Issues for Determination

1. The proper construction of the term “issue” in the will, which was ultimately agreed between the parties.
2. The appropriate costs order, given the construction point was essentially agreed.

FACTS

The testator died on 21 August 2015 aged 96. She left a small estate of $170,000 and a number of possible beneficiaries.

Her will used the term “issue” in circumstances where there was reason to consider what was meant was “children”.

There were 25 Respondents to the proceeding, but only one appeared, being the 25th, who was the solicitor who had drafted the will. Unfortunately, his file had been destroyed and he had no recollection of the matter.

The applicant’s lawyers had written to the 25th respondent with a copy of the proposed proceedings and counsel’s advice and suggested that he ought indemnify the estate for the costs of the application.

Again the 25th respondent suggested the application was unnecessary, but in any event should be discontinued against him and if so, he would be prepared to bear his own costs.

The matter ultimately proceeded, with only the applicant and 25th respondent appearing and both contending for the same interpretation. The substantial dispute between them was as to costs.

DECISION

Mullins J said:

“Not all questions of construction of a will have to be referred to the Court, if considered advice form an appropriately experienced lawyer is obtained and the outcome of any application is a foregone conclusion. This is particularly so in respect of a small estate. ”

It was not the case the Mullins J thought that application ought not to have been brought. Rather, specific reference was made to the large number and disparate nature of the beneficiaries not all of whom had acknowledged service and that the applicant was entitled to adopt a cautious approach.

However, she felt the 25th respondent’s offer to bear his own costs if the application against him was discontinued was reasonable, although she considered he might have gone further to offer to bear the costs of obtaining the initial advice from his lawyers and counsel but, as Mullins J said, “but once that advice was obtained by reference to the rule in Sibley v Perry, the applicant could not necessarily seek to hold the 25th respondent liable for taking the cautious approach of proceeding with the further step of an application for construction of the will.

ORDERS

The orders (as to costs) made were:

1. The 25th respondent’s costs incurred after 10 July (after his reasonable offer) paid on a standard basis from the estate;
2. The applicant not be denied an indemnity from the estate, because he was acting on his lawyers’ advice. However, “the applicant’s lawyers may wish to consider their position on the basis of these reasons at least in relation to the costs of the 25th respondent to be paid out of the deceased’s estate” .

Read the full judgement here.