Contested Will - Who Pays?
A recent case, involving the family of a man who died and left his entire fortune to the Conservative Party, illustrates one of the main exceptions which can apply, in cases involving wills, to the normal rule that ‘the loser pays the costs’ of a legal action – both their own and those of the winner. This is called ‘costs following the event’ in legal terminology. It means that the party in whose favour the issue is decided normally has his or her costs met by the unsuccessful party. The principle behind this rule is that the winner in a contested claim should not be worse off because of having to use legal proceedings to demonstrate the rightness of their argument.
There are, however, exceptions to this principle. In the case of contested wills, there are two exceptions. The first is when the cause of the litigation was the behaviour of the person who drew up the will. An example of this might be where the will was inconsistent with itself or unclear as to its meaning. In this case, the costs of the legal proceedings will normally be borne out of the estate. The second exception is when the circumstances are such that it is reasonable for an investigation to be made of the circumstances surrounding the will. In this case, the costs of the proceedings will generally be shared between all the parties to the action.
In the case in point, the man left £8 million to the Conservative Party and the will was contested by his family on the basis that he was not ‘of sound mind’ when he made it – in legal parlance, he lacked ‘testamentary capacity’. Evidence was presented to the court that the man was delusional to the extent that a challenge to his last will was more or less inevitable in any circumstances. The court ruled the will invalid. The question of how the legal costs should be borne was then raised.
The court ruled that it was proper in the circumstances for the Conservative Party to investigate the issue of the man’s testamentary capacity once the will had been challenged. Their costs to that point should therefore be met out of the estate. In this case, both sides had appointed experts to examine the issue of testamentary capacity. Their reports were exchanged, as is normal practice. The court ruled that it was appropriate for the costs to be shared up to the point at which the reports of the experts were exchanged.
There are, however, exceptions to this principle. In the case of contested wills, there are two exceptions. The first is when the cause of the litigation was the behaviour of the person who drew up the will. An example of this might be where the will was inconsistent with itself or unclear as to its meaning. In this case, the costs of the legal proceedings will normally be borne out of the estate. The second exception is when the circumstances are such that it is reasonable for an investigation to be made of the circumstances surrounding the will. In this case, the costs of the proceedings will generally be shared between all the parties to the action.
In the case in point, the man left £8 million to the Conservative Party and the will was contested by his family on the basis that he was not ‘of sound mind’ when he made it – in legal parlance, he lacked ‘testamentary capacity’. Evidence was presented to the court that the man was delusional to the extent that a challenge to his last will was more or less inevitable in any circumstances. The court ruled the will invalid. The question of how the legal costs should be borne was then raised.
The court ruled that it was proper in the circumstances for the Conservative Party to investigate the issue of the man’s testamentary capacity once the will had been challenged. Their costs to that point should therefore be met out of the estate. In this case, both sides had appointed experts to examine the issue of testamentary capacity. Their reports were exchanged, as is normal practice. The court ruled that it was appropriate for the costs to be shared up to the point at which the reports of the experts were exchanged.
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Adrian
Bennett
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This case is important because it shows that the courts will be sympathetic as regards costs when the circumstances meet the exceptions to the ‘loser pays costs’ rule. Many families are wary of challenging wills which have been created when the testator lacked mental capacity, because they fear the costs of losing. However, when the circumstances justify it, the costs of the challenge may be borne, in whole or in part, by the estate.
The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.
