When a beneficiary initiated ‘considerable efforts’ to check up on the activities of the executor of a deceased woman’s estate, the decision to investigate the conduct of the executor (who had also had a power of attorney during the woman’s lifetime) was well founded, as substantial misappropriations relating to assets in Switzerland were discovered.
The administrator of the estate then sued the executor on behalf of the woman’s estate and, as a result, he agreed to renounce his executorship, relinquish all his interests in the estate and pay the sum of £3.5 million to the estate. The settlement was agreed by the administrator on behalf of the eight beneficiaries.
The costs at that point in the proceedings were already considerable. That might well have been that, except that one of the beneficiaries was deeply unhappy with the conduct of the administration of the estate and began a lengthy legal challenge against the administrator, leading eventually to legal costs of more than £1 million being incurred before matters were resolved.
Inevitably, a second dispute arose – who should bear the legal costs and in what proportions?
The High Court considered the beneficiary’s conduct to be unreasonable and ordered him to pay approximately 85 per cent of the legal costs of the administrator – a sum of some £900,000.
Commencing a claim against an administrator or executor of an estate can be an expensive business as, if the claim does not succeed, the court is likely to require the unsuccessful claimant to pay the legal costs of the defendant personal representative(s).