Waters v Frank; Frank v Waters [2025] NSWSC 1389 concerned a contested Will. It involved Dr Percy Waters (the deceased), a highly vulnerable and elderly man. His dependence on his carer, Lavinia Williment (the second defendant), intensified in the later years of his life. Over time, successive wills increasingly benefited the carer. This occurred at the expense of his daughters. These changes prompted close judicial scrutiny of the circumstances in which those documents were made.
The Court examined three key issues.
First, it assessed whether the deceased had the necessary testamentary capacity.
Next, it considered if the surrounding circumstances were sufficiently suspicious to demand clear proof of knowledge and approval.
Finally, it looked into whether his free will had been overborne by undue influence.
Probate in common form was granted to Mr Andrew Frank (the first defendant) on 30 April 2021. This was in respect of the deceased’s will dated 5 August 2019. One of the deceased’s daughters, Laura (the plaintiff), sought to have that grant revoked. The plaintiff also seeks a grant of probate of an earlier will dated 3 June 2009.
Kevin Emanuel (the third defendant) filed an amended cross-claim seeking probate of the 5 August 2019 Will.
Costs
Rahman v Rahman (No 2) [2025] NSWCA 266 involves the proper approach to costs orders. It focuses on costs assessment as a gross sum. The case also addresses situations where parties to the litigation are lawyers. These lawyers are employed by the firm acting in the proceedings.
The appeal questioned if the second and third respondents recover costs. These were costs for the work done by the solicitors’ firm representing them. These respondents worked for the firm. This situation raised broader questions about the recovery of costs. Specifically, it questioned where lawyers are effectively acting for themselves, albeit through their employer. It also questioned how traditional principles governing solicitors’ costs apply in such representative arrangements.
The Court examined the method and justification for awarding costs on a gross-sum basis. This was chosen rather than through a conventional taxation process. The Court emphasised the need for transparency, proportionality, and evidentiary support. These elements are essential in determining the appropriate quantum.
Overall, the decision provides essential guidance on:
Courts need to decide how to assess and justify gross sum costs orders. Establishing the limits of cost recovery when lawyers are parties to proceedings and connected to the acting firm. There is also the ongoing importance of established principles that govern self-represented or quasi-self-represented legal practitioners.
Rahman v Rahman (No 2) is significant for practitioners. It clarifies the boundaries of recoverable costs in complex professional litigation. It also reinforces judicial scrutiny of major, lump-sum costs awards.
In Nobarani v Mariconte [No 2] [2018] HCA 49, the High Court of Australia held a key decision. It stated that an executor, like a trustee, is ordinarily entitled to have costs properly incurred. These costs, which are reasonably necessary for administering an estate, are paid out of the estate. This includes the costs of litigation. This applies even if the executor acts in good faith but is ultimately unsuccessful. For example, an executor reasonably believes in the validity of a Will. Defending proceedings brought by beneficiaries or seek to uphold a grant of probate on appeal.
In Nobarani v Mariconte [No 2][2018] HCA 49, the respondent, as executrix, properly obtained probate in solemn form. She reasonably resisted both the appeal to the Court of Appeal and the appeal to the High Court. The grant of probate was later set aside due to a denial of procedural fairness to the appellant. Yet, there was no suggestion that the respondent’s conduct was anything other than reasonable and proper.
The appellant objected on two grounds.
First, the respondent was also the sole beneficiary under the 2013 will.
Second, the respondent had not disclosed that the estate had been distributed to her (between the trial and the appeal).
The Court rejected both objections. The respondent’s dual role as executrix and beneficiary did not undermine the propriety of her conduct. Distributing the estate while an appeal was pending was done at the respondents risk although not improper. Nor did the solicitors’ failure to mention this distribution justify a personal costs order against them. The Court ordered that the costs of the trial be paid out of the estate. The costs of both appeals will also be paid on a trustee basis.
