Maria Oliveira by her tutor Ivo De Oliveira v John Antonio Oliveira

Supreme Court of NSW|2023-09-15|Before: Kunc J, Campbell JA

Summary

By its judgment delivered on 11 September 2023, the Court dismissed the plaintiff's summons for a family provision order under the Succession Act 2006 (NSW): Maria Oliveira By her tutor Ivo De Oliveira v John Antonio Oliveira [2023] NSWSC 1130 (the Principal Judgment). These reasons should be read, and assume familiarity, with the Principal Judgment. Defined terms in the Principal Judgment have the same meaning in these reasons.
The Court's orders made and entered on 11 September 2023 to give effect to the Principal Judgment were: The Court orders that: 1. The summons filed 25 October 2022 is dismissed. 2. The plaintiff is to pay the defendant's costs of the proceedings: a. on the ordinary basis up to and including 23 April 2023; b. on the indemnity basis on and from 24 April 2023. 3. On or before 25 September 2023, the defendant is to file and serve full written submissions and any evidence in support of the defendant's application that Mr Ivo De Oliveira, as Maria's tutor, personally pay any costs the court has ordered without recourse to Maria's estate. 4. The plaintiff is to file and serve any submissions and evidence in response by 16 October 2023. The Court notes that the parties agree that the Court will then resolve the application on the papers, unless the Court or a party otherwise requires.
This judgment deals with the question of whether Ivo should be required to pay the defendants' costs of the proceedings personally without recourse to Maria's estate. For the reasons which follow, that is what should occur. In summary, that is because the Court has concluded that the proceedings have been irregularly brought by Ivo purportedly as Maria's tutor. Ivo was not entitled to bring proceedings in that or any other capacity on behalf of Maria, because TAG, which is responsible for the management of Maria's estate under the NSW Trustee & Guardian Act 2009 (NSW) (the Act) never consented to these proceedings being brought and never declined to act as Maria's tutor. Furthermore, and in any event, the Court is satisfied in the exercise of the general discretion as to costs that Ivo should pay the defendants' costs personally and without recourse to Maria's estate.

