Hoare, Norris Geoffrey v Johnson, Peggy Dawn & Hoare, Ronald Rex & Harper, Doreen May (No 2)
[1998] TASSC 65
•22 May 1998
65/1998
PARTIES: HOARE, Norris Geoffrey
v
JOHNSON, Peggy Dawn
HOARE, Ronald Rex
HARPER, Doreen May (No 2)
TITLE OF COURT: SUPREME COURT OF TASMANIA
JURISDICTION: ORIGINAL
FILE NO/S: 1672/1994
M13/1994
DELIVERED: 22 May 1998
HEARING DATE/S: 13 May 1998
JUDGMENT OF: Underwood J
CATCHWORDS:
Succession - Wills, probate and administration - Probate and letters of administration - Costs - General principles - General principles in the exercise of the discretion - Costs follow the event - Exceptions.
Supreme Court Civil Procedure Act 1932 (Tas), s12(2).
Rules of Court (Tas), O80, r1(1).
Spiers v English [1907] P 122; Re Herbert Brothers Deceased (1990) 101 FLR 279; applied.
Aust Dig Succession [135]
Succession - Wills, probate and administration - Probate and letters of administration - Limited, special and conditional grants of probate and administration - Other cases - Administration ad colligenda bona - Costs of administration - Administrators also unsuccessful defendants in contentious proceedings - General principles in the exercise of the discretion.
Aust Dig Succession [95]
REPRESENTATION:
Counsel:
Plaintiff: A M Blow QC
Defendants: W T McMillan and G N McLean
Solicitors:
Plaintiff: McGrath & Co
First and Second Defendants: McLean Phillips & Bartlett
Third Defendant: McManus Palmer & Zeeman
Court Computer Code:
Judgment ID Number: 65/1998
Number of pages: 7
Serial No 65/1998
File Nos 1672/1994M13/1994
NORRIS GEOFFREY HOARE v PEGGY DAWN JOHNSON,
RONALD REX HOARE and DOREEN MAY HARPER (NO 2)
REASONS FOR JUDGMENT UNDERWOOD J
22 May 1998
Introduction
The plaintiff was a brother of Tasman William Hoare who died on 9 January 1994. By a writ of summons filed in this Court on 5 October 1994, the plaintiff sought probate in solemn form of the will of the deceased dated 12 December 1964. By that will, the plaintiff is one of two executors and the sole beneficiary of the deceased's estate. The first and second defendants were two of the siblings of the deceased and the third defendant was his common law wife. By their defence, the defendants put the plaintiff to proof that the 1964 will was executed in accordance with the provisions of the Wills Act 1840, s9. However, the real dispute between the parties lay in a counterclaim. By this counterclaim the defendants alleged that the deceased had made a later will dated 14 April 1967. It was counterclaimed that this later will had been lost or destroyed, but it had been duly executed and it expressly revoked all prior wills. If made out, the allegations on the counterclaim would have resulted in the deceased's estate being administered on an intestacy and his siblings would have been the beneficiaries. The third defendant had no financial interest in the outcome of the litigation, for she was not entitled to a share of the deceased's estate under either the 1964 will or upon an intestacy.
The trial on the claim and the counterclaim commenced on 9 December 1997. At the start, Mr McManus appeared for the third defendant, explained that her interest was identical to the other two defendants, sought and was given leave to withdraw. For reasons that will appear shortly, the trial of the action was adjourned on 11 December 1997. It resumed and concluded on 18 March 1998. On 3 April 1998, orders were made that the will of the deceased dated 12 December 1964 be admitted to probate in solemn form and that judgment be entered for the plaintiff against the defendants on the counterclaim. Now there is an argument about the costs of the action and related proceedings.
Events prior to the commencement of the action
At the end of March 1994, the plaintiff made application for probate in common form of the will dated 12 December 1964. In order to prevent a grant being made, the solicitors for the first and second defendants lodged a caveat on behalf of the first and second defendants, and two other siblings of the deceased, on 18 April 1994. By virtue of the Rules of Court (Probate), r78(2), the caveat was effective for six months unless renewed prior to the expiration of that period. On the same day, the first defendant made an application under the Justices Act 1959 for a restraining order, restraining the plaintiff from entering onto the deceased's property at Scamander and from damaging any of the deceased's property.
