Wright v Ryder
[2024] NZHC 2977
•14 October 2024
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2023-485-623882
[2024] NZHC 2977
IN THE MATTER OF of the estate of JAMES PHILIP MASTERS BETWEEN
CHRISTINE MAY WRIGHT
Applicant
AND
DENISE MARIE RYDER
Respondent
Hearing: 27 September 2024 Appearances:
A J Douglass and S Gaskell for Applicant Respondent in person
Judgment:
14 October 2024
JUDGMENT OF CHURCHMAN [COSTS]
[1] This decision relates to a costs application by Christine May Wright (the applicant) against Denise Marie Ryder (the respondent) regarding several interlocutory applications involving matters to do with the estate of the late James Philip Masters (Mr Masters).
[2]The specific matters that costs are sought in respect of are:
(a)Lodging of a caveat against dealings with Mr Masters’ estate.
(b)Filing an application for recall of the grant of probate in Common Form and obtaining an order for recall.
WRIGHT v RYDER [2024] NZHC 2977 [14 October 2024]
(c)Matters relating to the removal of the respondent as executor of the 2023 Will and appointment of Perpetual Guardian (Perpetual Trust Limited) as temporary administrator to make an application for probate in Solemn Form.
(d)Matters relating to preparation for and conducting the hearing in relation to the costs application including responding to the respondent’s application for an extension of time to file affidavits and dealing with admissibility issues.
[3] The applicant seeks indemnity costs in the sum of $77,028 or alternatively costs on a 3B/3C basis with a 50 per cent uplift. The scale costs are calculated at
$40,065.50 and with a 50 per cent uplift total $60,098.25. Costs are sought against the respondent personally on the basis that the respondent’s conduct has caused or contributed to the need for the applications or has made the disposal of the applications unnecessarily complicated.
[4] The respondent opposes the application. She denies any inappropriate conduct in her role as executor of the last Will of Mr Masters, in applying for probate in common form, in failing to seek the recall of the grant of probate or failing to lodge an application for a grant of probate in solemn form. She blames her various legal advisors for such delays or omissions as have occurred. Her position is that the applicant should personally bear all of her costs in relation to the interlocutory applications.
Background
[5] Given the complexity of the factual background and the extensive nature of the affidavit evidence filed in respect of the costs application, it is necessary to set out the factual background in much more detail than would normally be necessary in relation to an application for costs.
[6] The applicant was in a de facto relationship with Mr Masters for some 35 years. When the relationship commenced the applicant was a widow with two small children
(Cheryl and Janice). Mr Masters was divorced with two young children, the respondent and her sister Shelley.
[7] Mr Masters appears to have had a close relationship with the applicant’s daughters particularly Cheryl Pinkham, and her husband Eddie Pinkham and their children.
[8] On 25 November 2022 Mr Masters executed two enduring powers of attorney, one appointed Eddie Pinkham as his attorney for property and the other appointed Cheryl Pinkham as his attorney for personal care and welfare. Mr Masters and the applicant authorised Cheryl Pinkham to manage the party’s finances with Westpac. Cheryl Pinkham was successor attorney to the property attorney given to Eddie and Eddie was successor attorney to the care and welfare attorney given to Cheryl Pinkham.
[9] The respondent had comparatively little contact with Mr Masters until the last years of his life. Her sister Shelley appears to have had no contact at all with Mr Masters for over 35 years.
[10] On 13 June 2017 Mr Masters made a Will appointing the applicant as executor and, if she survived him for a period of one calendar month, giving the whole of his estate to her.
[11] If the applicant did not survive him for a month, the Will appointed the applicant’s two daughters Janice and Cheryl to be his trustees and executors. He gave the whole of his estate to be divided between Janice, Cheryl and the respondent. The Will explained why he left nothing to his daughter Shelley, stating that his relationship with her had not been a healthy one.
[12] The respondent’s contact with Mr Masters increased significantly over the last years of his life. Between 3 February 2021 and 26 September 2021, he withdrew
$260,000 from his and the applicant’s joint bank account and gave it to the respondent. The respondent accepts receipt of gifts totalling $250,000 but says that $10,000 of the
$260,000 was passed on by her to Mr Masters’ sister, Lorraine.