Facts

The unfortunate procedural history of this litigation is set out in [26] to [50] of the Principal Judgment. That history is incorporated in these reasons by reference and supplemented by what follows in [6] to [12] below.
These proceedings were commenced by summons filed on 25 October 2022 with the plaintiff described as "Maria Oliveira by her tutor Ivo De Oliveira". Accompanying the summons was a Supreme Court form entitled "Consent to Act as a Tutor" signed by Ivo on 24 October 2022 in which he stated: "I Ivo De Oliveira consent to act as tutor for Maria Oliveira, the plaintiff in the proceedings".
In response to service of the summons and related documents (including the consent form), the defendants' solicitors wrote to Ivo's solicitors on 2 November 2022, including (emphasis added): "Eligibililty of Ivo de Oliveira to Bring Proceedings In previous correspondence to our office, you indicated you were liaising with the NSW Trustee & Guardian (NSW T&G). We understand from our clients that the NSWT&G are the financial managers for Ms Maria Oliveira. Please urgently provide written authority from NSWT&G for Mr lvo de Oliveira to act as tutor for Ms Maria Oliveira or other written evidence of Mr Ivo de Oliveira's authority to bring proceedings on behalf of Ms Maria Oliveira. We put you on notice that, if Mr Iva de Oliveira does not have the appropriate authority to act as tutor and bring these proceedings, our clients will be seeking special costs orders against Mr lvo de Oliveira. …"
On 17 November 2022, the defendants' solicitors wrote again to Ivo's solicitors, including: "We refer to our letter to you dated 2 November 2022 and the affidavit of Ivo De Oliveira filed on 16 November 2022 in the above proceedings. We enclose our appearance, filed on 17 November 2022. You have not provided a proper response to our letter nor adequately addressed the information requested in that letter. You have not provided any evidence of Ivo De Oliveira's proper authority to bring these proceedings on behalf of Maria Oliveira."
In the absence of a reply, the defendants' solicitors wrote again on 24 November 2022: "We refer to our letter to you dated 2 November 2022. We note the matter is listed for first directions tomorrow. You have still not provided evidence of Mr De Oliveira's authority to bring these proceedings, as tutor for Maria De Oliveira. You have also not provided any evidence of the NSW Trustee & Guardian's knowledge of or consent to these proceedings being brought, despite our request for this information on 2 November 2022."
Despite having raised the question of Ivo's authority in three pieces of correspondence, there is no evidence that the defendants did anything more about their concerns about Ivo's authority to bring the proceedings beyond writing to TAG (see the following paragraph) and attaching the relevant correspondence to an affidavit that was served on Ivo on or about 13 March 2023.
On 13 December 2022, the defendants' solicitors wrote to TAG about the proceedings, including: "Would you please confirm the following· That the NSW Trustee & Guardian has been appointed as Maria Oliveira's financial manager and provide a section 122(2) Authority to demonstrate that Maria Oliveira is a managed person. and Whether the NSW Trustee & Guardian, as Maria Oliveira's financial manager, has directly consented to the Proceedings being brought on her behalf by her tutor lvo de Oliveira; and … Our clients are concerned that lvo de Oliveira is not the appropriate tutor to bring the Proceedings, as he is not an impartial third party and may have an interest in the outcome of the Proceedings. Our clients are also concerned that Maria Oliveira might potentially be exposed to an adverse costs order, because of the Proceedings being pursued in an uncommercial manner by her tutor, where there is no real financial need."
On 16 February 2023, TAG replied by email to the defendants' solicitors including: "Please find attached Order appointing NSWTG as financial manager for Maria Oliveira. NSWTG have not consented to Ivo bringing the family provision proceedings…"
There is no evidence that the defendants' solicitors did anything with the information that TAG had not consented to Ivo bringing these proceedings. In particular, there is no evidence that this was drawn to the Court's attention at any of the five subsequent directions hearings that took place before the matter came on for hearing before me. Neither party raised the issue with the Court at any time.
The fact that TAG had not given its consent for these proceedings to be brought on behalf of Maria was mentioned in passing towards the end of Mr Morahan's submissions in the context of explaining the delay in the proceedings being brought (Tcpt, 11 September 2023, 44(46)). The procedural significance of that lack of consent was not addressed by the parties until the Court directed them to provide submissions on the present costs issue.
For completeness, I record that I directed that a copy of the Principal Judgment be provided to TAG. When the matter came back before me for directions as to the determination of the present costs issue, there was an appearance by a representative of TAG. Beyond a reference to "general delay", that representative was unable to offer any explanation for TAG's failure to respond in a substantive way to Ivo's solicitors' attempts to ascertain TAG's position in relation to these proceedings.
Nor did TAG make any application to be heard on the question of the costs of the proceedings. That latter position may be explained on the basis that it was apparent that the defendants would be advocating for the position that Ivo pay the costs of the proceedings without recourse to Maria's estate.

