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Mediating Contested Wills Claims - Patrick Taylor

“Mediation is not just about one side getting what they want. That is a misconception...” HHJ Catherine Newman QC.

 

I am regularly appointed to mediate disputes about the validity of a will. Almost by definition they involve claims by family members against other family members.

The facts are always sad. A person has died and whatever else, his or her intentions certainly were not that there should be an almighty battle between his or her loved ones, swallowing up the bulk, if not the entirety, of the estate in legal fees. It happens all too frequently.

When mediating cases of this type, all too commonly at least one party assumes that, whatever the outcome, their costs will be paid out of the Estate. The consequence being that the challenging party, if this were correct, has a ‘risk free’ run at the claim. If successful he or she would recover an interest in the Estate and if not, would have the costs paid anyway (or would be covered by conditional fee arrangements). Executors, Personal Representatives and beneficiaries can easily be held to ransom.

In one mediation, I recall there were at least 5 parties represented including family members but also charities expecting to benefit from a bequest in the will. These were not national but local charities, desperately in need of resources. As usual, at the start of the mediation, I gathered in details of the legal fees each party had already incurred; and what they expected to spend up to the conclusion of trial. The proceedings were still some way from trial.  The sad reality was that if all parties expected the costs they had already incurred to be paid out of the Estate, there would be nothing left to fight over - even by the time the mediation was taking place!

It was with interest then that I read the judgment of Mrs Catherine Newman QC sitting as High Court Judge in the case of Christopher Burgess v Jennifer Penny and anr.[1] The Judgment is a welcome reminder of the circumstances in which the Court might depart from the general rule that costs follow the event and the special situations operating as exceptions to the general rule in probate cases.

The warring parties were siblings.  On one side, Mr Burgess (who it seems had already made himself financially secure) and, on the other, his two sisters, Mrs Penny and Mrs Kennard. The dispute arose as to the validity of a will in 2013.

There were three issues which the Court had to determine:

  • Issue 1 – was the 2013 will duly executed?
  • Issue 2 – did the Testator know of and approve the contents of her will?
  • Issue 3 – had the Testator effectively revoked her previous will?

The Claimant failed on the first point but succeeded on the second and third. The Judge stated that the starting point (following the general rule that costs follow the event) would be that the Defendants should pay half of the Claimant’s costs and the Claimant should pay half of the Defendants’ costs.

The Judge then set out exceptions to the general rule on costs in probate cases deriving from Spiers v English[2] and affirmed in Kostic v Chaplin[3]. I will not attempt to re-state the principles because they are set out in the judgment. The Judge listed various principles guiding her in exercising her discretion on costs. She posed the question:

“Would departing from the general rule encourage fruitless litigation spurred on by a belief that all of the costs will come out of the estate? The courts are increasingly alert to the dangers of encouraging litigation and discouraging settlement of doubtful claims if costs are allowed out of the estate to the unsuccessful party”.

The Judge decided that it was appropriate to depart from the general rule and the special situations. First, because “….High Court litigation to challenge a will, the provisions of which all possible beneficiaries profess to be happy with, is not obviously reasonable”. Second, because part of the case advanced by the Defendants was ‘at best a speculative claim‘ and ‘went further than [was] reasonable’.

Refusal to mediate

The Court also heard arguments about the (un)reasonableness of the Defendants’ “complete refusal” to mediate. The Defendants’ argued that their refusal to mediate was not unreasonable because they wanted the Claimant to admit that “…what he had done was wrong”.

Remember, the Defendants maintained that they were content with the division of their mother’s estate and so the financial outcome, ignoring costs, was somewhat academic. In this light the Judge questioned why such contentious litigation was necessary at all.

The Judge then demonstrated her insight into the mediation process. She said,

“…. mediation is not just about one side getting what they want. That is a misconception of the purpose of mediation. Mediation should be about attempting to reach a solution which both parties can live with as a better alternative to litigation. A trained mediator would have told the Defendants that in litigation they might well not get the admission they were seeking (and indeed they did not). Taking at face value their assertion that they were happy with an equal division of the estate, all parties could have focussed on who was to take the grant, and, since the discussion on the eve of Freda's funeral (referred to in detail in the judgment), it was apparent that the Claimant did not want to take the grant on his own if at all, I surmise that he would have been open to such a discussion”.

Unsurprisingly the Judge refused to award that the Defendants’ costs should be paid out of the net Estate. To do so the Judge said “…would be an encouragement to obduracy”.  The order made was that each party should pay their own costs.

I have no doubt, that solicitors acting in disputed will cases are doing their very best to prove their clients’ cases.  To echo the words of Catherine Newman, let’s hope that they advise their clients to mediate early and with an open mind, so they can reach a solution their clients can live with.  Maybe then the clients can start to build peace within their families.

Patrick Taylor

4-5 Mediation Group

4-5 Gray’s Inn Square

 

[1] [2019] EWHC 2034 (Ch).

[2] [1907] P 122

[3] [2007] EWHC 2909

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