The Supreme Court of New South Wales in Frank v Waters [2025] NSWSC 1389 examines these dangers. Highlighting the risks arising when an elderly and vulnerable testator becomes heavily reliant on a paid carer. This carer then becomes a prominent figure in the testator’s estate planning. Frank v Waters illustrates how diminished testamentary capacity, suspicious circumstances, and undue influence can combine to invalidate a Will.
Waters v Frank; Frank v Waters [2025] NSWSC 1389
The deceased died in September 2020 at the age of 101. His 2009 Will divided the residue of his estate equally between his two daughters, Laura (the plaintiff) and Victoria. From 2011 onward, though, each new will showed increased favour towards his paid carer, Ms Lavinia Williment (the Second Defendant). Receiving more in each successive iteration than she had in the last, her entitlement grew with each iteration. By the final Will executed in 2019 (2019 Will), the Second Defendant received the largest share of the estate. The Court admitted the 2019 Will to probate in 2021. Yet, the plaintiff later commenced proceedings challenging its validity. The plaintiff also challenged all Wills made after 2009.
Justice Elkaim focused on three central issues. First, did Dr Waters have the requisite testamentary capacity when making the later wills? He was of extreme age and declining health. Secondly, was the growing advantage to the carer a suspicious circumstance? This would need clear proof that Dr Waters understood and approved the contents of the wills. Thirdly, did anyone exercise undue influence? Was his free will overborne by dependency, pressure, or control because he relied on his carer?
His Honour closely examined evidence on the deceased’s mental state and his vulnerability. The role of the second defendant in preparing and executing the later Wills was also scrutinised. Elkaim AJ concluded that some of the later Wills lacked testamentary capacity. Others were the product of undue influence. The decision underscores the strict scrutiny courts apply to situations involving an elderly and dependent testator. It especially does so when a person in a position of trust or care receives a significant advantage. It reinforces the protective role of succession law. Guarding against the exploitation of vulnerable testators. Ensuring that a will reflects genuine, independent testamentary intention.
The Court accepted that some criticism of the first defendant was justified. This criticism was particularly due to his failure to recognise the clear warning signs. These signs were created by the second defendant’s presence at the execution of the post-2009 wills. The first defendant also overlooked matters that ultimately supported the finding of undue influence. Yet, the Court emphasised that this criticism should not be taken as suggesting any impropriety. The first defendant was not “shonky” or dishonest, a point expressly acknowledged by counsel for the plaintiff. Rather, the Court considered that less weight should be given to his affidavit and oral evidence. This was due to his serious ill health. His condition affected the reliability of his memory. It also impaired his capacity to give coherent evidence. He was suffering from advanced cancer and had recently sustained a concussion, which caused confusion and impaired recall.
Justice Elkaim further noted that his evidence was limited. He was not properly cross-examined. Submissions his close friendship with the deceased prevented him from recognising the influence exerted by the second defendant. Importantly, the first defendant had no personal interest in the estate. In those circumstances, the Court decided. The general rule by the High Court in Nobarani v Mariconte (No 2) was applicable. As with trustees, an executor is entitled to have costs reasonably and properly incurred in administering an estate. These costs can be paid out of the estate itself, including litigation costs. This extends to situations where an executor acts in good faith but is unsuccessful.
Examples include defending a Will, resisting beneficiary claims, or seeking to uphold a grant of probate on appeal. Overall, the first defendant’s conduct was open to criticism in hindsight. Nonetheless, it was not improper, dishonest, or self-interested. His actions fell within the scope of reasonable execution of his duties as executor.
Justice Elkaim was needed to decide:
- Did the deceased have testamentary capacity when executing the post-2009 Wills?
- Were there suspicious circumstances attending those Wills?
- Did the Second Defendant exert undue influence on the testator?
- And, if the later Wills fail, which earlier Will should be admitted to probate?
