Ontario Superior Court clarifies public policy matters in awarding costs in estate litigation

The case involved a claim of $800,000 legacy from the decedent's estate

Ontario Superior Court clarifies public policy matters in awarding costs in estate litigation

The Ontario Superior Court of Justice has addressed the matter of public policy considerations in awarding costs following the dismissal of a claim seeking an $800,000 legacy from the decedent's estate.

In Kurt v. Kurt and Sullivan, 2024 ONSC 589, the plaintiff, Kelly Kurt, brought a motion for summary judgment, arguing that the legacy was outlined in her late father, Donald's, secondary will.

The court's decision involved an analysis of the costs sought by the parties involved. The plaintiff, seeking substantial indemnity costs of $96,973.90 or partial indemnity costs of $65,998.80, argued that the traditional approach to fixing costs in estate litigation, with the estate bearing the costs, should be followed. The plaintiff contended that since the litigation arose from the actions of the testator, Donald, it was appropriate for the estate to cover the costs.

On the other side, Donald's lawyer, Warren Griffin and his firm, Giesbrecht, Griffin, Funk & Irvine LLP, sought partial indemnity costs of $44,898.38 from the plaintiff. Griffin argued that, as the successful party in defending against the motion for summary judgment, costs should follow the event, and he should be awarded his partial indemnity costs. The estate and the Donald Kurt Foundation aligned with Griffin, asserting that normal civil cost rules should apply, and they sought partial indemnity costs of $29,547.23 from the plaintiff.

The Ontario Superior Court of Justice referred existing jurisprudence, including McDougald Estate v. Gooderham, 2005 CanLII 21091, which displaced the traditional approach to fixing costs in estate litigation. The court emphasized that the standard civil cost rules should be followed unless public policy considerations were at play. The public policy considerations cited included situations where litigation was necessary for the proper administration of the estate or where it arose due to the testator's actions.

In analyzing the case, the court disagreed with the plaintiff's assertion that public policy considerations were triggered, stating that the litigation did not arise solely from the testator's actions. The court also highlighted Griffin's responsibility for a drafting error in Donald's secondary will, leading to the litigation.

Considering the factors outlined in Rule 57.01(1) and (2), the court ruled that the plaintiff should bear her costs. The court declined to award him costs despite Griffin's success in defending the claim, citing his responsibility for the drafting error. The estate and the foundation were deemed not responsible for the litigation, and the court awarded their partial indemnity costs.

Ultimately, the court ordered that the plaintiff cover her costs, Griffin bears his costs, and the plaintiff pays the partial indemnity costs of the estate and the foundation.

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