Weisbord v Rodny (No 5)

1. [1]

   These reasons for judgment and the four previous judgments that I have published concern the testamentary affairs of the late Mrs Rose Rodny.

2. [2]

   The Court must now make final orders to dispose of the remaining issues in the three out of four proceedings that have not yet been completed.

Previous judgments

1. [3]

   It is necessary to explain relevant aspects of the previous judgments, as well as a judgment of the Court of Appeal, in order to understand the remaining issues that are the subject of this judgment. I will follow the Court’s present practice and will call the properties that are relevant to these reasons “No 77” and “No 102”.

My first judgment

1. [4]

   I delivered the first judgment on 6 December 2018: Weisbord v Rodny [2018] NSWSC 1866 (Weisbord No 1). The judgment determined the plaintiffs’ claims in four proceedings. The plaintiffs are Ms Jeanette Weisbord and her two sons, Joel Weisbord and Alexander Weisbord. The defendant is Mr Laurence Rodny, who is Ms Weisbord’s brother. Ms Weisbord and Mr Rodny are Mrs Rodny’s children. To avoid confusion I will, with no disrespect intended, refer to Joel and Alexander by their first names.

2. [5]

   In one of the proceedings (the “probate claim”), all three plaintiffs sought an order revoking a grant of probate that the Court had made in favour of Mr Rodny of a will that had been executed by Mrs Rodny. The purpose of the proceedings was to persuade the Court to grant probate to Ms Weisbord and Mr Rodny of a document created in August 2008 that had not been executed by Mrs Rodny. The application relied upon s 8 of the Succession Act 2006 (NSW), which, in the circumstances set out in the section, empowers the Court to give effect as a will to a document intended by a deceased person to state that person’s testamentary intentions, but which has not been executed with the requisite formality. In conformity with the terminology suggested by the Court of Appeal, I will refer to the document as the “second typewritten draft,” which was prepared on 15 August 2008. I found in favour of the plaintiffs on this issue.

3. [6]

   The three other proceedings (the “family provision claims”) were commenced by each of the individual plaintiffs for orders for family provision under s 59 of the Succession Act. The gifts purported to be made in favour of the plaintiffs in the second typewritten draft were sufficiently beneficial to them that, if the plaintiffs succeeded on the probate claim, there was no basis for the Court to order additional family provision in favour of the plaintiffs.

4. [7]

   Following the publication of Weisbord No 1, I made the following orders on 11 February 2019 to give effect to those reasons:

5. [8]

   Order 7 was made on the basis, as explained above, that the dismissal of the family provision claims necessarily followed success on the probate claim. The family provision claims were not dealt with on their merits.

My second judgment

1. [9]

   The second judgment was published on 19 June 2019: Weisbord v Rodny (No 2) [2019] NSWSC 739 (Weisbord No 2). This judgment dealt with the costs of the proceedings.

2. [10]

   It is necessary to examine this judgment in some detail, as the Court was required to decide a number of issues which the parties appear to wish to revisit by means of their submissions that will be determined by these reasons.

3. [11]

   I made orders on 1 July 2019 that included the following:

4. [12]

   Relevantly to the making of order 2, I said in Weisbord No 2:

5. [13]

   I referred at [34] to a consensus that the parties had reached at the original hearing concerning the appropriate costs order. For completeness, I will set out part of my reasons that preceded the passages that I have extracted above. That is necessary to explain the background to some of the costs orders that Mr Rodny is now seeking. I said in respect of what I described as a change of position by Mr Rodny:

6. [14]

   What had happened was that there was no disagreement between the parties as to the appropriate costs orders to be made at the original hearing. Without leave, Mr Rodny sought to change his position after I had substantially completed the reasons that became Weisbord No 2. I rejected that approach and decided the costs of the original hearing on the basis of the consensus at that hearing.

7. [15]

   As, in the events that have happened, Mr Rodny succeeded in his appeal on the probate claim, he may have been better off if I had allowed him to change his position on the issue of costs.

8. [16]

   Order 2 was separately made in all four proceedings. Its effect was that, even though the plaintiffs had succeeded on the probate claim, but their family provision claims had been dismissed without the determination on the merits, the whole of the plaintiffs’ costs of all proceedings was ordered to be paid out of Mrs Rodny’s estate on the ordinary basis.

9. [17]

   The passages extracted from Weisbord No 2 above make it clear that I made order 2 because of the consensus to which I have referred. As noted, senior counsel for Mr Rodny explicitly accepted that outcome. That appeared to me at the time to be a reasonable position to adopt. In a real way, both the need for the probate claim and the uncertainty that led to the plaintiffs making their family provision claims arose out of the unfortunate difficulties that had to be addressed in relation to the identification of the will that would govern the distribution of Mrs Rodny’s estate. Furthermore, not only had an order been made that evidence in each proceeding be evidence in the others, but to my observation, the evidence that was tendered had overlapping relevance to a substantial degree to the issues raised by all of the proceedings. Furthermore, it would have been impracticable for the parties or the Court to separate the evidence and the parties’ forensic effort as between the different proceedings, given the substantial degree of overlap.

10. [18]

    Subject only to the effect of order 5 that has been extracted above at [11], order 2 was made without any reservation that an application could be made by Mr Rodny for an order that order 2 be vacated, in whole or in part, following the determination of any appeal, or the determination of any of the plaintiffs’ family provision claims, if those claims were revived as a result of orders made by the Court of Appeal. It is reasonable to infer that the plaintiffs have conducted the subsequent proceedings on the basis that order 2 was an valid order of the Court.