Evidence and Findings
Medical evidence revealed that the deceased had suffered a significant brain injury in 2006. Later developed cognitive impairment consistent with mild dementia. Elkaim AJ applied established legal criteria for testamentary capacity. He considered whether the deceased understood the nature and effect of his Wills. Expert psychiatric opinion indicated the deceased lacked this understanding from 2011 onward. This aligns with legal standards for capacity assessment.
Particular concern attached to the role of the Second Defendant. The Court found that her involvement in accessing the deceased’s finances met the legal thresholds for ‘suspicious circumstances.’ Her participation in significant transactions indicated ‘undue influence,’ as defined by estate law. This requires more than mere influence but a coercive environment that undermines testamentary capacity.
Undue Influence
Justice Elkaim emphasised that undue influence involves coercion. This coercion can override the testator’s free will. His Honour underscored the importance of thorough scrutiny in estate cases. This scrutiny is necessary to uphold justice and protect vulnerable individuals. By revoking the 2019 Will and confirming the 2009 Will, Elkaim AJ’s decision reinforces the integrity of estate law. It assures legal professionals of the robustness of judicial review in complex cases.
Decision
Justice Elkaim delivered its substantive judgment on 28 November 2025 in Waters v Frank; Frank v Waters [2025] NSWSC 1389. Yet, it deferred making any orders as to costs. At [221], Elkaim AJ expressed a provisional view. Stating that the costs of the plaintiff should be paid out of the estate. The first and third defendants’ costs should also come from the estate. There should be no costs order about the second defendant but that this was not a final determination. Inviting the parties to file written submissions on costs.
Justice Elkaim’s decision to reserve costs and specify indemnity basis payments shows the Court’s commitment to fair cost allocation. This reinforces confidence in procedural fairness for legal Practitioners and parties alike. Written submissions were later received from all parties except the second defendant. Those parties sought to leave from the Court’s preliminary position on how costs should be dealt with.
The plaintiff’s primary demand for orders requests that the first defendant pay the plaintiff’s costs of the proceedings. The second defendant must also pay these costs. They must do so severally on the ordinary basis.
Order that the first Defendant pay the third Defendant’s costs on the ordinary basis.
If the plaintiff and third defendants’ costs are not recoverable, the orders in paragraphs 1 and 2 are the reason. In that case, they should be paid from the estate.
If the plaintiff’s and third defendants’ costs are not recoverable, orders 1 and 2 will explain why. In this case, the estate should pay costs on an indemnity basis.
Order that the personal time of the first and third defendant charged through their legal practices is not recoverable.
The plaintiff has provided written submissions. Providing an affidavit from her solicitor, Ms Christine Vrahas. This affidavit is dated 12 December 2025.
Costs – Written Submissions
The parties have provided written submissions, all except for the second defendant. They are seeking a variation of Elkaim AJ’s preliminary view. The costs of the plaintiff should be paid out of the estate. The costs of the first defendant should also be covered by the estate. Additionally, the estate should cover the costs of the third defendant. There should be no order as to costs in respect of the second defendant.
The first Defendant seeks payment of his costs out of the estate on an indemnity basis.
The second Defendant has endorsed the Court’s preliminary view. She should pay her own costs. There should be no costs order against her.
The third Defendant seeks the same order as that sought by the first Defendant. Elkaim AJ started with the third Defendant, given that their position is clear. On 8 November 2024, Lindsay J made the following orders:
“1 ORDER that the first Defendant be excused from further conduct of the proceedings, save as to costs.
2 ORDER that Kevin Emanuel be joined as a third defendant to these proceedings.
3 ORDER that Kevin Emanuel be given conduct of the proceedings. This applies so far as it relates to the defence filed on 11 July 2023. It also applies to the cross-claim filed on 2 December 2022 by the first Defendant. The cross-claim may be amended as he may be advised.
4 ORDER that, subject to further order of the Court:
a. Kevin Emanuel’s costs in these proceedings must be paid from the estate of the deceased on the indemnity basis.
b. no party in the proceedings may have recourse to Kevin Emanuel for any personal liability in relation to his conduct as Defendant and cross-claimant.
