Re Estate Condon; Battenberg v Phillips

In contested probate proceedings, the defendants/cross claimants apply (by a notice of motion filed on 15 September 2017) for an order (under rule 42.21 of the Uniform Civil Procedure Rules 2005 NSW) that the plaintiff/cross defendant give security for the costs of the proceedings.

There are three main ingredients in the case for security. First and foremost, grounding the application for security on UCPR rule 42.21(1)(a), is the fact that the plaintiff (a nephew of the deceased person whose estate is contested in the principal proceedings) is ordinarily resident outside Australia; he is domiciled in Scotland. Secondly, the plaintiff has no assets in Australia. Thirdly, to the extent the plaintiff has assets in the United Kingdom, enforcement of a costs order against him there would be attended by difficulties and delay which should not be imposed on the deceased’s estate.

Blanche Minnie Condon (“the deceased”) died on 13 December 2016, aged 86 years, leaving property (with an estimated value in excess of $7 million) in New South Wales.

Four testamentary instruments are attributed to the deceased; namely:

Each of the 2016, the 1997 and the 1993 wills takes the form of a formal will prepared by a solicitor. Each of the 2016 and 1997 wills nominated one or more persons as executor; made provision, by way of legacies, for several natural persons and charities; and disposed of the residue. The 1993 will followed a similar pattern, save that it contained a specific devise of real property in favour of a friend as a preliminary to what became the usual form of dispositions.

Under each of the three solicitor-drawn wills the defendants each received a legacy of $400,000. In the 2016 will they were also named as residuary beneficiaries, replacing charities to which the deceased’s residuary estate had been destined to go under the 1997 and 1993 wills.

The 2006 document embraces legalese in its expression, but it appears not to have been drafted by a lawyer. Its narrative style contains a hint of a possibility that it might be read as intended to confer benefits on the plaintiff’s sister, Merryn, as well as him. The plaintiff’s case appears to be predicated upon an assumption that he is the sole intended “beneficiary” of the document; but evidence of his principal witness, Rudolf Fabian, attributes to the deceased contemporaneous statements of an intent to favour Merryn, by the 2006 document, as well as the plaintiff.

On one reading of the document, the defendants submit, Merryn might be entitled to 31.25% of the deceased’s net distributable estate. They have caused notice of the proceedings to be served on Merryn; she has not, as yet, entered an appearance in the proceedings. The nature of her current social relationship with the plaintiff (if any) is unknown.

The 2006 document is in the following terms, with emphasis added:

In the top right hand corner of the document appears the name of the deceased and her address.

The whole document is typed, save that the number “27” in the final paragraph is written in hand, consistent with evidence of Mr Fabian suggesting that the document was signed by the deceased on 14 September 2006 and subsequently by Alisa Lee, on 27 September 2006.

The original of the document has not been produced to the Court. Both sides of the record deny that it is within their possession.

All that is presently available to the Court is a photocopy sourced from Mr Fabian.

At the foot of the document are four signatures, purporting to be those of the deceased; “Alisa M Lee” (now deceased); “RJ Fabian” (friend and witness of the plaintiff); and “Ruth Phillips” (a sister of the deceased’s husband Harold, mother of the defendants).

According to Mr Fabian, the deceased sent to him by post the original document, ostensibly bearing the signature of the deceased and that of Mrs Phillips as witness to that signature; he superintended execution of the document by Mrs Lee (then terminally ill) and witnessed her signature. He says that he then posted the original document bearing all four signatures, to the deceased and retained a photocopy for his records; in accordance with oral agreements made between himself, the deceased and Mrs Lee, he did not disclose the existence of the document to the plaintiff until after the death of the deceased.

The evidence presently before the Court does not disclose whether Mrs Phillips is available to give evidence in the principal proceedings. Her name is not one of the six prospective witnesses identified by the solicitor for the defendants as likely to be called by them at a final hearing.

The principal proceedings have their genesis in a caveat filed by the plaintiff on 3 March 2017 and a summons for probate filed by the defendants on 27 March 2017.

The caveat was expressed in the following terms:

The caveat did not refer, in terms, to the plaintiff’s status as a beneficiary under each of the deceased’s 1997 and 1993 wills. Those instruments, on their own, conferred on him an “interest” sufficient to ground standing to challenge to the validity of the 2016 will.

Upon an exercise of probate jurisdiction, a caveat is not a form of originating process, but a document filed with the Court requiring, in effect, that the Court take no steps in the administration of a deceased estate without notice to the Caveator: Estate Kouvakis; Lucas v Konakas [2014] NSWSC 786 at [242]. The plaintiff’s caveat did not confer on him the status of a “plaintiff” for the purpose of principles governing the making of an order for security for costs: In re Emery, deceased; Emery v Emery [1923] P 184; Rose v Epstein [1974] 1 WLR 1565.

