Tuesday, May 06, 2008

Court Awards Successful Party Costs in Wills Variation Act Claim

In a Wills Variation Act lawsuit in British Columbia, the courts usually award the successful party court costs against the unsuccessful party. The costs don’t fully cover the successful party’s legal costs, but they can be substantial.

This general policy was reaffirmed in a Supreme Court of British Columbia decision released on April 29, 2008. The decision is Doucette v. Clarke, 2008 BCSC 506.

After a trial, reported at 2007 BCSC 1021, Mr. Justice Metzger varied the will of the late Mildred Lucy Doucette, in favour of two of her children, who were left very small portions of their mother’s estate in her will. The other two children, who were beneficiaries as well as the executors, had opposed the Wills Variation Act claim.

At trial, Mr. Justice Metzger also found that the executors held various assets that they claimed by right of survivorship as surviving joint tenants were held by them in trust for their mother’s estate. He also found that one of the other children held an account in trust for the estate.

On the issue of costs in respect of the Wills Variation Act claim, the two children who had opposed the Wills Variation Act claim sought to have their costs paid out of the estate. They sought their costs on the basis that they were acting to give voice to their mother. Mr. Justice Metzger rejected this argument. He held that as executors, the two defending children were required to remain neutral in the Wills Variation Act claim. In defending against the claim, the two children were protecting their interest as beneficiaries.

Mr. Justice Metzger ordered that the two defending children personally pay the plaintiff his costs. (Although the will was varied in favour of two children, only one of them had brought the Wills Variation Act claim.) The defending children argued that the lawsuit was caused by their mother in making a will that did not make adequate provision for their siblings. Accordingly, they argued, the estate should bear the costs, rather than the defending children personally.

In rejecting this argument, the court distinguished those cases in which the court may award costs to all parties because there was a question about whether the person who made the will had the necessary mental capacity or there was some ambiguity in the will, from a Wills Variation Act case. In capacity or interpretation cases, the courts often award costs to all parties on the theory that the lawsuit was caused by some fault of the testator or by other circumstances outside of the litigant’s control. But the policy of providing costs to all parties out of the estate does not apply to Wills Variation Act cases.

[Since I wrote this post, the British Columbia Court of Appeal has allowed an appeal of the trial judge's decision in Doucette v. McInnes on the substance of the claim. I have written a post on the Court of Appeal decision here. The Court of Appeal did not address the issue of costs. In my view the trial judge's analysis of the issue of costs discussed above is not affected by the Court of
Appeal decision.]

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