Wyllie v Firmin - [2024] NZCA 291

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

CA467/2022
[2024] NZCA 291

BETWEEN	CORNELIA FRIEDERIKE MARIA WYLLIE AND ABIGAIL JUTTA LATHAM Appellants
AND	TIMOTHY RICHARD FIRMIN Respondent

Hearing:	13 May 2024
Court:	Thomas, Fitzgerald and Osborne JJ
Counsel:	H L Thompson for Appellants S J Iorns and J N Carruthers for Respondent
Judgment:	4 July 2024 at 10.30 am

JUDGMENT OF THE COURT

AThe appeal is dismissed.
BThe appellants must pay the respondent costs for a standard appeal on a band A basis with usual disbursements. The award of costs should be met without reimbursement from the estate.

____________________________________________________________________

REASONS OF THE COURT

(Given by Osborne J)

Introduction

The appellants, Cornelia Wyllie and Abigail Latham, appeal a judgment of Associate Judge Sussock (Costs Judgment) by which it was ordered:[1]
(a)they pay to Timothy Firmin, the respondent, $18,810.17 in relation to the costs and disbursements he incurred in two proceedings relating to the estate of their deceased father, Anthony Firmin, (the deceased); and
(b)they not be reimbursed by the estate for two-thirds of the costs of the two proceedings.
(collectively, the costs orders)

Background

[1]Wyllie v Firmin [2022] NZHC 1994 [Costs Judgment].

The appellants are the executors named in the will of the deceased who died in February 2020. The appellants obtained probate of the will. The most substantial estate asset is an orchard property. The deceased and his wife had lived there, growing feijoas and running a winemaking business. The respondent lived on the property in what the family called the “smoko quarters”.
The respondent asserted he had, by way of a testamentary promise, a right of first refusal to acquire the property at market value, to be determined by a registered valuation. The promise arose, he asserted, because he and his wife had returned from Australia in 2015 to care for his elderly parents and to help in the day-to-day operations of the orchard.
Discussions between the parties did not lead to any agreement for sale to the respondent. In October 2020, the respondent provided the executors with a written offer to purchase the property for $800,000 plus GST based on a registered valuation, subject to finance. The following day the respondent lodged a caveat over the property. This was said to be pursuant to the offer he had made to purchase the property, on the basis of a right of first refusal afforded to him.
Further discussions and negotiations took place, unsuccessfully. In May 2021, the appellants gave the respondent notice to vacate the property by 5 July 2021.
When the respondent did not vacate the property, the executors in July 2021 filed an application for orders removing the caveat and for vacant possession (Caveat Application).
The appellants’ stated purpose in seeking vacant possession of the property was:
[S]o that overdue maintenance can be carried out before a decision is made regarding the future of the property, which may involve selling it or renting it on the open market.
Shortly afterwards,…

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

Case: [2024] NZCA 291
Decision Date: 4 July 2024 at 10.30 am

CaseChat Overview and Summary

The Court of Appeal of New Zealand considered an appeal by Cornelia Wyllie and Abigail Latham against a High Court costs judgment that required them to pay $18,810.17 to Timothy Firmin for costs and disbursements incurred in two proceedings relating to the estate of their deceased father, Anthony Firmin. The appeal was dismissed, and the appellants were ordered to pay the respondent’s costs for the appeal on a standard band A basis, without reimbursement from the estate.

The legal issues before the Court of Appeal revolved around whether the Associate Judge erred in finding the appellants’ conduct unreasonable, in making the costs orders, and in not reserving costs pending the outcome of the respondent’s substantive proceeding. The appellants also argued that the Judge disregarded a long-standing practice of having the estate bear the costs and a provision in the deceased’s will that protected trustees from personal liability for inadvertent breaches of trust or errors of judgment made in good faith.

The Court of Appeal held that the Associate Judge correctly applied the principles governing the award of costs, particularly in relation to executors taking unreasonable positions in litigation. The Court found that the Judge appropriately considered the reasonableness of the appellants' conduct and their right to reimbursement for expenses incurred. The Judge’s conclusions on the unreasonableness of the appellants’ conduct were straightforward and inevitable, and the provisions of the will did not alter the benchmark of reasonableness. The Court of Appeal affirmed that the costs orders were appropriately made and within the proper exercise of the Judge’s discretion.

The Court of Appeal dismissed the appeal and ordered the appellants to pay the respondent’s costs for the appeal on a standard band A basis, without reimbursement from the estate.

Orders