11. [19]

    The matters that I considered at [26] to [31] are significant because, if Mr Rodny had taken the view that the approach that I adopted was erroneous, he had the opportunity to challenge my reasoning on appeal, and in that event, he ought to have done so.

12. [20]

    Moving to a new issue, the plaintiffs sought an order that their costs be paid out of Mrs Rodny’s estate on the ordinary basis until 20 September 2017, and thereafter on an indemnity basis. That claim was based upon a Calderbank offer served upon Mr Rodny on 13 September 2017. This issue is significant because the plaintiffs have again sought to rely upon the same Calderbank offer in their submissions on costs that are the subject of these reasons.

13. [21]

    For the reasons given at [38] to [67], I rejected the plaintiffs’ claim for indemnity costs from 20 September 2017. A number of factors were relevant to this outcome. The plaintiffs had redacted from their Calderbank offer, as tendered on the application, the figures for the amounts that they would accept to compromise the proceedings: see [49]. The offer required Mr Rodny to accept separate compromises of the probate and family provision claims with each plaintiff, on a take it or leave it basis, for amounts that were apparently identified in the letter but not in the copy tendered in evidence: see [55]. The Court then had no basis for judging what the outcome of the family provision claims would have been: see [56]. The parties had no basis for knowing what evidence would be given by Mr Lloyd, the solicitor who acted for Mrs Rodny on her ineffective attempt to make a new will, until Mr Lloyd was called on subpoena at the original hearing: see [58]. I concluded:

14. [22]

    As appears from this paragraph of the reasons in Weisbord No 2, I acknowledged the possibility that the plaintiffs might be able to rely upon their Calderbank offer, if it became necessary for the Court to decide the family provision claims.

15. [23]

    The last aspect of Weisbord No 2 that requires consideration is the application by Mr Rodny for a costs order in the following terms:

16. [24]

    As will be seen below, by order 3 proposed by Mr Rodny in relation to Joel’s and Alexander’s family provision claims, Mr Rodny has renewed this claim, albeit that he has left the percentage to be inserted in the order for determination by the Court.

17. [25]

    Mr Rodny’s application for a costs order in favour of the plaintiffs that only allowed them 60% of their costs on the ordinary basis was based in part on the objective magnitude of the plaintiffs’ costs to date at that time ($1,444,171.40 inclusive of GST) compared to his own costs ($706,724 inclusive of GST). He also relied upon observations that I made in Weisbord No 1 at [311] to [330] about what I considered to be the egregious waste of legal costs in the way that these proceedings were prepared on behalf of the plaintiffs. There was a substantial amount of evidence that could not conceivably have been relevant to the probate claim, and is likely only to be distantly relevant to the family provision claims: see Weisbord No 2 at [69].

18. [26]

    After discussing the difficulties involved in properly assessing a proportionate reduction in the costs payable to the plaintiffs that would be just in the circumstances, at [76] to [85], I concluded:

19. [27]

    The position therefore is that it remains open to Mr Rodny to seek an order that the costs payable to the plaintiffs out of the estate of Mrs Rodny be reduced by an appropriate percentage to make a fair allowance for the excessive legal costs incurred by the plaintiffs in the preparation for the original hearing.

20. [28]

    This is the reason for order 5 made on 1 July 2019, that is set out above. However, it is to be noted that order 5 gave leave to Mr Rodny to make a formal application under s 98(4) of the Civil Procedure Act 2005 (NSW). As I understood it, Mr Rodny proposed to make an application under s 98(4)(b) for an order that the costs payable to the plaintiffs be limited to “a specified proportion of the assessed costs.” Given the factual complexity of the issue, it would be expected that the formal application would be supported by affidavit evidence containing an appropriate analysis of the evidence in the proceedings that would assist the Court in determining the application.

Court of Appeal judgment

1. [29]

   Mr Rodny successfully appealed to the Court of Appeal from my decision in the probate proceedings: Rodny v Weisbord (2020) 102 NSWLR 403; [2020] NSWCA 22. The orders made on 27 February 2020 by the Court of Appeal were:

2. [30]

   The Court of Appeal held that the requirements of s 8 of the Succession Act were not satisfied in respect of the second typewritten draft. Consequently, the original grant of probate in respect of the 19 December 1997 will of Mrs Rodny was revived.

3. [31]

   Order 5 sought in Mr Rodny’s notice of appeal was an order that: “The respondents pay the appellant’s costs of the Appeal and the trial before Robb J.” Order 4 made by the Court of Appeal dealt with the parties’ costs of the appeal on the basis that all of those costs were to be paid out of Mrs Rodny’s estate. The Court of Appeal did not make any order to set aside or vary order 2 that I made following Weisbord No 2. The Court does not know what happened at the hearing of the appeal. All that is known is that the Court of Appeal did not disturb order 2.

4. [32]

   Furthermore, the effect of the orders made by the Court of Appeal was to finally dispose of the probate claim. The Court is functus officio in relation to that claim. That is relevant because order 2 was made on the basis that the same order was made in each of the four proceedings on the assumption that it would be effective in each.

5. [33]

   As will be seen, all parties propose additional costs orders that would affect the operation of order 2. I will set out the terms of the orders proposed by the parties below.

Remission of family law claims

1. [34]

   In response to order 5 made by the Court of Appeal, an order was subsequently made that the plaintiffs’ family provision claims be remitted to me for determination. That order recognised the fact that I had not dismissed those claims on their merits, so that once my decision on the probate claim was set aside on appeal, the significance of the plaintiffs’ family provision claims was revived.

