CATCHWORDS: Wills, probate and administration - contested probate proceedings - costs - testator suffered stroke - whether party unsuccessfully opposing probate should have costs out of estate. (D)
LEGISLATION CITED:
DECISION: Supplementary reasons for earlier dismissal of appeal with costs.
JUDGMENT:
IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL
CA 40308/01
MASON P MEAGHER JA SHELLER JA
Wednesday 9 April 2003
Noel William SHORTEN v Stanley Alexander SHORTEN (No 2)
JUDGMENT
MASON P: The deceased, Florence Minnie Shorten, died on 6 February 1999 aged eighty-eight. Foster AJ granted probate in solemn form of her will made on 25 January 1996. He rejected the claim that she lacked testamentary capacity raised by the appellant Noel Shorten who propounded a 1979 will that the 1996 will had revoked (see Shorten v Shorten[2001] NSWSC 100).
Noel Shorten’s cross claim propounding the earlier will was dismissed with costs. The costs of the plaintiff executor (Stanley Shorten) were ordered to be paid out of the estate of the deceased and to be assessed on an indemnity basis. Otherwise there was no order as to costs. Foster AJ gave his reasons for these costs orders in a supplementary judgment (Shorten v Shorten[2001] NSWSC 363).
Noel Shorten’s appeal against the orders made by Foster AJ was dismissed with costs (Shorten v Shorten [2002] NSWCA 73). That judgment sets out the detail of the issues litigated at first instance and on appeal in relation to the estate.
Noel Shorten argued that at first instance his costs should have been ordered to be paid out of the estate.
In my reasons (with which Meagher JA and Sheller JA agreed) I said this:
The appellant’s challenge to the costs order fails, in my opinion, at the level of failing to establish any error in the exercise of the judicial discretion on the facts of the particular case. His Honour expressed his reasons in a supplementary judgment (Shorten v Shorten[2001] NSWSC 363). However some of the argument raises a question of some importance, since this Court was invited not to follow or alternatively to overrule some of the reasoning in the decision of Perpetual Trustee v Baker[1999] NSWCA 244 in light of a High Court decision in Middlebrook v Middlebrook(1962) 36 ALJR 216. I propose that in that aspect of this Court’s decision in the matter, this Court’s reasons in the present matter be reserved.
This judgment further addresses the reasons supporting the order made by Foster…
Grounds of appeal
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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Details
AGLC
Shorten v Shorten (No 2) [2003] NSWCA 60
Case
[2003] NSWCA 60
Decision Date
CaseChat Overview and Summary
This case concerned an appeal regarding costs in contested probate proceedings. The dispute arose after the testator suffered a stroke, leading to a challenge to the validity of their will. The appeal was heard by the Court of Appeal of New South Wales.
The primary legal issue before the Court of Appeal was whether the trial judge had erred in ordering the unsuccessful party opposing probate to pay the costs of the proceedings. Specifically, the court had to determine if the trial judge had correctly applied the principles regarding costs in probate matters, particularly in light of the testator's medical condition and the evidence presented.
The Court of Appeal, in its supplementary reasons, varied the costs order made at first instance. Owen J found that the trial judge had erred in relying on *Re Cutliffe’s Estate* to deny the unsuccessful party costs out of the estate, as the facts of the present case were distinguishable. In *Cutliffe’s Case*, the evidence disbelieved was that of the parties opposing probate on grounds of undue influence, whereas here, the evidence of a key witness had not been accepted. Menzies J also agreed that the trial judge had erred in following *Cutcliffe*, and would have ordered the plaintiffs' costs to be paid out of the estate. However, this was a dissenting view. The majority of the court, agreeing with Mason P, found that the trial judge had not erred in principle in concluding that the testator's condition did not cause the litigation, and that the case fell within an exception to the general rule that costs follow the event.
The appeal as to costs was ultimately dismissed, with the court varying the initial costs order.
Orders
Orders of the court
Supplementary reasons for earlier dismissal of appeal with costs.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
Owen J explained his disagreement with the costs order at first instance in the following terms (at 223):Finally it was argued that his Honour should not have ordered the defendant to pay the plaintiffs’ costs of the proceedings. In exercising the discretion which s153 of the Wills Probate and Administration Act, 1898-1954 (NSW) gave him, his Honour relied upon the decision in Re Cutliffe’s Estate, [1959] P 6, as showing that the defendant could not rely upon the evidence of Sister Mills to justify a departure from the general rule that costs follow the event because the sister’s evidence had not been accepted. In this respect I think his Honour fell into error. In Cutliffe’s Case the evidence which was disbelieved was that of the parties who had opposed the grant of probate on the ground of undue influence. But that is not the present case and, in all the circumstances, I am of opinion that no order as to costs of the proceedings before Myers J should have been made and that his Honour’s order should be varied accordingly. Taylor J did not address costs in his reasons. Although he expressed his agreement with the observations of Menzies J and Owen J, I read this as dealing with the substantive issues, because Taylor J expressly agreed with the form of order proposed by Owen J. Menzies J agreed that Myers J had erred in following Cutcliffe, a case in which a plea of undue influence had been rejected as an “invention”. He would have ordered the costs of the plaintiffs to be paid out of the estate, having regard to various matters (see at 218). However, this was a dissenting view in the High Court. The appellant’s submission that Foster AJ erred in principle in light of Baker’s Case cannot therefore be accepted. It was well open to his Honour to conclude that this case fell within the second “exception” stated by Powell J in Hodges. Merely because the deceased’s condition following her stroke raised triable issues as to her testamentary capacity did not require the court to conclude that she had been the “cause” of the litigation. In any event, the appeal as to costs was bound to fail because the appellant never suggested to Foster AJ that this was a case where the litigation was caused by the conduct of the testator (see [2001] NSWSC 363 at [4]). MEAGHER JA: I agree with Mason P. SHELLER JA: I agree with Mason P.