Costs Of Contesting A Will (Vic)
Anyone who intends to make a Testators Family Maintenance (TFM) Claim must be conscious of the costs of contesting a will in Victoria. A claimant can incur significant legal fees with no assurance that their case will succeed. The Supreme Court can order reimbursement of these costs, but depending on the circumstances of the case, they may instead order that the claimant pay their own costs and repay the estate’s costs to defend the claim. This article outlines the costs of contesting a will in Victoria and clarifies the role of costs through a Victorian Supreme Court case study.
What Is A Testators Family Maintenance Claim?
In Victoria, someone who is dissatisfied with his or her inheritance from a close relative can make a claim against a deceased estate using a TFM Claim. This type of claim is also known as a Part IV claim, named after the section of the Administration and Probate Act 1958 that allows certain people to contest a will in Victoria.
Those who are allowed to make a claim include the deceased’s current spouse or de facto partner, a former partner under some circumstances, children, carers and some dependents.
What Are Costs of contesting a will?
A claimant is responsible for his or her own legal costs when making a claim against a deceased estate. Conversely, the cost of defending the estate is not borne by the executor or administrator of the estate. Courts indemnify the personal representative from reasonable costs incurred during their work, as they do not want to discourage them from accepting the responsibility. Instead, the estate itself bears the costs and may also have to reimburse the claimant for their costs.
In Victoria, the Civil Procedure Act 2010 authorises the Supreme Court to award costs to a plaintiff and/or defendant in civil litigation. The court typically makes an order as to costs after the litigation is concluded, in either a fixed amount, a certain percentage, or in an amount to be assessed at a later date.
Generally, costs in civil litigation “follow the event” so that the losing party pays the successful party’s litigation expenses. Contested will cases are treated differently for several reasons. The court considers that TFM claims are unique and costs should be awarded in a just manner. The question of what would be a just outcome depends on the reasonableness of the claim, the conduct of the parties and how the costs will impact the finances of the parties. This means that even when a plaintiff is unsuccessful, they may not have to pay adverse costs and may even have their own costs reimbursed if the court finds that the litigation was reasonable.
The court has discretion to make an adverse cost order, particularly if one party has caused unnecessary delay or failed to act in a reasonable manner to resolve the dispute. A claimant must try to limit the costs of contesting a will in Victoria by trying to negotiate an agreement with the executor of the estate. If an agreement can be reached pretrial then both parties can avoid the high costs of litigating a court hearing. The court may order adverse costs against a party that was unwilling to make a reasonable attempt to compromise prior to court. One of Armstrong Legal’s experienced contested wills solicitors can help a claimant resolve their claim at this early stage or at pretrial mediation to avoid a hearing altogether.
Different Types Of Costs of contesting a will
The courts can assess costs of contesting a will several different ways, depending on the plaintiff’s circumstances and the facts of the case. Costs can be assessed on either a standard or indemnity basis. Standard costs take into account necessary and proper litigation costs, so it typically only covers some of the expense. The court may order standard costs if the submitted costs are unreasonable or the party has been unwilling to negotiate and wasted the court’s time. Alternatively, the court may order indemnity costs, which are calculated on the basis of warranted and reasonable costs. These costs may be based on a court mandated scale of fees, ordinarily payable charges, or a solicitor cost agreement. Indemnity costs typically reimburse a party for most of their expenses.
The court’s assessment of costs will depend largely on the conduct of the parties during the process. The court will consider:
- Whether either party made offers of compromise;
- Whether a party was non-compliant with a court order;
- Whether either party attempted to submit irrelevant evidence to the court;
- The validity of the claim; and
- Whether the costs were incurred because of the intransigence of the testator or the executor.
An unsuccessful claimant who appeals the Supreme Court decision is unlikely to be reimbursed for their costs. While the court affords claimants some latitude when it comes to presuming their right to make a claim against an estate, particularly when the testator or executor has not acted in a reasonable manner, there is a different attitude towards those appealing decisions of the Supreme Court. The court accepts that an appellant has a right to appeal the judgment of the court, but not at the expense of the estate.
In Re Veca (2015), the Supreme Court of Victoria declined to order costs for an unsuccessful caveator even though the executors of the estate had agreed to partially reimburse her legal expenses. In this case, the testator’s daughter filed a probate caveat on the will on the basis that her mother lacked testamentary capacity, did not know and approve the contents of the will, and her brother had unduly influenced their mother to make the will. The executors of the estate responded with affidavits from the testator’s solicitor and physician demonstrating that the will was valid, and the daughter withdrew her caveat. As she had already incurred legal expenses in the amount of $14,700, she requested that her costs be reimbursed from the estate. The executors agreed to make some contribution, but not to pay the full amount. When the daughter subsequently applied to the court for a costs order in the full amount, the court denied the application in its entirety. This decision was based on the following facts:
- There was sufficient evidence available to the caveator before she filed to suggest that she would not succeed in invalidating the will;
- The daughter’s allegations were serious and without proper foundation; and
- There was no convincing reason that costs should be awarded.
Not only did the caveator here not have her costs reimbursed, she was ordered to pay the estate’s costs to defend the application. In fact, the court noted that if the estate had requested compensation for the entire costs of litigating the caveat, they would have looked on the request favourably.
As this case demonstrates, the court has little patience with what it regards as frivolous litigation and will not reward what it considers unreasonable behaviour. It is essential that anyone planning to contest a will seriously consider the consequences of making a claim, as one cannot assume that the estate will reimburse the costs of contesting a will.
There is always a risk when commencing a contested estate action that you will incur expenses that will not be reimbursed by the estate. The contested wills team at Armstrong Legal will represent you on a “no win, no fee” basis so that you have some peace of mind when contesting a will. The team will also try and help you resolve your claim without having to proceed to trial, which will significantly lower the costs associated with the process. Please do not hesitate to contact or call us on 1300 038 223 for advice or representation in your claim.