My third judgment

1. [35]

   My third judgment was published on 30 April 2021: Weisbord v Rodny (No 3) [2021] NSWSC 458 (Weisbord No 3). This judgment dealt with a number of issues that needed to be determined before I decided the revived family provision proceedings. The issue that is relevant to the present judgment arose out of an application made by Mr Rodny for leave to reopen his case to tender further evidence in the family provision proceedings. The original substantive hearing had taken place on a number of days between 9 October 2017 and 12 April 2018. The hearing that led to the publication of Weisbord No 3 took place on 23 March 2021, some three years after the conclusion of the substantive hearing. I ruled that the Court should not receive the further evidence that Mr Rodny sought leave to tender in relation to the personal and financial circumstances of the plaintiffs. I did so for the following reasons:

2. [36]

   Accordingly, I took the view that in relation to the generality of the circumstances that might be relevant to the plaintiffs’ family provision proceedings, the Court had reserved judgment on 12 April 2018 and, those proceedings having been remitted to the Court for determination, the Court should decide the proceedings on the evidence that was before it when judgment was reserved.

My fourth judgment

1. [37]

   My fourth judgment was published on 16 December 2022: Weisbord v Rodny (No 4) [2022] NSWSC 1726 (Weisbord No 4). I held that Ms Weisbord’s family provision claim should be dismissed. In the family provision claims by Joel Weisbord and Alexander, I found that they had established grounds for the Court to make orders for further provision in their favour out of the estate of Mrs Rodny. Weisbord No 4 was decided on the basis of the evidence tendered at the original substantive hearing, and the submissions made by the parties for the purposes of that hearing, augmented by additional submissions on a number of issues at the invitation of the Court.

2. [38]

   My reasons for finding in favour of Joel’s and Alexander’s family provision claims relevantly included:

3. [39]

   In the section of Weisbord No 4 in which I considered the orders that should be made, I made the following observations that are relevant to the present issue of whether additional costs orders should be made that vary the effect of order 2 made following the delivery of Weisbord No 2:

Effect of delay following oral hearing

1. [40]

   An oral hearing on the issues that are dealt with in these reasons for judgment took place on 7 February 2023. It will be necessary to refer to a number of aspects of the transcript of the hearing on that day, including first in relation to why it has taken the Court until 15 December 2023 to deliver this judgment.

2. [41]

   As set out in [171] in the extract from Weisbord (No 4) that is set out above, I was concerned about the Court making orders in Joel’s and Alexander’s favour of specific amounts for further lump sum family provision without knowing what the present value of No 102 was, and without knowing whether the order that I made would have unexpected consequences in relation to the shares of other beneficiaries in Mrs Rodny’s estate as a result of the need to pay costs in amounts that were not known to the Court. I said: “The variation that I contemplate will be limited to some rational and fair proportional adjustment from the starting position of $1.0 million to reflect the effect of the payment of costs on the estate as a whole and possible increases in the value of relevant properties.”

3. [42]

   First, I was informed at the hearing on 7 February 2023 by senior counsel for Mr Rodny that, although property in the estate would need to be sold to pay all costs ordered to be paid out of the estate, this would not have unexpected and unfair consequences in relation to the shares in the estate to which other beneficiaries were entitled: see T 9.29.

4. [43]

   Secondly, although Mr Rodny’s primary submission was that the Court should not act on updated evidence of the value of No 102, his senior counsel also submitted that the Court should not act on the appraisals submitted by Joel and Alexander. Those appraisals were annexed to the plaintiffs’ written submissions and suggested values for No 102 of $8.5 million to $9 million in one case and $8 million to $8.5 million in the other case. The suggestion was made by the parties that, if the Court was minded to make orders in favour of Joel and Alexander on the basis of the current value of No 102, it would be preferable for the parties to arrange for an updated valuation to be provided by the professional real estate valuer who had valued the properties in the estate for the purposes of the original hearing. An informal arrangement was agreed between the parties and the Court that the parties would arrange for either the original or some other independent valuer to provide an updated valuation for the property. As it turned out, optimistically, senior counsel for Mr Rodny said at T 7.43: “That can be done reasonably promptly…”

5. [44]

   In Mr Rodny’s written submissions delivered before the latest hearing, a submission was made that if, over his objection, evidence was to be received by the Court as to the current value of No 102, there should be updated evidence of the value of all relevant assets in Mrs Rodny’s estate. Had any party pressed at the hearing on 7 February 2023 for that to happen, I would have accepted that submission. However, the parties all acquiesced in an updated valuation only being obtained for No 102, which was clearly the most relevant property to the determination of the amount of any order for further provision to be made in favour of Joel and Alex, given the reasoning in my earlier judgments. As Exhibit 8 showed that over 90% of the value of Mrs Rodny’s estate as at 31 March 2018 was represented by real property in Sydney (in one case indirectly via the real property owned by Karod Investments Pty Ltd), it is likely that the value of the estate generally has risen with the appreciation of Sydney real property values.

6. [45]

   As it has happened, I commenced work on these reasons for judgment but as of 4 March 2023, when a significant part of the reasons had been completed, I put the draft judgment aside pending receipt of the current valuation, as I was unsure what effect the new value would have on the Court’s process of reasoning.

7. [46]

   The solicitor for Joel and Alexander did not provide the new valuation report to the Court until 24 August 2023. The valuer adopted $10.5 million as the current value for No 102. Mr Rodny has not sought to challenge the accuracy of that valuation.

8. [47]

   The plaintiffs apologised to the Court for their delay in providing the new valuation report. Reasons were given, but there is no point in the Court commenting on the adequacy of those reasons. Matters were further delayed by some bickering between the parties’ solicitors that was forwarded to my Associate in relation to the appropriateness of communications that she had received from the solicitors. There is no point in the Court commenting on those matters.

