Wilson v Wright; Wilson v Wright (No 2)

I delivered the principal judgment in this matter on 7 May 2024: Wilson v Wright; Wilson v Wright [2024] NSWSC 519. These reasons should be read with that judgment.

In essence, I held that adequate provision had not been made for Kimberley and Kyle from the estate of the late Adam Patrick Fornari, their former step-father. It was not in dispute that Kimberley and Kyle had become estranged from the deceased following allegations of sexual abuse made by Kimberley against him of which he was found not guilty at trial. In light of that, I held that I could not attribute any blame for the estrangement to any party. I further held that the evidence before me was unsatisfactory as to the value of the Estate and the needs of the plaintiffs.

I ordered provision for Kimberley in the sum of $50,000 and for Kyle in the sum of $40,000. This was less than their initial submission that provision should be made in an amount reflecting two-thirds of the value of the estate (which was, eventually, agreed to have a net value of around $1,034,981) and also less than their closing submission that they should each receive around $200,000. The defendant’s submission had primarily been that they should receive nothing, but alternatively that Kyle should receive $25,000 and Kimberley should receive $50,000.

I reserved the question of costs. I also noted that, at the hearing, I was informed from the bar table that the defendant’s costs up to the end of the hearing were $75,000 on the indemnity basis. The plaintiffs’ costs (being one set of costs as they were jointly represented) were said to be $88,000 on the ordinary basis.

The plaintiffs and the defendant agreed that the defendant’s costs should be paid out of the Estate on the indemnity basis (which, of course, has the direct effect of reducing the legacy she will receive). That is the order I shall make in respect of the defendant’s costs. However, the parties’ submissions differed in terms of their proposed costs orders for the plaintiffs. Mr Flaherty, for the plaintiffs, argued that the plaintiffs’ costs should be paid out of the estate on the ordinary basis. Mr Tregenza, for the defendant, agreed that the plaintiffs’ costs should be paid on the ordinary basis but argued that the liability of the estate for those costs should be limited to two-thirds of the provision ordered; that is, $60,000.

It is regrettable that these proceedings were unable to be resolved without a hearing. Mediation occurred, but did not resolve the proceedings, at least insofar as the proceedings concerned Kimberley and Kyle. No offers of compromise were made. The hearing itself occupied two days of Court time.

Significantly, the total amount of provision obtained is very nearly equal to the plaintiffs’ costs incurred on the ordinary basis, and presumably less than the actual costs incurred by the plaintiffs.

The relevant principles to be applied in determining costs orders in a case such as this were explained by Beazley P in Salmon v Osmond [2015] NSWCA 42 at [170]-[174], relevantly being that the “overall justice of the case” is the key consideration, although that is not too far removed from the usual rule that costs follow the event. See also Haertsch v Whiteway (No 2) [2020] NSWCA 287 at [4]-[8].

I also note s 98 of the Civil Procedure Act 2005 (NSW):

I also note r 42.4 of the Uniform Civil Procedure Rules 2005 (NSW), which relevantly provides:

On costs-capping orders specifically, Ball J noted in Baychek v Baychek [2010] NSWSC 987 at [22]-[23] that:

His Honour discussed the practicalities of costs-capping orders at [25]:

I respectfully adopt his Honour’s analysis. Given that the costs incurred in this case were beyond the amount ultimately obtained by way of an order for provision; the relatively modest size of the estate; and the fact that any costs order will further reduce the legacy of the defendant, whom I found, at [90], had “made considerable personal sacrifices to support her brother” and was “the natural object of the deceased’s testamentary intention”, I have determined that it is appropriate to order that the plaintiffs only recover a portion of their costs from the Estate.

I should add that I accept that the plaintiffs saved expense by only retaining one firm of solicitors and one counsel between them. However, I view this as an essentially neutral factor. There was only minimal distinction between the plaintiffs’ claims. Evidence in one proceeding was ordered to be evidence in the other. It was inevitable that they would have been heard together.

Because of the information which the plaintiffs have helpfully provided as to their costs, and noting the remarks of Ball J above, it is further appropriate that I order costs to be fixed in a specific sum pursuant to s 98(4)(c) of the Civil Procedure Act. This will save the plaintiffs submitting their costs for assessment in circumstances where their maximum recovery is capped, which is the principal purpose of such an order: Hamod v New South Wales [2011] NSWCA 375 at [816]-[817], cited in Beau Timothy John Hartnett trading as Hartnett Lawyers v Anthony Robert Bell as Executor of the Estate of the late Mabel Dawn Deakin-Bell (No 2) [2023] NSWCA 311 at [46].

In the latter case, the Court (comprising Bell CJ and Adamson JA) noted at [48], that in assessing a figure to be ordered to be paid as a specified gross sum, the “Court is entitled to apply a broad-brush approach by reviewing the tax invoices of the solicitors and counsel and determining what is fair between the parties.” Such evidence is not available here although I did not understand Mr Tregenza to take issue with the veracity of the figures put forward by Mr Flaherty.

In those circumstances, I would have made an order requiring the defendant to pay 75% of the plaintiffs’ costs on the ordinary basis, due to the factors set out at [13] above. That leads me to determine that an appropriate order, specifying costs in a gross sum, is to order the defendant pay to the plaintiffs (jointly) $66,000 on account of their costs.

The orders of the Court will therefore be: