Re Wierzbowski
[2023] VSC 11
•25 January 2023
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
TRUSTS, EQUITY AND PROBATE LIST
S PRB 2021 12743
| IN THE MATTER of the estate of MAREK JAKUB WIERZBOWSKI, deceased | |
| between | |
| MACIEJ FRANCISZEK WIERZBOWSKI | Plaintiff |
| v | |
| ALEXANDRA MAYA WIERZBOWSKI | Applicant |
| and | |
| GALEA & FAUSTIN SOLICITORS | Non-party |
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JUDGE: | McMillan J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 2 August 2022 |
DATE OF JUDGMENT: | 25 January 2023 |
CASE MAY BE CITED AS: | Re Wierzbowski |
MEDIUM NEUTRAL CITATION: | [2023] VSC 11 |
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COSTS – Application for revocation of probate discontinued at commencement of trial – Probate granted in solemn form – Costs awarded against applicant on indemnity basis – Whether applicant’s former solicitors should indemnify applicant in respect of her costs – Whether applicant’s former solicitors breached their overarching obligations under the Civil Procedure Act – Requirement of proper basis – Obligation to ensure costs are reasonable and proportionate – Obligation to minimise delay – Civil Procedure Act 2010 (Vic) ss 18, 24, 25, 29.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr R Boaden | Pietrzak Solicitors |
| For the Applicant | Mr N Bird | Vasilaras & Co Lawyers |
| For the Non-party | Lander & Rogers |
HER HONOUR:
Marek Jakub Wierzbowski (‘the deceased’) died on 26 April 2021. He was survived by two adult children: his son, Adam Wierzbowski, and his daughter, Alexandra Maya Wierzbowski (‘the applicant’).
The deceased’s will dated 14 April 2021 (‘the will’) was signed by the deceased while he was a patient at Casey Hospital. The will appointed the deceased’s brother, Maciej Franciszek Wierzbowski (‘the plaintiff’) as his executor. The will provided that the deceased’s superannuation entitlements be shared between the plaintiff’s daughter, Agata Wierzbowski (‘Agata’), and the plaintiff’s granddaughter, Charlotte Lakowski (‘Ms Lakowski’), and bequeathed 40 per cent of the residue of the deceased’s estate to each of his children and the remaining 20 per cent to Agata.
On 6 August 2021 probate of the will was granted to the plaintiff. The deceased’s estate is valued at $625,996.26.
Application for revocation
By summons filed 4 February 2022, the applicant sought orders for revocation of the grant of probate, alleging that:
(a) the deceased was unlikely to have had testamentary capacity in the period shortly before and at the time of executing the will; and
(b) the will was executed in suspicious circumstances, giving rise to an inference that the deceased neither knew of the contents of the will nor approved of them.
Before commencing the application, the applicant’s solicitors did not contact the deceased’s treating medical practitioners or the deceased’s principal treating doctor at Casey Hospital, Dr Damian Hannon (‘Dr Hannon’), concerning the deceased’s capacity when he gave instructions for the preparation of the will and when he signed the will.
The applicant’s solicitors did not file a certificate as required by s 42(1B) of the Civil Procedure Act 2010 (Vic) (‘the Civil Procedure Act’) certifying that there was a proper basis for the application, nor was an overarching obligations certification provided by the applicant’s solicitors, as required by s 41 of the Civil Procedure Act.
On 11 April 2022 procedural orders were made, including that the application for revocation be listed for trial on 2 August 2022.
Pursuant to orders for discovery, the plaintiff filed an affidavit sworn 3 May 2022 regarding, inter alia, any medical or like reports in his possession. He deposed that apart from a radiologist report dated 30 September 2019, he did not possess any other medical or like reports or records for the deceased and confirmed that application had been made to Casey Hospital to obtain such medical records.
Also on 3 May 2022, the plaintiff filed witness statements of the plaintiff, Agata and the plaintiff’s solicitor, Mr Richard Pietrzak (‘Mr Pietrzak’).
The applicant filed an affidavit of documents affirmed 10 May 2022 that disclosed Monash Health, the operator of Casey Hospital, had provided 2,151 pages of medical records relating to the deceased to the applicant’s solicitors in electronic form. The schedule to the affidavit recorded the date of 23 February 2022 for 21 pages of the deceased’s patient records, the date of 24 February 2022 for 2,040 pages of additional patient records, and noted 90 pages of notes from Monash Health Pathology as undated.
Ms Stacey Clough, solicitor for the applicant (‘Ms Clough’), first sent a letter to Dr Hannon on 13 May 2022 and received a reply three days later, in which Dr Hannon stated that he declined to be involved in the application at that stage.