5 NOTE that nothing in these orders prevents any party from making a 3rd party costs application at a later stage against the first Defendant and/or any beneficiary.
6 ORDER that the first Defendant deliver up to the Court the original grant in common form of the estate granted on 30 April 2021.
7 ORDER that, until further order of the Court, Kevin Enanuel is granted administration of the estate of Percy Lloyd Waters (the ‘deceased’), limited to:
a. filing, or having conduct of, the defence and cross claim in these proceedings, and generally defending and representing the interest of the deceased in these proceedings;
b. the collection, maintenance and preservation of all assets of the deceased, including, if necessary, commencing proceedings on behalf of the estate;
c. establishing, and operating, in the ordinary course, of a bank account or accounts in the name of the estate of the deceased;
d. paying the accounts, or any liabilities, of the estate, or liabilities of the independent administrator incurred in the performance of his functions under these orders, including the costs order in order 4(a) above;
e. keeping an account of all receipts and disbursements in the administration of the estate of the deceased;
f. appointing an agent (including a solicitor, accountant or real estate agent) to do any business that the interim administrator is unable to do, or that it is unreasonable to expect the interim administrator to do, in person;
g. lodging tax returns on behalf of the estate, as well as any objections, on behalf of the estate, in respect of any assessments made; and
h. doing all such other things as are incidental to the powers hereby conferred.
8 NOTE that nothing in the orders in Paragraph 5 authorises the independent administrator to make a distribution of the estate of the deceased, or any part thereof, without the leave of the Court.
9 ORDER that the independent administrator be authorised, subject to further order of the Court, to allow to be paid to himself, out of the estate of the deceased, such remuneration as may be just and reasonable (at a rate not exceeding $550 per hour including GST), or such other amount as may be approved by the Court, in respect of legal costs, together with the reasonable out-of-pocket expenses for work done by him (including professional and non-professional services) in the discharge of his duties as independent administrator of the estate of the deceased.
10 ORDER that the solicitor of the first Defendant provide a copy of these orders to the administrator no later than 11 November 2024.
11 ORDER that the proceedings be placed in the Probate List on 22 November 2024 for further consideration, or directions, as the nature of the case might require.
12 NOTE that on that occasion, the Court anticipates that the plaintiff will apply to the Court for leave to adduce evidence from a forensic medical expert.
13 NOTE that, as presently advised, the evidence in these proceedings is complete save for the question of such expert evidence.
14 ORDER that the plaintiff file and serve no later than 18 November 2024 a short written submission in support of her application for leave to adduce expert evidence.
15 ORDER that the defendants file and serve no later than 21 November 2024 a short written submission in response.
16 RESERVE the question of the first Defendant’s costs of the proceedings for later determination, when the question of costs of the proceedings is to be dealt with.
17 RESERVE to the parties (including the administrator) liberty to apply generally.
18 RESERVE all questions of costs.
19 ORDER that these orders be entered forthwith.”
Lindsay J expressed the costs orders “subject to further order”. Still, Elkaim AJ did not see any basis to make any further order. There was no suggestion that the third Defendant acted outside the bounds of Lindsay J’s orders. There is also no suggestion that the third Defendant acted improperly or unreasonably.
Lindsay J made the orders. The first Defendant had become very unwell. They couldn’t stay involved in the litigation. The third Defendant assisted the Court in running the case on behalf of the first Defendant. His efforts were obviously to be paid.
The High Court in Bell Lawyers Pty Ltd v Pentelow [2019] HCA 29 confirmed a key point. Solicitors who act for themselves in litigation can’t recover costs for the value of their own professional time. This decision abolishes the Chorley exception. It was derived from The London Scottish Benefit Society v Chorley (1884) 13 QBD 872 at 877. Nonetheless, the Court preserved the separate “in-house solicitor” rule. This rule allows employed solicitors to recover costs when they act for their employer. This issue was later reconsidered in Birketu.
