Reed v Smith (No 2)

Reed v Smith (No 2) involved a dispute over the distribution of an estate, specifically whether certain wills were mutual wills subject to a testamentary agreement. The plaintiffs sought declaratory relief, which was denied as they failed to prove the alleged testamentary agreement. The central legal issues were whether the costs rules applicable to probate cases should govern this situation and whether the plaintiffs should be liable for the defendant's costs. Additionally, the court examined whether an offer made by the defendant under rule 361 of the Uniform Civil Procedure Rules 1999 had relevance as a Calderbank offer, particularly in light of the plaintiffs' unsuccessful claim.

The court ruled that the offer made by the defendant was indeed governed by rule 361 of the Uniform Civil Procedure Rules 1999, which mandates that if a defendant's offer to settle is not accepted by the plaintiff and the plaintiff does not obtain an order more favourable than the offer, the defendant is entitled to costs from the date of service of the offer. The court clarified that the comparison under the rule is whether the plaintiff has failed to obtain a more favourable order rather than focusing on whether they obtained a judgment not less favourable than the offer. The court found that the plaintiffs had not obtained an order more favourable than the defendant's offer and thus the rule applied. The court also determined that the costs rules applicable to probate cases were relevant, and the plaintiffs should be liable for the defendant's costs.

The court dismissed the balance of the application filed by the plaintiffs and entered judgment in favour of the defendant. It ordered that the defendant's costs be assessed on an indemnity basis and paid out of the estate. Furthermore, the court mandated that the first plaintiff pay the defendant's costs of and incidental to the proceedings on a standard basis, while the second plaintiff pay the defendant's costs from and including 12 November 2021, also on a standard basis. This decision underscored the applicability of specific procedural rules in estate disputes and the implications of failing to secure a more favourable outcome than a defendant's settlement offer.