On 24 May 2022 the applicant filed amended grounds of revocation.
On 22 June 2022 a mediation was held but was unsuccessful.
As the application was for revocation of the grant of probate, it was the obligation of the applicant to prepare a court book for use during trial, however, the applicant failed to prepare a court book. In order to assist the Court, Mr Pietrzak filed a supplementary affidavit of discovery sworn 14 July 2022 which included 2,688 pages of medical records for the deceased from Casey Hospital for the period November 2019 to 26 April 2021, the radiologist’s report disclosed in his first affidavit, a letter dated 23 June 2022 from Mr Pietrzak to Dr Hannon, and a letter dated 23 June 2022 from Dr Hannon. In this letter, Dr Hannon opined that the deceased had testamentary capacity up to and including Friday, 23 April 2021.
By letter dated 20 July 2022 to Mr Pietrzak, the applicant’s solicitors sought an adjournment of the trial to November 2022 primarily on the basis of the plaintiff’s supplementary affidavit of discovery, noting that they had only recently been apprised of Dr Hannon’s letter dated 23 June 2022 and that it was likely there were further medical records from Casey Hospital which had not yet been seen by them.
By letter dated 21 July 2021 to the applicant’s solicitors, Mr Pietrzak confirmed that the supplementary affidavit did not contain any new document or information not already known to the applicant and was prepared because the applicant had not prepared a court book. The plaintiff opposed any adjournment on a number of grounds, citing yet further delay in selling the deceased’s property in a declining property market, that the applicant had known of the trial date since April 2022, and that Mr Pietrzak was a sole practitioner and would be away for one month towards the end of 2022. Mr Pietrzak also reiterated what he described as his ‘most compelling’ argument against an adjournment, namely, that the application for revocation was without basis and doomed to fail, for the reasons set out in his previous correspondence. Mr Pietrzak also stated that the affidavits filed by the applicant’s witnesses were ‘redolent with inadmissible material’ and that he would not incur the additional work and expense of identifying the inadmissible paragraphs as viva voce evidence would be given at trial.
The application was listed for directions the next day, 22 July 2022. During the directions hearing, the application to vacate the trial was rejected and the trial date of 2 August 2022 was confirmed. At the hearing the Court raised concerns about the adequacy of the work undertaken by the applicant in preparing for the trial, the late timing of the application to vacate the trial, the fact that the applicant’s first ground for revocation was that the deceased was ‘unlikely to have had testamentary capacity’ at the time the will was made, and whether the particulars for the second ground amounted to suspicious circumstances.
In an affidavit filed at 9:45am on the day of trial, Ms Clough disclosed that on 26 July 2022 the applicant’s solicitors first made contact with a junior doctor, Dr Theodora Alexiou, who confirmed that she recalled the deceased but was unable to provide further information under the circumstances, instead suggesting that contact be made with the hospital’s legal department. Ms Clough further deposed that on 28 July 2022, the applicant’s solicitors unsuccessfully endeavoured to make contact with a medical officer, Liam Darcy, whom the medical records from Casey Hospital indicated was also involved in the care of the deceased. On this basis, Ms Clough deposed to her belief that there were further witnesses whom the applicant might have wished to call due to the recent discovery of further documents by the plaintiff, and that it would be impracticable for the trial to commence in the absence of such witnesses.
At the commencement of trial on 2 August 2022, the applicant made a further application for an adjournment to obtain instructions. At this point the Court raised concerns that overarching obligations and proper basis certifications had not been filed in accordance with the Civil Procedure Act; that the applicant’s first ground for revocation did not appear to be a ground known to the law; whether the particulars of the second ground were sufficient to give rise to suspicious circumstances; and as to the costs incurred in the application having regard to the amount in dispute and, in particular, that the applicant’s court book consisted of 5,824 pages.[1] The Court also enquired as to the quantum of the applicant’s costs of the proceeding.
[1]The applicant’s court book duplicated the medical records from Casey Hospital by including the records forwarded to both the plaintiff and the applicant.
After a short adjournment to obtain instructions, the applicant’s counsel sought leave to discontinue the revocation application and such leave was granted by the Court.
Plaintiff’s application for probate in solemn form
Following the applicant’s decision to discontinue her application, the plaintiff sought leave to prove the will in solemn form. Leave was granted and the plaintiff adduced viva voce evidence from Dr Hannon, the plaintiff and Mr Pietrzak.
