Plaintiff v Defendant

1 On the 7 April 2006, I gave judgment in this proceeding.[1] The plaintiff was unsuccessful in his claim for further provision from the estate of the late David Rodney Bull, and there remains the question of costs. On 26 May 2006, I heard oral arguments supported by helpful written submissions. Counsel for the plaintiff submitted that, although his client was not successful, he should have his costs from the estate. On behalf of the defendant executrix, it was put that costs should follow the event and that the costs of the estate should be paid by the plaintiff.

2 These applications were argued against the statutory background established by recent amendments to s. 97 of the Administration and Probate Act[2]. Sub-sections (6) and (7) are in the following terms:

(6) Subject to sub-section (7), the Court may make any order as to the costs of an application under section 91 that is, in the Court's opinion, just.

(7) If the Court is satisfied that an application for an order under section 91 has been made frivolously, vexatiously or with no reasonable prospect of success, the Court may order the costs of the application to be made against the applicant."

3 Section 24(1) of the Supreme Court Act 1986 confers on the Court a general discretion as to the costs "of all matters in the Court, including the administration of estates and trusts". The implementation of this discretionary power has been circumscribed in the cases so that there is a strong disposition in ordinary civil litigation to award costs in favour of the successful party - costs follow the event - and that these costs be assessed on a party and party basis. The statutory power is, however, expressed to be conferred "unless otherwise specifically provided by this or any other Act or by the Rules". Part IV of the Administration and Probate Act from its earliest inception in 1906[3] has contained in s. 97(6) and its predecessors a provision that the Court may make any order as to costs that is, in the Court's opinion, just. Whether, and to what extent, this is a provision as to costs inconsistent with s. 24(1) may be a matter of uncertainty. The fact is that, in applications under Part IV, orders for costs very often depart from the ordinary rule applicable in civil litigation. Defendant trustees are normally entitled to an indemnity in any event from the assets which they seek to protect. Even plaintiffs tend to be treated differently. If successful, they will often have their costs out of the estate on a solicitor and client basis[4]; and this has become so common that it has been described as "the standard order".[5] Likewise the Court has shown a readiness in the case of an unsuccessful application to depart from the costs-follow-the-event-rule which might otherwise obtain. In such a case, the Court may decline to make any order as to costs, leaving the unsuccessful plaintiff and the estate to bear their own.[6] In Singer v Berghouse[7], Gaudron J dealing with an application that a plaintiff provide for security for costs in an application under the New South Wales Family Provision Act 1982, made the following observation:

"Family provision cases stand apart from cases in which costs follow the event. Leaving aside cases under the Act which, in s 33, makes special provision in that regard, costs in family provision cases generally depend on the overall justice of the case. It is not uncommon, in the case of unsuccessful applications, for no order to be made as to costs, particularly if it would have a detrimental effect on the applicant's financial position." (Footnotes omitted.)

4 There have even been cases where an unsuccessful plaintiff has, nevertheless, obtained his or her costs from the estate.[8]

5 The changes to Part IV introduced in 1997 included the provisions enlarging the class of persons eligible to seek further provision which were the subject of my earlier judgment. Among these provisions is found the new s. 97(6) and (7) which I have set out above.[9]

6 Two things should be noted about these sub-sections. First, sub-s. 97(6) substantially re-enacts its predecessors which conferred on the Court a general discretion to make a costs order which seemed just. I take this to be a legislative endorsement of the long line of authority in this State which I have summarised.