The plaintiff acquired the title of “plaintiff”, in these proceedings, by an agreement between the parties that he file a statement of claim in support of his claim based on the 2006 document.

On 8 June 2017 the defendants filed a notice of motion seeking an order that the plaintiff’s caveat cease to be in force. When that motion came before Kunc J on 17 July 2017:

The plaintiff contends that it is more likely than not that he will be awarded the costs thus reserved. That is unwarranted speculation. It is at least as likely that those costs will be treated as costs in the principal proceedings (in the vernacular, “costs in the cause”), ultimately dependent for their disposition on the outcome of the principal proceedings.

On 26 July 2017 the plaintiff filed a Statement of Claim in which, in substance, he claimed relief to the following effect:

On 15 August 2017 the defendants filed a Defence in which, inter alia, they contended that:

On the pleadings, the plaintiff’s alternative claim of a beneficial entitlement to property of the deceased, based on an allegation that the 2006 document constituted an inter vivos declaration of trust by her, in favour of the plaintiff, must be circumscribed by what is not pleaded as well as defined by what is:

The defendants’ submissions in support of their motion for security describe the plaintiff’s prospects of success in the principal proceedings as “poor”, but the motion and submissions in support of it stop short of an application for an order that the Statement of Claim be struck out (UCPR rule 14.28), or that proceedings on it be summarily dismissed (UCPR rule 13.4), as an abuse of the process of the Court.

Nevertheless, in the interests of all parties and an orderly conduct of the principal proceedings, attention needs to be given to clarification of the case the plaintiff seeks to make on his alternative inter vivos “declaration of trust” case.

Attention is drawn to the following extracts from JD Heydon and MJ Leeming (eds), Jacobs’ Law of Trusts in Australia (LexisNexis Butterworths, Australia, 8th ed, 2016), paragraphs [6.22]-[6.23] and [6.25]-[6.26], omitting footnotes but with emphasis added:

On the pleadings, the strongest of the plaintiff’s claims – still contentious – appears to be his allegation that the 2006 document constituted an informal will. That case depends for its efficacy mainly on a successful challenge to the validity of the 2016 will, although the plaintiff would have the Court construe a standard revocation clause in the 2016 will as not extending to the 2006 document.

The plaintiff’s case is that the 2006 document took the form it did because the deceased wanted to provide “compensation” for him as redress for his alleged mistreatment, as a youth, at the hands of her brother (the plaintiff’s adoptive father) and her husband.

Because the original of the 2006 document is missing, the defendants contend that (assuming it ever had legally binding force) it should be presumed to have been destroyed and, if destroyed, revoked.

The defendants’ case is that the 2016 will was prepared by a solicitor who took instructions from the deceased on 10 November 2016, and witnessed execution of the will on 22 November 2016, in circumstances in which his evidence in support of a finding of testamentary capacity should be accepted.

The plaintiff’s response includes reference to documents produced on subpoena by the Prince of Wales Hospital said to evidence a sharp decline in the deceased‘s mental health between September 2015 and 12 December 2016, only about three weeks after the 2006 will was executed. That evidence does not necessarily displace evidence that the deceased possessed full capacity in November 2016. It does not pinpoint a time of sharp decline, which (on the evidence presently available) could have occurred after the will was executed.

On 16 August 2017 the defendants filed a Cross Claim in which they seek an order that they be granted probate of the 2016 will in solemn form.

On 30 August 2017 the plaintiff filed a Reply to the defendants’ Defence in which, so far as is material, he contends that, on the true construction of the 2016 will, the 2006 document was not revoked.

On 31 August 2017 the plaintiff filed a Defence to Cross Claim in which he contends that:

The plaintiff propounds the 2006 document; but assumes that the defendants, or some other person, will take a grant of probate or administration. The defendants propound the 2016 will. Nobody propounds the 1997 will or the 1993 will. Nevertheless, implicit in each party’s presentation of the case appears to be an acceptance that the 1997 will is valid, subject to whatever (if any) findings are made in favour of the validity of the later instruments.

I do not pause to do more than notice a suggestion by the defendants that the plaintiff is an undischarged bankrupt. Evidence adduced by the plaintiff demonstrates that he was discharged from bankruptcy on 25 May 2013.

As the defendants appear to have accepted, the evidence adduced on the hearing of their motion for security is sufficient to establish that the plaintiff has an arguable case (though, perhaps, not a strong one), both as to the validity of the 2016 will and as to the validity of the 2006 document as an informal will.

Although the original of the 2006 document has not been located, the plaintiff has obtained affidavits from Mr Fabian, who claims to have been a witness to its preparation and execution.