Legislative provisions

The Court has a wide discretion as to costs, including as to who should pay them. Section 98(1) of the Civil Procedure Act 2005 (NSW) provides (emphasis added): Courts powers as to costs (1) Subject to rules of court and to this or any other Act - (a) costs are in the discretion of the court, and (b) the court has full power to determine by whom, to whom and to what extent costs are to be paid, and (c) the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis.
Part 7 of the Uniform Civil Procedure Rules (NSW) (UCPR) includes these provisions in relation to tutors (emphases added): 7.14 Proceedings to be commenced or carried on by tutor (1) A person under legal incapacity may not commence or carry on proceedings except by his or her tutor. (2) Unless the court orders otherwise, the tutor of a person under legal incapacity may not commence or carry on proceedings except by a solicitor. 7.15 Tutors generally (1) Subject to this Division, a person may become the tutor of a person under legal incapacity without the need for any formal instrument of appointment or any order of a court. (2) Any person (other than a corporation) is eligible to be the tutor of a person under legal incapacity, in respect of any proceedings, unless the person is - (a) a person under legal incapacity, or (b) a judicial officer, a registrar or any other person involved in the administration of a court, or (c) a person who has an interest in the proceedings adverse to the Interests of the person under legal incapacity. (3) In the case of proceedings with respect to the estate of a person whose estate is subject to management under the NSW Trustee and Guardian Act 2009, the tutor of that person is to be the person who has the management of the person's estate under that Act. (4) Subrule (3) does not apply if the person concerned declines to act as tutor or is unable to act as tutor, or if the court orders otherwise. (5) A person may not replace another person as tutor of a person under legal incapacity except by order of the court. (6) Anything that these rules authorise or require a party to do in relation to the conduct of proceedings may, if the party is a person under legal incapacity, be done on his or her behalf by his or her tutor.
Finally, and insofar as relevant legislation is concerned, on 24 November 2020 the NSW Civil and Administrative Tribunal made these orders: 1 The estate of Maria Oliveira is subject to management under the NSW Trustee & Guardian Act 2009. 2 The management of the estate of Maria Oliveira is committed to the NSW Trustee & Guardian.
Under the Act, this meant that TAG exercises a "protective capacity" in relation to the management of Maria's estate (s 3 of the Act). Paragraph 16(1)(s) of the Act provides that TAG "may exercise the following functions when acting in a trust capacity or protective capacity… bring and defend actions, suits and other proceedings".
The Act also relevantly provides: 55 Application of Division This Division applies in respect of the estate of a managed person that is committed to the management of the NSW Trustee. 56 General management functions The NSW Trustee has, and may exercise, in respect of the estate of a managed person, the following functions - (a) all functions necessary and incidental to its management and care, (b) such other functions as the Supreme Court or the Civil and Administrative Tribunal (in the case of a person under guardianship) may direct or authorise the NSW Trustee to have or exercise. 57 NSW Trustee has all functions of managed person (1) For the purposes of its protective capacities in respect of a protected person or patient, the NSW Trustee has, and may exercise, all the functions the person or patient has and can exercise or would have and could exercise if under no incapacity. (2) For the purposes of its protective capacities for a managed missing person, the NSW Trustee has, and may exercise, all the functions that the person has and can exercise or would have and could exercise if the person were not missing. 59 Application of money of managed estates The NSW Trustee may apply money of the estate of a managed person towards any one or more of the following purposes… (e) the preservation and improvement of the estate of the person… 71 Managed person cannot deal with estate (1) The power of a managed person to deal with his or her estate is suspended in respect of so much of that estate as is subject to management under this Act. …. The defendants' submissions in chief
Citing Yakmor v Hamdoush (No 2) (2009) 76 NSWLR 148; [2009] NSWCA 284 and Azar v Kathirgamalingan (2012) 62 MVR 462; [2012] NSWCA 429, the defendants submitted that the costs orders made on 11 September 2023 should be ordered to be paid by Ivo personally without recourse to Maria's estate for these reasons (quoting from the defendants' written submissions): "(1) First, given the circumstances of this case where clearly the Plaintiff, Maria, could not have given instructions to commence these proceedings or continue these proceedings, it is evident that any such costs order should not be made against her given it was not her choice to commence or continue these proceedings. (2) Second, given the Plaintiff's circumstances where she is disabled, wholly dependent on NDIS, has a pension and has only $26,000 in the bank, any costs order should not be imposed on her. Indeed, responsibility for costs is one, but not the only, purpose of appointing a tutor and even if an opposite party has the benefit of orders against both the persons under the incapacity and the tutor, it is for the benefit of that party to be free from the complications of recovery from the incapable person. (3) Third, given his Honour's Judgment, his Honour held that the application failed at every turn as there was simply no contingency which would require funds to be paid to the Plaintiff. (4) Fourth, given the various offers that were made to settle the proceedings which were not accepted."

