High Court: Solicitor entitled to his costs of defending application to remove him as executor of will

About this case:

• Citation:
  [2021] IEHC 645
• Judgment:
  External link
• Court:
  High Court
• Judge:
  Mr Justice Mark Sanfey

On the issue of costs, the court held that the administration of the estate had largely been completed by the time the plaintiff’s proceedings issued and that, therefore, the proceedings were not an appropriately brought. While the plaintiff may have wished for the executor to move more quickly, this did not justify the application, the court said.

Background

The deceased died in December 2015 and had executed a will in October 2009. In the will, the deceased appointed the defendant as his executor. The defendant was an experienced solicitor with a busy practice in Dublin.

The main beneficiary of the will was the plaintiff, who had been the deceased’s carer for years prior to his death. The plaintiff was entitled to the residue of the estate after all liabilities had been paid out. The grant of probate recorded the gross value of the estate as approximately €1.8 million.

Three years after the death, the estate had not been administered. The plaintiff grew impatient and engaged a firm of solicitors to correspond with the defendant in March 2019. In response, the defendant claimed to have undertaken action in respect of the estate. This included dealing with issues regarding members of the deceased’s family and properly organising the affairs/statements of the deceased. A firm of accountants was engaged to deal with tax liabilities.

Subsequently, after the affairs had been brought in order, a grant of probate issued in February 2018. At that point, the assets of the estate had been gathered in and certain properties were sale-agreed, though no sale ultimately proceeded. Various distributions had been made to the plaintiff which amount to €865,025.58. This included a sum of €380,000 paid to the plaintiff’s solicitors in February 2019.

The plaintiff was not satisfied with the response and in May 2019, demanded for the defendant to “hand carriage of the Estate to [the plaintiff’s solicitors] while you remain as executor in name”. When this was not done, the plaintiff issued proceedings seeking the removal of the defendant as executor.

It was claimed that the defendant was failing to administer the estate and that his actions were preventing the realisation of the estate’s assets. The defendant argued that complex issues had arisen in the administration and that he had always been working on selling the assets. As such, it was said that the proceedings were “grossly premature”.

The proceedings were listed for hearing in November 2020, but the administration was nearly complete at that point. By June 2021, the administration was finished and the only outstanding issue was costs. The plaintiff applied for costs order to be made against the defendant personally, meaning that the defendant had no right of indemnity from the estate. This was vigorously opposed by the defendant.

High Court

The court began by considering the plaintiff’s submission that the ordinary rule of costs in the administration of estates did not apply, because the matter was a hostile lis inter partes (O’Connor v. Markey [2007] 2 IR 194). The court agreed with this position, noting that the main submissions of the defendant were directed at the facts of the case rather than the applicable law.

The court also considered Dunne v. Heffernan [1997] 3 IR 431, where it was held that the removal of an executor was not justified based on the frustrations of a beneficiary. Rather, the removal of an executor would only be justified as a result of serious misconduct or special circumstances.

The court noted that the plaintiff claimed that the proceedings were necessary in order to force the defendant to address his mind to the administration. It was also noted that the deceased chose the defendant as his executor and appeared to be of the view that a solicitor was a better person to manage the estate than a friend or relative.

The inference was that the deceased knew the solicitor was in a busy practice and that he would not address his sole attention to the estate. As such, it would have been known to the deceased that the estate may have taken longer to administer. However, it was also fair to assume that the deceased would not have wanted any undue delay in the administration.

The approach taken by the plaintiff was also relevant to the decision on costs. It was noted that a distribution account compiled by the defendant in October, 2019 shows that €870,000 had been discharged by the defendant. Further, a complaint to the Law Society from March 2019 about the defendant’s conduct was not pursued. The court held that the plaintiff was “decidedly aggressive” in the proceedings.

Finally, the court applied Dunne v. Heffernan and considered whether the proceedings were justified. The court said that there was no expert evidence before the court which might have assisted it in determining whether there was delay in the case. There was also no evidence of loss as contended by the plaintiff.

The court accepted that the administration took longer than the plaintiff would have liked and that the defendant may have acted more expeditiously at certain points. However, it was true that many beneficiaries were left waiting in probate cases. The court commented that the plaintiff could have advanced the complaint with the Law Society, which ordinarily causes solicitors to act with greater expedition.

In all the circumstances, it was held that the proceedings were not justified in order to expedite the administration which had largely been completed at the time of issue.

Conclusion

In light of these findings, the court said that the defendant was entitled to his costs of the proceedings and the costs of the administration.