There are substantial factual questions in dispute about the provenance of the document. By comparison with the signatures of the deceased on her three solicitor-prepared wills, the defendants question the authenticity of the purported signature of the deceased on the 2006 document.

The legal effect of the document (if any), and its relationship with the 2016 will, are matters for debate not fully argued before me.

Bound, on the hearing of the defendants’ motion for security, to form a view about the strength or otherwise of the plaintiff’s case, I incline to the view (for reasons already explained) that the plaintiff’s alternative case of a “declaration of trust” is not strong, and that his strongest case (dependent upon his challenge to the validity of the 2016 will) is his allegation that the 2006 document constitutes an informal will.

Although by no means conclusive, the medical records subpoenaed from the Prince of Wales Hospital invite a question as to the state of the deceased’s mental health during her end days. That said, the evidence thus far adduced by the plaintiff is a substantial distance from establishing a want of testamentary capacity in the deceased, either at the time she executed the 2016 will or at the time she gave instructions for its preparation.

The 2006 document is unusual in content and form, and in the alleged manner of its preparation. Propounded as an informal will, it attracts no “presumptions” associated with due execution of a testamentary instrument, and its extra-ordinary character deprives it of comparable inferences that might be drawn from common experience: Re Estate of Wai Fun Chan, Deceased [2015] NSWSC 1107 at [18]-[24].

By contrast, the 2016 will is regular on its face, accompanied by evidence of preparation by a solicitor, and due execution as a will, conforming to an established pattern of testamentary instruments executed by the deceased. Its form and manner of execution are likely to attract presumptions of due execution, capacity and knowledge and approval: Re Estate of Hodges; Shorter v Hodges (1988) 14 NSWLR 698 at 704-707.

In the absence of the original of the 2006 document a doubt might be expressed as to the utility of any handwriting expert briefed to express an opinion about the authenticity of the signature on a copy of the document attributed to the deceased. Nevertheless, the parties contemplate retaining handwriting experts.

The defendants’ motion for security was heard on affidavit evidence, to which no substantial objection was taken, without cross examination of any deponent.

In these circumstances, the evidence adduced on motion has not been sufficiently exposed to view to enable me (in the absence of full argument) to form a concluded opinion about the parties’ respective, ultimate prospects of success in the principal proceedings.

The state of the evidence focuses attention squarely upon the facts that the plaintiff is ordinarily resident outside Australia and, although he has assets overseas, he has no assets in Australia.

The plaintiff deposes to having assets in the United Kingdom but, to the extent that he has assets, they appear to be the subject of trusts (the terms of which are not in evidence) designed to ensure that he can claim an entitlement to means-tested social welfare benefits in the United Kingdom.

In an affidavit sworn by him on 27 October 2017 the plaintiff deposes to his residency in Scotland, his involvement in a motor vehicle accident in 2009 which has left him “almost a paraplegic” and his personal circumstances generally. In paragraphs 5 and 6 of that affidavit he summarises his financial position in the following terms:

In the same affidavit, the plaintiff not only discloses his involvement in other litigation, but foreshadows the prospect of yet more litigation, unrelated to these proceedings. His involvement in substantial litigation adds a flavour of contingency to any assessment of his financial circumstances.

An inference available on the whole of the evidence adduced on the hearing of the motion is that, if the plaintiff were ordered to pay the costs of the principal proceedings, the plaintiff’s assets are structured in such a way that enforcement of that order (independently of reciprocal arrangements for the enforcement of orders across territorial boundaries) would be attended by difficulty, delay and additional costs.

During the course of the hearing of the motion, I invited counsel for the parties to consider whether there was an occasion for invocation of the Court’s inherent jurisdiction to order security. In extending that invitation I had in mind the plaintiff’s submission that an order for security could not be accompanied by an order (such as that commonly made by reference to UCPR rule 42.21(1)) for a stay of proceedings, pending the provision of security, without frustrating the administration of the deceased estate the subject of the proceedings.

The existence of the Court’s inherent jurisdiction to make orders for the provision of security for costs is not in contest. It is well established: Rajski v Computer Manufacture & Design Pty Ltd [1982) 2 NSWLR 443 at 447-448, affirmed on appeal [1983] 2 NSWLR 122. However, with the benefit of submissions of counsel, I doubt that it adds anything of practical significance to a determination of the present motion.

Accordingly, I confine my determination of the motion to a consideration of UCPR rule 42.21, the current rule of court authorising an order for security for costs.

UCPR rule 42.21 is in the following terms (with emphasis added):

The common experience of probate practitioners is that an application, let alone an order, for security for costs in probate proceedings is uncommon. Authority on the topic is scant.