Dr Hannon is a general practitioner who was previously employed as the Palliative Care Registrar at Casey Hospital. Dr Hannon met the deceased on 29 March 2021 while he was being treated by the general medical team at Casey Hospital for cancer. Dr Hannon gave evidence that the deceased was suffering severe pain at that time and was quite frail, but was able to communicate freely. Shortly after he met Dr Hannon, the deceased’s care was transferred to the palliative care team and Dr Hannon began treating the deceased on a daily basis. Initially, the deceased began to stabilise and his communication and clarity of thought improved. Dr Hannon was aware that the deceased was seeing a solicitor with the intention of making a will and said his admission notes recorded that on 1 April 2021 the deceased indicated that one of his goals was to make a will. Dr Hannon opined that the deceased had testamentary capacity between 8 and 14 April 2021 and that he considered the deceased would have had the ability to weigh up the respective entitlements or claims that his children, his former partner, his brother, his niece and his grand-niece may have had upon his estate.
The plaintiff gave evidence that he made arrangements for a solicitor, being Mr Pietrzak, to assist the deceased to make a will, that he was present at the time instructions were given and that he signed the will as an attesting witness. This was because Casey Hospital was unable to assist with arrangements for an independent witness due to restrictions on visitors in light of the COVID-19 pandemic.
Mr Pietrzak gave evidence that he took instructions from the deceased for the preparation of the will at Casey Hospital on 8 April 2021, asking specific questions to ensure that the deceased had capacity. Mr Pietrzak returned to Casey Hospital on 14 April 2021 and the deceased read the will before it was signed by the deceased, Mr Pietrzak and the plaintiff. Mr Pietrzak said he was satisfied that the deceased fully understood the contents of the will before signing it and that he considered that the deceased was not distracted by pain or medication at that time.
The Court made orders that probate of the will be granted to the plaintiff in solemn form, subject to the requirements of the Registrar of Probates, that the plaintiff’s costs be paid by the applicant on an indemnity basis and, pursuant to the rule in Cherry v Boultbee,[2] the plaintiff was entitled to set off the applicant’s costs against the distribution to which the applicant was entitled pursuant to the will.
[2](1839) 4 My & Cr 442.
Counsel for the plaintiff also raised the issue of whether it was appropriate to call for submissions from the applicant’s solicitors as to whether they should indemnify the applicant for part or all of the costs of the proceeding. In the circumstances, the Court made orders that:
…
4.Within 14 days the applicant’s solicitors, Galea & Faustin Solicitors … file written submissions addressing the question of whether and to what extent, they should indemnify the applicant in respect of the plaintiff’s costs.
5.Pursuant to s 29 of the Civil Procedure Act 2010 (Vic), the applicant’s solicitors, Galea & Faustin Solicitors, be added as a non-party to the proceeding for the purposes of investigating whether they may have contravened any of their overarching obligations, specifically those contained in ss 18, 24 and 25 of the [Civil Procedure Act].
On 9 August 2022, the Court received notice that the applicant’s solicitors, Galea & Faustin Solicitors (‘Galea & Faustin’), had ceased to act for the applicant. In accordance with the Court’s orders, Galea & Faustin filed submissions dated 18 August 2022. On 24 August 2022, the Court emailed the parties providing the applicant with an opportunity to file submissions in response and, if she did, providing Galea & Faustin with an opportunity to file submissions in reply. The Court also requested that the applicant indicate whether she intended to waive legal professional privilege.
The applicant filed submissions on 13 September 2022 and Galea & Faustin filed submissions in reply on 20 September 2022. In her submissions, the applicant failed to respond to the Court’s query as to whether she intended to waive legal professional privilege.
Overarching obligations under the Civil Procedure Act
The Civil Procedure Act sets out overarching obligations for participants in civil proceedings for the purpose of improving standards of conduct in litigation.[3] The paramount duty and other overarching obligations in ss 16–27 of the Civil Procedure Act apply to, inter alia, any person who is a party to a proceeding, any legal practitioner or other representative acting for or on behalf of a party, and any law practice acting for or on behalf of a party.[4]
[3]Civil Procedure Act 2010 (Vic) s 1(2)(a).
[4]Ibid s 10(1).
The Court is empowered under s 29(1) of the Civil Procedure Act to make any order it considers appropriate in the interests of justice if it is satisfied, on the balance of probabilities, that a person has contravened any of their overarching obligations. Such an order may be made on the Court’s own motion,[5] and s 28(2) also makes clear that ‘in exercising its discretion as to costs, a court may take into account any contravention of the overarching obligations’.
[5]Ibid s 29(2)(b).