[13] As a result of Mr Masters failing health, he and the applicant moved into the Cantabria Rest Home in October 2022. The respondent was a frequent visitor to the rest home, often spending time alone with Mr Masters.
[14] On 14 August 2023, Mr Masters executed a new Will. He appointed the respondent the sole executor and trustee and the estate was to be divided in three parts, one part each to the respondent, her sister Shelley, and Mr Masters’ sister Lorraine.
[15] The same day Mr Masters revoked his existing enduring powers of attorney and appointed the respondent his attorney for both property and personal care and welfare.
[16] On 15 August 2023 Eddie Pinkham contacted Mr Masters then lawyers, Fenton McFadden, raising concerns about Mr Masters ability to make decisions and raising his concern that his decisions were being made under duress by others. He followed that up with an email of 16 August 2023.
[17] By email of 25 August 2023 the applicant’s lawyer Cheryl Drought emailed Fenton McFadden inquiring as to whether, prior to revocation of the powers of attorney, Fenton McFadden had checked to see whether Mr Masters was under any influence or duress.
[18] On 23 August 2023 the respondent emailed Cheryl Pinkham requiring the delivery of items of Mr Masters’ property and requesting a key to the residential property that the applicant and Mr Masters owned and had resided in, before moving into the rest home.
[19] On 23 August 2023, Cheryl Drought wrote to the respondent responding to the email to Cheryl Pinkham noting that Mr Masters had appointed Eddie Pinkham as his attorney for property and Cheryl Pinkham as his attorney for care and welfare and that both the applicant and Mr Masters had authorised Cheryl Pinkham as a signatory on their joint bank account. The email noted that the respondent had been giving instructions to the person looking after the applicant’s and Mr Masters’ house to send
all invoices to her. The letter noted that Mr Masters could not unilaterally countermand the instructions in respect of the jointly owned property.
[20] On 24 August 2023, Stephen Clews of the law firm Attewell Clews and Cooper (the respondent’s then employers) provided Cheryl Drought with a copy of documents revoking the powers of attorney that Mr Masters had given to Cheryl and Eddie Pinkham.
[21] By email of 24 August 2023, Cheryl Drought emailed Stephen Clews, raising concerns about Mr Masters’ capacity to make decisions.
[22] By email of 24 August 2023, Stephen Clews confirmed that he was acting for the respondent in her capacity as Mr Masters’ attorney. He said that the request for severing of the party’s joint bank account had nothing to do with separation or loss of capacity. Cheryl Drought replied the same day, again referring to issues of undue influence, duress and lack of capacity.
[23] By email of August 25, 2023 Stephen Clews wrote to Cheryl Drought claiming that he was now instructed by Mr Masters in relation to property matters. The letter said that Mr Masters wanted a division of finances which involved a splitting of the joint bank account and payment of half of its contents into a new bank account Mr Masters had opened in his own name.
[24] On 28 August 2023 Cheryl Drought wrote to Stephen Clews setting out in detail the basis of the claim of undue influence, referring to relevant factual material and case law.
[25] By email August 29, 2023 Stephen Clews wrote to Cheryl Drought responding in detail, in relation to claims of duress and undue influence.
[26] Significant further correspondence between Ms Drought and Mr Clews ensued including a letter from Ms Drought of 20 October 2023 when she noted that the respondent had instructed the rest home that Mr Masters was residing in (Cantabria) that she was not responsible for payment of Mr Masters care home fees and instead
that Cheryl Pinkham was responsible. The respondent was, at the same time, asserting that Mr Masters and the applicant had separated.
[27] On October 24, 2023, in an email to Cheryl Drought, Stephen Clews repeated the claim made by the respondent that she, as Mr Masters’ attorney, was not liable for payment of Mr Masters care home fees and that it was the responsibility of Cheryl Pinkham.
[28] In October 2023 Cheryl Drought wrote on a number of occasions to Stephen Clews requesting an agreement to an interim distribution of funds from the joint account of Mr Masters and the applicant so that rest home care fees for the both of them would be paid from the joint account. As Mr Masters care home fees were significantly greater than the applicant’s (because of the much higher level of care he required), payment of the care home fees from the joint account rather than an equal interim distribution advantaged him and disadvantaged the applicant.
[29] On November 7, 2023 Stephen Clews advised Cheryl Drought that Mr Masters had passed away the previous night. He also advised that the respondent was the sole executor in the new Will made by Mr Masters. The same day Cheryl Drought lodged an application to caveat the Will in the High Court in Wellington.
[30] By email of 27 November 2023 Cheryl Drought emailed Martin Finnimore of Heritage Lifecare (the operator of the Cantabria Rest Home) indicating they had not been informed which solicitors were acting for Mr Masters’ estate but anticipated hearing before an application for probate was made.
[31] On 5 December 2023, Cheryl Drought emailed Stephen Clews indicating she assumed he was acting for Mr Masters’ estate as he had apparently been in touch with Cantabria. She asked for a copy of Mr Masters most recent Will and for confirmation that Mr Clews would be applying for probate in Solemn Form.
[32] Stephen Clews did not immediately respond to that email, neither did he advise Cheryl Drought that the prior day, 4 December 2023, his firm had in fact lodged an application for probate in Common Form rather than Solemn Form.
[33] As a result of an error by a clerk in the probate unit, the caveat lodged by Cheryl Drought had been misfiled and when the application for probate in Common Form was received the fact that a caveat had been lodged was not appreciated and the probate in Common Form was granted on 8 December 2023.
[34] By email of 8 December 2023, Stephen Clews advised Cheryl Drought that the application for probate in Common Form had been granted and that he was ‘…not aware of any reasoned basis why we would need to apply for probate in Solemn Form.’ That is a surprising statement from someone who was aware of the allegations of undue influence and lack of capacity.
[35] On 11 December 2023, Cheryl Drought emailed Stephen Clews confirming that an application for probate in Solemn Form with both Wills annexed was appropriate and confirming that Stephen Clews had been given ample notice of the basis for Cheryl Droughts expectation of the application being in Solemn Form.
[36] By email of 14 December 2023 Stephen Clews emailed the applicant’s barrister (Allison Douglass) indicating that the respondent was prepared to make an application for an order for recall but only on the basis that the applicant would consent to the costs of that recall application and the associated application for probate in Solemn Form being paid from the joint bank account of herself and Mr Masters. This was unacceptable to the applicant.
[37] On 19 December 2023, the applicant applied for a recall of probate. By minute of 22 December 2023, by Registrar Jane Penney, the grant of probate in Common Form was recalled.
[38] By letter to Allison Douglass dated 18 December 2023, Stephen Clews indicated the respondent was unwilling to file an application for recall until her demands for distribution of funds from the joint bank account were agreed to. The letter also indicated that as Stephen Clews would likely be a witness in the Solemn Form proceeding, that Attewell Clews and Cooper could not act on the application but would have the firm of Buddle McCleary Kennedy deal with it. This firm was one which Attewell Clews and Cooper were shortly to merge with.
[39] The application for recall of the grant of probate and supporting documentation came before Cooke J on 9 February 2024. He noted that the Registrar had already made orders recalling the grant of probate to the respondent and directing that an application for probate in Solemn Form be filed. He agreed that those orders were appropriate. He noted that there were two further orders sought in the application that the Registrar did not have jurisdiction to make in which had been referred to him. The first related to the statutory time frame for making an election under the Property (Relationships) Act 1976 and whether the time frame for that ran from the grant of administration that had now been recalled or from the date of the further grant by the Registrar on 22 December 2023. He expressed a tentative view that the time ran from the date of the new grant and not from the grant that had been recalled.
[40] The second matter related to costs. He noted that Ms Douglass had explained the background of the application to him, noting that the respondent did not wish to make the application for recall of the grant of probate and the direction that an application for probate in Solemn Form be filed. He said1 ‘In the circumstances I agree that the applicant’s reasonable costs in making the application should be met out of the assets of the estate.’
[41] Neither the respondent nor Attewell Clews and Cooper made an application for probate in Solemn Form.
[42] On 30 January 2024, Buddle McCleary Kennedy emailed Cheryl Drought advising that they were acting for the respondent in her capacity as a beneficiary of the estate, not in her capacity as the executor of the 2023 Will.
[43] Considerable confusion ensued as to who, if anyone, had been instructed by the respondent in her capacity as executor of the 2023 Will in relation to the recall of probate or application for probate in Solemn Form.
[44] The respondent claims that Attewell Clews and Cooper were instructed in relation to the application for recall and application for grant of probate in Solemn Form. That is denied by Peter Attewell, formerly the senior partner at
1 Minute of Cooke J CIV-2023-485-621955 Wright v Ryder 9 February 2024 at [4].
Attewell Clews and Cooper and as of 1 April 2024 a consultant with the firm Buddle McCleary Kennedy Ltd.
[45] Mr Attewell filed an affidavit of 13 August 2024 confirming that he had been the solicitor on record for the respondent in relation to the original application for probate in Common Form. At [6] of that affidavit he states:
Because of potential conflicts of interest Ms Ryder was asked to instruct other counsel. I am aware that she did so both in her personal capacity and as the person named as executor in the deceased’s last Will. Ms Ryder advised that she had instructed the law firm Tompkins Wake in her personal capacity and Vicki Ammundsen Trust Law Ltd in her capacity as executor. On 14 March 2024 Attewell Clews and Cooper received an authority to uplift documents for Vicki Ammundsen Trust Law Ltd. On 26 March 2024 all documents held by Attewell Clews and Cooper were forwarded in compliance with the authority.
[46]Mr Attewell goes on to say at [7]:
Attewell Clews and Cooper was never instructed in connection with the application for recall of probate or the associated application for probate in Solemn Form. No notice of change of representation has ever been filed by Vicki Ammundsen Trust Law Ltd. It transpires that Ms Ryder has apparently dealt with those matters herself. When I have enquired of her as to progress, she has told me that she is now self-representing and that she has notified the Court of this. I have asked her to comply with Rules 5.4(2)(b) of the High Court Rules 2016 by filing and serving a notice in form G11. Ms Ryder has declined to do so on the basis that probate has been recalled and therefore she is unable to complete the documents. Ms Ryder will not accept that her reasoning is wrong and insists that her email notification to the Court is sufficient, hence the making of this application.
[47] The application made by Mr Attewell was for an order declaring that he had ceased to act for Ms Ryder as executor. Notwithstanding that Attewell Clews and Cooper forwarded their file to Vicki Ammundsen Trust Law Ltd as directed by the respondent, that firm never filed an address for service nor any other document in relation to these matters.
[48] However, the statement of claim filed by Perpetual Guardian in support of an application for probate in Solemn Form records as a potential liability of the estate, an account from Vicki Ammundsen Trust Law Ltd in the sum of $7,220.85. The respondent’s evidence is that this account is in dispute but there was no evidence as to what the dispute was about. It is not clear why the estate should be liable for that
account when Vicki Ammundsen Trust Law Ltd does not appear to have taken any steps at all in relation to either the recall or the application for a grant of probate in Solemn Form, including not even filing an address for service. That debt would appear to be one of the respondent’s personally.
[49] The statement of claim also records a potential liability of $10,529 to Stephen Clews. It appears that Mr Clews did not join the firm Buddle McLeary Kennedy Ltd on 1 April 2024 but became a Barrister sole (presumably as of 1 April 2024). There is no evidence on the Court file that, as a Barrister, Mr Clews has had any involvement in the application for recall or the application for probate in Solemn Form.