The background behind the restraining order appears from affidavits later filed in this Court and the material supporting the application itself. By April 1994, the defendants knew that the records of the former legal firm, Tyson & Tyson, contained entries to the effect that a will of the deceased dated 14 April 1967 was put in that firm's strong room and kept there until it was taken up by the deceased on 28 April 1981. This will has never been found. The first and second defendants alleged that the plaintiff told them that the deceased burnt a will on the banks of the Scamander River years ago. The first and second defendants also claimed that the plaintiff was inter-meddling in the estate and attempting to appropriate the deceased's assets to himself. The application for a restraining order stated that it was supported by the second defendant and filed with it was an affidavit sworn by the third defendant. An interim order in the terms sought was made, presumably ex parte, the same day as the application was dated. The further hearing of the matter was adjourned to 31 May 1994.
The third defendant sought separate legal advice and, it would appear, has maintained separate legal representation, at least until the trial of the action commenced on 9 December 1997. She, too, filed a caveat to prevent the 1964 will being admitted to probate in common form. The matter did not rest with the filing of caveats and the granting of a restraining order.
On 10 May 1994, five months before the writ was filed, the first and second defendants made application (M13/1994) for an order that they be granted letters of administration ad colligenda bona of the estate of the deceased. The application was supported by a number of affidavits, one of which was sworn by the third defendant. In her affidavit, the third defendant sought to be joined in the grant of administration ad colligenda bona with the other two defendants. The matter was heard ten days after the application was filed, viz, 20 May 1994. The hearing was ex parte. The order made by Cox J (as he then was) did more than appoint the three defendants administrators ad colligenda bona of the estate of the deceased. Paragraph 1 appointed the defendants administrators "limited for the purpose only of collecting and getting in and receiving the estate and doing such acts as may be necessary for the preservation of same". Paragraph 2 directed the plaintiff to hand all the deceased's property in his possession to his solicitors. Paragraph 3 ordered the plaintiff to hand to the solicitors for the first and second defendants, a complete inventory of the assets and liabilities of the deceased as known to him. Paragraph 5 empowered the administrators to find a tenant for the deceased's house. Paragraph 6 authorised the administrators to search and make inquiry for the will dated 14 April 1967 or a copy of it. The remaining paragraphs of the order dealt with service of documents and other incidental matters, including costs. The latter were reserved and form part of the present application.
By par4, Cox J ordered that:
"The Registrar of this Honourable Court do issue a subpoena in the usual form requiring the said [plaintiff] to produce and bring into the Registry of the Court any paper or writing being or purporting to be testamentary and made by the deceased which may be in his possession, power or under his control and requiring him to attend before Court to be examined on oath concerning the same and further as to his knowledge of any other paper or writing testamentary made by or destroyed by the deceased or any other persons."
Pursuant to that order the subpoena was issued and, on 8 February 1995, the plaintiff was examined before the former Chief Justice, Sir Guy Green. At the commencement of that examination, counsel for the plaintiff complained about the procedure, as the disputed will was, by that time, the subject of contentious proceedings (the action). However, as the learned former Chief Justice pointed out, that may be so, but nonetheless the Court had appointed the defendants administrators ad colligenda bona and conferred this power and duty on them. Meantime, the interim restraint order was continued from time to time on the application of the first defendant, and was ultimately made a permanent order with the consent of the plaintiff.
Costs of the administration ad colligenda bona, of the restraint orders and the filing of caveats
The defendants seek an order that they recover the costs of their administration ad colligenda bona. Mr Blow QC conceded that the administrators ad colligenda bona were entitled to their costs on an indemnity basis out of the estate of the deceased for carrying out the terms of the order dated 20 May 1994, but excepted from his concession those costs referable to carrying out the order, par4, and those costs referable to work done in connection with the institution and prosecution of the counterclaim in the action brought by the plaintiff (1672/1994). The order, par4 was made in the exercise of the non-contentious probate jurisdiction of this Court. The powers of an administrator ad colligenda bona are limited to the terms of the order appointing him, her or them. I accept that at the time of the hearing before the former Chief Justice pursuant to the terms of the order, par4, action No 1672/1994 was afoot and, no doubt the administrators used to full advantage the power conferred upon them by the order, par4, to assist them in the prosecution of the counterclaim in that action. However, although the inquiry pursuant to the order, par4 may have incidentally benefited the defendants in the prosecution of their counterclaim in the contentious proceedings, by conducting it the administrators were doing no more than they were ordered to do by the order of Cox J dated 20 May 1994.