As explained in Dura (Australia) Constructions Pty Ltd v Hue Boutique Living Pty Ltd (No 5):
To order a lawyer to pay the costs of litigation is a ‘serious charge’, deriving from the fact that it is occasioned by an alleged breach of a duty to the court. To this end, the court may take into account the repercussions of making an order of this kind. It is accepted that the principles in Briginshaw v Briginshaw apply, and the court should not make an order solely based on inference without evidence. For reasons already stated, I accepted that the discretion under s 29 [of the Civil Procedure Act] is governed by the principles in Briginshaw.[6]
[6](2014) 48 VR 1, 42 [108] (citations omitted).
In the orders dated 2 August 2022, the Court raised particular concerns regarding Galea & Faustin’s compliance with the following overarching obligations:
(a) the requirement of proper basis under s 18 of the Civil Procedure Act;
(b) the obligation to ensure costs are reasonable and proportionate under s 24 of the Civil Procedure Act; and
(c) the obligation to minimise delay under s 25 of the Civil Procedure Act.
Requirement of proper basis
Section 18 of the Civil Procedure Act provides:
A person to whom the overarching obligations apply must not make any claim or make a response to any claim in a civil proceeding that—
(a) is frivolous; or
(b) is vexatious; or
(c) is an abuse of process; or
(d)does not, on the factual and legal material available to the person at the time of making the claim or responding to the claim, as the case requires, have a proper basis.
In s 18, ‘claim’ refers to a cause of action or the assertion of a right that entitled the asserting party to relief from the Court, and it has been held that the obligation applies equally to claims for interlocutory relief.[7] The assessment of whether a proper basis exists is made at the time of advancing or responding to a claim, whether by filed document or in the course of an oral application.[8]
[7]Bolitho v Banksia Securities Ltd (No 18) (remitter) [2021] VSC 666, [1344] (John Dixon J).
[8]Ibid.
The applicant’s summons filed 4 February 2022 sought revocation of the grant of probate of the will. An applicant seeking to revoke a grant of probate must show that they have standing to make such an application; provide a reasonable explanation for the delay in bringing the application; and show a prima facie case to challenge the grant of probate.[9] In order to establish a prima facie case for revocation, an applicant must provide a sufficient factual basis for their grounds of revocation.[10]
[9]See, eg, Re O’Callaghan [2019] VSC 16, [19] (McMillan J) and the authorities cited therein.
[10]Ibid [23].
The applicant’s amended grounds of revocation filed 24 May 2022, with amendments marked up, provided:
Ground 1: The Deceased was unlikely to have had testamentary capacity in the period shortly before and at the time of executing the will to which the Grant of Probate was made (‘the will’).
Particulars
1. The Deceased had been diagnosed with cancer approximately two years
prior to executing the willbefore the will was executed. As a result of his cancer diagnosis, the Deceased became a palliative care patient at the Casey Hospital, Berwick, Victoria (‘Casey Hospital’), on 3 March 2021.2. When the Deceased allegedly executed the will on 14 April 2021, he had been a palliative care patient for approximately six weeks.
3. On 22 April 2022, both the Applicant and her then partner, Sandra Shell, saw the Deceased in his hospital room. The Deceased had executed the will eight days prior. For the reasons given by Sandra Shell in her affidavit dated 2 February 2022, the Deceased was likely to have been heavily affected by medication during the period in which he executed the will.
4. The effect of the medications that the Deceased was taking, morphine and haloperidol, would have rendered him incapable of undertaking complex tasks, such as giving instructions for the purpose of executing a will.
5. Given that the Deceased had been a palliative care patient since 3 March 2021, it can be inferred that the Deceased was unlikely to have been taking such medications prior to the execution of the will.
6. In conversations with both the Applicant and Sandra Shell, which took place on 22 April 2022 and 26 April 2022, the Deceased appeared to be in extreme pain and had difficulty communicating.
3. In the days and weeks prior to the execution of the will, the Deceased was heavily affected by medication administered by staff at Casey Hospital. The administration of such medications was necessary due to, among other things, severe pain experienced by the Deceased. Because of the medications being administered, the Deceased was unlikely to have been capable of executing complex documents, such as a will. In particular:
(a)on 12 April 2021, two days before the Deceased allegedly executed the will, the Deceased was administered a combination of medications by staff at Casey Hospital, including, among other things, morphine and oxycodone;
(b)on 13 April 2021, the day before the Deceased allegedly executed the will, the Deceased was administered a combination of medications by staff at Casey Hospital, including, among other things, midazolam, morphine and oxycodone; and
(c)on 14 April 2021, the day on which the Deceased allegedly executed the will, the Deceased was administered a combination of medications by staff at Casey Hospital. The medications that affected the Deceased on 14 April 2021 included, among other things, morphine, oxycodone and domperidone.
4. Further, the Deceased was regularly administered medications including both oxycodone and morphine between 3 March 2021 and 14 April 2021.