Ivo's submissions

The fundamental submission for Ivo was expressed as "the original costs orders were made before an exposition of the status of Ivo could be carried out and before the history of the position and attitude of the Defendants could be examined. It is respectfully submitted that the costs orders should be varied to an order that each party pays their own costs." The source of the Court's power to vary the orders made at the conclusion of the Principal Judgment, and now entered, was not identified.
In support of Ivo's submission, the Court's attention was drawn to two authorities. First, Ivo relied on the decision of Gleeson JA (sitting alone) in Smith v NRMA Insurance Limited (2016) 77 MVR 480; [2016] NSWCA 250 to the effect that while a tutor was in the ordinary course personally liable for costs, the Court had power to relieve the tutor from that liability by a protective order.
Without further exposition, the Court's attention was also drawn to the decision of Hallen J in Harris v Carter [2020] NSWSC 196 as "instructive". While not dissenting from the proposition that any decision of his Honour is instructive, I am unable to see how that decision is of any assistance to Ivo, because in considering whether a tutor should be personally liable to pay costs, his Honour concluded: "207 Ms Usherwood, even though strictly, not a "party", as the Plaintiff's tutor, is, nonetheless, to be regarded as a party for the purpose of making costs orders: Stokes v McCourt (Costs) [2014] NSWSC 63 at [7] (McDougall J); Yakmor v Hamdoush (No 2) (2009) 76 NSWLR 148 at 156-157 [44]-[45]; [2009] NSWCA 284 at [44]-[45] (Giles JA, Ipp and Tobias JJA agreeing). At [23], Giles JA referred, with approval, to a statement made by Buss JA in Farrell v Royal Kings Park Tennis Club (Inc) [2007] WASCA 173 at [17], that: "… it is well-established that if an action brought by a plaintiff under a disability is dismissed, and the defendant is awarded costs, the next friend of the plaintiff is personally liable to the defendant for the costs." 208 Thus, Ms Usherwood will be personally liable to pay the costs. The Defendants, if they desire to do so, may enforce the costs order directly against her since the Plaintiff is a person under a legal incapacity: Yakmor v Hamdoush (No 2) at [24]-[25], [44]-[45]. 209 Naturally, I considered that it might be thought to be unfair for Ms Usherwood to be liable for costs as she did not stand to personally benefit from the proceedings and only consented to act as tutor because the Plaintiff was under a legal incapacity. But that could be said for nearly every tutor. As was pointed out by Bathurst CJ (McColl and Meagher JJA agreeing) in Ashton v Pratt (No 2) [2015] NSWCA 134 at [18]: "… responsibility for costs is one, but not the only, purpose of appointing a tutor and even if an opposite party has the benefit of orders against both the persons under the incapacity and the tutor, it is for the benefit of that party to be free from the complications of recovery from the incapable person: Yakmor at [21], [30]." 210 When the potential costs implications if the Plaintiff were unsuccessful was raised at the beginning of the hearing, senior counsel for the Plaintiff informed the Court that Ms Usherwood was aware that "she will be personally liable for any order for costs that is made against the plaintiff in bringing these proceedings": Tcpt, 12 December 2019, p 8(38-42)."
Ivo's further submissions may be summarised as: 1. Given the complete lack of a substantive response from TAG to Ivo's solicitor's enquiries about TAG's attitude to the litigation, "it was not unreasonable for the solicitors for the Plaintiff to assume that the NSW Trustee & Guardian was declining to act as tutor" for the purposes of UCPR r 7.15(4) (set out in [18] above). 2. The defendants had never made any complaint to the Court concerning Ivo's status as tutor. If objection had been taken prior to the conduct of the final hearing, Ivo could have had the opportunity to consider his position and, if advised, seek a protection order in relation to costs or taken some other action. In the absence of such complaint, it is now unconscionable for the defendants to suggest that Ivo should be personally liable to indemnify the parties to the litigation. 3. There could be no suggestion that Ivo was acting otherwise than in Maria's interests. There was no evidence that he was acting in any way for his own benefit. 4. The proceedings had been reasonably brought and the fact that she has a small estate of about $26,000 is irrelevant to the questions of whether Ivo should pay the costs or not.

The defendants' submissions in reply

The defendants' submissions in reply may be summarised as: 1. The only question before the Court was whether Ivo should pay the costs order personally without recourse to Maria's estate. It was not open to Ivo to seek to vary the costs orders which the Court had already made; 2. At the very least, Ivo was made aware that TAG had not consented by the relevant correspondence (set out in [12] above) included in an affidavit served by the defendants on Ivo on 13 March 2023. 3. The defendants had raised the question of Ivo's authority to bring the proceedings in the three pieces of correspondence referred to in [7] to [9] above, to none of which Ivo's solicitors had ever responded. If TAG had in fact declined to act, then a tutor must pay the costs personally. 4. To the extent that the merits were relevant, the Court had conclusively found there was no basis for a further provision for contingencies being made in favour of Maria. 5. There was no basis to revisit the earlier costs orders. Ivo had been on notice from 2 November 2022 (see [7] above) that the question of his authority was in issue, including the risk of a personal costs order, and yet he did nothing about it. 6. Ivo should bear the costs personally because it was his decision to commence and then run the proceedings.

Consideration - three preliminary points

The Court has concluded that Ivo should pay the costs of the proceedings personally without recourse to Maria's estate for two reasons. First, Ivo did not have authority to bring the proceedings either as purported tutor or in some other capacity. Second, whether that analysis is right or wrong, in the exercise of its general discretion as to costs the Court is satisfied that the just and proper outcome is an order to that effect.
However, before setting out the reasons for those conclusions, it is convenient to deal with three preliminary matters.
First, the present issue must be determined in the light of the fundamental proposition that a tutor is personally liable to pay the costs of the proceedings in the absence of a protective order (which undoubtedly can be made: see [24] above). Furthermore, that liability exists whether a costs order is expressed to be made only against the party for whom the tutor was appointed, or against the tutor himself or herself.
So much appears from the two Court of Appeal decisions relied on by the defendants. In Yakmor, Giles JA (Ipp and Tobias JJA agreeing) said (emphasis added): "23 See also NSW Insurance Ministerial Corporation v Abualfoul [1999] FCA 433; Dissidomino v Butcher Paull & Calder [2005] WASCA 210; and Farrell v Royal Kings Park Tennis Club (Inc) [2007] WASCA 173. In the last of these cases Buss JA ordered that security for the costs of an appeal be provided where the next friend was bankrupt, saying at [17] that "it is well established that if an action brought by a plaintiff under a disability is dismissed, and the defendant is awarded costs, the next friend of the plaintiff is personally liable to the defendant for the costs". 24 In my opinion, and subject to consideration of r 42.3 of the Rules, these principles apply to the liability of a tutor appointed under the Rules to represent a person incapable of managing his or her affairs. They do not depend on particular rules governing the appointment of a next friend and the next friend's responsibilities, but ascribe to the office of next friend a responsibility in relation to costs for the benefit of the opposite party. As is apparent from NSW Insurance Ministerial Corporation v Abualfoul, an undertaking to be responsible for costs is not required - an undertaking had been given by the next friend in the District Court, but the rules requiring and giving effect to an undertaking were not in force and the general law principles were accepted. The responsibility was an incident of the office of next friend, and now is an incident of the office of tutor. 25 The cases generally do not distinguish between the tutor's liability to pay costs pursuant to an order made against the person under an incapacity, and the tutor's liability to pay costs pursuant to an order made against the tutor himself or herself. The liability, however, is clear, and (still subject to r 42.3) I see no reason why it should not expressly be stated in the manner sought by the respondent in order (2) [and order that the Appellant's tutor pay to the Respondent the costs the Appellant is ordered to pay]. This is ultimately an exercise of the discretion in s 98 of the Act, and in my opinion it should be exercised by making order (2)."
In Azar, Campbell JA (with whom McColl and Basten JJA agreed) said: "202 How this conflict arises requires some explanation. Even though in the present case the order for costs that was made was against the Appellant, such an order is enforceable against a tutor: Yakmor v Hamdoush (No 2) [2009] NSWCA 284; (2009) 76 NSWLR 148 esp at [24]. As well, it was held in Yakmor at [45] that there is jurisdiction for the court to make an explicit costs order against a tutor. That decision was reached on the basis that the tutor was a party to the litigation. Yakmor was decided at a time when UCPR 42.3 permitted costs orders against a non-party in only limited circumstances. Since then, the UCPR have been amended so that there is no longer a restriction on making costs orders against non-parties: Arena Management Pty Ltd (Receiver & Manager Appointed) v Campbell Street Theatre Pty Ltd [2011] NSWCA 128; (2011) 281 ALR 304 at [24]-[25]. However, in accordance with the reasoning in Yakmor it would still be possible to make a costs order directly against a tutor."
These authorities make clear that the costs order made against Maria at the conclusion of the Principal Judgment is enforceable against Ivo without any further order of the Court. However, the issue upon which the Court required further submissions and is the subject of these reasons, arises from a further general law principle, being that a tutor (if he or she be such) is entitled to an indemnity out of the estate of the person they are appointed to represent for all costs properly incurred on that person's behalf: Steeden v Walden [1910] 2 Ch 393; Murray v Kirkpatrick (1940) 57 WN (NSW) 162. The issue for present determination is whether the Court should make an order the effect of which is to deprive Ivo of the right of indemnity to which he would otherwise be entitled if he was validly Maria's tutor.
Second, insofar as Ivo's submissions seek to vary the existing costs order, the Court accepts the defendants' submission that Ivo has demonstrated no basis upon which the Court could vary that order (in contrast to what might occur on any appeal). The Court's cost order was entered on 11 September 2023. It was not submitted for Ivo that the costs order had been made "irregularly, illegally or against good faith" for the purposes of UCPR r 36.15. Furthermore, the costs order was a final order, being part of orders determining the claim. This means that UCPR r 36.16 is not available as a source of power to set aside the costs order (see UCPR r 36.16(3)(a)). Finally, it could not be suggested that the costs order was the product of a slip (so as to engage r 36.17) or was able to be set aside by reference to the inherent jurisdiction (see UCPR r 36.16(4)). The only matter for determination was whether the costs orders made against Maria should be satisfied by Ivo personally without recourse to her estate.
Third, I do not accept Ivo's submission that, in events which happened, it was reasonable for Ivo to assume that TAG had declined to act as tutor for the purposes of UCPR r 7.15(4) (reproduced in [18] above) because of TAG's silence in response to his solicitors' enquiries.
Ivo should have raised the matter with the Court, which could have required a response from TAG. There was, for example, no difficulty in procuring the attendance of a representative of TAG in relation to the costs question in these proceedings (see [15] above).
In any event, Ivo and his solicitors were, or ought to have been, on notice from on or about 13 March 2023 of the fact that TAG did not consent to the proceedings being brought by reason of the service of an affidavit on behalf of the defendants which included the relevant correspondence (see [10] above). Whatever may be said about the defendants' failure to raise the issue with the Court, there can be no doubt that Ivo should have raised TAG's lack of consent with the Court as soon as his solicitors became aware of it, not least in order to bring certainty to his own position as tutor, including to apply for a protective order against costs if he was so advised.

