Kerr v Kerr (No. 2)

[2016] SASC 24

SUPREME COURT OF SOUTH AUSTRALIA

(Testamentary Causes Jurisdiction: Application)

KERR v KERR (No 2)

[2016] SASC 24

Reasons for Decision of The Honourable Justice Gray

23 February 2016

SUCCESSION - MAKING OF A WILL - STATUTORY POWER OF RECTIFICATION

SUCCESSION - PROBATE AND LETTERS OF ADMINISTRATION - COSTS - WHERE LITIGATION CAUSED BY TESTATOR, EXECUTOR OR INTERESTED PERSONS - GENERALLY

Application for costs to be paid out of the estate following rectification of a will.  Following a trial, there was an order for rectification of a second codicil to the will of the deceased.  At trial, one executor agitated for rectification and one executor agitated against it.

Whether costs should be paid out of the estate of the deceased.

Held:

1.       When regard is had to all of the evidence, it could not be said that the defendant was unreasonable in opposing the application or that it was unreasonable for one executor to join the defendant in that opposition.  The circumstances of the proceeding fully justified the comprehensive and robust examination of the affidavit evidence. 

2.       There should be no departure from the usual order.  Costs should be paid from the estate.

Kerr v Kerr [2015] SASC 199; Wesley v Wesley (1998) 71 SASR 1; In the Estate of Francis Lloyd Quick (Deceased) [1996] SASC 5460; In the Estate of John Leslie Xavier Monaghan (Deceased) [2012] SASC 130; In the Estate of Rea Costello (Deceased) [2014] SASC 134; Twist v Tye [1902] P 92; Prinsep v Dyce Sombre (1856) 164 ER 489; Hall v Carney & Ors (No 2) [2012] SASCFC 105; Public Trustee v Hall [1937] SASC 252; Trimmer v Lax; Estate of Fresen (Unreported, Supreme Court of New South Wales, Hodgson J, 9 May 1997); Re Hawkes (decd) [2005] VSC 93; Rawack v Spicer [2002] NSWSC 849, considered.

KERR v KERR (No 2)
[2016] SASC 24

Testamentary Causes Jurisdiction

GRAY J.

1. On 18 December 2015, following a trial in the within proceedings, I ordered rectification of a second codicil dated 27 January 2012 to the will of Henry Robert Kerr, the deceased, being a will dated 18 February 1991.[1] 

   [1]    Kerr v Kerr [2015] SASC 199.

2. On 9 February 2016,  I ordered that the costs of the action of the plaintiff, the defendant and the interested party be adjudicated or agreed as between solicitor and client and be paid out of the estate of the deceased.  Ultimately, this costs order was made by consent but, in the circumstances, I reserved the right to publish reasons for the making of the order.  Those reasons now follow.

3. The usual practice in this State in a case involving rectification of a will, is that the costs of the parties are paid out of the estate unless the solicitor is at fault, in which case the costs are paid by the solicitor.[2]  This practice follows the long established practice of courts of probate that where the litigation has been brought about through the conduct of the testator or testatrix costs should be paid out of the estate.[3]

   [2]    See e.g. Wesley v Wesley (1998) 71 SASR 1; In the Estate of Francis Lloyd Quick (Deceased) [1996] SASC 5460; In the Estate of John Leslie Xavier Monaghan (Deceased) [2012] SASC 130; In the Estate of Rea Costello (Deceased) [2014] SASC 134.

   [3]    Twist v Tye [1902] P 92, 94.

4. Likewise, and by analogy, where it is necessary in the interests of justice that the issue of testamentary capacity and, therefore, the validity of testamentary documents, be the subject of judicial determination, it is the long established practice to order no costs against the unsuccessful executor or legatee and to allow them their costs out of the estate.[4]

   [4]     See Prinsep v Dyce Sombre (1856) 164 ER 489, 522; Hall v Carney & Ors (No 2) [2012] SASCFC 105.

5. In Public Trustee v Hall,[5] Angas Parsons J summarised the rules relating to costs in respect of probate litigation.  His Honour observed:[6]

   The rules relating to costs have been classified as follow:- 1. If the litigation results through the fault of the testator or those interested in the residue the costs may properly be paid out of the estate. 2. If there be sufficient and reasonable ground looking to the knowledge and means of knowledge of the opposing party to question either the execution of the will or the capacity of the testator, or to put forward a charge of undue influence or fraud, the losing party may properly be relieved from the costs of his successful opponent. 3. Unless the circumstances of the case bring it within one of the foregoing exceptions, the general rule that costs follow the event ought to prevail.

   [5]    Public Trustee v Hall [1937] SASC 252.

   [6]    Public Trustee v Hall [1937] SASC 252, 253.

6. In the present proceeding, the testator’s execution of the second codicil gives rise to a presumption that its contents reflect the testamentary intentions of the deceased.  It is an expression of intent of a person unable to give evidence.[7]  The authorities make it clear that an order for rectification should not be made unless the Court is satisfied by clear and convincing proof that an error has been made.[8]  The Court also expects the party seeking rectification to present to the Court all evidence which relates to the intention of the testator.[9]

   [7]    Wesley v Wesley (1998) 71 SASR 1, 5.

   [8]    Trimmer v Lax; Estate of Fresen (Unreported, Supreme Court of New South Wales, Hodgson J, 9 May 1997); Re Hawkes (decd) [2005] VSC 93; Rawack v Spicer [2002] NSWSC 849.

   [9]    Trimmer v Lax; Estate of Fresen (Unreported, Supreme Court of New South Wales, Hodgson J, 9 May 1997).

7. In the present case, one executor agitated for rectification and one executor agitated against it.  There was affidavit evidence capable of supporting the application and affidavit evidence capable of defeating the application.

8. In my view, the circumstances of the proceeding fully justified the comprehensive and robust examination of the affidavit evidence.  That evidence, and oral evidence led in the hearing, indicated that the testator was troubled by family relationships.  Ultimately, as my primary reasons reveal, I was satisfied by clear and convincing proof that an error had been made in the second codicil.  In reaching my conclusions, I was greatly assisted by the close attention paid to the conflicting evidence by all counsel.  When regard is had to all of the evidence, I do not consider that it could be said that the defendant was unreasonable in opposing the application or that it was unreasonable for the interested party, being one of the executors, to join the defendant in that opposition.  

9. The fact that I ultimately preferred some witnesses over others did not obviate the need for a close examination of all of the evidence at trial.  No party suggested that the matter could be resolved on the papers.  It was entirely appropriate that the matter proceed to trial with the testing of the affidavit evidence. 

10. In the above circumstances, I accept the submission that there should be no departure from the usual order and that the costs should be paid from the estate. 

11. As my primary reasons reveal, a matter for further examination relates to the conduct of the solicitor who prepared the second codicil.  Initially a submission was made that I should order that the solicitor pay the costs of the action.  Ultimately this submission was not pressed.  The solicitor did not attend before me and was not heard on the issue.  It will be left to the estate to take such action as it may be advised against the solicitor.