succession Act 2006 NSW, on behalf of the first defendant in consultation with each member of her family).
By and with the consent of the parties, the Court made orders on 1 September 2025 for questions about costs of the proceedings to be determined by me in chambers with the benefit of written submissions.
I have received and taken into account the following written submissions:
(a)the written submissions of the plaintiff dated 18 September 2025 (in chief) and 28 October 2025 (in reply);
(b)the written submissions of the first defendant dated 13 October 2025;
(c)the written submissions of the second defendant dated 7 October 2025; and
(d)the written submissions of the third defendant dated 14 October 2025.
The proceedings were commenced in the Court’s Protective List and, although the Court’s equity and statutory will jurisdictions were engaged, they retained the character of protective proceedings throughout.
In all the circumstances of the case, the appropriate principle to be applied upon a determination of the question of costs is that customarily applied upon an exercise of protective jurisdiction, encapsulated in the question: “What, in all the circumstances, is the proper order for costs to be made?”.
The reasons for that approach (a departure from the ordinary rule in civil proceedings that “costs follow the event”) were explained by Powell J in CCR v PS (No 2) (1986) 6 NSWLR 622 at 640E-G, followed in CAC v Secretary, Department of Family and Community Services [2014] NSWSC 1855 at [129]-[131] and CAC v Secretary, Department of Family and Community Services (No 2) [2015] NSWSC 344 at [13]-[15] and many other cases.
In Small v Phillips (No 3) [2020] NSWCA 24 at [2] the Court of Appeal adopted the same approach, in relation to an application for a statutory will, by reference to Re K’s Statutory Will [2017] NSWSC 1711; 96 NSWLR 69 at [14]-[18].
Powell J’s classic articulation of the rationale for this idiosyncratic approach to the costs of “protective” proceedings was in the following terms:
“I turn, but, in the circumstances, only briefly, to the question of costs. Costs are, of course, in the discretion of the court, but that discretion, being a judicial one, must be exercised in accordance with established principle. Although the principle generally to be applied in inter partes litigation is that costs follow the event, questions of costs in proceedings in the Protective Division have, over the years, come to be regarded as exceptions to that general principle. That this should be so is due to the facts, first, that in the normal case, proceedings in this Division are taken in the interests of those thought to be incapable of protecting themselves and their property; and, second, that those who would otherwise be concerned to act to protect the mentally ill or the mentally infirm might be deterred from acting if they were to expose themselves to the risk of costs if their application, even though reasonably made, were unsuccessful. In the light of these facts, the principle normally applied in proceedings in this Division is that the court will make that order which, in all the circumstances, seems proper.”
It is not necessary, or in the interests of the family engaged in these proceedings, to dwell upon the factual context giving rise to a requirement that questions of costs be determined by the Court. The course of the proceedings, family tensions and the different perspectives of the parties are outlined in their written submissions.
In large measure, albeit after extended negotiations and Family Court proceedings between the first and second defendants (involving the NSW Trustee as a receiver and manager of the estate of the first defendant), all matters in controversy (other than costs) have been resolved consensually.
The occasion for the principal proceedings arose from (now admitted) breaches by the second defendant of the fiduciary obligations owed by him to the first defendant as her enduring attorney, by self-dealing with real estate, albeit (he contends) with a benign object of paternalistically looking after the interests of the first defendant and their children.
The proceedings were ostensibly commenced by the plaintiff in the interests, and for the benefit, of the first defendant in circumstances in which, without being privy to the second defendant’s “estate planning” motivations, he was alarmed by the second defendant’s self-dealing when discovered by his investigative efforts.
Tensions within the first defendant’s family have arisen, in part, by the plaintiff’s protective instinct in favour of his mother in circumstances in which, after living with the dementia of his wife, the second defendant found companionship with another woman, not disclaiming his ongoing love for his wife.
The plaintiff has taken his mother’s “side”. His sister, the third defendant, has taken her father’s “side”.
Everybody expresses empathy for the first defendant and a desire that she be well cared for in her vulnerable state.
As between themselves, the first defendant (represented by the NSW Trustee as manager of her protected estate and her tutor in these proceedings) and the second defendant have agreed to pay their own costs; the second defendant says, and the first defendant does not deny, that this reflects an accommodation of the parties’ respective property rights in their family law settlement.
The third defendant seeks no order for costs, and no party claims costs against her.
There is no dispute that the first defendant’s costs of the proceedings (including those of the NSW Trustee and an earlier appointee as her tutor) should be paid out of the estate of the first defendant on the indemnity basis.
The problem is what to do with the plaintiff’s costs, which are considerable (he says, because he was required to investigate his parent’s affairs without timely disclosures or, before the commencement of these proceedings, frank disclosures by the second defendant).
For his part, the second defendant, with support from the third defendant, invites the Court to downplay the role of the plaintiff in bringing concerns about the welfare of the first defendant to the attention of the Court, and denies that the plaintiff had any substantial role to play after the appointment of the NSW Trustee as receiver and manager of the estate of the first defendant.
Rising above the family’s tensions, a central objective fact is that these proceedings were instituted by the plaintiff, and followed through by him, principally as a means of allowing the financial affairs of the first and second defendants to be unravelled in a way that ensured that the welfare and interests of the first defendant were (as mandated by Marion’s Case (1992) 175 CLR 218 at 258-259, informed by Re Eve [1986] 2 SCR 388; 31 DLR (4th) 1, and Holt v Protective Commissioner (1993) 31 NSWLR 227 at 238D) the paramount consideration.
In all the circumstances of the case, in my opinion the proper order for the costs of the plaintiff is that they be borne by the first defendant, and the second defendant, in equal shares.
Although I accept that the plaintiff’s principal motivation in the proceedings was to protect the interests of his incapacitated mother, there is some truth in the contention of the second and third defendants that, after the appointment of the NSW Trustee as receiver and manager of the first defendant’s estate, his role in the proceedings became subordinate to the NSW Trustee and his continuing involvement in the proceedings reflected, in part, a concern to protect his own interests. That duality can best be recognised by an order that his costs be assessed on the ordinary basis rather than (as would have been the case had his motivation been purely altruistic) the indemnity basis.
For these reasons I make the following orders:
(1)ORDER that the plaintiff’s costs of these proceedings, assessed on the ordinary basis, be paid:
(a)as to 50%, out of the protected estate of the first defendant; and
(b)as to 50%, by the second defendant.
(2)ORDER that the costs of the first defendant (including the costs of each of her tutors) be paid out of the estate of the first defendant on the indemnity basis.
(3)NOTE that no other orders for costs are made, with the intent that the second and third defendants bear their own costs of the proceedings.
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Amendments
06 November 2025 - At [19] the words "have their costs" are replaced by the word "be"
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