Kingsford v Mathers

[2025] NZHC 857

IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY

I TE KŌTI MATUA O AOTEAROA TAURANGA MOANA ROHE

CIV-2023-470-53 [2025] NZHC 857

BETWEEN  GLORIA JUDITH KINGSFORD as

Executor of the Estate of Cedric Thomas Mathers

First Plaintiff

GLORIA JUDITH KINGSFORD

Second Plaintiff

ANDJACQUELINE SALLY MATHERS, JOCELYN PAULINE MATHERS and

DIANNE PATRICIA WEISSENBORN as

beneficiaries of the Will of Cedric Thomas Mathers

Defendants

Hearing:                   On the papers

Counsel:                   S T Scott and G R Keystone for Plaintiff

N S Elsmore for Estate of Cedric Thomas Mathers A M Halloran and R S Brinkworth for Defendants

Judgment:                10 April 2025

JUDGMENT OF O’GORMAN J

[as to costs]

This judgment was delivered by me on 10 April 2025 at 10 am pursuant to r 11.5 of the High Court Rules 2016.

Registrar/Deputy Registrar

…………………………………

Solicitors/Counsel:

S T Scott, Tauranga Kaimai Law, Bethlehem N S Elsmore, Tauranga

Rejthar Stuart Law, Tauranga Pitt & Moore, Nelson

KINGSFORD v MATHERS [2025] NZHC 857 [10 April 2025]

Introduction

[1]       In this proceeding, the plaintiffs sought the grant of probate in solemn form for a will dated 18 December 2020 made by Cedric Thomas Mathers. The application was brought by the first plaintiff in her capacity as the named executor, and by the second plaintiff in her private capacity to represent her personal interests and to respond to allegations of undue influence.

[2]       The defendants were the three daughters of Mr Mathers who were named as beneficiaries under the 2020 will. They had lodged a caveat against the grant of probate, and they opposed Ms Kingsford’s application for the grant of probate in respect of the 2020 will on the grounds of lack of testamentary capacity and undue influence. Instead, they sought the grant of probate for the previous will executed by Mr Mathers on 19 October 2011.

[3]       In a judgment dated 30 August 2024,1 I made the orders sought by the defendants, declaring the 2020 will invalid on the grounds of lack of testamentary capacity and/or that it was procured by undue influence. I instead granted probate of the will dated 19 October 2011, appointing Mr Curtis of Waihi as the administrator of the estate.

[4]       I set a timetable for memoranda to be filed on the issue of costs (if costs could not be agreed). Unfortunately, those memoranda were not referred to me for determination until 31 March 2025.

Party submissions on costs

[5]       The defendants have sought costs on the basis that they were the successful parties and costs follow the event.

[6]       Their primary position is that they are entitled to indemnity costs under r 14.6(4) of the High Court Rules 2016 because of the findings of undue influence made against Ms Kingsford. The defendants say this shows she was motivated by financial gain and acting in breach of trust and confidence obligations owed to

1       Kingsford v Mathers [2024] NZHC 2470 [Judgment].

Mr Mathers. Furthermore, her conduct increased the litigation costs incurred by the defendants. Their actual costs were $205,377.40 plus disbursements of $20,882.16.

[7]       In the alternative, the defendants seek costs on a 2B basis with a 50 per cent uplift applied under r 14.6(3) of the High Court Rules. They calculated 2B costs at

$69,788. Applying a 50 per cent uplift would result in an award of $104,682 plus disbursements of $20,822.16.

[8]       They contend this alternative result is justified because the plaintiffs contributed unnecessarily to the time and expense of the proceeding by:

(a)repeatedly failing to provide relevant information;

(b)failing to comply with directions as to discovery;

(c)failing to comply with the Court timetable; and

(d)failing to admit facts until shortly before trial.

[9]       Counsel acting for the first plaintiff as named executor (effectively counsel for the estate) acknowledges that costs follow the event. However, the estate opposes any uplift in costs, saying that it was appropriate for the estate to apply for probate in solemn form to determine the disputed capacity issues, particularly in circumstances where Dr Malone’s expert opinion was that Mr Mathers maintained capacity. Counsel for the estate does not accept that any criticisms about interim steps including discovery justify any cost impact. Some delays were outside the hands of the plaintiffs and did not cause any loss, nor did they delay the substantive hearing. Counsel for the named executor also took issue with the claimed step of preparing interrogatories, when that consisted of a three line email.