Consideration - Ivo did not have authority as a tutor under the UCPR to bring or conduct the proceedings on behalf of Maria

I have concluded, on two distinct bases, that Ivo did not have authority to bring or conduct these proceedings on behalf of Maria. In that circumstance, Ivo must pay the costs personally without recourse to Maria's estate. The position is analogous to the usual (but not inevitable) order that a solicitor who takes steps in proceedings without authority is liable to pay the costs the solicitor has thereby caused other parties to incur (see, for example, Hillig v Darkinjung Pty Ltd (No 2) [2008] NSWCA 147 per McColl JA at [47]-[52] (Beazley and Giles JJA agreeing)).
The Court's first conclusion is that Ivo was not, as a matter of law, Maria's tutor and that his purporting to act in that capacity was a nullity. Because he was not her tutor as a matter of law, he would not be entitled to the general law right of indemnity that a tutor would otherwise have (see [33] above).
The reasons for this conclusion are (the relevant rules being set out in [18] above): 1. There is no doubt that Maria is a person under legal incapacity for the purposes of UCPR r 7.14. As such, she could not commence or carry on proceedings except by a tutor. 2. Because Maria's estate was subject to management, TAG (and no one else, subject to UCPR r 7.15(4)) had to be Maria's tutor by reason of UCPR r 7.15(3). That rule reflects the fact that by reason of the provisions of the Act (see [20] to [21] above) Maria's estate was under the control of TAG. 3. UCPR r 7.15(3) would have been excluded by UCPR r 7.15(4) only if TAG had declined to act as tutor, or was unable to act as tutor, of if the Court otherwise ordered. Relevantly, as a matter of fact, the Court finds by reason of the matters set out in [38] to [41] and [45] to [46] of the Principal Judgment and [11] to [12] above, that TAG never declined to act as tutor. The other exceptions in UCPR r 7.15(4) are irrelevant in the events which happened. 4. By reason of the preceding sub-paragraphs, on the proper construction of UCPR r 17.5 and in the events which happened, only TAG could be Maria's tutor under the rules. Any other person purporting to act as such was not a tutor for the purposes of the rules. Anything they did purportedly as tutor was a nullity in the sense that it could only be their act and could not be visited on the person whose tutor they purported to be.
If the foregoing conclusion is correct, then because Ivo was not in law Maria's tutor he is not entitled to indemnity from her estate. However, that conclusion also has the consequence that the general law liability of a tutor for the costs of the proceedings also does not apply to Ivo. Two things flow from that. First, there is a real injustice in the costs order which the Court made at the end of the Principal Judgment insofar as it visits the responsibility for costs on Maria in circumstances where she has absolutely no responsibility for the proceedings having been brought or prosecuted. Second, it will be necessary to exercise the Court's discretion to make a separate costs order against Ivo (see paragraphs [50] to [52] below).