In Elias v Smidt (No 3) [2025] NSWSC 1062, Leeming JA analysed these principles. He examined how they apply where a solicitor uses an incorporated legal practice. His Honour held that recovery of costs should not depend on corporate structure. Whether a solicitor acts as a sole practitioner or through a company they own and control, the same reasoning applies. Allowing recovery merely because a solicitor has incorporated would undermine equality before the law. Equality before the law was a central reason for abolishing the Chorley exception.
Leeming JA rejected a claim. A solicitor attempted to recover his own costs by billing through his incorporated legal practice. Although formally distinct from the individual, the company was merely a vehicle through which the solicitor acted personally. Permitting recovery in that situation would be inconsistent with the rule that solicitors can’t recover costs for acting for themselves.
In Birketu Pty Ltd v Atanaskovic [2025] HCA 2 (‘Birketu’), the High Court dismissed an appeal. The appeal was from a decision of the New South Wales Court of Appeal. The court case concerned whether an unincorporated law firm can recover costs for legal work performed by its employed solicitors. The case involved Atanaskovic Hartnell, an unincorporated legal practice. The practice sought to recover professional fees after successful proceedings against former clients. The firm limited its claim to work carried out by its employed solicitors. It did not claim for work done by its partners. A costs assessor declined to decide as a preliminary issue whether such fees were recoverable, prompting further litigation.
The Supreme Court of NSW ruled against the firm recovering costs at first instance. This decision was akin to United Petroleum Australia Pty Ltd v Herbert Smith Freehills[2020] VSCA 15. That case determined that Herbert Smith Freehills (an unincorporated law firm) could not recover its own employed solicitors’ costs. Yet, the New South Wales Court of Appeal overturned that view. Holding that, consistent with Bell Lawyers Pty Ltd v Pentelow, an unincorporated firm can recover such costs.
By a majority, the High Court affirmed the New South Wales Court of Appeal’s approach. The decision states that an unincorporated law firm can claim professional fees under a costs agreement. This applies to work performed by its employed solicitors. The Court explained that the “in-house solicitor rule” reflects a broader common law principle. A successful litigant can recover legal costs actually incurred for professional services. Regardless of whether those services are provided by an external practitioner or an employed lawyer. Adopting the contrary position taken in United Petroleum would undermine that principle. It would create an artificial distinction between internal and external legal representation. United Petroleum was overruled. The High Court confirmed that unincorporated law firms do not face disadvantages in costs recovery. This remains true even when their employed solicitors carry out the legal work.
In Waters v Frank; Frank v Waters [2025] NSWSC 1389, Elkaim AJ applied the same logic to the second defendant. The same logic was also applied to the third defendant. Working through incorporated law firms did not materially distinguish their position from that of a sole practitioner acting personally. Their situation was only “theoretically” close to the in-house solicitor exception. In substance, they were far removed from true employed solicitors. These include those in the Commonwealth Bank legal department considered in Commonwealth Bank of Australia v Hattersley. It would be incongruous to allow them to recover costs. They would be effectively acting on their own behalf through a corporate structure.
The second and third defendants were entitled to be indemnified from the trust corpus. Still, they were not entitled to recover costs representing their own professional time. These costs were charged through an incorporated legal practice. In Waters v Frank; Frank v Waters (No 2) [2025] NSWSC 1586, nevertheless, the position differs. The third defendant is protected by the earlier orders of Lindsay J. He is thus insulated from the application of Rahman. The first defendant was not acting on his own behalf. He was simply carrying out the deceased’s wishes by administering and executing the will. Hence, the prohibition identified in Rahman does not apply to him. As a result, the first defendant is entitled to the orders sought, without the qualification proposed by the plaintiff.
The third Defendant has also asked for an ‘indemnity’ order in these terms:
The plaintiff sought several orders.