Practice texts deal with the topic in passing references only.

Mason and Handler’s Succession Law And Practice NSW (LexisNexis Butterworths, 1985, Loose Leaf Service) records the following (in paragraph [6089]):

The service provides an extract from Powell J’s judgment as a casenote published at paragraph [13,029]. The whole judgment is available electronically on Butterworths’ Casebase website as Hyland v Burbidge; The Estate of Charles Keith Hyland BC 9201526.

Powell J’s judgment is a primary reference, not only in the LexisNexis Butterworths Looseleaf Service, but also in RS Geddes, CJ Rowland and P Studdert, Wills, Probate And Administration Law in New South Wales (LBC Information Services, Sydney, 1996).

In Appendix 1 to that text (entitled “Costs in Probate Matters”), at paragraph [Cost.14], on page 669, the following entry appears (with footnotes here incorporated in the text):

R Hastings and G Weir, Probate Law and Practice (Law Book Co, Australia, 2nd ed, 1948), upon which Geddes, Rowland and Studdert is based, appears not to notice at all the question of security for costs in probate proceedings, save in respect of a formal requirement for security in support of an appeal.

In neither the Butterworths service nor the Law Book Company texts is there a general treatment of the topic, security for costs in probate proceedings. Both modern texts, in substance, go no further than a reference to Powell J’s judgment in Hyland v Burbidge which, in turn, refers to the judgment of Dixon J in Willey v Synan. Of the two judgments, only that of Powell J relates to probate proceedings.

The observations of Powell J (and Dixon J) are directed, essentially, to the liability to an order for security of a party who ordinarily resides outside Australia; that is, to a party who attracts the operation of UCPR rule 42.21(1)(a).

Perhaps what is of particular significance in the judgment of Powell J is that, although his Honour traversed the facts of the case before him in great detail and doubted whether the plaintiffs’ claim in the proceedings before him was soundly based, he appears to have proceeded on the basis that the rules of court governing his decision (Supreme Court Rules 1970 NSW, Part 53 rules 1-5, the predecessors of UCPR rule 42.21) did not operate in probate proceedings in a manner explicitly different from their operation in other proceedings in the court.

That is consistent with an observation, about English probate law and practice, in Williams, Mortimer and Sunnucks on Executors, Administrators and Probate (Sweet & Maxwell, London, 20th ed, 2013), at paragraph [39-15] on page 487, that (under the English Civil Procedure Rules) “[security] for costs is given on the same principles as in other actions”.

With an express qualification, the same observation can be found in the iconic first edition of HC Mortimer, The Law and Practice of the Probate Division of the High Court of Justice (Sweet and Maxwell, London, 1911), at page 703, citing an earlier edition of Williams on Executors, citing in turn Robson v Robson (1864) 3 Sw & Tr 568; 164 ER 1396.

The qualification relates to attribution of the roles of “plaintiff” and “defendant” to parties in probate proceedings, bearing in mind that an order for security can only be made against a party who, in substance, is a plaintiff.

Having stated that “[the] question of giving security of costs in the Probate Division [of the English High Court of Justice] is governed by the same rules as apply at common law”, Mortimer recorded the following: “It should, however, be observed that, on the question of the immunity of a defendant from giving security for costs, the substantial, and not the nominal position of defendant and plaintiff respectively in the suit should be considered; as in certain cases in the Probate Division the nominal position of plaintiff or defendant depends on the mode in which the cause commenced.”

Although the same principles may apply to all proceedings, their application depends upon the facts of the particular case, including peculiarities about the nature of the proceedings in which they are to be applied.

With their focus upon due administration of a deceased estate, probate proceedings might require consideration of factors not material to other types of proceeding. At the very least, the comparative absence of orders for the provision of security for costs in probate proceedings invites a critical assessment of the jurisdiction.

At the commencement of a long judgment, Powell J described an application for security for costs as “an unusual form of application to be met in proceedings in this [the Probate] Division of the Court”: BC 9201526 at 1. His Honour did not dwell upon why applications for security were uncommon in Probate proceedings.

In the principal proceedings before him, the plaintiffs (resident overseas) sought an order for the revocation of a grant of probate in common form made to the defendant. Those proceedings were associated with various other proceedings in which family provision relief was claimed. There were substantial private international law questions, which his Honour addressed, about the law to be applied in administration of the deceased’s estate.

In his exposition of the facts of the case, Powell J not only expressed doubts about the plaintiffs’ prospects of success. He also remarked that what was “stultifying the administration of the estate” was not the existence of the grant of probate which the plaintiffs sought to have revoked, but the apparent impenetrability of asset structures put in place by the deceased as a barrier to claims by the plaintiffs: BC 9201526 at 23.