5. On multiple occasions while in palliative care between 3 March 2021 and 26 April 2021, the Deceased exhibited signs of cognitive decline, such as memory loss, while also being consistently in severe pain.
6. In conversations with both the [applicant] and her then partner, Sandra Shell, which took place on 22 April 2022 and 26 April 2022, the Deceased appeared to be in extreme pain and had difficulty communicating.
Ground 2: The will was executed in suspicious circumstances giving rise to an inference that the Deceased neither knew the contents of the will, nor approved of them.
Particulars
1. Given the medications that the Deceased was
likely to have beentaking in the period in which he allegedly executed the will and shortly beforehand, the particulars of which are provided above, the Deceased was unlikely to have been capable of comprehending complex documents, including a will.2. The will appears to be inconsistent with the likely wishes of the Deceased, for the reasons provided by the [applicant] in her affidavit dated 2 February 2022. The [applicant] alleges that the Deceased did not have a close relationship with the Plaintiff, nor did he have a close relationship with any of the beneficiaries listed in the will, except for his two children, the [applicant] and Adam Wierzbowski.
3. Although neither witness to the will is listed as a beneficiary, the daughter and granddaughter of one of the said witnesses stand to benefit from the will.
4. The Deceased did not, at any time, express to the [applicant] any intention to execute a will.
5. The Applicant alleges that, based on her enquiries, the Casey Hospital, Berwick, Victoria, where the Deceased was residing when the will was executed, does not have a record of the Deceased receiving a solicitor as a visitor at any time.
6. The Applicant alleges that the [plaintiff] refused to provide basic information to the Applicant and Adam Wierzbowski in relation to the Deceased’s superannuation, after they had made such requests to him.
7. Further, the Applicant alleges that the [plaintiff] became hostile towards her when she and her then partner sought to make inspections of the Deceased’s property.5. The Deceased did not disclose to any staff at Casey Hospital that he had executed a will on 14 April 2021. Further, the Deceased had made representations to a social worker at Casey Hospital on 9 April 2021 that he did not wish to execute a will due to the cost involved.
The summons for revocation was supported by an affidavit of the applicant filed 7 February 2022 (‘the applicant’s affidavit’) and an affidavit of the applicant’s then partner, Sandra Shell, filed 7 February 2022 (‘Ms Shell’s affidavit’).
The applicant deposed that sometime around March 2019 the deceased informed her he was suffering from lung cancer and that from 3 March 2021 until his death he was treated at Casey Hospital as a palliative care patient. The applicant recounted that when she visited the deceased at Casey Hospital on 22 April 2021, one week after the will was made, she observed that he was in severe pain and that his ability to communicate was affected by medication. The applicant suggested that the deceased had a strained relationship with the plaintiff and that he did not have a close relationship with Agata or Ms Lakowski. The applicant’s affidavit also recounted interactions between the applicant and the plaintiff following the deceased’s death and stated that the applicant made a formal request to Casey Hospital for information regarding the deceased’s medication, as she believed that the medications the deceased was likely to have been taking would have affected his capacity to execute a will. The applicant stated that when she made this request she was advised by a doctor at Casey Hospital that there was no record of the deceased having had any visit from a solicitor on or about 14 April 2021.
Ms Shell’s affidavit detailed her observations of the deceased when she visited him at Casey Hospital on 22 April 2021 and again on 26 April 2021. Ms Shell deposed that on 22 April 2021 she saw boxes of medication labelled haloperidol and morphine near the deceased’s bed and that a treating doctor told her the deceased was taking those medications. Ms Shell recounted that on the two occasions she visited the deceased he was in severe pain and struggled to communicate coherently.
The applicant’s first ground was expressed as the deceased being ‘unlikely to have had testamentary capacity’ at the time the will was made. This can be contrasted with the established ground for revocation that a deceased lacked testamentary capacity at the time they made their will. In written submissions, Galea & Faustin suggested that the relevant ground was in fact that a deceased ‘may lack testamentary capacity’, citing the following passage in Able Australia Services v Yammas:
Probate of a duly executed will may be refused, or a grant of probate revoked, on a number of grounds. The deceased may lack testamentary capacity, the will may be the result of undue influence or the will may have been signed in suspicious circumstances.[11]
It is evident, however, that in this passage Hargrave J was identifying grounds which may justify revocation of a grant of probate in a particular case, and was not suggesting that it would be sufficient to show that a deceased may have lacked testamentary capacity.
[11][2010] VSC 237, [5] (Hargrave J).