Consideration - there is no other basis on which Ivo had authority to bring or conduct the proceedings on behalf of Maria

The second basis for the Court's conclusion is that because the management of Maria's estate was committed to TAG under the Act, it was only TAG that could bring the proceedings on Maria's behalf or consent to someone else doing so. There is no doubt that Maria lacked the legal capacity to do so. Moreover, Maria's rights, such as they were, to bring proceedings for a family provision order were an incident of her estate that was under TAG's management. To assert such rights would be to seek the improvement of her estate, a purpose for which TAG could apply Maria's funds (see s 59(e) of the Act).
Maria's powers to deal with her own estate were suspended (s 71(1) of the Act) and could only be exercised by TAG (see ss 56(a) and 57(1) of the Act). For that reason, Ivo's solicitors were perfectly correct to enquire of TAG whether it would bring the proceedings as Maria's tutor or whether it would consent to Ivo doing so. However, Ivo should not have proceeded as tutor without that question being definitively resolved, if necessary with the assistance of the Court. The fact that Ivo may have been acting solely in Maria's interests does not change the legal reality that he did not have authority to bind Maria or her estate, including by bringing proceedings purportedly on her behalf.
I am satisfied that there is an applicable analogy between Ivo's situation and that of a solicitor acting without authority being liable for the other party's costs. It must therefore be accepted that that Ivo's conduct, being without authority, does not automatically have the consequence that he should pay the costs of the proceedings personally. While that is "the outcome which would usually be produced in a sound exercise of discretion", it does remain a matter for the exercise of the Court's discretion rather than a legal rule: Hillig at [51] - [52] (see paragraphs [50] to [52] below). However, the finding that Ivo had no other authority to prosecute the proceedings on behalf of Maria gives rise to the same injustice to Maria that I have referred to in [41] above.

Consideration - the costs order made against Maria

For the reasons which follow, the Court will of its own motion vacate the extant costs order against Maria.
While I have concluded (see [34] above) that Ivo has not demonstrated any basis on which the Court's earlier costs order can be set aside, the conclusions I have reached in [38] to [44] above do provide a proper foundation for the Court to set aside the costs order made against Maria and replace it with an identical order against Ivo. There are two alternative bases upon which I am satisfied the Court can do so in order to cure the injustice to which I have referred, Ivo's conduct having caused "the court and the parties [to] engage in a charade of purporting to decide issues between parties to litigation when one of those parties [in this case Maria] is not really there": Doulaveras at [138] per Campbell JA.
The first is that the costs order against Maria was irregularly made within the meaning of that term in UCPR r 36.15(1). The injustice of Maria being subject to a costs order for proceedings for which she is in no way responsible is sufficient cause to engage the Court's discretion under that rule. The irregularity is that it is a condition precedent to the making of a costs order that the person subject to that order is in some way materially responsible for having caused the relevant costs to be incurred. On no view can Maria have any such responsibility at all.
The alternative basis upon which I rely is the inherent jurisdiction of the Court where it has become apparent, by further argument and exposition of the facts, that the costs order made and entered against Maria is fundamentally unjust for the reason I have identified. For the purposes of these proceedings, Maria was just never there.
For these reasons, the Court will vacate the costs order against Maria but make an order in identical terms against Ivo personally. Insofar as the latter involves an exercise of the Court's costs discretion, that is set out in paragraphs [50] to [52] below.

