Supreme Court allows appeal on costs, ruling Rabbitte bears no liability due to conduct of the estate.
Legislator-Zusammenfassung
KI-generiertThe Supreme Court allowed the appeal regarding costs, substituting the High Court's orders to exempt Mr. Rabbitte from liability. The court found that Rabbitte's conduct, including non-disclosure and interference with estate assets, justified the Plaintiffs' prosecution but did not warrant him bearing any portion of the costs. Consequently, the estate is liable for the Plaintiffs' costs, while Rabbitte bears none.
Legislator-Regeste
KI-generiertProbate Act 1882; Administration of Estates Act 1962: Where a beneficiary's conduct necessitates proceedings against the estate but is not sufficiently egregious to justify their own liability, the estate bears the costs of the Plaintiffs while the beneficiary bears none.
Schlagwörter
KI-generiertZitierte Gesetzesbestimmungen
KI-generiertZitierte Rechtsprechung
KI-generiertVolltext
THE SUPREME COURT
[Appeal No. 100/2013]
O’Donnell J.
Clarke J.
Laffoy J.
BETWEEN
PAUL McCORMACK AND RINALDO PAOLOZZI
PLAINTIFFS/RESPONDENTS
AND
GINA DUFF (NEE SENEZIO) AND SILVIO RABBITTE
DEFENDANTS/APPELLANTS
Judgment of Ms. Justice Laffoy delivered on 23rd day of February, 2015
The appeal
1. This judgment relates to an appeal by the second named defendant/appellant (Mr. Rabbitte) against the judgment of the High
Court (Herbert J.) delivered on 8th June, 2012 ([2012] IEHC 285) and the order of the High Court (Herbert J.) made on 5th February,
2013. It is important to emphasise that the Court is not in this judgment concerned with any aspect of an appeal against the said
judgment and order initiated by the first named defendant/appellant (Mrs. Duff), who had died before this appeal was heard.
2. Although the notice of appeal filed on behalf of Mr. Rabbitte contained no less than forty seven grounds of appeal, many of which,
as was submitted on behalf of the plaintiffs/respondents (the Plaintiffs), are repetitious, on the hearing of the appeal what Mr.
Rabbitte seeks to achieve was narrowed down to the variation of two elements of the order of 5th February, 2013 and the issue of
the costs of the hearing in the High Court, which was at hearing for twenty five days between 18th October, 2011 and 15th
February, 2012 and was before the Court on several occasions thereafter.
3. In order to determine the issues which remain, it is necessary to consider the background to the decision of the High Court, the
case made in the High Court and the outcome in the High Court, as reflected in the judgment of the trial judge and in the order of 5th
February, 2013, in some detail.
4. The proceedings relate to the administration of the estate of Antonio Senezio (the Testator) who died on 13th February, 2007. The
Testator made two wills which are of relevance in the proceedings:
(a) a will dated 29th July, 2005 (the Irish 2005 Will), which was executed in, and in accordance with the law of, this
jurisdiction; and
(b) a will dated 29th September, 2006 (the Italian 2006 Will), which was executed in Italy.
5. A grant of probate of the Irish 2005 Will issued in this jurisdiction to the Plaintiffs, the surviving executors named in the Irish 2005
Will, on 10th June, 2008. The Plaintiffs then proceeded with the administration of the estate of the Testator, which they understood
to comprise solely of assets within this jurisdiction. They had filed an Inland Revenue Affidavit with the Revenue Commissioners which
disclosed assets of substantial value within this jurisdiction, to which a net value of in excess of €10m is ascribed in the grant of
probate.
6. In the Italian 2006 Will, having stated that he revoked and cancelled any other will that he might have made prior thereto, the
Testator devised property in Italy comprising of a building and lands at Via Casilina Sud in Cassino, which will be referred to as the
Casilina Sud Property, to his nephew, Mr. Rabbitte, on condition that he pay specified sums of money to named relatives of the
Testator, including the Testator’s sister, Mrs. Duff, and the Testator’s nephew, the second named Plaintiff. At the time of the
Testator’s death he was the owner of other property in Italy which was not specified in the Italian 2006 Will, both immovable property
in Cassino at Via Monte Maggio, which will be referred to as the Monte Maggio Property, and movable property, in general terms,
monies in bank accounts in Italy and shares in companies.
The case in the High Court
7. The proceedings were initiated by a plenary summons which issued on 18th February, 2010. In the endorsement of claim on the
plenary summons, apart from seeking damages, accounts and inquiries, interest and suchlike, the Plaintiffs sought twelve specific
forms of relief, the first of which was a declaratory order that the Testator was a citizen of Ireland and domiciled in Ireland at the
date of his death and that the movable estate of the Testator wheresoever situate outside Ireland at the time of his death devolved
under Part VIII of the Succession Act 1965 (the Act of 1965). Various reliefs were directed to ascertaining the Testator’s movable
and immovable property, whether located within or outside Ireland. Various orders were sought directing Mrs. Duff and Mr. Rabbitte to
make full disclosure of information which identified the Testator’s assets at the date of his death. Prohibitory injunctions were sought
against both defendants restraining them from intermeddling with the assets of the estate of the Testator wheresoever located and
restraining them from executing any document or agreement affecting movable or immovable assets wheresoever located until the
estate of the Testator had been administered in accordance with the laws of Ireland. Specific orders were sought against Mrs. Duff in
relation to specific movable assets of the Testator in Italy.