As submitted by the plaintiff, the inclusion of the qualifier ‘unlikely’ means that the applicant’s first ground for revocation was misconceived. Galea & Faustin nonetheless submitted that it was apparent that the allegation was that the deceased did not have testamentary capacity at the time he made the will and that, if necessary, the ground could have been amended. This issue was identified by the Court and counsel for the plaintiff before trial, and orders were made on 11 July 2022 requiring the parties to file, inter alia, a summary of key issues in the application. While the applicant’s summary noted that a key issue was whether the deceased possessed testamentary capacity between 1 April 2021 and 14 April 2021, no amendment to the grounds was sought by the applicant.
In any event, the obligation in s 18 does not apply to the maintenance of a claim but is instead ‘addressed to the moment in time when a claim is made or responded to’.[12] The Court accepts Galea & Faustin’s submission that in the circumstances the use of the term ‘unlikely’ with respect to the first ground does not necessarily mean that the application was without proper basis. In any event, even if the Court were to find that the applicant’s first ground lacked a proper basis as a result of the use of the word ‘unlikely’, this would not in itself amount to a breach of the obligation in s 18 which would justify an order under s 29.[13]
[12]Dura (Australia) Constructions Pty Ltd v Hue Boutique Living Pty Ltd (No 5) (2014) 48 VR 1, 35 [89] (J Dixon J).
[13]Cf Gibb v Gibb [2015] VSC 35.
However, in written submissions, the applicant also contended that Galea & Faustin did not have a legal or factual basis to advise her to issue the proceeding, as the allegations contained in her affidavit and the affidavit of Ms Shell were mere speculation and did not support the allegations contained in the revocation application or the amended particulars. In this regard the applicant relied on the following statement in Gardiner v Hughes (No 2):
The task for the party seeking to have a grant of probate revoked is therefore to show that there is a ‘case for investigation’ or ‘something to go on’. Such a case will, by definition, not be frivolous or vexatious. However, mere speculation will not suffice.[14]
[14][2019] VSCA 198, [41] (Kyrou, McLeish and T Forrest JJA).
For their part, Galea & Faustin submitted that on the available evidence it was plain that Galea & Faustin had a proper basis at the relevant time. In particular, they submitted that:
(a) the application was supported by the sworn evidence of the applicant and her partner, providing a factual foundation for the particulars alleged;
(b) there was a factual basis enabling Galea & Faustin to form a reasonable belief that there was a proper basis for the first ground, relating to testamentary capacity, in the form of sworn evidence that the deceased was suffering from lung cancer and in palliative care at the time he made the will, was experiencing severe pain affecting his ability to communicate and appeared confused, and was taking medications that may have impaired his cognition and understanding; and
(c) there was a factual basis enabling Galea & Faustin to form a reasonable belief that there was a proper basis for the second ground, relating to suspicious circumstances, in that:
(i) the will was inofficious, in the sense that the deceased had made provision for relatives that he did not have a close relationship with, to the detriment of his children and contrary to his natural affections and moral duties;
(ii) by making the will, the deceased departed from his past testamentary practice of not making a will and stating that he did not want to make a will;
(iii) the deceased was in poor health, in pain and feeble around the time the will was executed, which may be relevant to knowledge and approval of the will; and
(iv) there was no record that the deceased saw a solicitor in hospital.
As noted above, Galea & Faustin failed to file overarching obligations and proper basis certifications in accordance with the Civil Procedure Act. It was suggested in Ms Clough’s affidavit filed 13 August 2022 that this was likely an oversight of the solicitor who was then responsible for the application. Such an explanation is unacceptable, and this failure is a relevant matter to be taken into account when determining costs in the proceeding and in considering whether to make an order as to Galea & Faustin’s compliance with their obligations.
The fact that the application was ultimately withdrawn cannot create a rebuttable presumption that the claim lacked a proper basis when it was made. However, on its face, the particulars of the application were insubstantial. For example, affidavit evidence that the deceased was on certain medications one week after executing the will, was in severe pain and had difficulty communicating could not alone establish that the deceased did not have testamentary capacity at the time he executed the will. Nor could it necessarily amount to suspicious circumstances, even when combined with the applicant’s statements about the plaintiff and deceased having a strained relationship and the lack of any record of a solicitor visiting the deceased at Casey Hospital.
Galea & Faustin knew that the will was drawn by a solicitor and it must be the case that the solicitor understood the test for testamentary capacity. While in some circumstances medical evidence can be of assistance, ultimately it is not necessarily essential or determinative. This is because the test for testamentary capacity is a legal test. Lay witnesses, including solicitors, are usually in a position to provide probative evidence for determining testamentary capacity.[15] It is a question of degree to be solved as a whole on the facts disclosed by the entire body of evidence, which may include medical evidence as well as lay witnesses, and depends on the circumstances of each case.[16]
[15]Zorbas v Sidiropoulous (No 2) [2009] NSWCA 197, [65] (Hodgson JA, Young JA and Bergin CJ in Eq agreeing).
