Walker v Walker

1. The parties in this proceeding were involved in a dispute over the will of the late Joseph Walker. The plaintiff is one of the deceased’s daughters. The defendant is the widow of the deceased and was sued in two capacities. Judgment dealing with the substantive issues was delivered on 3 February 2025: Walker v Walker (No 2) [2025] ACTSC 9 (primary judgment). Knowledge of the primary judgment and the issues it determined is assumed for the purposes of resolving the sole remaining question here, being who should pay the plaintiff’s costs.

Orders making family provision for the plaintiff

2. Following a further hearing on 7 March 2025, the Court made the following orders:

(1) The time for filing an application for an order under s 8 of the Family Provision Act 1969 (ACT) (FP Act) is extended to 20 October 2021.

(2) Pursuant to s 8 of the FP Act, provision is made for the plaintiff out of the will of the late Joseph Walker as follows:

a. A lump sum payment of $50,000 (“the lump sum”) within 42 days of these orders being made.

b. The lump sum and interest as calculated below are to be treated as an advance on the plaintiff’s future entitlement as a beneficiary under the will of the late Joseph Walker.

c. Interest is to accrue on the lump sum until the plaintiff receives her interest from the estate at the post-judgment interest rate provided for in the Court Procedures Rules (2006) (ACT) or any replacement.

(3) The defendants’ costs are to be paid from the estate of the late Joseph Walker.

…

3. The remaining issue was whether, having succeeded on the family provision claim, the plaintiff was also to receive the entirety of her costs out of the estate.

Competing positions of the parties on costs

4. The plaintiff sought that her costs be paid out of the estate on a party and party basis. She argued that she had been successful in obtaining an order for family provision and that the ordinary rule that costs follow the event applied. Although the plaintiff did not succeed on her challenge to the validity of the will (referred to in the primary judgment as the 2018 Will), that part of the proceeding invoked the probate jurisdiction of the court. There is a public interest in such cases, in that the court is concerned to give effect to the last will of a free and capable testator or testatrix. Even though her challenge to the last will of the deceased did not result in the 2018 Will being found invalid, the plaintiff did succeed in establishing circumstances which reasonably invited an investigation into the 2018 Will and it was therefore appropriate that her costs be paid by the estate.

5. The defendants sought that the plaintiff pay her own costs, or alternatively that one quarter of the plaintiff’s costs be paid out of the estate. This was on the basis that the plaintiff succeeded on only one of three aspects to the proceedings, the dominant issue being the validity of the 2018 Will. On the challenge to the will, the plaintiff failed. She also failed on the undue influence challenge to the deceased’s transfer of a half interest in the matrimonial home to the defendant, as part of his succession planning strategy.

6. The plaintiff succeeded only on the third aspect, being the family provision question. The defendants relied on the principles set out in Bostik Australia Pty Ltd v Liddiard (No 2) [2009] NSWCA 304 (Bostik) at [38] and Elite Protective Personnel Pty Ltd v Salmon (No 2) [2007] NSWCA 373 (Elite), arguing that it was appropriate here to deprive the successful party of costs, or a portion of her costs, where the matters upon which the plaintiff was unsuccessful took up a significant part of the trial.

Applicable principles

7. Part of the circumstances of the proceeding here include the fact that much of the dispute was about the validity of a will, which invoked the probate jurisdiction of the Court.

8. It is necessary to first explain the principles applying generally to costs considerations in ordinary civil litigation to provide a basis for understanding the submissions here, which focussed on the fact that the Court’s probate jurisdiction has “particular characteristics which differ from ordinary civil litigation”: Estate of Guamani; Guamani v De Cruzado [2023] NSWSC 502 (Guamani) at [183].

9. The starting point is always that costs are in the discretion of the Court: see r 1721(1) of the Court Procedures Rules 2006 (ACT). Rule 1705(1) confirms that the Court has power to make an order for costs in relation to a particular issue in a proceeding.

10. The principles guiding the exercise of the Court’s discretionary power to award costs in a private law context and where there were multiple issues involved have been recently set out in Wu v Wu (No 3) [2024] ACTCA 35 (Wu (No 3)) at [8]. The discretion is wide, although must be exercised in accordance with established principle and statutory context: Oshlack v Richmond River Council [1998] HCA 11; 193 CLR 72 (Oshlack) at [32], [65].

11. The purpose behind an order for costs is compensatory not punitive: Latoudis v Casey (1990) 170 CLR 534 at 567 (Latoudis). A substantially successful party is entitled to recover its costs from the opposing party, because it is just and reasonable that the party who has caused the other party to incur costs should reimburse that party for the liability incurred: Oshlack at [67]; Latoudis at 543 per Mason CJ, at 562- 3 per Toohey J, at 566-7 per McHugh J. That principle has been described as the “ordinary rule” that “costs follow the event”: Kone Elevators Pty Ltd v Shipton [2021] ACTCA 33 at [294].

12. The relevant ‘event’ is primarily to be determined “by reference to the outcome of the litigation and whether or not the plaintiff has obtained judgment in his favour”. That is so, “even if the defendant has defeated some claims and has succeeded on others, or has succeeded on some issues”: Priestley v Priestley (No 2) [2016] NSWSC 1259 at [49].

13. In Waters v P C Henderson (Aust) Pty Ltd (1994) 254 ALR 328 the following guiding principle was accepted at 330-331: Where there are multiple issues in proceedings, the Court generally does not differentiate between those on which the party succeeded or failed ... unless a particular issue or group of issues is clearly dominant or separable it will ordinarily be appropriate to award the costs of the proceedings to the successful party without attempting to differentiate between those particular issues on which it was successful and those on which it failed.