8. Immediately following the initiation of the proceedings, a motion was brought by the Plaintiffs for interlocutory relief. That motion
was ultimately the subject of a consent order made by the High Court (Murphy J.) on 7th May, 2010. In that order, the Court
declared by agreement of the parties that the Testator was a citizen of Ireland and was domiciled in Ireland on 13th February, 2007,
that is to say, at the date of his death. Certain orders were made by consent against both defendants: directing the disclosure of
information in relation to the assets of the Testator and the value of the assets; restraining the defendants from intermeddling with
the assets of the estate of the Testator wheresoever located; and restraining the defendants from executing any document or
agreement affecting movable or immovable assets wheresoever located pending the trial of the action. There was a consent order
that Mr. Rabbitte produce to the Plaintiffs documents within his possession which were described as purporting “to be a testamentary
disposition”. There was a consent order which facilitated the transfer of a sum of approximately €164,000 which was in a bank
account in a bank in Cassino to the credit of the proceedings. Finally, provision was made, with the co-operation of Mrs. Duff, for
payment into court of the sum of €159,700.45, being movable assets of the Testator at the time of his death, which she had
appropriated after his death.
9. That consent order was in place when the statement of claim was delivered on 3rd June, 2010. In the statement of claim
allegations of wrongdoing were made against both defendants: that they failed and neglected to furnish to the Plaintiffs all material
information, relevant documentation, valuations and suchlike; that they had intermeddled in the estate of the Testator; that they
failed and neglected to ensure that what was described as “personal property” of the Testator at the time of his death, which had
been outlined in a letter dated 13th February, 2010 to the first named Plaintiff from the Bank in Cassino, was delivered up to the
Plaintiffs so as to facilitate the proper and timely administration of the estate of the Testator; that they were continuing to
intermeddle in the assets of the Testator; and that until restrained they would continue to conduct themselves in the manner outlined
and until compelled to deliver up all of the assets and the material information. A specific allegation of wrongdoing made against Mr.
Rabbitte was that he had produced a document (obviously the Italian 2006 Will) purporting to be a will made by the Testator in Italy
which it was contended was not “a valid testamentary disposition”. It was further alleged that “salient matters”, which were material
to proceedings which had been initiated by Mr. Rabbitte against Mrs. Duff in Italy, had been concealed from the court in Cassino
dealing with the proceedings. A feature of the statement of claim was that, among the reliefs claimed, which reiterated the reliefs
claimed in the plenary summons, were order for inquiries as to –
(a) what the Testator’s immovable property situate outside Ireland consisted of at the time of his death, and
(b) who at the time of the death of the Testator were the persons entitled to the immovable property of the deceased
situate outside Ireland and in what shares and proportions for liability purposes pursuant to the Capital Acquisitions Tax
Consolidation Act 2003 and Part VIII of the Act of 1965.
10. A defence and counterclaim was delivered on behalf of Mrs. Duff on 30th June, 2010. The Italian 2006 Will was referred to in the
defence and it was pleaded that Mrs. Duff did not admit that the Italian 2006 Will was invalid or void in this jurisdiction or in Italy.
11. A defence and counterclaim was subsequently delivered by Mr. Rabbitte. In the defence, it was pleaded that the Irish 2005 Will
was not the last will and testament of the Testator, in that, it was contended, it was revoked in whole or in part by the Italian 2006
Will. Further, it was denied that the Italian 2006 Will was not a valid testamentary disposition and that, as the Plaintiffs had alleged, it
was invalid or void in this jurisdiction or in the Republic of Italy. In the counterclaim, Mr. Rabbitte sought:
(a) revocation in whole or in part of the grant of probate of the Irish 2005 Will which issued on 10th June, 2008;
(b) that the Court pronounce against the validity of the Irish 2005 Will or such parts thereof as were inconsistent with
the Italian 2006 Will; and
(c) that the Court admit the Italian 2006 Will to probate in solemn form.
In addition, Mr. Rabbitte denied all allegations of wrongdoing against him, in particular, that he had failed and neglected to furnish to
the Plaintiffs all material information, relevant documentation, valuations and suchlike, or that he had wrongfully interfered,
intermeddled, or continued to intermeddle with the assets of the Testator.
12. In their reply and defence to Mr. Rabbitte’s counterclaim the Plaintiffs joined issue with all of the matters pleaded on behalf of Mr.
Rabbitte. They reiterated that the Italian 2006 Will was not a valid will. In short, apart from consensus that the Testator was an Irish
citizen and was domiciled in Ireland at the date of his death, every allegation made by and against each of the parties remained in
issue when the pleadings closed.
Judgment of the High Court
13. In his judgment, the trial judge outlined the pleadings in considerable detail. He also set out the chronology of what he considered
to be the key events on the issues before him. Notwithstanding, as he recorded, that both Mrs. Duff and Mr. Rabbitte in their
respective defences had admitted that the Testator was a citizen of Ireland and was domiciled and was ordinarily resident in Ireland
at the date of his death, the trial judge in his judgment stated (p. 28) that he was fully satisfied on the evidence and he found that
the Testator was domiciled in Ireland at the date of the execution of the Italian 2006 Will and at the death of his death. Following
that finding he went on to state:
“I cannot erase or disregard what is stated by the deceased in his Italian will. In particular I cannot ignore that part of
the text of the will in parenthesis which is stated to have been taken down by the Notary as declared to him,
commencing with the words, ‘I revoke and cancel any other will that I might have made prior to this’. There is a very
heavy burden on the plaintiff executors and indeed the second defendant insofar as towards the end of the trial Senior
Counsel on his behalf informed me that the second defendant was no longer contending that the Irish will of the
[Testator] had been revoked by his Italian will, to show that this revocation clause did not revoke all previous
testamentary dispositions. They must satisfy me that there is sufficient evidence that the [Testator] did not intend to
revoke the Irish will made prior to the Italian will.”
