O'Connor v Markey and Another

• Jurisdiction: Ireland
• Judge: Mr. Justice Herbert
• Judgment Date: 14 July 2006
• Neutral Citation: [2006] IEHC 24,[2006] IEHC 219
• Court: High Court
• Docket Number: [2003 No. 500 SP]
• Date: 14 July 2006

O'CONNOR v MARKEY

(probate)

in the MATTER of the estate of philip markey, BUSINESSMAN, late of curragh LAWNS

NURSING home, kinneagh, curragh, co. kildare, and FORMERLY of "the stray inn" mile

mill, kilcullen, co. kildare, deceased.

between

john o'connor

Applicant

and

gerard markey and mary markey

Defendants

[2006] IEHC 219

[No 500 S.P./2003]

The high court

PRACTICE AND PROCEDURE

Costs

Administration action - Adverse litigation - Principles to be applied - Whether costs of parties should be paid out of testamentary estate - Whether defendant liable to pay costs of parties personally - Whether costs could be charged on specifically devised real estate - Order for costs granted (2003/500SP -Herbert J - 14/7/2006) [2006] IEHC 219 In re Markey: O'Connor v Markey

: The Special Administrator of an Estate applied to Court to resolve a dispute arising in the course of the administration of an Estate. The First Named Defendant had been ordered to indemnify the estate as to debts the subject matter of the application. The First Named Defendant now claimed that the entire costs of all the parties to the application should be paid out of the assets of the estate. The Second Named Defendant claimed, inter alia, that her costs and those of the special administrator should be paid out of the estate with an order over against the First Named Defendant or that the First Named Defendant was obliged to personally indemnify the estate against the debts.

Held by Herbert J., in applying Order 99, rule 1(5) R.S.C., that the costs of the special administrator were to be paid out of the administration of the estate. This was a hostile lis inter partes between the beneficiaries under a will and the special administrator was only a nominal Plaintiff. The Second Named Defendant was entitled to an order for costs against the First Named Defendant personally of all previous applications and the present application, excluding legal submissions.

Reporter: E.F.

VELLA v MORELLI 1968 IR 11

BUCKTON, RE 1906 B 1879

BUCKTON v BUCKTON 1907 2 CH 406

KNAPMAN, RE 1879 K 14

KNAPMAN v WREFORD 18 CH 3000

RSC O.99 r1(1)

RSC O.99 r1(4)

O'REILLY v FORDE 5 ILTR 54

FAIRTLOUGH v FAIRTLOUGH 1 MILW 36

O'KELLY v BROWNE IR 9 EQ 353

YOUNG v DENDY LR P & D 344

BURKE v MOORE IR 9 EQ 609

GILLIC v SMYTH 49 ILTR 36

MURPHY v FINLEN 1939 LJ IR 50

KAVANAGH v FEGAN 1932 IR 566

RSC O.99 r1(5)

SUCCESSION ACT 1965 S46(3)

SUCCESSION ACT 1965 SCH I PART II

JACKSON v PEASE LR 19 EQ 96

1 judgment of Mr. Justice Herbert delivered on the 14th day of July, 2006

2 This was an application made by way of Special Summons to the Court, by the special administrator appointed by the court, for the purpose of resolving a dispute which had arisen in the course of the administration of the Estate of Philip Markey, between Gerard Markey and Mary Markey, both children of the deceased and beneficiaries under his will. The first named Defendant claimed that payment of the several debts the subject matter of the application, were the sole liability of the estate and should be paid, in effect, out the residuary gift bequeathed to the second named Defendant. The second named Defendant claimed that the first named Defendant was obliged to personally indemnify the estate against the total amount of these debts, which in default of payment should be paid by the special administrator out of the property specifically devised to the first named Defendant. In my judgment given on 24th January, 2006, I found that the first named Defendant was obliged to indemnify the estate in respect of the whole amount of these debts.

3 The first named Defendant now claims that the entire costs of all the parties to the application, together with certain linked costs, should be paid out of the assets of the estate. The second named Defendant claims that her costs and those of the special administrator should be paid out of the estate with an order over against the first named Defendant, or in the alternative, claims an order for costs against the first named Defendant personally. The special administrator claims that he is entitled to his costs of the application out of the estate. Counsel for the first named Defendant relied upon the decision in the case of In The Goods of Morelli, deceased: Vella v. Morelli [1968] I.R. 11. Counsel for the second named Defendant relied upon the decisions in In Re Buckton: ( 1906 B. 1879), Buckton v. Buckton [1907] 2 Ch. 406 and In Re Knapman: (1879 K. 14) Knapman v. Wreford, 18 Ch.D. 300.

4 Order 99, rule 1(1) of the Rules of the Superior Courts, 1986, provides that the costs of and incidental to every proceeding in the Superior Courts shall be in the discretion of those Courts. Order 99, rule 1(4) of those Rules provides that the costs of every issue of fact or law raised upon a claim or a counterclaim shall, unless otherwise ordered, follow the event.

5 In the case of In The Goods of Morelli, deceased, (above cited) Budd, J.

6 ( Ó Dalaigh C.J., Haugh and Walsh J.J., concurring, FitzGerald J., dissentiente), adopting the decision in O'Reilly v. Forde 5 I.L.T.R. 54, and referring to Fairtlough v. Fairtlough 1 Milw. 36 at 39 per Dr. Radcliffe, (a decision of the Prerogative Court), O'Kelly v. Browne Ir. 9 Eq 353, Young v. Dendy Lr., P. and D. 344, Burke v. Moore Ir. 9 EQ 609, Gillic v. Smyth 49 I.L.T.R. 36, Regan, deceased: Murphy v. Finlen [1939] L.J.Ir. 50 and Kavanagh v. Fegan and Others [1932] I.R. 566, held, that it was the general practice in Ireland that if:

7 (a) The case was a proper one to have been litigated and

8 (b) The litigation was properly conducted, the general costs should be paid out of the personal estate of the deceased as the Court had no jurisdiction to order them to be paid out of real estate.

9 The learned judge declined to accept the argument of Counsel for the Defendant in that case, that a more recent practice had developed in Ireland of only exonerating the unsuccessful party from paying the costs of the successful party. It was held as follows by Budd, J.:-

"A question, however, arises about the proper order to make and, if there is a doubt about the matter, it is obviously desirable that there should be some general principles laid down as a guide to a trial judge so as to secure some uniformity of practice and, in particular, so that litigants can be advised and may know how they stand when they wish to contest or support a will in an action. Speaking for myself, I am by no means satisfied that some new practice has found general acceptance in recent times; nor do I think that any good reason has been shown for departing from the old Irish practice. In our country the results arising from the testamentary disposition of property are of fundamental importance to most members of the community and it is vital that the circumstances surrounding the execution of testamentary documents should be open to scrutiny and be above suspicion. Accordingly, it would seem right and proper to me that person, having real and genuine grounds for believing, or even having genuine suspicions, that a purported will is not valid, should be able to have the circumstances surrounding the execution of that will investigated by the court without being completely deterred from taking that course by reason of a fear that, however genuine their case may be, they will have to bear the burden of what may be heavy costs. It would seem to me that the old Irish practice was a very fair and reasonable one and was such that, if adhered to, would allay the reasonable fears of persons faced with making a decision upon whether a will should be litigated or not. If there be any doubt about its application in modern times, these doubts should be dispelled and the practice should now be reiterated and laid down as a general guiding principle bearing in mind that, as a general rule, before the practice can be operated in any particular case the two questions posed must be answered in the affirmative. I now turn to the facts."

10 In my judgment, In The Goods of Morelli, deceased, is distinguishable on its facts from the instant application and, the principles of law restated and followed by the then Supreme Court in that case have no application to the circumstances which fall to be addressed in the present application. In The Goods of Morelli, deceased, was a case which turned on a question of due execution, as did Kavanagh v. Fegan and Others, Gillic v. Smyth and, Burke v. Moore. Keogh v. Wall was a revocation suit. In Regan, Deceased: Murphy v. Finlen, the three statutory pleas were raised and, O'Kelly v. Browne was a probate suit. All these cases were concerned either with, "The state in which the deceased himself or herself has left his or her testamentary papers", or with the testamentary capacity of the deceased. This explains what Budd J., meant in the passage which I have cited and, why he considered, "The old Irish practice was a very fair and reasonable one."

11 By contrast, the instant application bore all the hallmarks of contentious litigation between beneficiaries which did not in any way touch upon the capacity of the testator or the state in which he had left his testamentary papers. The present application arose in the course of administration of the estate, was not a probate action, but neither was it an ordinary administration suit. To all intents and purposes it was a hostile lis inter partes between two beneficiaries under the will. It related to the conduct of the testator's business by the first named Defendant while the testator was still alive and to the issue of whether the first named Defendant was or was not obliged to pay the particular debts as they arose, so that they would not become a burden upon and payable out of the estate on the death of the testator. The special...