[50] Although Mr Clews’ email of 22 July 2024 was sent from the address of Stephen Clews Barrister, the invoices related to two pieces of work said to have been done by Attewell Clews and Cooper. The first, in the sum of $4,148, being in respect of work said to be done for Mr Masters while he was alive and the second said to relate to work done for the estate between the date of death (6 November 2022) and 29 February 2024. No details of the actual work undertaken are provided. It is not clear what work Attewell Clews and Cooper would have done for the estate in January and February of 2024 that would justify the estate being liable for fees. Indeed, it was the absence of cash in the estate to pay for legal work that appears to have been the reason that Mr Clews did nothing after the obtaining of the grant of probate in Common Form in early December 2023.
[51] The respondent did nothing to advance an application for probate in Solemn Form and, on 21 May 2024 the matter was again before the Court with the respondent seeking a direction that she be permitted to renounce probate. The applicant did not oppose such a direction but sought an order that the costs claimed by the respondent’s former solicitors be paid by the respondent personally rather than by the estate.
[52] The applicant sought an order for the appointment by the Court of an independent administrator to make an application for probate in Solemn Form. Because the respondent was self-represented La Hood J made timetable directions requiring the parties to file memoranda setting out the issues requiring determination,
the directions which were sought and a proposed timetable for the filing of evidence and submissions.
The Court directions
[53]These matters again came before Grau J on 24 June 2024. Her minute2 said:
No application for probate in Solemn Form has been made. Instead, Ms Ryder has sought to renounce probate of the 2023 Will and has stated she would not oppose a grant of probate of the 2017 Will. Ms Wright has responded, indicating she would abide by the decision of the Court as to whether or not Ms Ryder should be permitted to renounce probate. She seeks the appointment of a temporary administrator to apply for probate in Solemn Form and considers that Ms Ryder should pay costs personally. Ms Ryder considers that any costs should be paid out of the estate.
[54]Grau J made the following orders:
(a)That Ms Ryder be removed as executor.
(b)That Perpetual Guardian be appointed as temporary administrator.
(c)That the temporary administrator be directed to apply for probate in Solemn Form.
(d)Directing the temporary administrator to serve the proceedings on the beneficiaries named in Mr Masters’ 2023 Will and on Ms Cheryl Pinkham and Mr Eddie Pinkham.
(e) –(l) (Making various timetable orders).
[55] Among the directions was a direction that a two hour submissions only hearing be allocated to hear the applicant’s application for a costs order personally against the respondent.
2 Minute of Grau J CIV-2023-485-623882 Re Estate of J P Masters: Wright v Ryder 24 June 2024 at [3].
[56] The matter was next before the Court on 19 August 2024 and in a minute of 20 August 20243 McHerron J extended some of the timetable directions made by Grau J. The respondent was also directed to provide discovery of documents sourced from the Probate Unit file regarding communications between the respondent’s former lawyers (Attewell Clews and Cooper) and the Probate Unit in relation to the application for probate in Common Form.
[57] The matter again came before the Court on 27 August 2024 before McQueen J. The respondent had filed and served two affidavits in reply in respect of the costs hearing. They were four days out of time and contained much material that was either repetitive, irrelevant to the costs issues to be determined by the Court or otherwise inadmissible on grounds such as it was hearsay. The affidavits were substantial, one, including annexures, running to some 233 pages. The applicant objected to their filing.
[58] In her minute of 27 August 20244 McQueen J directed that the issue of the admissibility of the affidavits was a matter for the judge hearing the costs application.
[59] Notwithstanding the clear directions given by McQueen J, the respondent filed a further memorandum of 18 September 2024 seeking directions as to whether the two affidavits would be ‘accepted’ by the court. The memorandum implied that she would be unable to file submissions in relation to the costs hearing until this happened.
[60] This necessitated a further minute from the Court5 reminding the respondent that McQueen J had already specifically dealt with this issue in her minute.
[61] A one page supplementary affidavit was filed on 26 September 2024 by Cheryl Drought an annexed an email that had inadvertently been missed when an earlier affidavit had been filed. The defended costs hearing proceeded on 27 September 2024.
3 Minute of McHerron J CIV-2023-485-623882 Wright v Ryder and CIV-2024-485-471 Perpetual Trust Ltd v Ryder and Wright 20 August 2024.