9. [48]

   The delay in the parties providing the new valuation report is the primary cause of the delay in the Court delivering these reasons for judgment. That delay is most unfortunate given the lengthy history of these proceedings. However, it had the usual effect that the Court was engaged in its ordinary business dealing with matters in which litigants who had acted more promptly than the parties in this case had an interest, and the Court by then required much more time than ought to have been necessary to refresh its mind on the remaining issues and their connection to the history of these proceedings than ought to have been required.

10. [49]

    The delay has had a further effect, as senior counsel for Mr Rodny suggested at the hearing on 7 February 2023 that it may be preferable for the Court to fix a further brief hearing, after the new valuation had been delivered, so that the parties could make submissions concerning its significance, and also so that they could deal with the outstanding costs issues more fully than they had done at that hearing. I did not agree to that course, but I left the possibility open, depending upon my consideration of the parties’ oral and written submissions in the light of the content of the earlier judgments in these proceedings. Given the lengthy history, I said at T 11.47: “… if I can take a view about something, I will,” meaning that I would decide issues on the material that I had received to date provided that I was satisfied that I could do so properly. However, the elapse of time since 7 February 2023 has now had the effect that I will decide the outstanding questions on the basis of the material that is now available, as I, as the trial judge, no longer have time to give to the parties for a further oral hearing.

Orders proposed by the plaintiffs

1. [50]

   The plaintiffs submitted in par 15 of their written submissions dated 30 January 2023 that the Court should make the following costs orders in relation to the proceedings:

2. [51]

   The plaintiffs (and also Mr Rodny, as will be seen) have asked the Court to make orders that confirm the orders made by the Court of Appeal. That is not necessary, and the Court does not have power to confirm the orders made by the Court of Appeal in any legally meaningful sense.

Orders proposed by Mr Rodny

1. [52]

   Mr Rodny attached to his 6 February 2023 submissions the following draft orders that he submitted should be made by the Court:

2. [53]

   Most of the orders proposed by Mr Rodny concern costs orders that he asks the Court to make in the four proceedings. Proposed order 2 in the family provision claims made by Joel and Alexander concern the family provision orders that the Court must now make. I will deal with that issue first.

Orders for further provision in favour of Joel and Alexander

1. [54]

   Mr Rodny has strongly submitted that, as the Court rejected his application to lead fresh evidence on the issue of the plaintiffs’ circumstances relevant to their family provision claims, it would be wrong and unfair for the Court to act upon current evidence of the value of No 102.

2. [55]

   I reject the suggested equivalence between unidentified and open-ended new evidence relevant to the plaintiffs’ circumstances that would risk a complete renewal of the hearing on the one hand, and evidence of the current value of the assets in the estate on the other hand. The latter type of evidence is an objective integer that may be crucial to the formulation and proper operation of the orders for further provision and costs orders that the Court might make. It is evidence that is independent of the conduct of the parties.

3. [56]

   Furthermore, consistently with a practice that I understand Hallen J to have adopted as Succession List Judge in appropriate cases, had I made final orders for further provision in favour of Joel and Alexander, I would not have made orders for the payment of lump sums of $1 million in favour of each plaintiff out of Mrs Rodny’s estate in ignorance of the relative effect of that order. I would have made an order that each plaintiff receive a lump sum equal to 20% of the market value of No 102.

4. [57]

   The conclusions that I reached in Weisbord No 4 were influenced by the circumstances noted at [160], that Mrs Rodny encouraged both of her grandsons to believe that they would receive a share in No 102, and that the gift included by Mrs Rodny in the second typewritten draft will in 2008 in favour of her four grandchildren gave each of them an equal share in that property. Although that document was not admitted to probate, I accepted that it was evidence of Mrs Rodny’s real testamentary intention.

5. [58]

   As recorded at [169], which is extracted above, my reasons were based on the fact that No 102 had been valued before the original hearing at $5.1 million. As I noted in Weisbord No 1 at [19], the parties’ agreement as to the value of the property in Mrs Rodny’s estate was embodied in Exhibit 8, which gave No 102 the value of $5.1 million as at 31 March 2018. That is 5 and a half years ago.

6. [59]

   As noted above, the evidence is that the current value of No 102 is $10.5 million. That it is almost exactly twice the value that was accepted by the parties as at 31 March 2018. The Court can take judicial notice of the fact that real property values in metropolitan Sydney have been steadily increasing over the last five years, and that No 102 is located in a suburb of the city that is generally accepted as being a highly desirable place to live.

7. [60]

   On the basis of the two appraisals of the value of No 102 that were then available, and noting my reasoning at [169] of Weisbord No 4, the plaintiffs made the following submissions concerning the amount of the lump sum orders for further provision that should be made in favour of Joel and Alex:

8. [61]

   The Court is entitled to infer that Ms Weisbord does not oppose the Court making orders for further provision in favour of Joel and Alexander that apply the logic set out in Weisbord No 4 to the current value of No 102. Mr Rodny has not put his own personal or financial circumstances in issue in these proceedings, and there was indefinite evidence to suggest that Mr Rodny is relatively wealthy.