14. The above principle has been cited numerous times, examples being Bostik at [38]; Elite at [6]; and in this jurisdiction, Clarkson Williams Partners Pty Ltd v Vaughan (No 2) [2016] ACTCA 8 (Clarkson) at [10].

15. Unless a particular issue or group of issues is clearly dominant or separable, it will ordinarily be appropriate to award the costs of the proceedings to the successful party without attempting to differentiate between those particular issues on which it was successful and those on which it failed: Elite at [6]. The Court of Appeal in that case went on to state at [11] that “where there is a mixed outcome in proceedings, the question of apportionment is very much a matter of discretion and mathematical precision is illusory”.

16. As stated in Wu (No 3) at [8], fairness is the touchstone, taking into account the particular facts and circumstances of the proceeding. The question is what is “the appropriate order in the interests of justice”: Clarkson at [12].

The unique nature of probate proceedings

17. In Guamani, Meek J undertook a detailed consideration of costs in probate proceedings at [181]-[192] as part of dealing with a different matter altogether, being an application for security for costs in probate proceedings. There are two aspects of that detailed consideration that have significance for the present costs question. The first is that there is a public interest in “keeping faith with the wishes of a capable will-maker that requires an investigation into the validity of the propounded wills”. That results in a public interest in the incurring of some level of costs in cases where there is genuine doubt about the validity of a will: Guamani at [184], citing Gray v Hart; Estate of Harris (No 2) [2012] NSWSC 1562 at [5].

18. The second is that, while the ordinary principles surrounding the compensatory principles that costs follow the event still apply in the probate jurisdiction, there is greater flexibility in the discretion to order costs in the probate jurisdiction. Such discretion includes a number of exceptions, two of which were explained in Re Hodges; Shorter v Hodges (1988) 14 NSWLR 698 at 709E-G and summarised by Meek J in Guamani at [185] as follows: (1) where the cause or responsibility for the litigation can fairly be laid at the feet of the testator the costs of unsuccessfully opposing probate may be ordered to be paid out of the estate (cause exception); and (2) if the circumstances in which the testamentary instrument was created are such as to reasonably invite an investigation by the Court, the costs of that exercise may be left to be borne by those who respectively incur them (investigation exception).

19. These two circumstances have been referred to in jurisprudence in the present jurisdiction, with examples being Kovacs v Fogarty (No 2) [2007] ACTSC 40 at [5] and In the Estate of Rummer [2017] ACTSC 277 at [130]. It is not necessary to go into detail about other exceptions that do not apply to this case.

20. Where a proceeding involves the construction of a will or its administration, whether brought by the trustee or a beneficiary, there is a guiding principle that unless a party has been vexatious or lacking in good faith, costs are usually allowed to all parties out of the trust fund: Elders Trustee & Executor Co Ltd v Eastor [1963] WAR 36; Re Buckton [1907] 2 Ch 406 (Buckton) at 414-415; Tjiong v Chang [2025] NSWCA 25 at [425]; Warton v Yeo [2015] NSWCA 115 at [78]. However, those authorities also make clear that where the litigation is properly characterised as adversarial litigation, the usual order that an unsuccessful party will be ordered to pay the costs of the litigation will be “rigidly enforced”: Buckton at 415.

21. These considerations inform the discretion. Although there are particular features of the probate jurisdiction that bring an additional nuance to the discretion in awarding costs, those considerations may nevertheless be accommodated by considering them as part of ensuring an outcome that best reflects the interests of justice overall in the circumstances of the case.

What costs order best reflects the interests of justice overall in the circumstances of the case?

22. The plaintiff was successful overall. She did not succeed on the challenge to the 2018 Will and I accept that this issue was the dominant one in the proceeding. Even so, it cannot be said that the plaintiff was wholly unsuccessful on that dominant issue. As will be apparent from the primary judgment at [41]-[43], the circumstances in which the testator made his last will did reasonably invite an investigation by the Court. Accordingly, the investigation exception discussed above has some bearing here.

23. However, applying that exception, the consequence is not automatically that the plaintiff is entitled to the costs of determining that issue or that her costs will be paid by the estate. It is simply that, where it might otherwise have been the case that costs follow the event (such that the plaintiff would have been liable to pay the estate’s costs of the challenge to the 2018 Will), the just outcome may instead be that the parties are left to bear their own costs of that issue.

24. Ultimately though, the court has to assess what is in the interests of justice overall, not to determine the probate component in a vacuum from the issues involving undue influence and family provision. Taking into account the lack of success on a dominant issue must also include an acknowledgement of the full circumstances relevant to that issue, which include the probate context and much of the plaintiff’s evidence being accepted (recalling the compensative purpose of a costs order). Although fairness to all parties is an outcome that recognises the plaintiff’s mixed success and the adversarial nature of the plaintiff’s challenges, the result is one that reduces the plaintiff’s entitlement most conveniently by making a percentage adjustment, but is not one that leaves her receiving only a quarter of her costs or paying her own costs of the proceeding. An apportionment of 60% in the plaintiff’s favour is what I consider to be in the interests of justice in the overall circumstances of this case, the issues that were determined and the evidence directed to those issues. Orders

25. The order of the Court is as follows:

(1) 60% of the plaintiff’s costs are to be paid out of the estate.

I certify that the preceding twenty-five [25] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Justice McWilliam

Associate: Date: