Assessing liability for costs in will disputes

We were originally instructed in a claim in which the deceased's will was contested on the ground that he did not have testamentary capacity. The matter went to a final hearing and judgment was given in favour of the claimant.

Following that judgment, the issue of who was to pay both the parties' costs in the matter was left to be decided. The ruling given on costs is now considered a leading judgment on the subject. It provides a detailed analysis of the development of costs awards in this area, and discusses the balance which needs to be achieved between allowing litigation in some circumstances whilst also ensuring that 'the lure of costs out of the estate' does not encourage unnecessary litigation.

Very briefly, it was held that the costs of a contentious probate action were, like any other claim, within the discretion of the court. Generally speaking, costs follow the event, in other words the loser pays the winner's costs. However, there are two long established exceptions to this rule. Firstly, if the person who made the will, or persons interested in the residue of the estate, had really been the cause of the action or responsible for the litigation, then the costs should be paid out of the estate. Secondly, if the circumstances lead reasonably to an investigation of the matter, then the costs may be left to be borne by those who incurred them.

In this case the deceased's unusual behaviour was regarded as the primary cause of the dispute and our clients, the defendants, had been fully justified in investigating the issue of testamentary capacity. The costs of those investigations up until the point when a realistic assessment of the claim could be made were ordered to be paid out of the estate. This investigative phase continued until expert reports were exchanged. Thereafter, the usual costs order would apply, namely that the unsuccessful defendants were ordered to pay the successful claimant's costs.

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