At BC 9201526 at 25, Powell J made the following observations:

Against this background, Powell J dealt with the defendant’s application for security for costs (reported at BC 9201526 at 27-30) in the following terms (with emphasis added):

On a subsequent occasion, Powell J made orders for security for costs in terms to the following effect:

In his Law of Costs (LexisNexis Butterworths, Australia, 3rd ed, 2013), at pages 931-932, Professor GE Dal Pont makes the following observations (with emphasis added, but footnotes omitted) about the “purpose and rationale” of an order for security to costs:

Professor Dal Pont’s reference to “risk management” in the second sentence of paragraph [28.1] is a reference to the following observations of French J in East Grace Corporation v Xing (No. 1) [2005] FCA 219 at [6]-[7], with emphasis added:

Professor Dal Pont’s reference to family provision cases in the penultimate sentence of paragraph [28.4] is supported by a reference to the judgment of Gaudron J in Singer v Berghouse [1993] HCA 35; 67 ALJR 708; 114 ALR 521. There her Honour dismissed an application for an order that security for the costs of an appeal to the High Court of Australia be provided. She did so on the basis that, given the special nature of family provision cases, so far as costs are concerned, there was no certainty that, even if unsuccessful in the appeal, the appellant would be ordered to pay the costs of the appeal.

Singer v Berghouse is not directly in point in the current proceedings. Although often closely connected in practice (and similar to the extent that the costs of all parties are commonly ordered to be paid out of a deceased estate, or an unsuccessful party might not uncommonly be relieved of an obligation to pay an opponent’s costs), probate and family provision proceedings have their own dynamic. The practice of the Court in dealing with the costs of a family provision claim (governed by legislation unique to it) cannot, in principle, be taken as a guide to the Court’s practice in dealing with the costs of probate suit.

For present purposes, the significance of Gaudron J’s decision is that: (a) it illustrates the proposition that, if there is a substantial possibility that a party will not be subjected to an adverse costs order in the event of an unsuccessful outcome in the proceedings, that fact weighs heavily against an order for the party to provide security for costs; and (b) it lends support to a need, upon any application for security for costs, to take into account the nature of the proceedings in respect of which an order for security is sought .

An order for security for costs is available as a means of minimising a risk of abuse of the processes of the Court attending the conduct of proceedings by a party, in substance a plaintiff, who invokes the jurisdiction of the Court without being able or willing to pay costs of a defendant if ordered to do so. The nature and magnitude of any such risk may depend upon the nature of the jurisdiction of the Court invoked in the principal proceedings.

The purpose of probate proceedings is generally to advance the due and proper administration of a particular deceased estate, having regard to any duly expressed testamentary intentions of the deceased, and the respective interests of parties beneficially entitled to the estate; the task of the Court is generally to carry out a testator’s testamentary intentions, and to see that beneficiaries get what is due to them: In the goods of William Loveday [1900] P 154 at 156; Bates v Messner (1967) 67 SR (NSW) 187 at 189 and 191-192; Hookway v Hookway [2017] TASFC 4 at [9] and [69].

In the paradigm case (a model to which the current proceedings conform despite the plaintiff’s alternative case based upon an allegation of a declaration of trust), an essential feature of probate proceedings is that they concern the management of property in a court-supervised process designed to effect an orderly transfer of property from a deceased person (whose formally expressed intentions, if any, are paramount) to one or more beneficiaries in circumstances in which: (a) the deceased person is, by definition, absent; and (b) one or more beneficiaries may also be absent or under a legal disability.

Because the subject matter of the proceedings is succession to property from a deceased estate, a special public interest element attends the proceedings. By nature, property rights generally, notionally operate “against the whole world”, not merely as between a transferor and transferee. Where, as in a probate case, the transferor is incapacitated by death and interested persons are dependent upon findings of the Court in identification and enforcement of his or her intentions, the public has a particular interest (beyond the interests of parties in ordinary adversarial proceedings) in the integrity of the Court’s processes.

In Gray v Hart; Estate of Harris (No. 2) [2012] NSWSC 1462 at [4]-[5] White J drew a number of threads together with the following observations (with emphasis added):

In an uncertain, imperfect world the law endeavours to accommodate both respect for a deceased person’s testamentary intentions (if any) and insistent claims on a deceased’s estate by the living. This is done in a variety of ways, chief amongst them being the following:

In the management of probate proceedings, there may be alternative means available for minimising a risk of an abuse of process associated with a plaintiff who is impecunious or whose assets are beyond reach, and an application or order for security for costs might well occupy a low rank of priority when measured against the Court’s preference for cases to be heard and determined on the merits.

