England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM CHANCERY DIVISION
BRISTOL DISTRICT REGISTRY
(HIS HONOUR JUDGE MCCAHILL QC)

		Royal Courts of Justice Strand, London, WC2A 2LL
		10th November 2011

Lord Justice Ward:

1. This is an application for permission to appeal the order made by HHJ McCahill QC, sitting as a judge of the High Court, at the conclusion of a contested probate action heard in the Bristol District Registry on 8 December 2010.
2. The matter came before the judge to resolve a preliminary issue as to the domicile of the deceased. The deceased was a Norwegian citizen who had lived much of her life in England. She made two wills, one in 1997 and one in 1998. In about 2000 she gave her 1997 will to her good friend, the applicant, Mrs Mason. No other instructions were given and I do not think Mrs Mason was even aware of the later will. The deceased died on or before the 31 August 2007, the circumstances of her death being unknown. She was found lying in the garden of her home. Inside the house there was the 1998 will, much of it defaced by crossings out of bequests and appointments. That led the Probate Registry to write to the respondent's solicitors, drawing their attention to a paragraph in Tristram and Coote's Probate Practice and saying this:

"In view of the deceased's connection with Norway you need to find out whether the alterations were made in that country or whether at the date of the Will or the date of her death the deceased was domicile in, habitually resident in or a national of Norway. If she was you will need to establish whether the alterations amount to a valid revocation or partial revocation of the Will under Norwegian law."

From what I can understand the respondents were content to proceed and may well have advised the Probate Registry that they were content to proceed on the basis that the deceased remained domiciled in England.

3. In the proceedings which followed it was the defendant, Mrs Mason, who alleged in her defence that:

"The deceased was a citizen of Norway and retained her domicile in this country [I think that should be 'that country']. She even remained on the Registry of Residence...in Norway. Norwegian law is therefore applicable as per Tristram & Coote..."

4. So that defence raised the issue of domicile. It did not simply rely on nationality. That is probably why Mr John Jarvis QC, sitting as a deputy judge, ordered that this issue be tried as a preliminary issue. In that preliminary issue the defendant lost. There followed a short discussion about costs. Counsel for the respondents submitted to the judge:

"My submission is that the defendant should be ordered to pay the costs of the claimant in this trial of the issue of domicile. First, probate litigation -- and this is part of a probate action -- is hostile litigation and the general rule is costs follow the event. Secondly, in my submission the contention in the context of this particular highly contentious probate litigation, the contention that the deceased was domiciled in Norway is in no way less contentious than the contention that she did not properly execute the will or executed it under undue influence. It is in every way as contentious an issue as either of those and in the case of either of those, if the issue was brought to trial and lost costs would indisputably follow the event."

5. The defendant's response was sadly limited on Mrs Mason's behalf. All that was said was this:

"As for costs, I do think it fair to remind you, your honour, and my learned colleague that we were ordered by the decision of Mr John Jarvis QC on 15 September this year to limit this trial which was set by him to occur today, yesterday and today, and, therefore, in the light of what we had come here for this purpose to clarify where we stand with regard to domicile as a preliminary issue. I do think it is fair to ask you to award the costs from the estate."

6. It is perhaps unfortunate -- I know not -- that there was not a fuller argument about costs before the judge. It is a shame that no challenge was made to the assertions of counsel for the claimants. The judge decided the case on this basis:

"This is a case in which the claimants held no doubt themselves about the domicile of the deceased, in that they swore the necessary affidavit to obtain probate asserting the fact that the deceased was domiciled in England and Wales.

They, therefore, did not ask the court to resolve the matter. Had they done so, by asking for directions, it might well have resulted in an order that the estate should bear all costs because everybody benefited from the resolution of that particular point. However, it seems to me that this was and is hostile litigation.

The point of domicile has been raised. It was open to the defendant to raise it or not raise it, but raise it she did. Accordingly, it has been necessary for the matter to be resolved. It was a contentious issue. It has remained contentious, as the skeleton arguments and submissions have demonstrated, but it seems to me to be one in which there was a clear winner and a clear loser against the background of adversarial litigation.

In my judgment, and in exercising my discretion, I conclude that the merits of the case require that the defendant should pay the claimant's costs."

7. No-one appears to have directed their attention to CPR 44.3 that, whereas the general rule is that the court may order the unsuccessful party to pay the costs, the court can make a different order and in the Court of Appeal the general rule did not necessarily apply to probate proceedings. That does not apply at first instance. What applies at first instance is what is left of the old probate practice. It is exemplified in cases such as Mitchell & Mitchell v Gard & Kingwell [1863] 3 Sw & Tr 275 or more recently in Spiers v English [1907] P 122 where the President, Sir Gorell Barnes said this at page 123:

"In deciding questions of costs one has to go back to the principles which govern cases of this kind. One of those principles is that if a person who makes a will or persons who are interested in the residue have been really the cause of the litigation a case is made out for costs to come out of the estate. Another principle is that, if the circumstances lead reasonably to an investigation of the matter, then the costs may be left to be borne by those who have incurred them."

8. That would be the principle relied on by the applicant. It has been called a little in question in modern times: see for example the observations of Henderson J in Kostic v Chaplin [2007] EWHC 2909 where he observed that:

"The trend in recent cases has been to narrow rather than extend the circumstances in which the old Chancery rule prevailed."

9. I have recited this at some length because, although I can see an argument for saying that the judge did not have the rule correctly described to him, costs are always a matter in the discretion of the court and it is always a hugely difficult task to overturn an order made in the exercise of discretion. The reasons given by Sir Mark Potter for refusing permission on paper exemplify that decision. I, however, understand the dilemma faced by Mrs Mason, her desire to carry out what she thought were her friend's intentions and I utterly accept her bona fides and genuineness in raising these issues in order that right be done by her deceased friend. Costs could have come out of the estate or costs could have been the subject of no order, but the judge was the one who had to decide it and although I could give permission it may be being cruel to be kind. What I am going to do therefore is adjourn this case. I will have a transcript of this judgment prepared as soon as I can and Mrs Mason can obtain a copy of this judgment and then take advice upon it and apply either to restore the application to me or alternatively to withdraw her application for permission to appeal, but I would ask that that be done by her urgently and that this matter come back before me early in the new year.

Order: Application adjourned to be restored to Ward LJ in January 2012