Costs in Will Construction Suits After the Legal Services Regulation Act 2015: “Lis Inter Partes” Beneficiary Disputes, Segmented Orders, and Charging Costs to the Losing Beneficiaries’ Gifts

1. Introduction

Murphy v Butler [ORSE Murphy] and Ors [No. 3] (Approved) [2026] IEHC 421 is a costs judgment of the High Court (Egan J.) following two earlier rulings in a will construction suit concerning a modest estate. The substantive dispute was between:

  • the plaintiff (a beneficiary claiming the entirety of the deceased’s farmlands under a devise described as “my…lands at Belalaw (sic), Myshall in the County of Carlow”); and
  • residuary beneficiaries (the “Roberts defendants”), contending that only lands in the townland of Bealalaw passed under the devise, with other lands falling into residue to be divided among nine residuary legatees (some non-participating).

The litigation proceeded in two phases:

  • Module 1 (1 February 2024): the Court found an ambiguity on the face of the will and held that extrinsic evidence could be admitted under section 90 of the Succession Act 1965.
  • Module 2 (14 November 2025): the Court admitted and relied on evidence from the drafting solicitor (Mr Clarke) and a contemporaneous memorandum, resolving the ambiguity in favour of the plaintiff’s construction (all lands in the folio passed under the devise).

This third judgment addresses how costs should be allocated under sections 168–169 of the Legal Services Regulation Act 2015 (“the 2015 Act”) and Order 99, where a will construction dispute is, in substance, adversarial litigation between beneficiaries, and where some defendants withdrew after Module 1.

2. Summary of the Judgment

Egan J. applied the statutory “costs follow the event” framework to probate-related civil proceedings, guided by O'Connell v. O'Connell [2023] IEHC 215, and made a segmented set of orders:

2.1 Executrix’s costs

  • Module 1: executrix awarded costs out of the estate, split 50% from the plaintiff’s gift and 50% from residue.
  • Module 2: executrix awarded costs against the remaining participating residuary defendants, charged on their gifts, with any shortfall payable personally by them on a joint and several basis.

2.2 Plaintiff’s costs

  • Module 1 (up to 29 January 2025): no order as to the plaintiff’s costs.
  • Module 2: plaintiff awarded costs against the remaining participating residuary defendants, charged on their gifts, with any shortfall payable personally by them on a joint and several basis.

2.3 Withdrawing residuary defendants’ costs

  • Module 1: withdrawing defendants to bear their own costs.

2.4 Remaining residuary defendants’ costs

  • Module 1: no order as between them and the plaintiff.
  • Module 2: they bear adverse costs as above (plaintiff + executrix), reflecting unreasonable continuation after Module 1 and after disclosure of the drafting solicitor’s memorandum, and failure to accept a Calderbank offer.

3. Analysis

3.1 Precedents cited and their influence

(a) O'Connell v. O'Connell [2023] IEHC 215

This decision is the central modern Irish authority shaping the Court’s approach. Egan J. treated it as establishing that probate/administration/construction proceedings are “civil proceedings” for the purposes of the 2015 Act, so that costs are determined primarily by sections 168–169, not by older “probate rules” as if they were automatic.

Two points from O'Connell v. O'Connell drive the outcome here:

  • Vella-style estate-indemnity is not a default in construction suits: where validity is not in issue and the dispute is between rival beneficiaries, public policy rationales for routinely paying all parties from the estate are weaker.
  • Reasonableness can change over time: it may be reasonable to commence or defend, but unreasonable to persist after information emerges showing the case cannot succeed; that concept was used here to distinguish Module 1 from Module 2.

(b) Vella v. Morelli [1968] IR 11 and Elliott v. Stamp [2008] 3 IR 387

These authorities represent the older approach often summarised as: where litigation is a proper investigation and conducted bona fide, costs may come from the estate. Egan J. accepted their continuing relevance only as part of the “nature and circumstances” context, but (following O'Connell v. O'Connell) rejected them as creating an automatic rule for construction suits. The judgment emphasises that where the contest is truly adversarial between beneficiaries—i.e., a lis inter partes—the statutory default that the successful party is entitled to costs is not displaced merely because the case concerns a will.