With respect to the application for a grant of administration ad colligenda bona, there was sufficient material, in my view, to warrant such an application being made. It is true that the application was made ex parte and, in a recently filed affidavit, the plaintiff disputed the correctness of much of the defendants' affidavit material filed in support of the application; but it is clear that there was a major family dispute afoot and there was a real risk that before a full grant of administration could be made, at least some of the assets might be lost or dissipated. Accordingly, it seems to me that, subject to two matters, the administrators are entitled to recover out of the estate the costs of the application for appointment as administrators ad colligenda bona on an indemnity basis. One of the matters relates to the order of Cox J dated 20 May 1994, par6, which provided:
"6 That the administrators are authorised to conduct such searches and enquiries as they shall be advised by their solicitors to make in an endeavour to locate the will allegedly made by the deceased and dated the 14th day of April 1967 or a copy thereof or notes of its contents and the usual searches for a missing will including the insertion of advertisements in newspapers and further authorising the administrators to pay all costs and expenses in connection with such searches and enquiries out of the estate of the deceased."
Much of the evidence adduced at the trial in support of the counterclaim concerned the unsuccessful searches that had been made for the document that had been kept in the strong room of Tyson & Tyson until 1981, or a copy or note of it. I am satisfied that the scope of the search for the missing document was greater than that reasonably necessary for the discharge of the office of administrators ad colligenda bona. I am satisfied that to that extent, the administrators should not have their costs of carrying out the terms of the order, par6. Accordingly, the order that the administrators recover their costs out of the estate will be limited in the case of carrying out the order, par6, to those costs which were incurred prior to the conclusion of the hearing before the former Chief Justice on 8 February 1995. The other matter concerns the separate legal representation of the third defendant. The interests of the three defendants as administrators (and as defendants to the action) were identical and, insofar as the costs of the administration was increased by reason of the third defendant being separately represented, they are not recoverable.
The first defendant also seeks an order that the costs of and incidental to the applications for the restraining orders be taxed and paid out of the estate on an indemnity basis. The difficulty with this application is that the initial application for a restraining order and subsequent applications to continue the interim order were not authorised by the order of Cox J dated 20 May 1994. Without that authorisation, the first defendant, as administrator, is not entitled to the order she seeks. In order to overcome this difficulty, the defendants took out an interlocutory summons in the administration ad colligenda bona proceedings seeking an order (inter alia) that the Court make a declaration declaring that the first defendant was authorised to apply for the restraining order, which application was made before the grant of administration was made, and/or was authorised to continue the interim restraining order after the grant of administration ad colligenda bona. The application for a declaratory order will be refused. There is a dispute on the affidavit material as to whether it was reasonably necessary that an application for a restraining order be applied for and/or continued. I am unpersuaded that the restraint order was necessary for the purpose of protecting the estate of the deceased. An administrator ad colligenda bona will obtain retrospective authorisation for acts done four years earlier only in an exceptional case. Unless it is shown that there was a clear need to act before authorisation could have been obtained, costs for unauthorised work will not be allowed. No such need was demonstrated.
By the interlocutory summons (as amended), the defendants also seek a declaration that they were empowered to renew the caveat filed on 18 April 1994 and an order that they have the costs of renewing the caveat on the several occasions that it was renewed thereafter. The primary function of an administrator ad colligenda bona is to gather in and preserve the estate of the deceased until a general grant can be made. See Whitehead v Palmer [1908] 1 KB 151. Sometimes that grant is made to a complete stranger. See Re Wyckoff (1862) 3 SW & TR 20: 164 ER 1178. It is no part of an administrator's business to propound one will in preference to another. The declaration sought will not be made.
Further, the interlocutory summons seeks an order declaring that the defendants be authorised to resist the contentious proceedings commenced by the plaintiff and authorised to prosecute the counterclaim. For the reasons given with respect to the application for a declaration that the defendants be authorised to continue the caveat, this application is refused. The issue concerning an order for costs on the action is dealt with below.
Finally, the interlocutory summons seeks orders that any order for costs made in favour of the administrators be charged against and paid in the first instance out of money held by the administrators' solicitors, and, if insufficient, be charged against identified property of the deceased. I have no material before me to show why I should make any such orders. The whole of the deceased's estate will pass to one beneficiary and there is no need to identify any particular fund that should bear the incidence of any costs order. However, in case any difficulty arises in connection with carrying out the terms of any order of costs, I will reserve liberty to apply.
The costs of the action
At the outset it must be said that having regard to the evidence concerning the document that was kept in the strong room of Tyson & Tyson, probate in common form would not have been granted. On any view, the plaintiff would have been compelled to seek probate in solemn form in contentious proceedings. This was conceded by Mr Blow QC. Accordingly, the plaintiff accepts that he has to bear his own costs of contentious proceedings, but claims an order that insofar as those costs were increased by the counterclaim, there should be an order that he recover those costs from the defendants.
On behalf of the defendants, Mr McMillan relied upon the Rules of Court, O80, r1(2), which provides:
"(2) Nothing contained in this rule shall deprive an executor, administrator, trustee, or mortgagee, who has not unreasonably instituted or carried on or resisted any proceedings, of any right to costs out of a particular estate or fund to which he would be entitled according to the rules heretofore acted upon in the Court in its equity jurisdiction."
Mr McMillan referred to Plimsoll and Others v Drake (No 2) B37/1995 and O'Rourke & Ors v Perpetual Trustees & Ors (No 2) 45/1987, in each of which there is a discussion of the principles applicable to the proper exercise of the discretion pursuant to the above rule. However, the provisions of O80, r1(2) are not relevant, for the defendants did not counterclaim in their capacity as administrators. Such action was not within the terms of the grant of administration. Accordingly, the making of an order for costs calls for an exercise of the general discretion conferred by the Supreme Court Civil Procedure Act 1932, s12(2) and the Rules of Court, O80, r1(1), in accordance with principles developed by the common law (Norbis v Norbis (1986) 161 CLR 513).
Williams, Mortimer and Sunnucks, Executors, Administrators and Probate, 16 edn, at 408 et seq, set out four exceptions to the general rule that costs follow the event, namely:
where notice to cross-examine has been given;
where litigation has been caused by the conduct of the testator;
where litigation has been caused by the conduct of the principal beneficiaries;
where circumstances afford reasonable grounds for opposing a will.
Foundational authorities for the proper exercise of the discretion with respect to costs in contentious probate proceedings are Mitchell v Gard (1863) SW & TR 274; 165 ER 1280 and Spiers v English [1907] P 122. In the former case, Sir J P Wilde said at 277; 1281:
"The basis of all rule on this subject should rest upon the degree of blame to be imputed to the respective parties ; and the question, who shall bear the costs ? will be answered with this other question, whose fault was it that they were incurred ? If the fault lies at the door of the testator, his testamentary papers being surrounded with confusion or uncertainty in law or fact, it is just that the costs of ascertaining his will should be defrayed by his estate.
If the party supporting the will has such an interest under it that the costs, if thrown upon the estate, will fall upon him, and he by his improper conduct has induced a litigation which the Court considers reasonable, it is not unjust that the estate should bear the costs of the litigation which his conduct has caused.
But if the testator be not in fault, and those benefited by the will not to blame, to whom is the litigation to be attributed ? In the litigation entertained by other Courts, this question is in general easily solved by the presumption that the losing party must needs be in the wrong, and, if in the wrong, the cause of a needless contest. But other considerations arise in this Court. It is the function of this Court to investigate the execution of a will and the capacity of the maker, and having done so, to ascertain and declare what is the will of the testator. If fair circumstances of doubt or suspicion arise to obscure this question, a judicial inquiry is in a manner forced upon it. Those who are instrumental in bringing about and subserving this inquiry are not wholly in the wrong, even if they do not succeed. And so it comes that this Court has been in the practice on such occasions of deviating from the common rule in other Courts, and of relieving the losing party from costs, if chargeable with no other blame than that of having failed in a suit which was justified by good and sufficient grounds for doubt."
In Spiers v English (supra), Sir Gorell Barnes said at 123:
"In deciding questions of costs one has to go back to the principles which govern cases of this kind. One of those principles is that if a person who makes a will or persons who are interested in the residue have been really the cause of the litigation a case is made out for costs to come out of the estate. Another principle is that, if the circumstances lead reasonably to an investigation of the matter, then the costs may be left to be borne by those who have incurred them. If it were not for the application of those principles, which, if not exhaustive, are the two great principles upon which the Court acts, costs would now, according to the rule, follow the event as a matter of course. Those principles allow good cause to be shewn why costs should not follow the event. Therefore, in each case where an application is made, the Court has to consider whether the facts warrant either of those principles being brought into operation."