If an order for the payment of costs out of an estate can fairly be anticipated (because the cause of litigation is plainly the fault of the deceased), or if the plaintiff has an interest in the estate whatever outcome of the proceedings is reasonably likely, there may be no necessity for, or utility in, an order for security. A plaintiff who claims an interest in an estate might assign or charge his or her interest in the estate in favour of somebody able and willing to prosecute the proceedings with the requisite funding: JG Starke, Assignments of Choses in Action in Australia (Butterworths, Australia, 1972), paragraphs [82]-[83] and [87]-[88]; Dal Pont, Law of Costs (3rd ed, 2013), paragraph [3.44]. Given their central concern with property, probate proceedings lend themselves to a variety of private arrangements (including, at times, an inter partes agreement that reasonable costs are to be, or are likely to be, paid out of an estate) without involvement of the Court in interlocutory procedures.

A plaintiff might, not uncommonly, circumvent the more onerous costs of probate proceedings, and the costs regime applicable in probate proceedings, by pursuing an alternative claim for family provision relief in a hope or expectation (not always realised) of a more liberal access to an order for the payment of all costs out of the estate of the deceased.

If and when, by one means or another, all persons with an interest in an estate are joined in, or otherwise bound by the outcome of, probate proceedings, questions about security for costs may begin to approximate such questions as encountered in ordinary civil proceedings – but for the possibility that, in the ordinary course of probate practice, an order for costs might not be made against an unsuccessful party.

In practice, in most cases, that possibility turns on:

It is not necessary in this judgment to explore in depth the practice of the Court in making orders for costs in probate cases. It is sufficient to observe, first, that there is substantial scope for a departure from the rule that “costs follow the event”; and, secondly, that flexibility in exercise of the Court’s costs jurisdiction does not, of itself, preclude an order for the provision of security.

Nevertheless, it should be noticed that an examination of older practice texts, and case law, suggests a greater range of possible orders than is acknowledged by the defendants, and customarily acknowledged, by reference to the “two exceptions” (from the rule that costs follow the event) specifically mentioned by Powell J in Re Hodges; Shorter v Hodges (1988) 14 NSWLR 698 at 709. See, for example, Hastings Weir, Probate Law and Practice (2nd ed, 1948) at pages 33-338. Dal Pont, Law of Costs (3rd ed, 2013), paragraph [10.17] et seq, also suggests greater flexibility in the costs jurisdiction than is sometimes suggested by reference to Shorter v Hodges.This flexibility is consistent with the management function of an exercise of probate jurisdiction directed towards facilitating an orderly succession to property. Ultimately, the question for the Court is what, in all the circumstances of the case, is the appropriate order for costs: Williamson v Spelleken [1977] Qd R 152.

In Gray v Hart; Estate of Harris (No. 2) [2012] NSWSC 1562 White J returned to the source of much jurisprudence on probate costs (Mitchell v Gard (1863) 3 Sw & Tr 275; 164 ER 1280) for the purpose of drawing attention to enduring principles.

Towards the same end, I set out here the substance of the judgment of Sir James Plaisted (later Lord Penzance) in Mitchell v Gard (with emphasis added):

In making (Hyland v Burbidge BC 9201526 at 23) or in declining to make (Sawbridge v Hill (1871) 2 LR P&D 219 at 221) an order for security for costs in probate proceedings, the Court may have regard to the effect of such an order on the administration of the estate the subject of the proceedings.

If an order for security is to be made against a party who is ordinarily resident outside Australia, but who resides in a jurisdiction which has reciprocal enforcement protocols with Australia, what is necessary for the due administration of an estate may be a factor to be taken into account in deciding whether the quantum of security ordered should be limited to the costs of enforcing an order of the Court in the foreign jurisdiction. The presence of that factor might serve to distinguish probate proceedings from other types of case, in which a defendant might be confined to security limited to foreign enforcement costs. Cf, Lo Surdo v Public Trustee [2003] NSWSC 837 at [22]-[31].

The plaintiff contends for a right to be heard on his claims for relief based on the 2006 document, and in opposition to admission of the 2016 will to probate, unqualified by any obligation to provide security for costs against the possibility that: (a) he might fail to establish his claims for relief based on the 2006 document; (b) he might fail in his challenge to the 2016 will, the defendants proving the validity of the 2016 will; and (c) he might be ordered to pay the costs of the defendants.

Viewed in terms of risk management, there is, my opinion, an appreciable risk that the case sought to be made by the plaintiff (with respect to both the 2006 document and the 2016 will) will fail, and that (in part, because he is apparently seeking to vindicate a personal right, representing no interest save his own) that risk is accompanied by a risk of an adverse costs order.

