A High Court judge has said the total legal costs of a dispute, which resulted in the judge finding that a deceased Kerry farmer had not left Kerry Group shares worth some €1m to a nephew, could be somewhere between €600,000 and €700,000.
Ms Justice Nuala Butler made orders with the effect the nephew, Thomas O’Connell, will have to pay most of the costs of the litigation.
Her costs judgment, published on Tuesday, arose from her previous finding that Mr O’Connell was not entitled to some €1m worth of Kerry Group shares forming part of his uncle’s assets. Those shares will instead be divided among the surviving siblings and extended family of the deceased.
Thomas O’Connell was gifted “Kerry Co-Operative shares” in a 1990 will of his uncle, John T Cronin, who died some 23 years later in 2013, aged in his 90s.
Thomas O’Connell, who inherited his uncle’s 38-acre farm at Ballahantouragh, remains entitled to the estimated €272,438 value of the Kerry Co-Op shares but the judge ruled last February he was not entitled to the Kerry Group shares, and those fell into the residue of the estate.
The proceedings concerning the 1990 will were brought under the Succession Act by Pádraig O’Connell, as executor of the deceased’s estate, against Thomas O’Connell, as principal beneficiary of the will, and Breda (Bridie) Murphy, a sister of the deceased, representing herself, three other surviving siblings entitled to share in the residue of the estate, and 30 persons, mainly nieces and nephews, entitled to varying shares.
The case ran for four days, followed by a further hearing on costs issues.
In her judgment on the “thorny issue” of costs, Ms Justice Butler said while the outcome of the case was, on its face, straightforward, it was complicated by the fact the costs of the litigation are “very significant”.
That was not intended as a criticism of the lawyers involved, she stressed, noting another potentially complex issue had been resolved between the sides, saving at least one additional hearing day.
“However, litigation costs in Ireland are particularly high,” she said.
In an April 2020 letter, Ms Murphy’s solicitor had estimated that €100,000 in legal costs had been incurred in the previous 12 months, including costs of an unsuccessful mediation.
Assuming the costs of all three parties were likely to be roughly similar, and assuming an equivalent, “but most likely a greater sum”, was then incurred by each party by going to trial, the total costs of the litigation may well be between €600,00 and €700,000, she said.
That “rough estimate” cannot predict what claims will be made or what costs sums might be allowed on adjudication “but it does serve to illustrate how significant the legal costs are likely to be”.
The judge ruled the fairest outcome was to award the executor his costs, to include all reserved costs, and of the costs application, from the estate. Half of those costs are to be met from the residue of the estate and half from the gift of Kerry Co-Op shares made to Thomas O’Connell.
She declined to make an order for costs in favour of Thomas O’Connell to be paid out of the estate for reasons including that would significantly reduce the residue sum available for distribution to all those whose interests had been successfully represented by Ms Murphy and not do justice between the parties.
In coming to that decision, she took into account Thomas O’Connell had been unsuccessful in the case; there was no issue as to the validity of Mr Cronin’s will and no evidence to suggest any bona fide concern about Mr Cronin’s capacity to make it.
In reality, the litigation concerned a dispute between beneficiaries as to who should benefit from property held by Mr Cronin which had significantly increased in value before Mr Cronin’s death, the judge said. Had Mr Cronin wishes to make an express gift of that property, he could have done so but, having chosen not to do so, the case that he had inferentially gifted the Kerry Group shares to Thomas O’Connell through the making of a different gift was “not particularly strong”.
Another factor was Ms Murphy was mindful from the outset of the potentially damaging effects of litigation on the estate and suggested mediation before taking any other step in the proceedings.
Ms Murphy, the judge ruled, was entitled to 90 per cent of her costs of the case, including reserved costs, and her costs of the costs application, against Thomas O’Connell, to be charged on the gift due to be made to him under the will.