9. [62]

   In all of these circumstances, I will make orders for the provision out of the residue of Mrs Rodny’s estate a lump sum legacy of $1.75 million to each of Joel and Alexander. I consider that to be a fair way to take into account the evidence of the increase in value of No 102. I have not simply multiplied the $1 million tentatively suggested in [171] of Weisbord No 4 by a factor of 2 to reflect the apparent doubling of the value of No 102. That makes an allowance for the fact that Joel and Alexander have not given specific evidence addressed to their accommodation needs. It allows for the fact that the new valuation has not been subject to scrutiny (having regard to the two appraisals that were submitted by the plaintiffs that were below the value adopted by the valuer). It also acknowledges that the evidence that was presented at the original hearing concerning the personal and financial circumstances of Joel and Alexander is now somewhat remote, so that it is fair that some effect should be given to Mr Rodny’s objection to evidence being received of the current value of No 102, in circumstances where he has been denied the opportunity of demonstrating that Joel’s and Alexander’s circumstances have materially changed since 12 April 2018.

Costs orders sought by the plaintiffs

1. [63]

   I will deal first with the costs orders proposed by the plaintiffs. It will be necessary for the Court to consider the orders proposed by the plaintiff on a provisional basis, as the costs orders proposed by Mr Rodny are in various respects completely inconsistent with the orders proposed by the plaintiffs. Consequently, I will in the first instance consider the plaintiffs’ proposed orders, taking them at face value, as if Mr Rodny had not submitted that entirely inconsistent orders should be made.

2. [64]

   The four orders are set out above at [50]. The only order which is the subject of serious contest is order (a), which I will repeat for convenience:

3. [65]

   The plaintiffs’ application in order (a) for costs on the indemnity basis from 13 December 2017 is based upon the service of a Calderbank offer on that date. As I have explained above at [22], although the Court rejected the plaintiffs’ attempt to rely upon the Calderbank offer in Weisbord No 2, they may be entitled to revive their reliance upon it after the Court had decided the family law claims, if that became necessary as a result of an appeal from my orders in the probate claim.

4. [66]

   If order (a) was now made by the Court, it would have the effect of specifying the basis upon which the costs of order 2 made following the delivery of Weisbord No 2 were to be payable. As order 2 was made in all four proceedings, proposed order (a) would go further than to confirm order 2, and it would have the effect of entitling the plaintiffs to be paid their costs of the probate claim on the indemnity basis from 13 December 2017 out of Mrs Rodny’s estate, even though the Court of Appeal has subsequently made orders that have had the effect of dismissing that claim. It would also have the effect that all of Ms Weisbord’s costs of her failed family provision claim would be paid out of the estate, not limited to the costs of the original hearing that was the subject of order 2, but would include the subsequent costs of her claim, notwithstanding that as a result of Weisbord No 4, that claim will be dismissed.

5. [67]

   I will assume for the present that order 2 will stand because it was not set aside or varied by the Court of Appeal. I will revisit this assumption when I consider the costs orders proposed by Mr Rodny.

6. [68]

   Order 2 was made in respect of the proceedings up to the date of publication of Weisbord No 2 on 19 June 2019. The order did not extend to the costs of any aspect of any of the proceedings after that date. Accordingly, even if order 2 covers the costs of Ms Weisbord’s family provision claim up to 19 June 2019, it does not cover the costs of that claim thereafter. The additional costs of that claim must be dealt with separately and on the basis that the claim failed. The ordinary outcome would be that costs of the additional proceedings on Ms Weisbord’s family provision claim would follow the event. I will defer further consideration of this issue until I deal with the relevant costs order proposed by Mr Rodny.

7. [69]

   If order 2 remains effective as the order of the Court, any further orders made by the Court concerning the costs of the proceedings after 19 June 2019 should be made separately and be formulated on the basis that they only apply to the costs of that period. The Court should not now make new costs orders that overlap the effect of existing costs orders.

8. [70]

   Consequently, as the orders made by the Court of Appeal finally determined the probate claim, that claim has now been determined and is at an end and no further costs orders should be made by the Court in respect of it.

9. [71]

   That leaves the family provision claims made by Joel and Alexander on which they have succeeded. The ordinary costs order in that circumstance would be that those claimants’ costs of prosecuting their family provision claims after 19 June 2019 would be paid out of the estate of Mrs Rodny on the ordinary basis. If that order were made, those successful claimants would become entitled to be paid the whole of their costs out of the estate on the ordinary basis, partly by force of order 2 and partly by force of the new costs order.

10. [72]

    The plaintiffs do not now challenge Mr Rodny’s entitlement to be paid his costs as executor out of the estate on the indemnity basis.

11. [73]

    That leaves the question of whether the Court should now make an order that any of the costs payable under order 2 or a new costs order should be payable on the indemnity basis.

12. [74]

    It would be wrong for the Court retrospectively to order that the plaintiffs’ costs the subject of order 2 be payable for any period on the indemnity basis in respect of the probate claim, as the Court now knows that that claim has been dismissed. Furthermore, following the making of the Court of Appeal’s orders, the Court is functus officio and it is now too late for the Court to make any further order affecting the costs of that claim.

13. [75]

    As the plaintiffs’ claim that their costs from 13 September 2017 should be paid on the indemnity basis was dismissed in Weisbord No 2, their renewed reliance on the Calderbank offer made on that date could only be effective in respect of costs incurred thereafter. That is an issue that can only arise in relation to the costs of Joel and Alexander in relation to their successful prosecution of their family provision claims after 13 September 2017.

14. [76]

    On the present application for an order that their costs be paid out of Mrs Rodny’s estate on the indemnity basis, the plaintiffs relied upon the whole of the 13 September 2017 Calderbank offer, without the amounts of the suggested compromise being redacted. It will be recalled that the redaction of those amounts was one of the reasons why the application for indemnity costs was dismissed in Weisbord No 2.