4 Minute of McQueen J CIV-2024-485-623882 Wright v Ryder 27 August 2024.
5 Minute of Churchman J CIV-2024-485-623883 Wright v Ryder and Perpetual Guardian 19 September 2024.
The law as to costs
[62] The principle as to costs in the High Court are well known. Rule 14.1 of the High Court Rules 2016 (HCR) provides that costs, including costs relating to a step in a proceeding are at the discretion of the court. HCR 14.2 sets out the general principles which include the principle that the party who fails with respect to a proceeding, or an interlocutory application, should pay costs to the party who succeeds.
[63] Schedule 2 to the High Court Rules, sets out appropriate daily recovery rates and Schedule 3 sets out the reasonable times for various steps. HCR 14.6 provides for increased costs and indemnity costs. HCR 14.6 lists various factors that the Court may take into account in determining whether increased costs are appropriate. Relevant factors include whether the party opposing indemnity costs has contributed unnecessarily to the time or expense of the proceeding or a step in it.
[64] HCR 14.6(4)(a) provides that the Court may order a party to pay indemnity costs if that party has acted improperly or unnecessarily in commencing or continuing a proceeding or a step in a proceeding.
[65] HCR 14.8 provides that, unless there are special reasons to the contrary, costs on an opposed interlocutory application must be fixed in accordance with the rules when the application is determined and become payable when they are fixed.
[66] The liability of a trustee for costs is also governed by the Trusts Act 2019 s 81 of which provides that a trustee is personally liable for an expense, or a liability incurred when acting as trustee but, provided the trustee has acted reasonably, can expect to be reimbursed from the trust’s funds.
[67] If a trustee takes an aggressive or hostile approach to litigation or behaves unreasonably in all the circumstances including not taking a neutral position and or nor acting impartially, such conduct may lead to a conclusion that the trustee has not acted in the best interests of the Trust and has incurred expenses that were not property incurred.6
6 See Perez v Equiom Trust Corp (UK) Ltd [2022] EWHC 2996 (ch) at [199].
[68] There have been a number of cases which have developed further principles in relation to issues of costs incurred by executors, particularly where there are allegations of undue influence or incapacity in relation to the making of a will. These principles were addressed by the Court of Appeal in Gorringe v Pointon.7 The decision in that case8 noted that, in probate matters, the principles articulated by Stringer J In re Paterson (Deceased) are still applicable.9
[69] The relevant principles from that case include that: if the litigation originates from the fault of the testator, the costs of an executor may properly be paid out of the estate; if there are sufficient and reasonable grounds, 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 fault, the losing party may properly be relieved from a costs award.
[70] At [16], the Court of Appeal in Gorringe v Pointon10 noted that the case law was clear that an allegation of undue influence (such as that which occurred in that case) meant that an executor should take a neutral (rather than partisan) approach to such a claim.
[71] The Court also noted, at [25] that in order to be regarded as a successful party in litigation involving claims such as undue influence, it is not necessary for a party to have been successful on all causes of action, just some. In that case, the Court of Appeal also addressed a claim for increased costs. The claim was advanced on two grounds, only one of which is appropriate in the present case namely on the grounds of alleged impropriety on the part of the respondents in various respects including the approach to probate, the conduct of the litigation and the conflicted position of the executors.
7 Gorringe v Pointon [2023] NZCA 426.
8 At [10].
9 In re Paterson (Deceased) [1924] NZLR 441.
10 Above, n 6.
Grant of probate in Common Form
[72] The first question to consider is whether it was appropriate for the respondent to have applied under urgency for a grant for probate in Common Form.
[73] In her affidavit of 22 August 2024, the respondent attempts to distance herself from having been responsible for the filing of that application saying, at [28]:
The Application was not filed by me it was filed by Peter Ian Attewell (‘Mr Attewell’) the solicitor acting for the estate of James Philip Masters on 4 December 2023…
[74] However, the reality is that it was the respondent, as the executor of the 2023 Will, who instructed Mr Attewell to make the application and it was her who swore the affidavit in support of the application despite the fact that both she and Attewell Clews and Cooper had had the issues of capacity and undue influence raised with them on a number of occasions. It was Stephen Clews who took the affidavit. He was fully aware at that stage of the allegations of undue influence and incapacity.