7 Second, in the context in which it is found, the qualification to this discretion imposed by sub-s. 97(7) is less surprising than it might otherwise seem. I say, surprising, because it may be supposed that a Court might ordinarily consider it just to award costs against a party which is unsuccessful. And even more so against a party which has brought the proceeding frivolously, vexatiously or with no reasonable prospect of success. Why, in these circumstances, would Parliament empower, not direct, the Court to make a costs order against such a plaintiff? The answer, to my mind, lies in an application of the fact that, in the ordinary course, an order for costs in family provision cases may not be made against a plaintiff simply because the application has failed. There may be a further consideration. A discussion paper was prepared for the Attorney-General's Law Reform Advisory Council in July 1994[10]. In it Dr Atherton discusses concerns about the wisdom of enlarging the class of persons eligible to seek further provision beyond one based on family relationships to one based upon economic dependency or moral responsibility. Such a change may create uncertainty for testators and may raise the spectre of large numbers of applications by non-relatives. In fact Parliament in the Wills Act 1997 has accepted moral responsibility as the touchstone for eligibility. It may be, therefore, that the reminder and encouragement offered to the Court by sub-s. 97(7) is intended to operate as a disincentive to would-be applicants whose claims to a moral entitlement are tenuous.

8 It was accepted by both parties before me that the present application, although unsuccessful, was not one which fell within the class of applications mentioned in sub-s. 97(7). They accepted, too, that, in these circumstances, my discretion fell to be exercised in the terms of s. 97(6), that is, to make such order as seems just. This is a discretion which is informed by the cases which have been decided in this area of law for the past century.

9 I turn, then, to the relevant circumstances of this application. I refer to my reasons for judgment. This case involved difficult questions of fact to be applied to a relatively new statutory regime. In short, it is not a case of which it can be confidently be said, that it ought not to have been brought.

10 The plaintiff is impecunious.

11 The plaintiff receives a modest benefit under the will, reflecting no doubt the affection which the deceased had for him. It is apparent, too, that the plaintiff loved the deceased. I would be loath to deprive him of this modest mark of his older friend's affection.

12 In a sense, the competition here has been between the estate, representing the deceased, and the plaintiff. I have found the deceased's conduct towards the plaintiff in his early years was cruel, criminal and exploitative. The estate representing that person in the way I have mentioned must therefore accept some responsibility for the plaintiff's present predicament.

13 These are factors which lead me to the conclusion that the plaintiff ought not to be required to bear the costs of the estate.

14 That said, it cannot be denied that the plaintiff made a decision to bring this proceeding and to incur the costs of so doing. This is a decision which has cost the estate. In these circumstances, he should not further burden the estate with the costs of his own erroneous decision.

15 Its seems to me, therefore, that the just result in this case is to make an order that each party bear its own costs. I will make no order as to these costs as between the parties.

16 I therefore propose the following orders in this proceeding:

(a) the proceeding be dismissed;

(b) the costs and expenses of the defendant of and incident to the proceeding be had and retained out of the estate.

[1] [2006] VSC 113.

[2] Inserted by the Wills Act 1997.

[3] See Widows and Young Children Maintenance Act 1906 s. 9(7).

[4] In the Will of Mailes [1908] VicLawRp 40; [1908] VLR 269 at 270, per A'Beckett J; In Re Bennett [1909] VicLawRp 35; [1909] VLR 205 at 207, per A'Beckett J; In the Will and Codicils of Read, deceased [1910] VicLawRp 16; [1910] VLR 68 at 72, per A'Beckett J.

[5] J.K. de Groot and BW Nickel, Family Provision in Australia, 2nd ed 2001 at p. 219.

[6] See, for example, In the Will of Roberts, deceased [1919] VicLawRp 18; [1919] VLR 125 at 128, per Hood J; In Re Kennedy, deceased [1920] VicLawRp 93; [1920] VLR 513 at 516, per Mann J. Compare Re Lago, deceased [1984] VicRp 62; [1984] VR 706 at 712, per Brooking J.

[7] [1993] HCA 35; (1993) 114 ALR 521 at 522.

[8] See Singer v Berghouse [1993] HCA 35; (1993) 114 ALR 521 at 522. Re Lack [1981] Qd R 112.

[9] See para [2] above.

[10] Rosalind Atherton: Discussion paper for the Attorney-General's Law Reform Advisory Council on the desirability of reforming aspects of Part IV of the Administration and Probate Act 1958 (Vic), July 1994.