These principles were applied and discussed by the Northern Territory Court of Appeal in Re Herbert Brothers Deceased (1990) 101 FLR 279. They are to be applied in this case.
I reject Mr McMillan's submission that this case falls outside the general rule by reason of the conduct of the testator. This is not a case where it could be said that the testator left his affairs in such a mess that his conduct really gave rise to the litigation. It is true that at the examination before the former Chief Justice, evidence was given by the plaintiff from which it might be inferred that the testator burnt a subsequent will on the banks of the Scamander River. I expressed my reservations about this evidence in my reasons for judgment in the action, but, even if it that did happen, the defendants' position was clearly established at an early stage, namely, at best, there was an earlier will but it was lost or destroyed and there was no copy or note of it to be found. The testator's conduct in either destroying his will or taking it from the solicitors and losing it did not make the conduct of the counterclaim reasonably necessary. This was a lost will case and no direct evidence of the contents was available. The law with respect to such cases is well settled. Similarly, I reject Mr McMillan's submission that this litigation was caused, in part, by the conduct of the plaintiff. Nothing the plaintiff said or did altered the plain situation that faced the defendants, namely, that there was a 1964 will which, on the face of it, was valid, and that probably there had been a later document that purported to be a will, but it was no longer in existence and there was no evidence of its contents, other than that which might be inferred from the uncertain circumstantial evidence concerning the habits and conduct of the legal advisers whom the deceased consulted. The plaintiff gave a strange account of the deceased burning a document that looked like a will on the banks of the Scamander River. The veracity of that account excited some suspicion, but it was not the kind of suspicion that justified the prosecution of the counterclaim. As I have already said, no matter how suspicious the defendants might have been that the plaintiff was not telling the truth about the burning of the will, prosecution of the counterclaim was not likely to remove the suspicions and certainly would not alter the fact that the document taken from the solicitor's strong room could not be found, nor could any copy or note of it.
In all the circumstances, I am clearly of the view that the general rule should apply and, with respect to the action, the costs should follow the event. On behalf of the defendants, application was made for the costs of an application for leave to serve interstate subpoenas on Maxwell James Hoare and Fay Lucy Hoare. These are part of the defendants' cost of unsuccessfully counterclaiming and the order sought will not be made. It is also appropriate that the defendants should bear their own costs of and incidental to the application that a Citation to See Proceedings be issued pursuant to an order made on 12 June 1996. However, there is one matter of the action that requires separate treatment.
When the trial commenced on 9 December 1997, Mr Blow QC for the plaintiff, made an application to withdraw an admission in the certificate of readiness that "The deceased Tasman William Hoare made a will on 14 April 1967". Such an admission carried with it an admission that the 1967 document had been executed in accordance with the provisions of the Wills Act 1840, s9. The application was, quite properly, contested and there was a hearing on the voir dire. At the conclusion thereof, the application was granted and the implied admission withdrawn. The granting of the application forced the defendants to apply for an adjournment on 11 December 1997 in order to adduce further evidence. It is appropriate that the plaintiff pay the defendants' costs of and occasioned by the application on 9 December 1997 to withdraw the admission in the certificate of readiness and the costs of and thrown away by reason of the adjournment on 11 December 1997 on a party and party basis.
Summary
I propose that the following orders be made, but before doing so will hear counsel as to their form:
In proceedings M13/1994, it is ordered that the applicants' [defendants'] costs of the application for the appointment of administrators ad colligenda bona and the costs of the administrators carrying out the order of this Court dated 20 May 1994, be taxed on an indemnity basis and paid out of the estate of the deceased Tasman William Hoare, except for:
(a)the costs of administrator Doreen May Harper insofar as those costs were increased by her having legal representation separate from that retained by the other administrators; and
(b)any costs incurred after 8 February 1995 in connection with the carrying out of par6 of the order of this Court dated 20 May 1994.
In action No 1672/1994, it is ordered that the defendants pay the plaintiff's costs of the counterclaim taxed on a party and party basis except those costs of and occasioned by the application on 9 December 1997 to withdraw the admission in the certificate of readiness and the costs of and thrown away by reason of the adjournment on 11 December 1997.
In action No 1672/1994, it is ordered that the plaintiff pay the defendants' costs of and occasioned by the application on 9 December 1997 to withdraw the admission in the certificate of readiness and the costs of and thrown away by reason of the adjournment on 11 December 1997 taxed on a party and party basis.
Liberty reserved to any party to apply generally.
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