Consideration - exercising the Court's costs discretion

Having concluded that there is no basis on which Ivo had authority to bring and prosecute the proceedings on behalf of Maria, it is necessary to determine whether he should pay the defendants' costs of the proceedings and, for the avoidance of doubt, whether he should do so without recourse to Maria's estate. However, I make clear that even if I was of the view that Ivo did have authority whether as tutor or otherwise, I would still have reached the same conclusion that he should personally pay the defendants' costs without recourse to Maria's estate for the reasons which follow (but excluding the reason in [52(1)]).
I have carefully considered the matters advanced on Ivo's behalf put against the proposition that he should pay the costs personally without recourse to Maria's estate. Consideration of that question does not change the applicability of the reasons for the form of the costs order (including as to indemnity costs) set out in [56] to [58] of the Principal Judgment, given that Ivo was the person responsible for the conduct of the litigation, including the responses to the relevant offers of settlement.
In my respectful opinion, the strongest argument advanced against Ivo's personal liability was that he was not acting in his own interest. That may be accepted. However, as Hallen J observed in Harris (see [25] above), that can be said of any tutor or, in this case, any person purporting to act as a tutor. It is not sufficient to displace the reasons why I am satisfied that Ivo should pay the costs personally without recourse to Maria's estate, which are: 1. Ivo had no authority to bring and prosecute the proceedings on behalf of Maria. 2. Maria, a legally incapable person, had no responsibility for initiating or conducting the litigation. 3. The decision to bring and prosecute the proceedings was entirely Ivo's. 4. Ivo has not suggested that he did not understand that he was at risk as to costs. 5. The proceedings failed completely. Ivo has not sought to rely, for example, on any advice he may have received before or during the proceedings that they had reasonable prospects of success. 6. By reason of the defendants' solicitors' letter of 2 November 2022 (see [7] above), Ivo was on notice from a very early stage of the proceedings that he was at risk of a personal costs order being sought against him if he did not have authority to bring the proceedings. Nevertheless, Ivo refused to engage with the concerns raised by the defendants about his authority to bring the proceedings. Furthermore, he failed to draw to the attention of the Court or make any application arising from the fact that he or his solicitors knew, or ought to have known at any time after 13 March 2023 (see [10] above), that TAG had not consented to the proceedings being brought by him on behalf of Maria. 7. The evidence of the defendants' solicitor was that $26,000 had been incurred in costs and disbursements (I assume on a solicitor/client basis) up to 24 August 2023 with a further $24,000 in costs and disbursements estimated to be incurred up to and including the final hearing. The Court finds that on any view the value of the costs order the Court has made in favour of the defendants is well in excess of the $26,000 Maria has under the management of TAG (being her only asset of value). The fact that enforcing the costs order directly or by way of indemnity would exhaust a disabled person's only real, current asset is, contrary to Ivo's submission, relevant to the present issue. 8. In summary, and notwithstanding that the proceedings were brought for Maria's benefit, both in fact and law the proceedings were brought and prosecuted by Ivo alone and he should, therefore, bear the costs consequences personally, and without recourse to Maria's estate.

Conclusion

The orders of the Court are: 1. Vacate order 2 made on 11 September 2023; 2. Ivo De Oliveira is to pay, without recourse to the estate of Maria Oliveira, the defendants' costs of the proceedings: 1. On the ordinary basis up to and including 23 April 2023; and 2. On the indemnity basis on and from 24 April 2023 (including, for the avoidance of doubt, the argument as to costs).

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 29 November 2023

Guardian Act 2009(NSW)

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