14. The reference in that passage to the fact that towards the end of the trial the High Court was informed that Mr. Rabbitte was
not pursuing the substance of his counterclaim and was not seeking to have the grant of probate of the Irish 2005 Will revoked and
the succeeding observations of the trial judge are significant. On the appeal, counsel for the Plaintiffs emphasised that Mr. Rabbitte
did not withdraw his counterclaim until the twentieth day of the trial of the action. Further, it was submitted on behalf of the
Plaintiffs that the evidence at the trial established that there was no true intention by Mr. Rabbitte to maintain the counterclaim as
pleaded and that the claim for the revocation of the grant of probate of the Irish 2005 Will was deployed as a bargaining tool.
However, the observations of the trial judge as to what he considered to be the onus on the Plaintiffs was in reality ignored in the
Plaintiffs’ submissions.
15. In any event, the trial judge went on to find on the evidence that the Testator did not intend that Clause 9 of the Irish 2005 Will,
which was in effect the residuary clause, would apply to movable or immovable assets outside the State (p. 30). Although not of
particular relevance for present purposes, the property which passed under Clause 9 was the subject of very complex discretionary
trust provisions in the succeeding clauses of the Will (Clauses 10 to 54 inclusive). Further, he went on to find that the Testator
intended the general revocation clause in the Italian 2006 Will to be limited to revocation of prior wills made by him in Italy. He also
found as a fact that the Testator made no disposition in the Italian 2006 Will of the Monte Maggio Property or of movable assets in
Italy, e.g. money in the bank in Cassino (p. 32). The trial judge summarised the consequences of those findings as follows (p. 34):
“The movable estate of the [Testator] in Italy at the date of his death . . ., which included the funds now lodged to the
credit of this action and, any other movable assets of the [Testator] wherever located outside Ireland, will devolve
according to the Intestacy Laws of Ireland. The two real estate properties . . . at Cassino will devolve in accordance with
the Laws of the Republic of Italy. I am satisfied that the [Testator] by his Italian will intended to deal only with the real
estate property at Via Casilina Sud, . . ..”
On the foregoing basis the trial judge refused all of the reliefs sought by Mr. Rabbitte in his counterclaim.
16. Later in the judgment (p. 42 et seq.) the trial judge referred to a line of correspondence commencing with a letter of 19th May,
2009 in which the Revenue Commissioners informed the Plaintiffs that the estate of the Testator was under investigation and that,
consequently, no dispersal of assets in the estate was to take place without prior notice to the Acquisitions Tax Unit of the Revenue
Commissioners. The requirements of the Revenue Commissioners were then set out in the judgment, followed by an outline of the
subsequent interaction between the Plaintiffs, on the one hand, and each of the defendants and their respective legal advisers, on
the other hand, as regards those requirements. Referring to a proposed family agreement in relation to the Testator’s Italian assets
which had been put to family members, including the second named Plaintiff, as a nephew of the Testator and a person named in the
Italian 2006 Will, by a lawyer apparently acting for Mr. Rabbitte, who was, inter alia, a practising solicitor in this jurisdiction, which
proposed agreement was to be the subject of discussion at a meeting in Dublin on 19th February, 2010, the trial judge stated (p. 53):
“. . . this proposed family agreement would in Irish law constitute a serious and unlawful intermeddling in the estate of the
[Testator]. In Irish law the real estate property of the [Testator] at Via Casilina Sud Cassino, may not be transferred to
the person or persons entitled, until the tax liabilities of the [Testator] in Ireland have been ascertained and paid. The
[Plaintiffs] are personally liable in this regard.”
It was the fact of the second named Plaintiff becoming aware of that proposed agreement which triggered the initiation of these
proceedings by the Plaintiffs.
17. Later, reference was made by the trial judge to the order of the High Court of 7th May, 2010, which was made by consent of the
parties, the terms of which were fully outlined (pp. 62/63). It was recorded that the bank in Cassino paid into court the sum of
approximately €164,000 to the credit of this action pursuant to that order and that the sum of €159,700.45 was also paid into court
to the credit of the action pursuant to that order.
18. The trial judge found that from 2nd March 2009, when the first Plaintiff first wrote to both defendants indicating that it was
necessary to file a corrective affidavit with the Revenue Commissioners disclosing all offshore assets held by the Testator in his own
name or in partnership or through nominees, the defendants were, or one or other of them was, aware, either personally or through
their lawyers in Cassino, of facts which were then set out (pp. 65 to 74), some of which related to Mrs. Duff and some to Mr.
Rabbitte. As an aside, while, on the hearing of the appeal, counsel for Mr. Rabbitte emphasised that the immovable property initially
was not part of the estate of the Testator which was subject to Irish law, I understood him to accept that it was material to the
Revenue Commissioners’ inquiries.