[10]Counsel for Ms Kingsford in her personal capacity made similar submissions:

(a)Ms Kingsford notes that she paid the legal costs of the estate in respect of discovery from her own resources.

(b)In terms of the 2B cost calculations, counsel takes issue with the one day sought for converting briefs to affidavits, contending that this time is excessive.

(c)Ms Kingsford’s personal position is that there is no proper basis for seeking an uplift in costs (or indemnity costs) given the without prejudice negotiations between the parties. In a settlement conference, Ms Kingsford says she had offered terms similar to the outcome achieved in the litigation.

(d)In all the circumstances, Ms Kingsford submits that an award of costs on a 2B basis is all that is warranted.

[11]     In submissions in reply, the defendants say that the delays caused numerous additional attendances and Court conferences to address discovery and other non-compliance with the Court timetable. On the two issues raised in respect of the 2B calculations:

(a)the defendants contend that the time for the step of issuing interrogatories is justified because of the groundwork in reaching that point; and

(b)the conversion of briefs to affidavits was time-consuming because of the number of witnesses and exhibits involved.

[12]     On the issue of the without prejudice settlement attempts, the defendants say the offers did not match the outcome of the litigation.

Legal principles

[13]     The Court has a general discretion to award costs under r 14.1 of the High Court Rules. For cases involving contested wills, well-established principles govern the exercise of the discretion as follows:2

(i)   If the litigation originates in the fault of the testator—eg by the state in which he left his testamentary writings, or by his eccentric or irrational habits and mode of life — or of those interested in the residue, the costs may be properly paid out of the estate.

(ii)  If there be sufficient and reasonable ground, looking to the knowledge and means of knowledge of the opposing party, to question either the execution of the will or the capacity of the testator, or to put forward a charge of undue influence or fraud, the losing party may properly be relieved from the costs of his successful opponent.

[14]     Subject to such discretions, r 14.2 provides the principles to be applied in most cases:

(a)Under r 14.2(1)(a), the party who fails with respect to a proceeding or an interlocutory application should pay costs to the party who succeeds.

(b)Under r 14.2(1)(b), an award of costs should reflect the complexity and significance of the proceeding. For those purposes, r 14.3 provides for three categories of proceeding (1, 2 or 3).

(c)Rule 14.2(1)(c) provides that costs should generally be assessed by applying the appropriate daily recovery rate to the time considered reasonable for each step reasonably required in relation to the proceeding or interlocutory application. The reasonable determination of time is set out in r 14.5 by band (A, B or C).

(d)Rule 14.2(1)(f) provides that an award of costs should not exceed the actual costs incurred by the party.

2       Gorringe v Pointon [2023] NZCA 426 at [10], citing Re Paterson (deceased) [1924] NZLR 441

(SC) at 442–443.

[15]     The above position of limiting a losing party’s liability for costs to scale in most cases is supported by access to justice considerations.3 Other objectives are that the determination of costs should be predictable and expeditious.4

[16]     Under r 14.6(4) the court may order a party to pay indemnity costs if, relevantly:

(a)the party has acted vexatiously, frivolously, improperly, or unnecessarily in commencing, continuing, or defending a proceeding or a step in a proceeding; or

…

(f)some other reason exists which justifies the court making an order for indemnity costs despite the principle that the determination of costs should be predictable and expeditious.

[17]     Indemnity costs under r 14.6(4)(a) can be awarded if a party has acted vexatiously, frivolously, improperly, or unnecessarily. This requires that the unsuccessful party has pursued a “hopeless case”,5 being a position “totally without merit” 6 and “bound to fail”,7 or one commenced or continued for an ulterior motive or where there has been wilful disregard of the known facts or the clearly established law.8

[18]     However, the award of costs generally reflects parties’ conduct during litigation, not before it.9

3       Bradbury v Westpac Banking Corp [2009] 3 NZLR 400 (CA) at [10]; and Ben Nevis Forestry Ventures Ltd v Commissioner of Inland Revenue [2014] NZCA 348, (2014) 22 PRNZ 322 at [13].

