Stewart v Stewart [No 2]
[2020] WASC 70
•10 MARCH 2020
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: STEWART -v- STEWART [No 2] [2020] WASC 70
CORAM: CURTHOYS J
HEARD: 6 DECEMBER 2019
DELIVERED : 10 MARCH 2020
FILE NO/S: CIV 1102 of 2018
BETWEEN: PETER MCVEIGH STEWART
DAVID THOMAS STEWART
Plaintiffs
AND
IAN ALEXANDER STEWART
First Defendant
PAUL RUSSELL STEWART by guardian ad litem THE PUBLIC TRUSTEE
Second Defendant
Catchwords:
Costs incurred by the estate - Indemnity costs - Testamentary capacity
Legislation:
Nil
Result:
First defendant pay plaintiffs' costs of proceedings
First defendant pay second defendant's costs of proceedings
No order as to costs of the first defendant
The plaintiffs and the second defendant's costs be paid from the first defendant's share of the estate
Category: B
Representation:
Counsel:
| Plaintiffs | : | Mr J R Birman |
| First Defendant | : | Not applicable |
| Second Defendant | : | Not applicable |
Solicitors:
| Plaintiffs | : | Birman & Ride |
| First Defendant | : | In person |
| Second Defendant | : | Public Trustee |
Case(s) referred to in decision(s):
Calderbank v Calderbank [1975] 3 All ER 333
CURTHOYS J:
This judgment concerns the appropriate order for costs following orders made by the court on 6 December 2019.
The plaintiffs and the second defendant filed submissions as to costs. The first defendant despite being given the opportunity to do so did not file submissions.
The parties to the action are the sons of the late Ruth Stewart.
Ian Stewart, the first defendant, was effectively the full time carer for his mother. Amongst other things he took her to medical appointments in the period before her death including the period before she executed her will on 14 October 2009.
It is evident from reports prepared by Dr John Kitchin, a geriatrician at the Peel Health Campus, that Ian was aware that his mother did not have the capacity to manage her financial affairs (See principal judgment).
On 5 November 2008 Dr Kitchin recommended to Ian that he apply to the State Administration Tribunal Appeal for the appointment of an administrator. Ian did not take any steps to appoint an administrator prior to the will being executed. In fact, the application was ultimately made by Peter Stewart.
Ian Stewart took his mother to lawyers to execute a will but, as noted in the principal judgment, he did not call the lawyers to prove due execution.
The plaintiffs seek indemnity costs against Ian Stewart.
Ian Stewart must have had concerns about his mother's capacity following the advice from Dr Kitchin to seek the appointment of an administrator. However, since the test for testamentary capacity is not identical to the test for appointing an administrator, it is not appropriate to order indemnity costs against him on this basis.
On 27 March 2019 Peter Stewart's lawyers wrote to Ian stating that if the offer contained in the letter was not accepted indemnity costs would be sought citing Calderbank v Calderbank [1975] 3 All ER 333. The letter did not explain what indemnity costs are nor did it explain the principles stated in Calderbank. Whilst a reference to the case without more may be satisfactory when a party is represented, to expect an unrepresented person to understand what was being sought simply by reference to 'indemnity costs' and 'Calderbank' does not adequately convey the choices faced. At the very least a copy of the case should have been enclosed. I am not prepared to order indemnity costs on this basis.
However, it is appropriate that Ian pay the party/party costs of the action.
As the plaintiffs correctly submitted:
3. In Graham v Kahler (SC(NSW)) Young J, 17 July 1991, unreported, BC9101779), Young J stated:
Carroll's case is authority for the proposition that unless there are some special circumstances, if a person has obtained probate in common form and the grant is revoked, and probate in solemn form is granted in an earlier will, that person usually pays the whole of the costs of the proceedings personally and is not entitled to any costs out of the estate and that is the reason why cases such as Levy and Carroll suggest that defendants in the present situation should always obtain an indemnity from beneficiaries.
Ian Stewart did not lead any evidence that provided a basis to oppose the revocation or to prove that his mother had testamentary capacity.
The costs incurred by the estate were completely unnecessary. It is appropriate that Ian Stewart pay those costs personally. It is also appropriate that the cost of the other parties be paid out of his share of the estate in order to ensure that payment is made without further delay and without the need for the estate to seek to recover those costs from Ian Stewart personally.
I order that:
1.The plaintiffs' costs of the proceedings, including any reserved costs, be paid by the first defendant, to be taxed if not agreed.
2.The second defendant's costs of the proceedings, including any reserved costs, be paid by the first defendant, to be taxed if not agreed.
3.There be no order as to costs of the first defendant.
4.The plaintiffs and the second defendant's costs be paid from the first defendant's share of the estate of Ruth Peters Stewart.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
MDM
Associate to the Honourable Justice Curthoys9 MARCH 2020
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