[75] In the case of Public Trust v Dollimore11 there were some factual similarities with the present case, with the testator changing her Will shortly before her death and allegations of undue influence and incapacity. Notwithstanding allegations of undue influence and lack capacity the Public Trust chose to propound only one of the two Wills.
[76] At [11] Simon France J referred to the decision Wilson J In Re Young12 for the proposition that the proper course to follow where there are two Wills and doubt about testamentary capacity at the time the later will was made, was to seek to admit both Wills to probate so that the Court could determine which was the last valid Will.
[77] The Public Trust had adopted a partisan position in Dollimore seeking probate of the earlier Will and a declaration of invalidity of the later Will on the basis of undue influence. The Court held that this was inappropriate, that the actions of the Public Trust were unreasonable and that the correct approach was13 ‘…to place the
11 Public Trust v Dollimore [2019] 2 NZLR 901.
12 Re Young, Hobbs v Christchurch City Council [1968] NZLR 1178 at 1179.
13 At [34].
two Wills before the Court and ensure the Court has available the necessary evidence.’ Because some of the work that the trustee had done would have had to be done anyway the Court allowed one third of the Public Trust’s legal costs but said all the other litigation costs were to be borne by the trustee personally.
[78] In the present case, the respondent was in a position of considerable conflict, the allegations of undue influence were directed at her personally, she received a significant personal benefit from the 2023 Will that she would not have got under the earlier Will, as did her sister and aunt. Under her newly acquired powers of attorney, she had arranged for her employer, Attewell Clews and Cooper, to act personally for Mr Masters prior to his death.
[79] The respondent appears to have completely overlooked her obligations as executor to act impartially and to put the two competing Wills before the Court so that the Court could conclude which one was valid.
[80] In the circumstances, the respondent’s conduct in failing to file an application for probate in Solemn Form was unreasonable and inappropriate. Any costs she incurred with Attewell Clews and Cooper in that regard are therefore not recoverable from the estate. The fact that such an application should not have been filed is also relevant to the applicant’s claim that the respondent, rather than the estate, should be liable for her costs.
The caveat application
[81] A caveat application against the grant of probate was filed by the applicant immediately upon learning of Mr Masters’ death. At that stage the respondent had not taken any steps. There does not seem to be any basis for awarding costs against the respondent personally in respect of this stage.
[82] In the circumstances, it was appropriate that a caveat was lodged. But for the error on the part of the Probate Unit staff in misfiling the caveat, it would have prevented the grant of probate in Common Form. However, that is not something that the respondent bears any responsibility for. The applicant is entitled to her actual and
reasonable costs for this step but those costs are payable from the estate and not by the respondent.
The recall application
[83] It was inevitable that a recall application was needed and would be granted. The respondent’s consent to that was conditional upon conditions she sought to impose as to payments from the joint bank account of the applicant and the estate of Mr Masters. The imposition of conditions was unreasonable. The applicant did not apply promptly for a recall. The real reason for that appears to be that there was no cash in the estate readily available to pay for it.
[84] In those circumstances it was appropriate for the applicant to have made that application. Were it not for the fact that the applicant, when making that application had sought a direction that the costs of the recall application be payable by the estate and that direction acted upon by Cooke J, the applicant may well have had a claim to recover those costs from the respondent. However, the order made by Cooke J that the applicant’s costs in that regard were to be met by the estate disposes of this issue. The applicant’s actual and reasonable costs of making the recall application are therefore to be met by the estate.
Application for probate in Solemn Form
[85] Once the grant of probate in Common Form had been recalled it was necessary for there to be an application for probate in Solemn Form and the appointment of a temporary administrator.
[86] As noted above, there was considerable confusion about who, if anyone, had been appointed by the respondent in her capacity as executor of the 2023 Will to apply for a grant of probate in Solemn Form. By memorandum of 10 May 2024 the respondent indicated she was not prepared to do so because the estate did not have cash to meet the costs of such an application and her concern that she could potentially be liable for costs personally, and on 10 May 2024 the respondent filed two memoranda seeking to renounce her role as executor.
[87] Given the respondent’s unwillingness to apply for probate in Solemn Form it was necessary for the applicant to initiate that procedure. It is appropriate that her costs in doing so should be met. The issue is whether they should come from the estate or the respondent and whether they should be calculated at scale, with a 50 per cent uplift or on an actual basis.
[88] The matters that the applicant points to as justifying an award of indemnity costs against the respondent are that the various interlocutory matters in respect of which costs are sought would not have been incurred had the respondent applied in the first place a grant for probate in Solemn Form. She also relies on the fact that she was successful in obtaining orders directing an application for probate in Solemn Form and the appointment of an interim trustee.
[89] She further alleges that the respondent caused or contributed to the proceedings becoming more complicated and expensive than necessary by not acting promptly, creating confusion about who she had instructed to represent her in her capacity as the executor of the 2023 Will; failing to comply with Mr Attewells’ advice to her as to what was required in relation to notification of a change of solicitor with this necessitating further case management hearing, ultimately electing to represent herself which delayed resolution matters including causing the need for the directions given by La Hood J, failing to provide proper discovery causing the need for directions at a further case management conference, failing to comply with timetable directions including filing affidavits out of time and filing affidavits which contained a great quantity of material that was irrelevant, repetitive or inadmissible.
Analysis
[90] For what should have been a relatively straight forward application for probate in Solemn Form there have been an exceptionally high number of memoranda and affidavits filed and something in the order of 10 separate minutes from a range of judges. In addition to the number of affidavits that have been filed their length and contents is also of relevance.
[91] At the hearing, I reserved my ruling on the applicant’s opposition to the filing of the last two affidavits filed by the respondent. I accept the applicant’s submission
that a large part of those affidavits is inadmissible amounting to hearsay or material that was either repetitive or irrelevant to the relatively defined issues relating to costs that the interlocutory hearing addressed. I therefore only have regard to those parts of the affidavits that were admissible and relevant.
[92] However, the filing by the respondent of material that was either repetitive or irrelevant was not just confined to those two affidavits. That may be a result of the respondent’s decision to represent herself. The applicant’s counsel was required to read all the material filed and make application for the offending material to be struck out. I have ultimately come to the conclusion that at least a proportion of the applicant’s costs for work completed subsequent to the obtaining of the recall of probate should be met by the respondent. I fix that proportion at 50 per cent. The other 50 per cent is to be met by the estate.
[93] The issue then becomes what quantum of costs should be awarded. The schedule prepared by the applicant calculates costs on a 3B and 3C basis together with a 50 per cent uplift. Category 3 is claimed because it is contended that the proceedings, because of their complexity or significance require counsel of special skill and experience in the High Court. Band C is sought because it is said that a comparatively large amount of time for a particular step is considered reasonable.
[94] I don’t accept that these proceedings were of particular complexity or required counsel of special skill or experience. These are interlocutory matters rather than substantive proceedings. To the extent that some of the matters could have been said to have taken a comparatively large amount of time that is effectively captured in the decision to award costs against the respondent personally rather than the estate. It would be double counting to have regard to that a second time. The appropriate scale is 2B other than in respect of those matters where I have determined actual and reasonable costs are payable.
Overall outcome
[95](a) The applicant is entitled to her costs in respect of the caveat on an actual and reasonable basis payable by the estate.
(a)In relation to the recall application the applicant is entitled to actual and reasonable costs payable by the estate in accordance with the decision of Cooke J.
(b)In relation to the application for probate in Solemn Form, the applicant is entitled to her actual and reasonable costs payable by the respondent.
(c)In relation to the subsequent case management conferences and the costs hearing itself, the applicant is entitled to costs calculated on a 2B basis, to be met 50 per cent by the respondent and 50 per cent by the estate.
[96] The applicant is to file an amended costs schedule for approval by the Court in accordance with this decision.
Churchman J
Solicitors:
Office Solicitor Perpetual Guardian for Applicant Mark Copeland Lawyers, Rotorua for First Respondent
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