(c) Buckton v. Buckton [1907] 2 CH 406 and O'Connor v. Markey [2007] 2 IR 194

The residuary defendants relied heavily on Buckton v. Buckton and its categories (trustee guidance cases; beneficiary applications necessary for administration; and hostile beneficiary disputes). Egan J. held that (i) post-2015, categorical “rules” are not determinative, and (ii) in any event this case falls within the third Buckton category: a hostile contest between beneficiaries.

In reaching that conclusion, the judgment cites Herbert J.’s description in O'Connor v. Markey [2007] 2 IR 194 of a “hostile lis inter partes between two beneficiaries under the will,” treating that characterisation as apt where the litigation is effectively about who inherits what, rather than how an executor should safely administer the estate.

(d) Shannon v. Shannon [2019] IEHC 604

The residuary defendants relied on this as a rare modern costs decision in a construction suit, noting that no order as to costs was made there. Egan J. treated it as distinguishable: the earlier decision did not require extrinsic evidence, whereas here ambiguity was found and s.90 evidence admitted. The Court’s ultimate reasoning, however, did not turn on that distinction alone; rather, it turned on the post-Module 1 reasonableness of persisting to Module 2 given the disclosed extrinsic evidence.

(e) Costs framework cases under the 2015 Act

Egan J. summarised and applied the statutory methodology informed by: Chubb European Group SE v. Health Insurance Authority [2022] 2 IR 734, Higgins v. Irish Aviation Authority [2020] IECA 277;[2022] IESC 45, Word Prefect Translation Services v. Minister for Public Expenditure [2023] IECA 189, ESB v. Good [2025] IESC 40, Náisiúnta Leictreach Contraitheoir Eireann v. The Labour Court [2020] IEHC 342, and Ryanair v. An Taoiseach [2020] IEHC 673.

Their influence is visible in:

  • the “entirely successful” starting point (s.169(1));
  • a pragmatic “events/issues” lens (from Higgins and Náisiúnta Leictreach Contraitheoir Eireann v. The Labour Court); and
  • the use of the statutory power to make time- and party-specific orders (s.168(2)).

3.2 Legal reasoning

(a) The statutory starting point: “entirely successful” and the burden shift

The Court framed the analysis squarely within s.169(1): an entirely successful party “is entitled” to costs unless the Court orders otherwise. It rejected the attempt to dilute “success” by arguing that in Module 1 both sides lost their “unambiguous will” arguments. The key “event” at Module 1 was whether extrinsic evidence could be admitted; the plaintiff succeeded on that. In any event, the plaintiff was plainly entirely successful at Module 2 and on the overall outcome (who takes the lands).

(b) “Nature and circumstances” does not displace s.169(1) in a beneficiary fight

The residuary defendants argued that construction suits are inherently for the estate’s benefit and should therefore be treated like administration litigation where costs come from the estate. Egan J. accepted that pre-2015 jurisprudence can inform what is “just,” but (following O'Connell v. O'Connell) held that:

  • there is no special costs exemption for construction suits;
  • s.168(1)(b) merely confers a discretion to order costs out of the estate; it does not mandate it; and
  • the dispute here was, in substance, adversarial between rival beneficiaries (a “lis inter partes”).

(c) Conduct and reasonableness: the pivot between Module 1 and Module 2

The Court made a careful temporal distinction:

  • Up to Module 1: it was a “narrow judgment call,” but not unreasonable for the residuary defendants to litigate to the point where ambiguity was judicially confirmed. That assessment drove the “no order” positions and the decision not to impose Module 1 adverse costs on them.
  • After Module 1 (Module 2): continuation became unreasonable. The remaining participating residuary defendants had received (months before trial) the drafting solicitor’s memorandum and knew the evidence proposed. Persisting, attempting to re-open admissibility, and running a case the Court had found speculative and implausible engaged s.169(1)(a)–(c).

