Radford v White (No 2)[2020] QSC 369

SUPREME COURT OF QUEENSLAND

1. [1]
   JACKSON J: This is an application for costs.  By the primary decision, I declared that a video recording formed the will of Jay Matthew Schwer (“deceased”) within the meaning of s 18(2) of the Succession Act 1981 (Qld).^[1] Following that order, both parties applied for orders for costs by written submissions.
2. [2]
   By the primary decision, the applicant succeeded on the issue that was disputed.  However, the respondent submits that the applicant or the applicant’s solicitor should be ordered to pay the respondent’s costs to be assessed on the indemnity basis. The respondent provided lengthy written submissions on costs, raising numerous reasons why those orders should be made. 
3. [3]
   First, the respondent submits the application should have been brought by the applicant in a representative capacity, but was not.  Rule 18 of the Uniform Civil Procedure Rules 1999 (Qld) (“UCPR”) requires that a person suing in a representative capacity must state the representative capacity on the originating process.  There was no formal will made by the deceased and no executor was appointed by him.  It is to be observed that the application was not for a grant of probate.  It did not seek that relief^[2]  and was not made under or in accordance with the rules for a grant of probate.^[3]
4. [4]
   The applicant is a beneficiary under the informal will. The terms of the informal will provide for the deceased’s estate to be given to her and directed her to set aside $30,000 in a savings account to be given to the deceased’s daughter, Aleena, on the condition that she complete a particular class of university degree before the age of 25. If she does not graduate by that time, the deceased directed that the money is to “absolve” back to the applicant and that the money that will be accumulated is to be used for one thing only, and that is to put a deposit on a house in Aleena’s own name.  The informal will further provided that on Aleena’s 16^th birthday, the applicant is to give all the deceased’s coinage and an American Girl doll to Aleena.  The applicant is described by the deceased as his girlfriend.  In my view, the applicant was not required to state a representative capacity on the originating process under r 18 of the UCPR.
5. [5]
   Second, the respondent submits that the applicant filed volumes of unnecessary material, much of which were social networking pages.  The respondent submits those documents were evidence that the applicant was in a de facto relationship with the deceased which was unnecessary to prove.  The application sought a declaration that the applicant was the deceased’s de facto wife.  By the time of the hearing there was no issue about that.  Having regard to the applicant’s submissions as to costs, there may have been a potential reason to apply for that declaration because it might have assisted to establish who was the deceased’s “wife” entitled to his pension or other entitlements from the United States Department of Veteran Affairs. But, in any event, in my view, the exhibits to the applicant’s affidavit filed on 5 April 2018 were irregular.  Many pages of the exhibits were unnecessary.  Against that, the relevant pages that were the exhibits identified in the body of the affidavit were clearly marked with physical tags.  The result was an unnecessary volume of material, but it caused no real difficulty in the hearing of the application or significant waste of costs that was apparent.
6. [6]
   Third, the respondent submits that the applicant did not comply with r 31(3) of the UCPR because the applicant did not name as respondents all parties whose interests may be affected by the granting of the relief sought.  The respondent submits that the application did not name the respondent and her daughter as respondents, even though they each had an interest in the deceased’s estate on intestacy and, therefore, an interest in the relief sought by application.  However, the originating application did name the respondent as the party to be served with the application. It was apparently served on her or at least she had notice of it after which she filed a notice of appearance.   Confusingly, on at least two occasions, the applicant contended that the respondent was required to apply to be joined as a party to the proceeding.  That was a distracting mistake.  However, once the hearing began no question fell to be decided whether the respondent was entitled to appear and oppose the order sought on the application.  The respondent’s daughter is Aleena Schwer.  She too was an interested party.  But she is a young child and it was not suggested by her mother, the respondent, that she ought to have been separately represented at the hearing of the application to oppose the application.  In my view, any irregularity in this respect did not affect the hearing of the application. 
7. [7]
   Fourth, the respondent submits that the applicant refused to provide information as to the details of the estate until 26 June 2018.  Again, confusingly, the applicant contended in correspondence that the respondent was not entitled to details of the estate until she was made a party to the application and also that she had no rights because final property orders had been made as between the deceased and the respondent by the Family Court of Australia.  By the time of the hearing this point was of no consequence.  The evidence was that if the trustees of the relevant superannuation funds elected to pay the benefits to which the deceased was entitled to his personal representative, the estate was worth the net amount of approximately $287,000. 
8. [8]
   The respondent submits that the application should not have been made given the small size of the estate.  The respondent submits further that the court, in determining the order for costs, should take into account the value of the property the subject of the proceeding and the value of the property about which there was a disputed entitlement under r 700A(2)(a) of the UCPR.  In my view, it would have been better had the parties not engaged in some of the disputes evidenced by the correspondence passing between them.  However, the estate was not so small as to warrant the conclusion that the application should not have been made.  In my view, there was nothing disproportionate about the costs incurred in bringing the present application by the applicant that was demonstrated. 
9. [9]
   Last, the respondent submits that she made offers to settle the proceedings relevant to the question of costs.  The respondent’s last offer to settle was made on 19 July 2018 without prejudice save as to costs.  The terms of the offer were that the application be discontinued and each party pay their own costs and that each party support the division of the superannuation proceeds as to 50 percent to each daughter (the applicant has a daughter with the deceased whilst Aleena is the respondent and deceased’s daughter) to be held by each daughter’s mother, or 50 percent to each mother for the purpose of supporting their respective daughters.  That offer of settlement was inconsistent with the terms of the informal will, which was declared to be the will of the deceased within the meaning of s 18(2) of the Succession Act 1981 (Qld).  The applicant did not do worse than the terms of that offer by pressing on with the proceeding.  She did better, unless the trustees of the relevant superannuation funds decide or decided to pay the benefits to which the deceased was entitled in a way that is unfavourable to the estate.  There is no evidence to that effect.  Accordingly, in my view, there is no basis to deprive the applicant of an order for costs based on an offer to settle that was made by the respondent. 
10. [10]
    As to the applicant’s solicitor, the respondent submits that an order should be made that the applicant’s solicitor pay the respondent’s costs, mostly for the same reasons that have been dealt with already.  The respondent submits that the proceeding was unduly prolonged, and time was lost to the parties because of the erroneous assertion that the respondent had no standing to be a party.  The originating application was first returnable on 23 April 2018.  The parties agreed for it to be adjourned by correspondence.  On 1 May 2018, the respondent filed a notice of address for service.  Because the matter was likely to take more than two hours, it was adjourned to 29 June 2018.  On 29 June 2018, it was adjourned on the papers to 11 July 2018.  On 11 July 2018, it was adjourned on the papers due to hospitalisation of the respondent’s counsel.  On 20 July 2018, it came on for hearing.  In my view, it is not established that the proceeding was unduly prolonged because of any erroneous contentions by the applicant’s solicitor or that the conduct of applicant’s solicitor caused significant loss of time to the parties. 
11. [11]
    It follows, in my view, that an order that the applicant or the applicant’s solicitor pay the respondent’s costs of the proceeding should not be made. 
12. [12]
    An alternative order sought by the respondent is that the applicant pay the respondent’s costs of the proceeding and the applicant be entitled to seek an indemnity for those costs and her own costs from the estate of the deceased.   
13. [13]
    The approach to the question of costs where the litigation concerns probate, including whether there should be a grant for an informal will, is summarised in the following passage:

“Where the litigation concerns probate, such as whether a grant should be made of an informal will, the Court generally applies the usual rules as to costs in probate proceedings; that is, where the litigation has been caused, or contributed to, by the way in which a testator made his or her testamentary intentions known, costs would usually be ordered to be paid out of the estate…

The reason for the usual costs rules relating to probate litigation was explained by Sir J P Wilde in Mitchell v Gard as follows:

‘It is of high public importance that doubtful wills should not pass easily into proof by reason of the cost of opposing them. It is of equal importance that parties should not be tempted into a fruitless litigation by the knowledge that their costs will be defrayed by others.’”^[4]

14. [14]
    Such an order is one of the forms of order that might have been made if the applicant sued as a trustee (including as personal representative) under r 700 of the UCPR.  However, the applicant did not bring the proceeding as a trustee, and that rule does not apply.
15. [15]
    The applicant applied for an order that the respondent or the respondent’s solicitor pay the applicant’s costs of the proceeding to be assessed on the indemnity basis.  There are a number of grounds advanced for that order. 
16. [16]
    First, the applicant submits that the respondent was attempting in some way to defraud the United States Department of Veteran Affairs in relation to the deceased’s war pension or other benefit entitlements.  That assertion is unsupported as a matter of fact and, in any event, was irrelevant to the outcome of the primary decision.
17. [17]
    Second, the applicant submits that the respondent’s solicitor attempted to litigate the proceeding “by correspondence”, in some way in breach of r 5 and r 700A of the UCPR. As already observed, both parties engaged in significant dispute by correspondence.  Both sides made contentious assertions that were not justified or reasonable. 
18. [18]
    Third, the applicant also submits that the respondent “attempted to mislead” the applicant and the Court as to the “parties involved” in the proceeding.  This contention should not have been made.  The respondent submitted, rightly, that she and Aleena Schwer were interested parties.  It was the applicant who wrongly contended that they were not. 
19. [19]
    In my view, there is no reason disclosed by the circumstances to make an order that the respondent’s solicitor should pay the applicant’s costs of the proceeding, or that any costs ordered to be paid by the respondent should be assessed on the indemnity basis.
20. [20]
    The remaining question is whether the respondent should be ordered to pay the applicant’s costs of the proceeding, based on the outcome that the applicant succeeded on the disputed question whether a declaration should be made that the informal will was the will of the deceased within the meaning of s 18(2) of the Succession Act 1981 (Qld).
21. [21]
    Ordinarily, the costs of a proceeding are in the discretion of the court, but follow the event unless the court orders otherwise, under r 681 of the UCPR.  Where the proceeding is an application to prove a will, different considerations may apply, as set out above, and an unsuccessful party’s costs may be ordered to be paid from the estate of the deceased.  
22. [22]
    It is not necessary to discuss those principles in any greater depth in this case.  That is because the present application is not an application to prove the will.  It was not brought in accordance with the rules providing for the proof of a will. The required public notice of an application for probate was not given.  Because of the way the proceeding was brought, it was dealt with as a declaration inter partes as between the applicant and the respondent. 
23. [23]
    In my view, however, the circumstances do disclose a reason why an order should not be made that the respondent pay the applicant’s costs.  The appropriate method of proceeding would have been for the applicant to apply to be appointed an administrator under r 603 of the UCPR and to prove the informal will under s 18 of the Succession Act 1981 (Qld).  Had that been done, it would have been appropriate to order, if no contrary consideration emerged, that the informal will be admitted to proof as the will of the deceased.  It would have also been appropriate to order that the respondent’s costs of the application be paid from the estate, because it was the deceased’s failure to make a formal will that caused the dispute over the validity of the informal will. 
24. [24]
    Because of those circumstances, notwithstanding the applicant’s success in obtaining a declaration as to the informal will being a will under s 18(2) of the Succession Act 1981 (Qld), it should not be ordered that the respondent pay the applicant’s costs of the proceeding.  There should be no order as to costs as between the applicant and the respondent personally.
25. [25]
    However, if a personal representative of the deceased’s estate is appointed, it would be appropriate for the costs of both parties to be paid from the estate.  Accordingly, I will make a conditional order to that effect, but limited to the amounts assessed on the standard basis having regard to the conduct of both parties previously discussed.