[16]Attwell v Morgan [2019] WASC 182, [425] (Curthoys J); Starr v Miller [2021] NSWSC 426, [488] (Hallen J).
While the facts set out in the initial particulars were limited in terms of the grounds, the fact that Galea & Faustin did not have evidence from medical practitioners at that time did not mean they would be unable to obtain evidence to support the application and corroborate the allegations contained in the admissible parts of the applicant’s affidavit and Ms Shell’s affidavit. As explained in Gardiner v Hughes (No 2):
The task for the party seeking to have a grant of probate revoked is therefore to show that there is a ‘case for investigation’ or ‘something to go on’. Such a case will, by definition, not be frivolous or vexatious. However, mere speculation will not suffice. …
… There may be a case for investigation even if all the facts needed to justify the inference in question are not yet known or alleged, but there is enough to ‘go on’ to call for a trial. That will be the case if there is a reasonable explanation for the facts relied upon which, if shown to be correct, would justify revoking probate. Each case will of course depend on its particular facts. But in every case the onus rests on the party raising the doubt as to validity.[17]
[17][2019] VSCA 198, [41]–[42] (Kyrou, McLeish and T Forrest JJA).
Ultimately the available evidence does not establish that Galea & Faustin breached their obligations under s 18 of the Civil Procedure Act. While the allegations in the applicant’s affidavit and Ms Shell’s affidavit rose no higher than speculation as to the deceased’s testamentary capacity and the circumstances under which the will was made, there is no suggestion that Galea & Faustin did not have a reasonable belief as to the truth of the relevant statements in those affidavits. Further, the fact that the applicant has not waived privilege potentially prevents Galea & Faustin from relying on advice from counsel or other material to support their position that there was a proper basis for the claim.
Obligation to ensure costs are reasonable and proportionate
Section 24 of the Civil Procedure Act provides:
A person to whom the overarching obligations apply must use reasonable endeavours to ensure that legal costs and other costs incurred in connection with the civil proceeding are reasonable and proportionate to—
(a) the complexity or importance of the issues in dispute; and
(b) the amount in dispute.
As the Court of Appeal explained in Yara Australia Pty Ltd v Oswal:
Section 24 adopts a flexible test. There is plainly no costs matrix or formula that can be applied in determining whether the parties have met their obligations. Rather, the court must weigh the legal costs expended against the complexity and importance of the issues and the amount in dispute, in order to determine whether the parties used reasonable endeavours to ensure those costs were proportionate.
Each party and their solicitor and counsel have an obligation to comply with the overarching obligation. Whether any of them have breached that overarching obligation is to be determined by an objective evaluation of their conduct having regard to the issues and the amount in dispute in the proceeding. The legal practitioners’ duty is non-delegable. The obligation will override their duty to their client where the discharge of that duty would be inconsistent with the overarching obligation. The legal practitioners will not be relieved of this overarching obligation because of the instructions of their client.[18]
[18](2013) 41 VR 302, 307 [13]–[14] (Redlich and Priest JJA and Macaulay AJA).
Galea & Faustin submitted that they did not breach their obligations under s 24 of the Civil Procedure Act as:
(a) their representation of the applicant was proportionate and not excessive;
(b) there were not multiple interlocutory hearings in relation to particulars or discovery;
(c) the orders of 11 April 2022 and 18 May 2022 were made on the papers;
(d) while the court book was lengthy, it was electronic and prepared in consultation with both parties; and
(e) the $40,000 in costs incurred by the applicant in this proceeding was not disproportionate to an estate with a value of approximately $940,000 including superannuation.
Galea & Faustin contended that the fact that two unsuccessful adjournment applications were made by the applicant did not amount to a contravention of s 24. The second application was made at trial, thereby not incurring any additional costs to the parties who were to attend on that day in any event, and moreover the duration of the hearing was shortened by reason of the withdrawal of the revocation application. They submitted that s 24 is directed to ensuring that the costs incurred are reasonable and proportionate, not to curtailing the parties’ freedom to make applications that are ultimately unsuccessful.
Ultimately, the applicant did not address the question of whether Galea & Faustin breached their obligation to ensure costs were reasonable and proportionate in her written submissions. There was also no affidavit before the Court detailing the costs incurred in the proceeding.
As noted above, on the day of trial the Court raised concerns about the costs incurred in the proceeding having regard to the amount in dispute and particularly in light of the size of the court book. Counsel for the applicant indicated that at that time, the applicant’s costs were approximately $40,000. While Galea & Faustin identified this amount as ‘not disproportionate’ to the value of the estate at approximately $940,000 including superannuation, such a characterisation is disingenuous. The deceased’s superannuation is not an estate asset and the value of the estate as recorded in the inventory of assets and liabilities is $626,996.[19] If the revocation application succeeded, the applicant and her brother would be the beneficiaries on intestacy in equal shares. Under the will, the applicant and her brother each receive 40 per cent of the estate and Agata receives the remaining 20 per cent, being $125,000.
[19] If the will were not valid, then on an intestacy, the deceased’s two children, that is, the applicant and her brother, would be the intestacy beneficiaries. As they each receive 40 per cent of the estate under the will, the value of the dispute is the 20 per cent share bequeathed to Agata.
The costs of Galea & Faustin at $40,000 concerning a dispute valued at $125,000 represents approximately one third of the amount in dispute. Prima facie, the claimed costs are not reasonable and proportionate to the complexity or importance of the issues and the amount in dispute.
While the information currently before the Court does not justify a finding that Galea & Faustin have breached their overarching obligation under s 24 of the Civil Procedure Act, there are sufficient concerns as to the proportionality of the costs incurred in the proceeding that justify further investigation by the Court as to the quantum of those costs. Accordingly, the Court will order that Galea & Faustin provide the details of their claimed costs of the proceeding and the relevant costs agreements and disclosures to the Court.
Obligation to act promptly and minimise delay
Section 25 of the Civil Procedure Act provides:
For the purpose of ensuring the prompt conduct of a civil proceeding, a person to whom the overarching obligations apply must use reasonable endeavours in connection with the civil proceeding to—
(a) act promptly; and
(b) minimise delay.
Galea & Faustin submitted that when their conduct as a whole was assessed, it was apparent that there was no relevant delay. At the time the application was made, the applicant was not in possession of the deceased’s medical records, preventing them from identifying medical witnesses. They submitted that Galea & Faustin took steps to contact potential witnesses, including Dr Hannon, in early May, well before trial. While Galea & Faustin did not contact other potential witnesses, namely Dr Theodora Alexiou and Liam Darcy, until 26 July 2022, Galea & Faustin submitted that they acted reasonably in following instructions to contact those witnesses. Further, as the applicant did not waive privilege they were constrained in their ability to address the circumstances of, and advice relating to, the identification of those two witnesses. They also submitted that there was no contravention of s 25 arising from the applicant’s instruction to withdraw the application on the day of trial.
The applicant did not address the question of whether Galea & Faustin breached their obligation to minimise delay in her written submissions.
The manner in which the application was conducted by Galea & Faustin was concerning. Within three months of issuing the application, Galea & Faustin were in possession of the three witness statements filed by the plaintiff on 3 May 2022 and, as noted above, Mr Pietrzak filed the court book in the form of the plaintiff’s supplementary affidavit of discovery sworn 14 July 2022.
However, while the Court again has concerns about the conduct of the proceeding, including the steps taken to prepare the applicant’s case for trial, there is ultimately insufficient information before the Court that would justify a finding that Galea & Faustin breached their overarching obligation to minimise delay under s 25 of the Civil Procedure Act.
Conclusions
Notwithstanding that the Court has not found that Galea & Faustin breached their overarching obligations, the Court nonetheless has the power to make a non-party costs order, pursuant to r 63.23 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic).[20] However, despite the concerns held by the Court relating to the conduct of this proceeding, in light of the parties’ submissions and the material before it, the Court is ultimately not satisfied that this is a ‘clear case’ of misconduct, default or negligence that would justify such an order.
[20]See, eg, Re Janson; Gash v Ruzicka (No 3) [2022] VSC 557, [56]–[57] (McMillan J).
Nonetheless, as the claimed costs of Galea & Faustin are, prima facie, not reasonable and proportionate to the complexity or importance of the issues and the amount in dispute, the Court will investigate the quantum of the costs.
Further, as it was the conduct of Galea & Faustin, including the failure to file a proper basis certification, that led to the Court making orders 4 and 5 of the orders dated 2 August 2022, Galea & Faustin should bear the applicant’s costs arising from those orders.
Orders
The Court orders that:
(a) On or before 15 February 2023, the applicant’s solicitors, Galea & Faustin Solicitors, provide the details of their claimed costs of the proceeding and the relevant costs agreement and disclosures to the Court.
(b) The applicant’s solicitors, Galea & Faustin Solicitors, bear the applicant’s costs arising from the orders made on 2 August 2022.
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