15. [77]

    The 13 September 2017 letter from the plaintiffs’ solicitors to Mr Rodny’s solicitors that contained the Calderbank offer relied upon by the plaintiffs was stated to be “Without Prejudice Save As To Costs,” and relevantly provided:

16. [78]

    Karly Marks and Jordana Michael are Ms Weisbord’s daughters. They did not join as plaintiffs in the probate claim and they did not make family provision claims.

17. [79]

    In my view, on the proper construction of this letter, Mr Rodny was given the choice of accepting it in whole or rejecting it. Although the letter contained an “offer to settle each of the matters” and the consideration that Mr Rodny was asked to agree to was stated separately for each of the claims, I do not think that the letter invited Mr Rodny to pick and choose which of the claims he would agree to compromise on the terms offered. That view is reinforced by the statement “my clients believed that this offer represents a significant compromise,” where the word “offer” is in the singular. “Offer” is used in the singular in a number of other places in the letter.

18. [80]

    Numbered paragraphs 3 and 4 deal with Ms Weisbord’s family provision claim and the probate claim, both of which have been dismissed. In respect of these claims the offer made in the letter was not more favourable than the result achieved.

19. [81]

    Furthermore, Ms Marks and Ms Michael were not even parties to the probate claim.

20. [82]

    Even though, in the events which have happened, the global result achieved by the plaintiffs in respect of the four proceedings is more favourable to the plaintiffs, taken as a whole, than the amount for which the plaintiffs offered to compromise the four proceedings, the offer is not, in my view, an effective Calderbank offer. In principle, as stated by GE Dal Pont in Law of Costs (5th ed, 2021, LexisNexis) at [13.69]: “Unlike the rule-based offers of compromise, no formality requirements attach to a Calderbank offer.” Furthermore, care must be taken in the consideration of what is required of a settlement offer for it to be taken into account when the Court considers the costs orders that should be made, as the Court always has a discretion under s 98 of the Civil Procedure Act in respect of the costs orders that it makes. It is not necessary for the Court to determine whether Calderbank offers should be made separately for each claim in order to be effective on the issue of costs, or whether Calderbank offers may be effective when they only give the offeree the option to accept a global compromise that is offered in respect of separate proceedings, even where the basis of the compromise is specified separately for all of the proceedings. In deciding what effect should be given by the Court to a failure by a party to accept a Calderbank offer made by the other party, the reasonableness of the failure is a primary consideration: see for example Rickard Constructions Pty Ltd v Rickard Hails Moretti Pty Ltd [2005] NSWSC 481 at [31] per McDougall J. It is not unreasonable in my view for a party to have rejected an offer to compromise on a global basis a number of different proceedings, where the result of the Court’s determination of those proceedings is that some of them succeed but others fail. The party given the offer is not required to make a judgment as to whether on an overall basis, taking into account the possibility of wins and losses, the parties making the offer are likely to do better in aggregate when the proceedings are decided than the aggregate amount of the offer. If that requirement were imposed on the party given the offer, it might require the party to accept an adverse outcome in proceedings that the party rightly believed will fail against the party. The party given the offer has legal rights that the party is entitled to defend, and a reasonable response to a single offer to compromise multiple proceedings should not require the acceptance of liability in some proceedings which the party rightly believes will fail.

21. [83]

    Accordingly, the Court will make a costs order in Joel’s and Alexander’s family provision claims that they be paid their costs of those claims out of the estate on the ordinary basis from 19 June 2019.

Costs orders sought by Mr Rodny

1. [84]

   I will deal first with the orders sought by Mr Rodny in the plaintiffs’ probate claim. The effect of the orders sought is that no order be made as to the costs of the plaintiffs to the intent that they bear their own costs of the proceedings; the plaintiffs pay Mr Rodny’s costs of the proceedings on the ordinary basis, and that Mr Rodny be indemnified out of the estate for the balance.

2. [85]

   Those orders are inconsistent with order 2 made following Weisbord No 2 and the costs orders made by the Court of Appeal in the appeal in the probate claim.

3. [86]

   Order 2 was recorded in the Court’s computerised Court records system on 1 July 2019, so it is taken to have been entered on that date by operation of Uniform Civil Procedure Rules 2005 (NSW) (UCPR) r 36.11(2).

4. [87]

   By order 4, order 2 was stayed pending the decision of the Court of Appeal but, notwithstanding that Mr Rodny’s application in order 5 sought in the notice of appeal was for an order that the present plaintiffs pay his costs of the trial, the Court of Appeal did not set aside or vary order 2.

5. [88]

   In Roads and Traffic Authority of New South Wales v Palmer (No 2) [2005] NSWCA 140, Giles JA (Spigelman CJ and Handley JA agreeing) considered the power of the Court to make orders varying costs orders. The decision was delivered when the applicable regime was found in the Supreme Court Rules 1970 (NSW), however the relevant rules are in substantively the same terms as the UCPR.

6. [89]

   Giles JA found that a costs order determines a “claim for relief” within the meaning of the equivalent of UCPR r 36.16(3)(a), meaning that the 14 day time limits for variation in rr 36.16(3A) and (3B) apply.

7. [90]

   His Honour’s reasons included:

8. [91]

   The decision of White JA (Basten and Macfarlan JJA agreeing) in Oikos Constructions Pty Ltd t/as Lars Fischer Construction v Ostin (No 2) [2021] NSWCA 98 collects the authorities regarding the general rule that a motion for variation of a costs order must be filed within 14 days of entry (or that, at the least, the Court must be notified within 14 days of a party’s intention to apply for a variation):

9. [92]

   The legal position therefore is that the costs of the probate claim have finally been determined by orders of the Court that have been entered, and it is now too late for Mr Rodny to make an application for an order setting aside or varying the orders that have already been made in those proceedings.