19. The trial judge set out his finding as to disclosure in relation to the various matters he had outlined as follows (p. 74):
“. . . I am satisfied and, I so find, that the defendants did not make full or proper disclosure to the plaintiffs of all material
information known to them and their respective servants and agents, such as would assist the plaintiffs in identifying the
nature, location, ownership and value of the assets of the [Testator] in the Republic of Italy or elsewhere outside
Ireland.”
He also went on to find (p. 75) that, contrary to what was asserted by both defendants at the hearing of the action, they –
“. . . did not cooperate fully with plaintiffs who, I find, were acting properly and reasonably in due course of administration
in seeking to identify, gather and secure the assets of the [Testator] held outside Ireland . . ..”
In particular, the trial judge rejected the claim made on behalf of Mr. Rabbitte by his former solicitors in their letter to the first named
Plaintiff dated 6th May, 2010 that the proceedings were unnecessary as far as he was concerned and that he should not have been
joined in the action as he had co-operated at all times with the Plaintiffs. The trial judge went on to state that the Plaintiffs “were
fully justified in prosecuting to a full hearing” before the High Court their claim against both defendants for information regarding the
assets of the Testator. He recorded that, however, as a result of the oral and documentary evidence furnished at the hearing of the
action, the Plaintiffs did not consider it necessary to seek further orders of disclosure against the defendants or either of them (p.
76).
20. The trial judge then went on to find (p. 76) on the evidence that the defendants and each of them had wrongly intermeddled in
the assets of the estate of the Testator in the Republic of Italy, both by their actions there and in Ireland. As regards Mr. Rabbitte,
he referred to the fact that he had taken proceedings against Mrs. Duff in the civil court of Cassino claiming title as devisee under the
Italian 2006 Will to the Casilina Sud Property and claiming a share together with other alleged “heirs” of the Testator in the Monte
Maggio Property and movable assets of the Testator in the bank at Cassino at the date of the Testator’s death. The trial judge
commented that, while understandable having regard to the behaviour of Mrs. Duff, the action of Mr. Rabbitte nonetheless amounted
to intermeddling in the estate of the Testator. However, the trial judge went on to state:
“This intermeddling on the part of the second defendant has not caused loss or damage to the estate.”
The trial judge rejected explanations which had been advanced on behalf of the defendants and, in relation to whether legal advice
obtained from lawyers in Cassino could explain the actions of Mr. Rabbitte, he stated that it could not excuse intermeddling in the
assets of the estate of the Testator. Further, he stated (p. 77) that he was quite satisfied on the evidence that neither defendant
ever intended to disclose to the Plaintiffs, as executors of the Irish 2005 Will, or to the Revenue Commissioners, the existence of any
of the assets of the Testator in the Republic of Italy.
21. The trial judge went on to find that, despite repeated warnings given to them by the first Plaintiff in the course of
correspondence which commenced on 2nd March, 2009, the defendants continued to intermeddle in the assets of the Testator up to
19th February, 2010, the day after these proceedings were initiated.
22. The trial judge then reached the following conclusion (p. 78):
“In the circumstances, the only proper inference to be drawn from the evidence is that the defendants and each of them
would continue to intermeddle in the assets of the estate of the [Testator] unless restrained by order of this Court. I will
therefore order that the defendants and each of them, their servants and agents, be restrained from intermeddling in any
manner whatsoever in the assets of the estate of the [Testator] wheresoever located both within and outside Ireland. I
will order that they also be restrained from executing by themselves, their servants or agents or by anyone on their behalf
any document or agreement affecting the immovable or movable assets of the estate of the [Testator] wherever located
both within and outside Ireland without further order of this Court.”
23. The remainder of the judgment (pp. 78 to 93) addresses the allegations against Mrs. Duff solely and her counterclaim. It is not
necessary to outline the findings made by the trial judge on those matters. However, it is appropriate to record that he noted that he
had witnessed “the high degree of suspicion and hostility existing between the first defendant and the second defendant during the
hearing” of the action and, on that basis, he accepted the evidence of Mr. Rabbitte as to why he did not reply to a letter of 12th
June, 2007 from her asking if he was dealing with the estate of the Testator in Italy. This is consistent with the observations of the
trial judge quoted earlier to the effect that it was understandable, having regard to the behaviour of Mrs. Duff, that Mr. Rabbitte took
proceedings against her in the civil court of Cassino. The trial judge dismissed the counterclaim of Mrs. Duff, which was a claim for
damages for negligence and breach of duty against the second named Plaintiff.
24. Before reaching the conclusion recorded earlier (at para. 15) as to how the movable and immovable assets of the Testator
located in Italy should devolve in accordance with law, the trial judge referred to evidence given by Mr. Rabbitte, stating (p. 33):
“The second defendant gave evidence that the [Testator] wished to keep his Italian affairs and his Irish affairs
segregated and entirely separate. The second defendant stated in evidence that he well recalled his late uncle in Cassino
in September 2006, using the phrase ‘Italy for the Italian, Ireland for the Irish’.”
The trial judge stated that that evidence was corroborated, referring to a number of factual matters. First, there was clear evidence
that neither the Testator’s solicitors nor his accountants in Ireland were ever made aware that he had assets in the Republic of Italy
or elsewhere. His Italian lawyer did not know about the Irish 2005 Will until two years and ten months after the Testator’s death.
Secondly, he also recorded the evidence of Mr. Rabbitte, which he implicitly accepted, that he did not know that the Testator had
made a will in Ireland until after his death. The trial judge continued:
“I am satisfied from the entirety of the evidence that this aphorism of the [Testator] has informed every act and omission
of the second defendant with respect to the Italian assets of his late uncle [the Testator] from September, 2006 to the
date of this judgment.”
