AB v RT

[2016] NZHC 1399

IN THE HIGH COURT OF NEW ZEALAND NELSON REGISTRY

CIV 2013-442-306 [2016] NZHC 1399

UNDER	the Family Protection Act 1955
UNDER	the Administration Act 1969
BETWEEN	AB Plaintiff
AND	RT AND ST Defendants

Hearing:	On Papers
Counsel:	I Hunt and C Light for Plaintiff D E Holloway for Defendants G Downing for Beneficiaries
Judgment:	24 June 2016

COSTS JUDGMENT OF BROWN J

[1]      In my judgment of 11 December 20151  I held that the plaintiff’s mother had

breached her moral duty owed to the plaintiff in making a bequest in the amount of

$25,000 from an estate of approximately $2.4 million.

[2]      On  the  plaintiff ’s  claim  for  $1.25 million  under  the  Family  Protection Act 1955 (the Act), I made an award of $335,000 which, together with the $25,000 bequest, represented 15 per cent of the estate.  In accordance with the fundamental principle that costs follow the event2   I stated that prima facie the plaintiff was entitled to costs.  However consequent upon Mr Downing’s request that the parties

make submissions on costs, I set a timetable for the filing of submissions.

1      AB v RT and ST [2015] NZHC 3174.

2      Manakau Golf Club Inc v Shoye Venture Ltd [2012] NZSC 109, [2013] 1 NZLR 305.

AB v RT AND ST [2016] NZHC 1399 [24 June 2016]

[3]      All parties filed submissions in compliance with that timetable.

[4]      The parties’ position on costs is summarised in the plaintiff’s submissions:

7.The plaintiff’s position is that costs should be awarded on a solicitor/client basis, i.e. indemnity costs.   The position of the defendant  beneficiaries  is  that  the  “best  case  scenario”  for  the plaintiff is an award of costs on a 2B basis, or that costs should lie where they fall.  The executors’ position is that indemnity costs are not appropriate in this case.

[5]      In support of her request for indemnity costs, the plaintiff advances a number of factors including:

(a)      the longstanding practice in the Family Protection Act jurisdiction to award costs out of the estate on a solicitor/client basis;

(b)while there are exceptions to that principle, they do not apply in this case as the estate is a large one and a costs award would not absorb the entire value of the estate;

(c)      the costs award would not have a substantial  effect on the major beneficiaries;

(d)there are no disqualifying features that make payment of a costs award out of the estate inappropriate.   The bequest of one per cent of the substantial estate was a manifest breach of the plaintiff’s mother’s moral duty to her;

(e)      the defendant executors who were major beneficiaries of the estate breached a duty of even-handedness by first distributing the estate and then informing the plaintiff of this, thereby frustrating the plaintiff ’s claim under the Act;

(f)      despite the breach of moral duty the defendant beneficiaries defended the proceeding on the basis that the plaintiff was guilty of disentitling conduct.

[6]      The  plaintiff ’s  actual  costs  and  disbursements  total  $136,433.70  whereas…