First, that the first and second defendants pay her costs.
Second, that the first Defendant pay the third Defendant’s costs.
Third, that payment of any unrecovered costs from the estate be made on an indemnity basis.
Lastly, the personal time of certain lawyers acting through their own firms should not be recoverable.
The first and third defendants, by contrast, sought indemnity costs from the estate.
The second Defendant supported the preliminary view that there be no order as to costs against her.
Elkaim AJ held its decision about the third Defendant. The comprehensive costs and indemnity protections earlier ordered by Lindsay J on 8 November 2024 should stand. Those orders were made because the first Defendant had become seriously unwell. The third Defendant effectively assumed conduct of the proceedings to help the Court. There was no basis to disturb those protections. There was also no suggestion of any improper or unreasonable conduct by the third Defendant.
Elkaim AJ rejected the plaintiff’s reliance on Rahman v Rahman (No 2) [2025] NSWCA 266. The plaintiff aimed to qualify the third Defendant’s entitlement to costs. The earlier orders of Lindsay J insulated him from that reasoning. As to the first Defendant, his Honour had been critical of his failure to detect warning signs of undue influence. Nevertheless, it was accepted that he was not dishonest. He had no personal interest in the estate. He had acted in good faith as executor. His evidence was affected by serious illness and viewed through that lens.
His Honour applied the High Court’s statement in Nobarani v Maticonte (No 2), (2018) ALR 296; [2018] HCA 49. He held that his costs were properly recoverable from the estate. Although the amount claimed was significant, Elkaim AJ was not satisfied that those costs were improper or unreasonable. He also found the indemnities from minor beneficiaries to be irrelevant. He ordered that the first Defendant recover his costs from the estate on an indemnity basis. The order was made without the qualification sought by the plaintiff.
Elkaim AJ concluded that the probate issued for the 2019 will should be revoked. Additionally, according to the parties’ agreement, probate should be granted to the plaintiff for the 2009 will. The amended cross-claim will be dismissed. His honour’s preliminary view about costs was split. Expenses for the plaintiff and the first and third defendants should be paid from the estate. No order will be made for the second defendant. Yet, she had lost the case with the Court making adverse findings of undue influence against her. Ordinarily, those matters justify a costs order. But the Court considered countervailing factors. These included the fact that the testator’s own conduct had necessitated the investigation of the wills. It had always been necessary to scrutinise the later wills. The second Defendant was entitled to defend her position as a beneficiary.
While financial hardship was not determinative, it was a relevant factor. In balancing all considerations. It exercised its discretion to make no order as to the second Defendant’s costs. This means she should bear her own costs but not those of any other party.
The Court accepted the plaintiff’s submission. The matter does not put her in a worse position than the third party. Hence, the estate should pay her costs on an indemnity basis.
Finally, the Court corrected an error in the principal judgment. It amended the order granting probate. The amendment grants Letters of Administration in solemn form of the 2009 Will to the plaintiff, according to r 36.17 of the Uniform Civil Procedure Rules 2005 (NSW).
The final orders were:
- The grant was amended to Letters of Administration in solemn form of the 2009 Will. This was in favour of Laura Marie Waters.
- Pay the plaintiff’s from the estate on an indemnity basis. Pay the first Defendant’s costs from the estate on an indemnity basis.
- There is no order as to the second Defendant’s costs.
- The third Defendant’s costs must be paid or retained from the estate on an indemnity basis.
- There will be no personal recourse against him. Lindsay J’s earlier costs orders remained unaffected. A formerly granted stay applied equally to these orders.
Significance
The decision provides a pointed reminder. Courts will scrutinise the circumstances with great care when carers are closely involved in a testator’s estate planning. This is especially true when the testator is elderly or cognitively impaired. Practitioners should make sure robust safeguards are in place. These safeguards protect testamentary freedom. They also avoid the risk of later Wills being set aside.