Thirdly, the trial judge went on to refer to the evidence of the first Plaintiff, the Testator’s Irish solicitor, to whom the Testator had
given a sealed envelope to be opened only after his death. The list of assets, which the first named Plaintiff perused after the death
of the Testator, did not contain any item of offshore property, either movable or immovable. The trial judge stated that he was
satisfied that the proper inference to be drawn from that and the other evidence is that, but for a procedural direction given by the
judge in the civil court of Cassino which caused the Italian proceedings by Mr. Rabbitte against Mrs. Duff to be served in this
jurisdiction through the office of the Chief State Solicitor on “other named heirs” of the Testator resident in this jurisdiction, –
“. . . no one in Ireland but some members of the Senezio Family would ever have become aware nor, in my judgment, was
it ever intended by the [Testator] that they should become aware of his Italian will or of its provisions and vice versa as
regards his Irish will.”
Order of the High Court dated 5th February, 2013
25. Reflecting the finding in the judgment referred to at para. 15 above, the order of the High Court dated 5th February, 2013
contained a declaration in the following terms:
“The Court doth declare that the [Testator] was a citizen of Ireland and domiciled and ordinarily resident in Ireland on the
13th day of February, 2007 and that his moveable (sic) estate wheresoever situate outside Ireland at the time of his
death devolved inter alia under Part VIII of the Succession Act 1965.”
26. The following orders were then made against both Mrs. Duff and Mr. Rabbitte, namely, that –
(i) “the Defendants and each of them are restrained from intermeddling in the assets of the estate of the [Testator]
wheresoever located both inside and outside Ireland” and
(ii) “the Defendants and each of them are restrained from executing (whether by themselves their servants or agents or
anyone on their behalf) any document or agreement affecting the immovable or moveable (sic) assets of the estate of
the [Testator] wherever located both within and outside Ireland without further Order of this Honourable Court.”
Counsel for Mr. Rabbitte, while acknowledging that those orders reflect what the trial judge stated in the judgment, as quoted at
para. 22 above, submitted that both limbs of the order are incorrect, being inconsistent with the finding made earlier by the trial judge
(referred at para. 15 above) that the two real estate properties of the Testator situated in Italy “devolve in accordance with the
Laws of the Republic of Italy”, thus recognising that the High Court had no jurisdiction in relation to the devolution of those
properties.
27. Having made orders which affected Mrs. Duff solely, it was ordered that the counterclaim of Mrs. Duff be dismissed. It was then
ordered that the counterclaim of Mr. Rabbitte be dismissed.
28. The elements of the order of the High Court in relation to costs are unusually complex, in that it was ordered as follows:
(a) that the costs of the Plaintiffs both as to the claim and the counterclaim (presumably meaning counterclaims) “be
taxed as between party and party and also as between solicitor and own client”, it being expressly provided that the
costs included reserved costs and certain pre-action costs incurred between 2nd March, 2009 and 18th February, 2010;
(b) that Mrs. Duff pay to the Plaintiffs “an apportioned two thirds” and that Mr. Rabbitte pay to the Plaintiffs “an
apportioned one third” of “the whole of the said costs taxed as between party and party”;
(c) that the Plaintiffs be at liberty to retain and pay out of the assets of the Testator in priority to all and any other
claims, debts and liabilities of and against the Testator “so much of the said party and party costs as they shall not
recover and actually receive from the Defendants” and also “what shall be certified by the Taxing Master to be the
difference between the said costs as taxed between party and party and between solicitor and client”;
(d) that -
(i) each of the Defendants do have “costs taxed between party and party out of the assets of the [T]estator of so
much of the action as was solely and exclusively concerned with the claims of domicile and revocation”,
(ii) “such costs be assessed upon the basis that three full hearing days were taken up with these claims”,
(iii) “the Taxing Master set-off these costs and the apportioned party and party costs directed to be paid by [Mrs.
Duff and Mr. Rabbitte]”,
(iv) “the Taxing Master do certify to which of them the balance after such set-off is due”,
(v) “such balance be paid by the party from whom to the party to whom the same shall be certified to be due”,
(vi) “if the said balance be due to the Defendants or either of them the said [balance] be paid as hereinbefore
ordered out of the said assets of the [T]estator in due course and order of administration”.
29. While the foregoing provisions of the order are extremely complicated, from the perspective of the Plaintiffs, on the one hand, and
Mr. Rabbitte, on the other hand, the overall default position is that the Plaintiffs are to get their costs on a solicitor and client basis
paid out of the estate of the Testator, to the extent that they are not paid by Mrs. Duff and Mr. Rabbitte. Mr. Rabbitte’s liability is for
one third of the whole of the costs of the Plaintiffs taxed on a party and party basis, subject to set-off against that sum of Mr.
Rabbitte’s costs taxed on a party and party basis of three full hearing days ascribed “solely and exclusively” to “the claims of domicile
and revocation”.
30. In summary, the inter partes provision for costs in the order envisages the estate of the Testator being liable to each of Mrs. Duff
and Mr. Rabbitte for three days’ costs on a party and party basis and the balance being borne by Mrs. Duff and Mr. Rabbitte in the
proportions of two thirds and one third respectively. Given that it is difficult to relate the number of days the matter was before the
Court, as recorded in the order and the transcripts furnished to the Court, and given the inclusion in the costs of reserved costs and
pre-action costs, I consider that it would be unwise to attempt to convert Mr. Rabbitte’s share of the balance to be borne by him into
hearing days.