10. [93]

    I will now turn to the consideration of the orders sought by Mr Rodny in Ms Weisbord’s family provision claim.

11. [94]

    In the manner that I have explained above when dealing with the orders sought by the plaintiffs, order 2 made following Weisbord No 2 covered Ms Weisbord’s costs of her family provision claim up to 19 June 2019. That order was entered in Ms Weisbord’s family provision claim on 1 July 2019. It is now too late for this Court to make an order setting aside or varying order 2. In any event, as I have explained above, my understanding is that order 2 was made with the approval of Mr Rodny.

12. [95]

    As I have also explained above, order 2 does not cover Ms Weisbord’s costs after 19 June 2019. Ms Weisbord prosecuted her family provision claim after it was revived as a result of the orders made by the Court of Appeal, and her claim failed. No satisfactory reason has been offered as to why costs should not follow the event after 19 June 2019.

13. [96]

    Mr Rodny seeks an order that Ms Weisbord pay his costs on the indemnity basis after 12 August 2016. That claim has the result that Mr Rodny seeks an order that the costs payable to him by Ms Weisbord be on the indemnity basis from 19 June 2019.

14. [97]

    Mr Rodny’s claim for an order that Ms Weisbord pay his costs on the indemnity basis is based on an offer of compromise made by Mr Rodny to Ms Weisbord on 11 August 2016, which was made in the following terms:

15. [98]

    I think that the offer of compromise complies with the requirement in r 20.26(2) that the offer be exclusive of costs, because par 2 was an offer to pay an amount towards Ms Weisbord’s costs, and par 3 did not require Ms Weisbord to pay any of Mr Rodny’s costs. Paragraph 3 involved a recognition of the ordinary rule that, as the executor of Mrs Rodny’s estate, Mr Rodny was entitled to be indemnified for his costs out of the estate.

16. [99]

    The difficulty with the offer of compromise is that it required Ms Weisbord to accept the dismissal of her family provision claim in return for the trivial contribution to her costs of $5,000. That raises the issue of whether the offer involved a sufficient element of compromise to be treated as an offer of compromise under r 20.26 for the purposes of Pt 42, Div 3 of the UCPR.

17. [100]

    The Court of Appeal held in Regency Media Pty Ltd v AAV Australia Pty Ltd [2009] NSWCA 368 (Spigelman CJ, Beazley and McColl JJA):

18. [101]

    Although I was not satisfied that Ms Weisbord had established that adequate provision for her had not been made under the will of Mrs Rodny that was admitted to probate, her claim was by no means trivial or frivolous. I am clearly of the opinion that the offer made by Mr Rodny in the offer of compromise was not a real or genuine compromise, and should not benefit from the operation of UCPR r 42.15A by reason of the Court making an order that the costs that Ms Weisbord will be ordered to pay as a result of her failed family provision claim should be on the indemnity basis.

19. [102]

    Order 4 proposed by Mr Rodny in Ms Weisbord's family provision claim and order 6 proposed in Joel's and Alexander's family provision claims have been proposed because on 1 July 2019, the Court made the following orders in those proceedings:

20. [103]

    The orders sought by Mr Rodny are reasonable in that they will make clear that the $300,000 that has already been paid out of the estate to the plaintiffs must be treated as a part payment of the costs to which they are entitled as a result of all of the costs orders made in their favour in any of the proceedings. Given the amount of costs that the Court has been told the plaintiffs have incurred, it is unlikely that these orders will have any operative effect.

21. [104]

    Orders 3 and 4 proposed by Mr Rodny in relation to the family provision claims by Joel and Alexander would have the effect that only a stated percentage of their costs be paid out of Mrs Rodny’s estate and they would be required to pay a percentage of Mr Rodny’s costs.

22. [105]

    As has been explained above, order 5 of the orders made following Weisbord No 2 granted leave to Mr Rodny to make a formal application, after the decision of the Court of Appeal, to seek an order under s 98(4) of the Civil Procedure Act in respect of the plaintiffs’ costs payable pursuant to order 2.

23. [106]

    Not only has Mr Rodny not made a formal application, but the application that he has made relates only to so much of the plaintiffs’ costs to which they became entitled under order 2 that related to Joel’s and Alexander’s family provision claims. In relation to the costs of those claims after 19 June 2019, Mr Rodny is entitled to make a claim under s 98(4) without needing the leave of the Court, as these reasons for judgment are dealing with the costs of those family provision claims after that date.

24. [107]

    Section 98(4) empowers the Court to make orders of the types listed “at any time before costs are referred for assessment,” so it is open to Mr Rodny to seek an order under sub-par (c) that Joel and Alexander are entitled to “a specified proportion of the assessed costs.” So far as the costs to which Joel and Alexander are entitled under order 2 for the period up to 19 June 2019 are concerned, the effect of the leave granted by order 5 is that Mr Rodny may apply for an order that Joel and Alexander only be entitled to a proportion of the costs that they would otherwise be entitled to recover under order 2 in respect of the costs of their family provision claims. At this stage, the leave granted by order 5 would not extend to permitting Mr Rodny to seek an order that Joel and Alexander be ordered to pay him a portion of his costs, contrary to the effect of order 2. That means that, for the period up to 19 June 2019, Mr Rodny may pursue his proposed order 3, but not proposed order 4.

25. [108]

    Although, in principle, Mr Rodny is free to pursue both proposed orders 3 and 4 for the period after 19 June 2019, I am satisfied that nothing in the preparation or conduct of Joel’s and Alexander’s family provision claims in the period after 19 June 2019 involved any waste of costs that could justify the Court making either of the proposed orders in respect of the costs of the family provision claims in that period. The “egregious waste of legal costs in the way that these proceedings were prepared on behalf of the plaintiffs” that I considered in Weisbord No 1 at [311] to [330], and have referred to above, related entirely to the plaintiffs’ conduct of the proceedings up to the end of the original hearing.

26. [109]

    Mr Rodny’s claim for orders against Joel and Alexander in the form of proposed order 3 has not been supported by any affidavit evidence or detailed submissions that would enable the Court to make an objective judgment about the extent of the waste of legal costs, or the proportion that the waste may have borne to the whole of the costs that were incurred. Nor has Mr Rodny provided a rational basis for the Court to allocate the waste as between the probate claim and Ms Weisbord’s family provision claim on the one hand, and Joel’s and Alexander’s family provision claims on the other.

27. [110]

    Although in broad principle there is a basis for concluding that some part of the costs incurred by Joel and Alexander in pursuing their family provision claims up to 19 June 2019 contributed to the waste of legal costs, the informal nature of Mr Rodny’s application has not provided the Court with a basis to make a just judgment as to the proportion of Joel’s and Alexander’s entitlement to costs that should be the subject of a reduction under s 98(4) of the Civil Procedure Act.

28. [111]

    Consequently, I will not make the costs orders that will be made in favour of Joel and Alexander subject to a proportionate reduction.

29. [112]

    As it appears that Mr Rodny will have to sell No 102 to pay the lump sum further provision to Joel and Alexander, and as the current value of that property has been an important integer in the Court’s determination of the amount of the further provision, I will adjust the usual order for payment of interest so that interest will become payable if the lump sums have not been paid within 6 months of the date this judgment is delivered.

Orders

1. [113]

   The orders of the Court in the three proceedings that have not already been determined will be as set out below.

2. [114]

   Proceedings No 2015/324982

   1. (1)

      Summons dismissed.

   2. (2)

      Order the plaintiff to pay the defendant’s costs of the proceedings from 19 June 2019 on the ordinary basis.

   3. (3)

      Order that the defendant’s costs of the proceedings from 19 June 2019 be paid out of the estate of the deceased on the indemnity basis, making allowance for all costs already paid out of the estate to the defendant.

   4. (4)

      Confirm all existing costs orders in the proceedings.

   5. (5)

      Order that the sum of $300,000 paid to the plaintiff as well as the plaintiffs in proceedings 2015/324966, 2015/324977 and 2016/225246 on account of costs be treated as a part payment of the costs of those proceedings and to the extent that there is thereby any overpayment in aggregate of those costs by the estate of the deceased, the extent of the overpayment shall be treated as a due by the plaintiffs in those proceedings to the estate.

3. [115]

   Proceedings 2015/324966

   1. (1)

      Order that the time for the filing of the summons be extended to 5 November 2015, the date of filing thereof.

   2. (2)

      Order that the plaintiff have provision out of the estate of the deceased by way of a lump sum of $1,750,000.

   3. (3)

      Order that the provision in order 2 be born to the extent possible out of the residue of the estate.

   4. (4)

      Order that no interest is to be paid on the lump sum, if it is paid within 6 months of the date of this judgment, otherwise, interest calculated at the rate prescribed by s 84A(3) of the Probate and Administration Act 1898 (NSW), on unpaid legacies, is to be paid from that date until the date of payment of the lump sum.

   5. (5)

      Order that the plaintiff’s costs of the proceedings from 19 June 2019 be paid out of the estate of the deceased on the ordinary basis.

   6. (6)

      Order that the defendant’s costs of the proceedings from 19 June 2019 be paid out of the estate of the deceased on the indemnity basis, making allowance for all costs already paid out of the estate to the defendant.

   7. (7)

      Confirm all existing costs orders in the proceedings.

   8. (8)

      Order that the sum of $300,000 paid to the plaintiff as well as the plaintiffs in proceedings 2015/324982, 2015/324977 and 2016/225246 on account of costs be treated as a part payment of the costs of those proceedings and to the extent that there is thereby any overpayment in aggregate of those costs by the estate of the deceased, the extent of the overpayment shall be treated as a due by the plaintiffs in those proceedings to the estate.

4. [116]

   Proceedings 2015/324977

   1. (1)

      Order that the time for the filing of the summons be extended to 5 November 2015, the date of filing thereof.

   2. (2)

      Order that the plaintiff have provision out of the estate of the deceased by way of a lump sum of $1,750,000.

   3. (3)

      Order that the provision in order 2 be borne to the extent possible out of the residue of the estate.

   4. (4)

      Order that no interest is to be paid on the lump sum, if it is paid within 6 months of the date of this judgment, otherwise, interest calculated at the rate prescribed by s 84A(3) of the Probate and Administration Act 1898 (NSW), on unpaid legacies, is to be paid from that date until the date of payment of the lump sum.

   5. (5)

      Order that the plaintiff’s costs of the proceedings from 19 June 2019 be paid out of the estate of the deceased on the ordinary basis.

   6. (6)

      Order that the defendant’s costs of the proceedings from 19 June 2019 be paid out of the estate of the deceased on the indemnity basis, making allowance for all costs already paid out of the estate to the defendant.

   7. (7)

      Confirm all existing costs orders in the proceedings.

   8. (8)

      Order that the sum of $300,000 paid to the plaintiff as well as the plaintiffs in proceedings 2015/324982, 2015/324966 and 2016/225246 on account of costs be treated as a part payment of the costs of those proceedings and to the extent that there is thereby any overpayment in aggregate of those costs by the estate of the deceased, the extent of the overpayment shall be treated as a due by the plaintiffs in those proceedings to the estate.