4       Lawrence v Glynbrook 2001 Ltd [2015] NZHC 1005 at [18]–[20], citing North Shore City Council

v Body Corporate 188529 [2010] NZCA 234, (2010) 20 PRNZ 740 at [12].

5       Ben Nevis Forestry Ventures Ltd v Commissioner of Inland Revenue, above n 3, at [17].

6       TheCircle.co.nz Ltd v Trends Publishing International Ltd (in liq and in rec) [2021] NZCA 235, (2021) 25 PRNZ 766 at [34].

7       Big Basin Ltd v Stockco Ltd [2023] NZHC 2130 at [45].

8       Ben Nevis Forestry Ventures Ltd v Commissioner of Inland Revenue, above n 3, at [17]; and Big Basin Ltd v Stockco Ltd, above n 7, at [53].

9       Jessica Gorman and others McGechan on Procedure (online ed, Thomson Reuters) at [HR14.1.03] and [HR14.6.02(1)(a)], referencing Paper Reclaim Ltd v Aotearoa International Ltd [2006] 3 NZLR 188 (CA) at [160]; aff’d [2007] NZSC 26, [2007] 3 NZLR 169 (SC) at [40]–[41]; and

Thames-Coromandel District Council v Coromandel Heritage Protection Society Inc [2009] NZCA 204, (2009) 19 PRNZ 365 at [10]. See also Gorringe v Pointon, above n 2, at [77].

[19]     Rule 14.6(3) of the High Court Rules sets out the circumstances where an order for increased costs may be appropriate. They include where there is a failure by the paying party to act reasonably,10 or where the party opposing costs has contributed unnecessarily to the time or expense of the proceeding by pursuing an argument that lacks merit, failing to accept a legal argument or for some other reason justifying the Court making an order for increased costs. In such a case, the Court must consider the extent to which the failure to act reasonably contributed to the time or expense of the proceeding and it is only to that extent that any percentage uplift from scale can be justified.11

[20]     There is no inflexible rule that a party who is awarded costs is “entitled” to costs associated with the application for costs.12 Costs for each step in a proceeding are always at the discretion of the court. Relevant considerations are whether it has been addressed by memoranda only (making an award less likely), and the extent to which the parties succeeded on the disputed cost issues.13

Analysis

Context of contested will

[21]Neither of the two scenarios referred in [13] apply as:

(a)the disputed issues were not the fault of the testator; and

(b)the defendants who questioned the capacity of the testator and raised undue influence were not the losing party.

[22]     Accordingly, ordinary cost principles apply, with the primary principle being that costs follow the event.

10     Bradbury v Westpac Banking Corp, above n 3, at [27].

11     Commissioner of Inland Revenue v Chesterfields Preschools Limited [2010] NZCA 400, (2010)

24 NZTC 24,500 at [165].

12     Harrington v Wilding [2019] NZCA 605 at [45].

13     See Jeffreys v Morgenstern [2013] NZHC 1361 at [40]; DGL Manufacturing Ltd v Simmonds

[2022] NZHC 1434 at [18]; and Legler v Formannoij [2022] NZHC 1804 at [12].

Calculation of 2B costs

[23]     There was no dispute that this proceeding is appropriately classified as category 2 (proceedings of average complexity requiring counsel of skill and experience considered average in the High Court). Band B is generally suitable, based on a normal amount of time being considered reasonable for each step. Given the number of witnesses and amount of documentary evidence, certification for two counsel at trial is appropriate.

[24]     Accordingly, there are only minor disputed issues with regard to the defendants’ calculation of 2B costs as set out in sch A to their memorandum dated 20 September 2024. I assess each issue as follows:

(a)I accept that a one-day time allocation for a notice to answer interrogatories is excessive in circumstances where the notice consists of a three-line email. While I acknowledge that the preparatory steps must be taken into account, a band B allocation anticipates that the general notice to answer interrogatories will usually be detailed, potentially covering numerous issues. In this case, I consider that a band A time allocation of 0.4 days is appropriate for that step.

(b)On the other hand, I accept the task of converting the briefs to affidavits would have been time-consuming because of the number of witnesses and the process of completing the cross-references to the evidence referred to. This was also complicated by the delay in finalising the common bundle. I grant the time sought of one day for that step.

[25]     The defendants have also sought one day for preparing the memorandum of costs. I return to this issue below because I consider that the availability of costs on costs should reflect the extent to which costs claimed were reasonably disputed.

Indemnity costs

[26]     I do not regard Ms Kingsford’s stance in this proceeding as being so unjustified as to meet the tests in r 14.6(4) for indemnity costs.

[27]     The primary argument relied on for seeking indemnity costs is the finding of undue influence. As referred in [18] above, I do not accept that costs are appropriately used as a punishment for behaviour that is the subject matter of the substantive claim, involving conduct before the litigation. The consequences of such conduct are determined by the remedies available for the substantive causes of action.

[28]     A finding of undue influence does not necessarily equate with intentionally wrongful conduct. In this case, I made a circumstantial finding on the balance of probabilities that the 2020 will was procured by undue influence, even if Ms Kingsford subjectively believed Mr Mathers was still capable of being robust on issues important to him.14

[29]     Accordingly, in terms of r 14.6(4), I do not consider that the evidence relevant to the undue influence claim was so clearcut that Ms Kingsford’s arguments were totally without merit and her defence of those allegations was “bound to fail”.

[30]     Similarly, I accept that it was necessary to resolve the disputed probate issues, and Ms Kingsford had a reasonable basis for considering that the 2020 will might be valid, given the expert assessment of Dr Malone that Mr Mathers was more likely than not to have had capacity at the time of execution.

[31]Accordingly, I decline to award indemnity costs.

14 Judgment, above n 1, at [87].

Increased costs

[32]     Both parties have referred to the position taken in without prejudice negotiations prior to trial. It is difficult to assess the relevance of those negotiations for costs purposes because the scope of matters that the parties sought to settle extended beyond the questions of probate determined in these proceedings.15 In particular, there were disputed issues about survivorship for jointly owned property, and drafting inconsistencies about how they intended their assets to be dealt with under various scenarios. The settlement also sought to address other disputed issues about whether debts were owing to the estate and what had become of household chattels. Given the limited issues determined in the probate proceeding, it is not clear to me that the without prejudice principles reflected in rr 14.10–14.11 were triggered for the benefit of either side.16

[33]     However, I accept that the plaintiffs did act unreasonably with ongoing non-compliance with the Court timetable, failing to provide information in a timely way, failing to comply with discovery orders and failing to admit facts until shortly before trial. That behaviour caused extra attendances for filing memoranda and Court mentions to address those issues, and in preparing evidence to prove denied facts. This unnecessarily increased the defendants’ costs. I accept that this unreasonable behaviour should result in increased costs. In the circumstances, I consider that a 50 per cent uplift from scale is justified.

Conclusion

[34]     I do not consider it appropriate to award costs for the defendants’ costs memorandum in circumstances where the plaintiffs reasonably opposed indemnity costs.

15 At [89].

16  Under r 14.11(3) and (4), the offer may only be taken into account if it is better than or close to the benefit achieved by the other party under the judgment (for example, see Gorringe v Pointon, above n 2, at [37]). In any event, a without prejudice offer pursuant to r 14.10 does not of itself give rise to an entitlement to increased or indemnity costs, as this remains at the Court’s discretion taking into account a range of factors: r 14.11(1) and Weaver v HML Nominees Ltd [2016] NZHC 473 at [30].

[35]     Reflecting the above, the 2B calculation should be reduced by 1.6 days (for the lower allocation for the interrogatories step and removing costs on costs). This results in a total sum of $65,964 for steps taken in the proceeding. Applying a 50 per cent uplift results in costs of $98,946, plus disbursements of $20,882.16.

Result

[36]     I award costs in favour of the defendants against Ms Kingsford personally (not to be deducted from the estate) of $98,946 plus disbursements of $20,882.16.

O’Gorman J