Rectification of error in order
31. On the hearing of the appeal, counsel for Mr. Rabbitte made it clear that he was asking the Court to amend the errors in the order
of the High Court outlined at para. 26 above. I am satisfied that what are obvious errors in the order must be rectified so that –
(a) para. (i) is amended by the deletion of the words “both inside and outside Ireland” and the following words are
substituted therefor:
“. . . other than immovable assets situate outside Ireland;” and
(b) para. (ii) is amended by the deletion of the words “both within and outside Ireland” and the substitution therefor of
the following words:
“other than immovable assets situate outside Ireland . . ..”
On the hearing of the appeal, counsel for the Plaintiffs did not object to the foregoing amendments being made.
Appeal
32. The Plaintiffs have brought no cross-appeal in relation to any aspect of the order of the High Court and, in particular, they have
not challenged the award of party and party costs to Mr. Rabbitte on the basis of three full hearing days.
33. As has been stated at the outset, the grounds of appeal in the notice of appeal are many and repetitious. However, apart from
the necessary amendment to the order, which has been addressed in paras. 26 and 31 above, in reality, the only matter which was
pursued on the hearing of the appeal related to the costs for which Mr. Rabbitte is liable under the order. In a nutshell, the position
adopted by Mr. Rabbitte’s counsel was that he should not be liable to the Plaintiffs for any costs and he should be allowed the costs
incurred by him in relation to the proceedings out of the estate of the Testator.
34. Before considering the issue of costs, it is worth pausing at this juncture to consider the overall effect of the outcome of the
Plaintiffs’ claim against Mr. Rabbitte and Mr. Rabbitte’s counterclaim against the Plaintiffs.
35. The Plaintiffs succeeded on their claim to the extent that it was declared that the destination of the movable estate of the
Testator wheresoever situate outside this jurisdiction falls to be determined in accordance with Irish law. However, that was subject
to the finding of the trial judge that movable assets located outside Ireland (including the money lodged in court) would devolve in
accordance with the law on intestacy in this jurisdiction, not under the provisions of the Irish 2005 Will. Further, as regards the
immovable property in Italy, the Casilina Sud Property and the Monte Maggio Property, it was held that those properties “will devolve
in accordance with the Laws of the Republic of Italy”. That meant that the immovable property outside Ireland was identified and that
those entitled to it were to be determined in accordance with Italian law, which resolved the difficulty the Plaintiffs had sought to
resolve by seeking the inquiry orders they had claimed and in addressing the inquiries of the Revenue Commissioners.
36. In the light of the amendments to the order of the High Court made earlier to reflect that the prohibitory injunctions restraining,
inter alia, Mr. Rabbitte from intermeddling with assets of the estate of the Testator and entering into any document or agreement
affecting assets of the estate of the Testator do not extend to immovable property situate outside the State, the Plaintiffs were not
wholly successful in obtaining the reliefs they sought against Mr. Rabbitte, although the prohibitory injunctions do continue to extend
to movable property situate outside this jurisdiction. On the other hand, the Plaintiffs were wholly successful in obtaining the dismissal
of Mr. Rabbitte’s counterclaim, which had effectively sought to wholly obliterate the status of the Irish 2005 Will as the last will and
testament of the Testator in relation to, inter alia, his assets in this jurisdiction, albeit that Mr. Rabbitte’s abandonment of the
counterclaim was indicated to the trial judge on the twentieth day of the trial.
The law/discussion
37. Counsel for Mr. Rabbitte predictably relied on two decisions of this Court, the oldest being In bonis Morelli; Vella v. Morelli [1968]
I.R. 11, and the more recent decision being Elliott v. Stamp [2008] 3 I.R. 387. Although forty years elapsed between the two
decisions, the decision in the Morelli case was applied in Elliott v. Stamp. Both actions were actions which are variously commonly
referred to as probate actions or will suits.
38. In Elliott v. Stamp the plaintiff had raised issues as to whether the will in issue in the proceedings –
(a) was executed in accordance with the provisions of the Act of 1965;
(b) made by the testator who was of sound disposing mind; and
(c) had been procured by duress or undue influence of the defendants or either of them.
In the event, the plaintiff withdrew the claim in relation to testamentary capacity and proceeded on the claim of undue influence
only. The plaintiff was unsuccessful in the High Court, there being a finding that the testator had been of sound mind and that there
was no undue influence or duress on the part of the defendants. The plaintiff was awarded one third of her costs in the High Court
payable out of the estate of the deceased. She appealed that decision to this Court and the appeal was allowed. Following the
decision in the Morelli case, Kearns J., with whom the other judges of this Court concurred, concluded that the plaintiff was entitled
to her full costs from the estate. He quoted the passage from the judgment of Budd J. in the Morelli case (pp. 34 to 35), which
explained the rationale underlying the practice which had developed in Ireland of awarding costs out of the estate to a litigant who
challenged the validity of a will and who was unsuccessful, provided two questions were answered in the affirmative, namely: whether
there was reasonable ground for the litigation; and whether it was conducted bona fide. Kearns J. stated (p. 395) that a special
jurisprudence in relation to costs was developed in this jurisdiction in relation to probate actions for the reasons expressed by Budd J.
in the Morelli case and that the departure from that jurisprudence requires a “reasoned basis” in a will suit.