The Court also treated a Calderbank (“without prejudice save as to costs”) offer as materially relevant under s.169(1)(f). Given the plaintiff’s ultimate success, the offer was “undoubtedly fair,” and failure to accept it counted against the remaining participating defendants on costs.

(d) The executrix as sui generis—and yet not fully insulated from segmentation

Consistent with O'Connell v. O'Connell, Egan J. treated the executrix as neither “successful” nor “unsuccessful,” emphasising policy reasons for indemnifying a neutral personal representative who must progress administration. That said, the Court still segmented:

  • Module 1: paid from the estate, but split between the plaintiff’s gift and residue (an explicit attempt at fairness given the ambiguity and the modest estate).
  • Module 2: shifted away from the estate and onto the remaining participating residuary defendants because their post-Module 1 conduct made it unjust to socialise those costs across innocent beneficiaries or the successful devisee.

(e) Charging costs against the losing beneficiaries’ gifts and personal liability for shortfall

A notable practical feature is the mechanism: Module 2 costs were ordered against the remaining participating residuary defendants, charged on their gifts, with any shortfall payable personally on a joint and several basis. This reflects a clear policy choice:

  • protect the estate (and non-participating residuary legatees) from depletion caused by adversarial, unreasonable continuation; and
  • ensure the costs order is not illusory where the charged benefit may be insufficient.

3.3 Impact

  • Reinforcement of O'Connell v. O'Connell in practice: the judgment operationalises the post-2015 Act approach by refusing to treat “construction suit” as a near-automatic gateway to estate-funded costs.
  • Clear warning for beneficiary-driven litigation: where the dispute is essentially “who gets what,” beneficiaries who persist after disclosure that undermines their case face a real risk of personal adverse costs.
  • Greater prominence for Calderbank strategy in probate disputes: the Court expressly links settlement incentives to protecting modest estates from destructive costs.
  • Encouragement of targeted cost orders: segmentation by module, date, and party demonstrates the practical utility of s.168(2) in multi-stage probate litigation.
  • Protection of non-participating beneficiaries: the judgment gives weight to the fairness of not eroding the entitlements of residuary legatees who chose not to litigate.

4. Complex concepts simplified

  • Construction suit: court proceedings to interpret what a will means (as distinct from challenging whether it is valid).
  • Section 90 Succession Act 1965 (extrinsic evidence): where a will’s wording is ambiguous, the court may admit evidence outside the document (e.g., the drafting solicitor’s evidence) to resolve the ambiguity.
  • “Lis inter partes”: a truly adversarial contest between parties with opposing interests; in this context, rival beneficiaries fighting over entitlement.
  • “Costs follow the event” (s.169(1) 2015 Act): the winning party is presumptively entitled to recover costs from the losing party unless the court identifies a reason to depart.
  • Segmented costs orders (s.168(2)): the court can award costs only for particular steps, or up to/from a specified date, or allocate costs differently across parties—useful where conduct changes over time or parties withdraw.
  • Calderbank offer: a “without prejudice save as to costs” settlement offer that cannot be used to decide the merits, but can be shown to the court on costs to argue that a party acted unreasonably in refusing it.
  • Charged on a gift / joint and several shortfall: costs are first taken from the losing beneficiary’s inheritance; if that is insufficient, the beneficiary must pay personally, and each is liable for the full shortfall as between creditor and debtors.

5. Conclusion

Murphy v Butler [ORSE Murphy] and Ors [No. 3] [2026] IEHC 421 confirms that, after the 2015 Act and in line with O'Connell v. O'Connell [2023] IEHC 215, will construction suits are not cost-exception cases by default. Where the dispute is a beneficiary “lis inter partes,” the statutory presumption that costs follow success applies robustly—especially where parties unreasonably persist after receiving compelling disclosure and after declining a fair Calderbank offer. The judgment is also a strong example of the modern Irish approach to segmented, conduct-sensitive costs orders, including the practical step of charging costs to the losing beneficiaries’ gifts with joint-and-several personal liability for any shortfall.