In Kurt v. Kurt and Sullivan, 2024 ONSC 589, the Plaintiff had contended that she was entitled to $800,000 due to the legacy that was allegedly left for her under the deceased testator’s secondary will. The drafting solicitor, who was one of the Defendants in the action, acknowledged that there was a drafting error with the secondary will and the deceased’s intent was not in fact to leave $800,000 to the Plaintiff. After applying the armchair rule to the secondary will, the Court disagreed with the Plaintiff’s interpretation and dismissed the Plaintiff’s motion for summary judgment, thereby disposing the action entirely.

The parties were unable to agree on the issue of costs, and the Court ordered that the Plaintiff was to cover her own costs for the action and summary judgment motion as well as the partial indemnity costs of the estate. The drafting solicitor was ordered to cover his own costs.

The Court began its analysis by noting that the Court of Appeal decision in McDougald Estate v. Gooderham, 2005 CanLII 21091 (ONCA) had displaced the traditional approach to fixing costs, namely that a litigant’s costs are funded from the assets of the estate. The modern approach to fixing costs, however, involves a sequential analysis. A Court must first consider whether any policy considerations apply. If so, and absent exceptional circumstances, the parties’ reasonable costs are payable from the estate. If no policy considerations apply, however, then a Court is to exercise its discretion under s. 137 of the Courts of Justice Act RSO 1990, c. C.43 and Rule 57.01.

The Court also emphasised that the modern approach to fixing costs was designed to,

1. Indemnify successful litigants for the cost of litigation;
2. Encourage settlements; and
3. Discourage and sanction inappropriate behaviour by litigants

Applying that analytical framework to the case, the Court disagreed with the Plaintiff’s position that the litigation arose as a result of the deceased’s actions. While the deceased had himself signed the Secondary Will, a higher standard should not be placed upon him to identify, question and understand drafting errors contained in his testamentary instruments. It was the deceased’s drafting solicitor who had failed to read the secondary will sufficiently to correct the drafting errors. The Court went further to say that even if it were incorrect in its application of that analysis, it would decline to order the Plaintiff’s costs be recoverable from the estate because her conduct had been “less than laudable”. It noted that the Plaintiff was aware she did not have a close relationship with the deceased that would have justified the alleged $800,000 bequest, refused to proceed by way of application resulting in unnecessary costs being incurred, and made to offers to settle that were not earnest attempts at compromise.

Thanks for reading.

Aaron Chan