39. While, in this case, the Plaintiffs had already obtained a grant of probate of the Irish 2005 Will, the counterclaim brought by Mr.
Rabbitte claiming, inter alia, revocation of the grant of probate rendered the proceedings analogous to a probate action. It is of
significance that in the passage from the judgment of the trial judge quoted at para. 13 above, he regarded the issue raised by Mr.
Rabbitte, albeit abandoned by him “towards the end of the trial”, as being an issue he had to determine, which imposed a probative
burden on the Plaintiffs, notwithstanding that Mr. Rabbitte was not pursuing the point. The part of the order in relation to costs
expressly links the costs awarded to Mrs. Duff and Mr. Rabbitte to “the claims of” not only domicile, but also revocation.
40. Unfortunately, apart from that linkage, in this case there is no express exposition of the reasoning underlying the manner in which
the trial judge dealt with the issue of costs. Reading the order of 5th February, 2013, what appears to have happened was that,
having delivered judgment on 8th June, 2012, the proceedings were adjourned from time to time and eventually on 11th December,
2012, the trial judge made the substantive declaration quoted at para. 25 above and the orders against Mrs. Duff and Mr. Rabbitte
outlined at para. 26 above and also the orders against Mrs. Duff referred to at para. 27 above. Subsequently, on 5th February, 2013,
the trial judge heard submissions from the three parties (Mrs. Duff being represented by an individual acting under a power of
attorney) and then made the orders for costs outlined at para. 28 above. However, this Court has no record of either the submissions
made on behalf of the parties or of any reasons given by the trial judge for the basis on which he determined liability for costs. Aside
from the linkage to the issues of domicile and revocation referred to earlier, it is reasonable to infer that the approach adopted by the
trial judge as regards Mr. Rabbitte’s liability for costs was informed by the findings he made in relation to intermeddling and lack of co-
operation by Mr. Rabbitte, which were reflected in the orders he made against Mr. Rabbitte.
41. Indeed, the Plaintiffs’ counsel’s primary response to the position adopted on behalf of Mr. Rabbitte was that his reliance on the
decision in the Morelli case was misconceived and that these proceedings were primarily concerned with intermeddling with the
Testator’s estate and lack of co-operation with his personal representatives in identifying the assets of the estate. An alternative
proposition put forward was that, even if the decision in the Morelli case is applicable, Mr. Rabbitte did not meet the requirement that
the litigation was conducted bona fide. In this connection, counsel for the Plaintiffs emphasised its criticisms of the manner in which
Mr. Rabbitte conducted the proceedings which have been outlined earlier (at para. 14). In short, the Plaintiffs’ position is that Mr.
Rabitte’s counterclaim was not pursued bona fide and that there was no justification for either initiating his counterclaim or
perpetuating it until the twentieth day of the trial.
42. Counsel for Mr. Rabbitte advanced two further legal arguments in support of the contention that the order of the High Court
should be set aside.
43. First, it was submitted on behalf of Mr. Rabbitte that the trial judge erred in characterising the proposal for a family agreement in
February 2010, which has been referred to earlier and which triggered these proceedings, as “intermeddling”. Counsel referred to the
common law concept of an “executor de son tort” and to s. 23 of the Act of 1965, which it was submitted supersedes and replaces
the common law concept. Section 23(1) provides as follows:
“If any person, to the defrauding of creditors or without full valuable consideration, obtains, receives or holds any part of
the estate of a deceased person or effects the release of any debt or liability due to the estate of the deceased, he shall
be charged as executor in his own wrong to the extent of the estate received or coming to his hands, or the debt or
liability released, after deducting –
(a) any debt for valuable consideration and without fraud due to him from the deceased person at the time of his
death; and
(b) any payment made by him which might properly be made by a personal representative.”
The argument advanced on behalf of Mr. Rabbitte was that the only intermeddling which the law now recognises is that as set out in
s. 23, so that, before he is liable, the intermeddler has to obtain, receive or hold part of the estate of the deceased person. Further,
it was submitted, a proposal to deal with the assets of a deceased person which is not implemented cannot be deemed to be
intermeddling. On that basis, as the proposal for a family agreement made in February 2010, which triggered the proceedings, was not
implemented and, indeed, could not be implemented without the participation of the second named Plaintiff, there was no justification
for finding that Mr. Rabbitte would continue to intermeddle in the absence of a permanent injunction restraining him.
44. Section 23 is a provision designed to impose liability on a person who fraudulently or wrongfully obtains or retains the estate of a
deceased person, which liability is treated as liability as an executor de son tort, the person not having title to obtain a grant of
probate or administration of the deceased’s estate. However, the fact that an intermeddler with the estate of a deceased person,
which in common parlance means a person interfering in what is none of his business, has not reached a stage where he is liable to be
charged as an executor in his own wrong under s. 23, does not mean that it is not open to the personal representative of the
deceased, who legally stands in the shoes of the deceased, to invoke the equitable jurisdiction of the Court to restrain such wrongful
intermeddling or interference. The reliance on s. 23 on behalf of Mr. Rabbitte, in my view, is entirely misconceived.
45. Secondly, counsel for Mr. Rabbitte referred the Court to the commentary in Williams, Mortimer and Sunnucks on Executors,
Administrators and Probate (being the 20th Ed. of Williams on Executors and the 8th Ed. of Mortimer on Probate) on the exercise of
the Court’s discretion in relation to costs of a probate action where the litigation has been caused by the conduct of the testator. At
para. 39.04 the editors state:
“Where the state of the testator’s testamentary papers, the habits and mode of life or (doubtfully) where the testator’s
own statements have brought about the litigation, costs of unsuccessful parties may be ordered out of the estate. The
touchstone is whether it was the testator’s own conduct that led to his will ‘being surrounded with confusion or
uncertainty in law or fact’. As a result, a residuary legatee who succeeds in proving the existence of a will may under this
exception end up paying the unsuccessful side’s costs.
Thus, where owing to the confusion in which the testator left his papers it was doubtful whether the deceased intended entirely to
revoke an earlier will, . . . the Court ordered the costs of both parties to be paid out of the estate.”
It was contended on behalf of Mr. Rabbitte that these proceedings are the product of the failure by the Testator to properly and
adequately arrange his affairs prior to his death and, accordingly, Mr. Rabbitte’s costs should be borne by the Testator’s estate.
46. Finally, the role of this Court as to findings of fact made by the trial judge as laid down by this Court in Hay v. O’Grady [1992] 1
I.R. 210 underpinned the Plaintiffs’ responses to the arguments advanced on behalf of Mr. Rabbitte. It was submitted that findings of
fact made by the trial judge were supported by credible evidence and that this Court is bound by them. It was further submitted that
he drew very few inferences. Despite a very thorough analysis at the hearing of the appeal by counsel for Mr. Rabbitte of the
observations and findings made by the trial judge in his judgment (pp. 67 to 74), I am not satisfied that it has been demonstrated on
behalf of Mr. Rabbitte that any of the findings made or inference drawn by the trial judge as to his conduct, which obviously informed
the trial judge’s decision in relation to costs, were erroneous.
Decision on costs
47. The decision to be made on costs has two limbs: first, whether this Court should set aside the order made by the trial judge in
relation to Mr. Rabbitte’s liability for and entitlement to costs; and, secondly, if so, whether this Court should accede to Mr. Rabbitte’s
application that the costs he incurred in the proceedings be paid out of the assets of the estate of the Testator, or, if not, what
provision should be made in respect of Mr. Rabbitte’s costs. It is not possible to quantify the effect of the order made by the trial
judge and, as has been observed earlier, it would be unwise even to attempt to express it in terms of hearing days. Notwithstanding
that, for present purposes, I think it is reasonable to assume that Mr. Rabbitte would probably be liable for in excess of 25% of the
costs of the proceedings taxed on a party and party basis, if the trial judge’s order were to stand.
48. The proceedings embodied claims by the Plaintiffs, who had already obtained a grant of probate of the Irish 2005 Will, as personal
representatives of the Testator seeking equitable and other relief against Mrs. Duff and Mr. Rabbitte to enable them to fulfil their
obligations as personal representatives in accordance with law. That the proceedings also embodied a will suit element arose from the
counterclaim by Mr. Rabbitte, which sought to revoke the grant of probate of the Irish 2005 Will, but that element was eventually
abandoned by Mr. Rabbitte, although not until the hearing of the proceedings had run for twenty days. While the conduct of the
Testator may have contributed to the uncertainty as to the effect of the revocation clause in the Italian 2006 Will, resolving that
uncertainty and determining the effect of the revocation clause on the Irish 2005 Will should not have necessitated a hearing that
would last for twenty days.
49. I have come to the conclusion that, having regard to the various findings made by the trial judge as to the conduct of Mr.
Rabbitte and the outcome of the proceedings, this is not a case in which the estate of the Testator should bear Mr. Rabbitte’s costs
of the proceedings or any part of those costs. Those findings, which have been recorded earlier in this judgment at para. 18 et seq.,
relate to the knowledge which Mr. Rabbitte had at the material time in relation to assets of the Testator of which the Plaintiffs, as
personal representatives of the Testator, were unaware, his failure to make disclosure of material information in relation to those
assets to the Plaintiffs, his failure to co-operate with the Plaintiffs in the performance of their obligation to identify and get in the
assets of the estate of the Testator, and, significantly, his intermeddling and interference with the assets of the estate of the
Testator. That conduct of Mr. Rabbitte as so found necessitated the prosecution of these proceedings, the costs of which will be
borne by the beneficiaries of the estate of the Testator, whether under the 2005 Irish Will or on intestacy. There could be no
justification for imposing on those beneficiaries any liability for Mr. Rabbitte’s costs of the proceedings.
50. On the other hand, taking an overview of the matter, including the factors set out in the two preceding paragraphs, I am not
satisfied that the conduct of Mr. Rabbitte as so found was such as to justify the imposition on him of liability for roughly 25% of the
costs of the proceedings, or indeed any part of the costs of the proceedings. Therefore, I have come to the conclusion that Mr.
Rabbitte should not be liable for any costs.
51. Accordingly, I would allow the appeal to the extent that there be substituted for the orders for costs made in favour of and
against Mr. Rabbitte orders that –
(a) Mr. Rabbitte is not entitled to have any of the costs of the proceedings incurred by him paid out of the assets of the
estate of the Testator, and
(b) Mr. Rabbitte is not liable for any of the costs incurred by the Plaintiffs in relation to the proceedings.
For the avoidance of doubt, to the extent that they are not otherwise covered, the Plaintiffs are clearly entitled to have their costs
of the proceedings discharged on a solicitor and client basis out of the assets of the estate of the Testator.