Earlier this week I blogged about Devlin Estate (Re), 2022 NSCA 33 which is a Nova Scotia Court of Appeal decision with respect to the validity of a will that was made by a testator who was known to have struggles with mental health issues throughout his life.
The Court of Appeal agreed with the trial judge that Mr. Devlin’s mental health issues, which also contributed to a deterioration of his physical health, gave rise to suspicious circumstances which shifted the onus of proving Mr. Devlin’s capacity to make the Will onto Ms. Summerfield. Ultimately, both levels of court were unpersuaded by Ms. Summerfield’s arguments and the Will benefiting Ms. Summerfield was found to be invalid.
As the unsuccessful appellant, Ms. Summerfield was ordered to pay $1,000.00 to the respondent and she was denied any recovery of her own costs from the Estate. The Nova Scotia Court of Appeal found that there was no basis to grant Ms. Summerfield any costs because she had been unsuccessful throughout. I was somewhat surprised by this comment as there was no mention in the appellate decision that Ms. Summerfield was involved in the procurement of a will from Mr. Devlin and that it was Mr. Devlin who seemed to have, out of the blue, mailed Ms. Summerfield a duly executed holograph will in an effort to convince her to return to Nova Scotia so that they can be together.
In reviewing the case that was referred to in the Court’s costs reasoning, Wittenberg v. Wittenberg Estate, 2015 NSCA 79, it appears that Nova Scotia’s approach to costs in estate proceedings is, in principle, similar to Ontario’s approach. Wittenberg outlines how the modern approach to costs in McDougald Estate v. Gooderham, 2005 CanLII 21091 (ON CA), have been a “trend” in some Nova Scotia cases and made the following comment which was highlighted in Devlin:
[98] The policy reasons for the old rule are weaker now. By contrast, litigation is more expensive than ever. A rule that accommodates a losing party with costs is an inducement to litigation. Although the public interest component remains in probate litigation, the liberality of contemporary disclosure and the court’s policy of encouraging settlement, (Ameron v. Sable, 2013 SCC 37), favours the usual rule that the victor should be indemnified by the vanquished.
[99] To the extent that there was a traditional practice of paying costs of all parties out of the estate, those days are over. Provided that a personal representative is discharging her duties and is acting reasonably, she can be expected to be indemnified from the estate. Not so with an adverse party, who may obtain party-party costs if successful, but may have to bear her own costs or even have to pay them, if unsuccessful. If the court proceeding can be ascribed to conduct of the deceased or residuary beneficiaries, a losing party may still recover costs from the estate, although usually on a party-party basis (Casavechia, supra; Townsend v. Doherty, 1993 O.J. No. 713, per Borins J. as he then was; Gamble v. McCormick, 2002 O.J. No. 2694 (S.C.J.); Holzel v. Mjeda, 2000 ABQB 549; Oldfield v. Oldfield Estate, 1994 O.J. No. 2529).
[100] Awarding costs against or out of an estate means that the expense usually is borne by the residuary beneficiaries. It is appropriate to ask whether that is a proper burden for them to bear. Where the personal representative is discharging her duties and there is no other unsuccessful party to share at least some of the burden, there is nothing that can be done to mitigate this indirect charge on the generosity of the testatrix, at the expense of the residuary beneficiaries. But where, as here, there is an unsuccessful party who is the cause of the litigation, it is proper that the unsuccessful party bear much of the burden. Moreover, in this case, there was very little lay evidence, and no expert evidence, sustaining Mr. Wittenberg’s allegations. Finally, those allegations were not confined to incapacity, but also cast the aspersion of undue influence.
Curiously, the trial decision in Devlin was silent on costs.
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