This assessment highlights the plaintiff’s contentions that: (a) an order that he provide security for the costs of the defendants would stultify the proceedings generally, both on his claims for relief based on the 2006 document and in respect of the 2016 will; (b) an order that the proceedings be stayed until security is given would impede administration of the deceased’s estate; (c) unless the case he seeks to make is determined on the merits after a full hearing, any grant of probate made in favour of the defendants would be liable to be revoked; and (d) because the defendants are on notice of his claim to a beneficial entitlement to a substantial portion of the deceased’s estate, they cannot administer the estate in disregard of that claim without themselves being liable to account to him for his entitlement.

The plaintiff relies upon observations of the Privy Council in Guardian Trust and Executors Company of New Zealand Ltd v Public Trustee of New Zealand [1942] AC 115 at 128, where, upon revocation of a grant of probate in common form, the displaced executors of a will found to have been invalid were held liable to her next of kin for legacies paid out to third parties in reliance upon the grant of probate subsequently revoked:

Debate on this aspect of the plaintiff’s case did not extend to a consideration of the statutory protection available to the defendants, and those dealing with them, in the event of revocation of a grant made in their favour: see Probate and Administration Act 1898 NSW, sections 40D and 90(2).

A principal point of difference between the present proceedings and those dealt with by the Privy Council (which may not affect the plaintiff’s alternative “declaration of trust” claim) is that, in the present proceedings, the defendants seek a grant of probate of the 2016 will in solemn form.

As explained in Estate Kouvakis; Lucas v Konakas [2014] NSWSC 786 at [249], a grant of probate “in solemn form” is a judicial statement that, on the Court’s then assessment:

Whereas a grant of probate in common form may be described as “inherently revocable” (Tobin v Ezekiel (2012) 83 NSWLR 757 at [8]; Dickman v Holley [2013] NSWSC 18 at [235]), the same cannot be said of a grant in solemn form which, by its nature, demands deference to principles governing the finality of judgments.

If the plaintiff’s claims for relief in due course were to be dismissed (UCPR rule 42.21(3)), or if the Court were to decline to hear the plaintiff in opposition to the defendants’ claim for a grant of probate (Young v Jackman (1986) 7 NSWLR 97; Chamberlain Group Pty Ltd v Kids for Life Academy Pty Ltd [2015] NSWCA 241; 18 BPR 35,591 at [17]), for want of compliance with an order for security, the plaintiff would arguably be in no better position than a person who: (a) had notice of the claim for probate; (b) was given a reasonable opportunity to intervene in proceedings on the claim; and (c) did not intervene.

It is not necessary, at this stage of these proceedings, to form a concluded view about what, if any, factors should be taken into account on an application under UCPR rule 42.21(3) for an order that the plaintiff’s claims for relief be dismissed, or about the effect of such a dismissal having regard to the Civil Procedure Act 2005 NSW, section 91. Nor is it necessary to form a concluded view about whether the plaintiff should be heard no further in the proceedings in the event that he fails to comply with an order for the provision of security.

It is sufficient for the day to determine, as I do, that the nature of the case sought to be advanced by the plaintiff in the principal proceedings does not render him immune from an order that he provide security for the costs of the defendants if a case for security is otherwise made out.

The plaintiff’s contention that a stay of proceedings in aid of an order for security would impede administration of the deceased’s estate can be met in at least two ways.

First, nothing in UCPR rule 42.21 mandates that an order for security must be accompanied by an order that proceedings be stayed. Both orders are within the discretion of the Court. While in most cases proceedings might be stayed until security is given (or, perhaps more often, relying upon the general power to stay proceedings found in section 67 of the Civil Procedure Act 2005 NSW, if security is not given), there may be cases (and the present is one) in which this is not appropriate: NSW Law reform Commission, report No. 137: Security for Costs and Associated Orders (December 2012), paragraphs [5.26]-[5.33].

Secondly, if an order for a stay were to be made under UCPR rule 42.21(1) it could (and should) be made on terms (authorised by the Civil Procedure Act 2005 NSW, section 86) that it not operate so as to affect administration of the estate of the deceased pursuant to the interim administration order made by Kunc J on 17 July 2017.

Upon an application of UCPR rule 42.21, the plaintiff is “a plaintiff” not only in name but in substance. He seeks to invoke the jurisdiction of the Court for the purpose of establishing, in his own interest, rights said to attend the 2006 document. A primary focus of the principal proceedings (and the one likely to occupy most time and costs) is the provenance, validity and effect of that document. The status of that document, irregular in form and content, is at the core of the proceedings.

But for the Statement of Claim, in which the nature of the document is laid out, and the plaintiff’s related challenge to the validity of the 2016 will, the principal proceedings would be a routine application for probate of a regular form of will conforming to an established pattern of the deceased. In a practical sense, the plaintiff is, in forensic terms, the moving party in the proceedings, it being incumbent on him to prove the 2006 document.

A determination of the plaintiff’s status having been made, there is no dispute that he is ordinarily resident outside Australia within the meaning of UCPR rule 42.21(1)(a). That fact enlivens the discretions (to make an order for security and to order that the proceedings be stayed) for which UCPR rule 42.21(1) provides.

Non-residence is a pre-condition to an exercise of the discretion to order security, but there must be something more to justify an order: Lo Surdo v Public Trustee [2003] NSWSC 837 at [26]. That “something more” is an unacceptable risk that, unless an order for security is made, a costs order made later in the proceedings will be frustrated by an unwillingness or inability of the plaintiff to satisfy it.

If and to the extent that the plaintiff is impecunious, that fact cannot, of itself, justify the making of an order for security: UCPR rule 42.21(1B).

Turning to the criteria for the making of an order for security to which UCPR rule 42.21(1A) invites attention, the following attract comment:

Specific consideration needs to be given to the quantum of costs likely to be incurred in the principal proceedings (UCPR rule 42.21(1A)(j)) and the question whether the security sought by the defendants is proportionate to the importance and complexity of the subject matter in dispute in the proceedings (UCPR rule 42.21(1A)(k)).

Nevertheless, in my assessment, there is a risk (against which the defendants should be protected by an order for security) that the plaintiff’s case in the principal proceedings will fail at a final hearing, he will be ordered to pay costs of the defendants and he will be either unwilling or unable to do so.

The defendants seek security in the sum of $175,000, against their “existing and expected” costs of $238,383. They support that level of claim with a detailed affidavit by an experienced solicitor, based upon assumptions about the future course of the proceedings. They point to cost estimates on the plaintiff’s side of the record which suggest that the plaintiff’s “existing and expected” costs could total $175,000.

Even if costs of that order were ultimately to be incurred, and reasonably incurred, on the defendants’ side of the record, I am not presently satisfied that the proceedings are so complex as to render a forward estimate of that level of costs reasonable. The defendants’ claim is for an order for security in a single lump sum directed towards providing for conduct of the whole proceedings, until the conclusion of a four day hearing, preceded by substantial interlocutory preparation, including medical evidence and the report of a handwriting expert.

The jurisdiction of the court to order that security be given extends to making an order that includes an element of security for costs already incurred; but the fact that a defendant has incurred those costs without first making an application for security is a factor to be taken into account upon an assessment of the quantum of security to be ordered: Dal Pont, Law of Costs (3rd ed, 2013), paragraphs [28.37]-[28.38].

The size of the plaintiff’s claim in the principal proceedings (ostensibly not less than about $1.3 million) justifies serious preparation of the case in opposition to that of the plaintiff; but, at this stage of the proceedings, I doubt the necessity for, or utility of, an order for security having the reach for which the defendants contend. Too onerous an order for security might stultify the proceedings even if (as I apprehend) a more modest one would not. A balance must be struck.

In my opinion, having regard to all the circumstances of the case (including the possibility that the proceedings might settle), the appropriate order for security is one that requires the plaintiff to give security in the sum of $75,000, in the form of a bank bond or such other form as might be agreed between the parties or approved by the Registrar.

In circumstances in which the defendants have been appointed interim administrators of the deceased’s estate, and having regard to the time of the year at which an order for security is made, I propose, subject to any submissions that might be made to the contrary, to allow the plaintiff until 28 February 2018 to give the security ordered.

I do not propose to order that the proceedings be stayed in aid of the order for security, in circumstances in which the deceased’s estate is the subject (only) of an interim form of administration. These proceedings differ from those in which Powell J made an order for security (Hyland v Burbidge) because there a grant of probate had been made, but was the subject of an application for revocation, whereas here no grant has yet been made, although interim administrators have been appointed.

It is generally not in the public interest for an application for probate to be left, unnecessarily, in abeyance. In the present case, the parties should be left to prepare for a final determination of the principal proceedings as they deem appropriate. The plaintiff does not himself seek a grant of administration. It is in the interests of all concerned that there be a grant of probate or administration as soon as may be practicable.

Although I am not minded to stay the proceedings: unless the parties press the Court for directions for the preparation of evidence in the meantime, I propose to adjourn the proceedings until a date shortly after 28 February 2018, reserving liberty to apply for an earlier directions hearing in the event that the plaintiff gives the requisite security earlier than that date.

Prima facie, the plaintiff should pay the defendants’ costs of the motion for security, costs following the event.

Subject to allowing the parties an opportunity to be heard as to the form of the orders to be made and costs, I propose to make orders to the following effect: