Long v Rodman & Ors

In a s.50 application concerning the replacement of a personal representative, costs are governed by the fact-specific discretion in Civil Procedure Rules 1998, rules 44.2 and 46.3. Success is assessed by reviewing each party’s case as a whole. A party does not necessarily succeed merely because the order sought is made, particularly where the party fails on the proposed replacement and succeeds only on a late alternative case.

A personal representative normally has an indemnity from the estate for properly incurred costs. The indemnity may be withheld where the personal representative acted unreasonably in bringing or defending the proceedings. In an application concerned with the interests of the estate and beneficiaries, conduct and the parties’ failure to adopt realistic positions may justify making no order for inter partes costs and depriving a fiduciary of an indemnity.

The judgment concerned costs following an earlier decision replacing David Long as administrator of Norman Rodman’s estate with Matthew Pintus. Long had opposed his replacement and had separately applied under CPR rule 64 for directions. Linda and Debra Rodman had applied under section 50 of the Administration of Justice Act 1985 to replace him, initially proposing that they should become administrators.

The court had rejected that proposed appointment but accepted the late alternative that Mr Pintus should replace Mr Long. The issues were the parties’ relative success, the effect of their conduct on any inter partes costs order, and whether Mr Long should receive an indemnity from the estate.

1. Part 64 application. A personal representative is ordinarily entitled to seek the court’s guidance and, in most cases, to an indemnity for doing so. The application was reasonable when made, notwithstanding agreement in principle on some matters, because of the parties’ substantial history of difficulty. No inter partes costs order was made, but Mr Long was entitled to an indemnity for the costs incurred up to the commencement of the section 50 application (para. [16]–[17]).
2. Section 50 application. The general principles in CPR rule 44.2 applied, but the application was not conventional inter partes litigation. The court was primarily concerned with the interests of the estate and beneficiaries. The fact that Mr Long was replaced did not make the Rodmans successful on their case, because their case had been that Linda and Debra should replace him, and that case failed. Mr Long was unsuccessful in resisting replacement, although he succeeded in showing that Linda and Debra were unsuitable (para. [18]–[20]).
3. The court rejected the suggestion that the late introduction of Mr Pintus as an alternative automatically justified an adverse costs order by analogy with Beoco Ltd v Alfa Laval Ltd and Magical Marking Ltd & Anor v Ware & Kay LLP & Anor. Those cases concerned different circumstances and ordinary inter partes litigation. The appropriate approach was a common-sense, fact-specific assessment of success and conduct (para. [23]).
4. Both sides had adopted unrealistic and inflexible positions. The Rodmans had developed their case late and conducted parts of it inappropriately. Mr Long had unreasonably defended the application to the end instead of proposing a professional replacement, despite his fiduciary position and the beneficiaries’ unanimous wishes. The just order was therefore no order for costs (para. [21]–[23]).
5. Under CPR rule 46.3 and Practice Direction 46, the starting point was Mr Long’s entitlement to an indemnity for properly incurred costs. His conduct was unreasonable in defending the section 50 application as he did. He was accordingly deprived of an indemnity in respect of those costs (para. [24]).

First-instance costs judgment following the court’s judgment of 29 March 2019. The citation of that earlier judgment is not stated in the judgment.