BARCLAYS PRIVATE BANK AND TRUST (CAYMAN) LIMITED v. McLAUGHLIN (A minor, by his Guardian ad litem, McLAUGHLIN-MARZIALE), CONEJO and STERN (as Administrator and Ancillary Administrator of the Estate of OBREGON, deceased) 25-November-1998
[1998 CILR 313]
BARCLAYS PRIVATE BANK AND TRUST (CAYMAN) LIMITED v. McLAUGHLIN (A minor, by his Guardian ad litem, McLAUGHLIN-MARZIALE), CONEJO and STERN (as Administrator and Ancillary Administrator of the Estate of OBREGON, deceased)
GRAND COURT (Smellie, C.J.): November 25th, 1998
Trusts—costs—indemnity from trust fund—pre-emptive costs—may award to impecunious minor beneficiary with separate interest to be represented in s.45 proceedings commenced by trustee—important that merits indicate costs likely to be awarded by trial judge and case to be handled cost-effectively—no order in favour of defendant challenging trust
Trusts—costs—indemnity from trust fund—pre-emptive costs—order allowing beneficiary’s participation in s.45 proceedings commenced by trustee normally to include indemnity against adverse costs order
Civil Procedure—costs—security for costs—defendant in proceedings brought by trustee under Trusts Law (1996 Revision), s.45 stands in position of plaintiff for purposes of Grand Court Rules, O.23, r.1(4) if proceedings prompted by defendant’s challenge to trust
    The plaintiff trustee applied for directions under s.45 of the Trusts Law (1996 Revision).
    The administrator of the trust, the second defendant, brought proceedings in the United States challenging the capacity of the settlor at the time of the creation of the trust and his paternity of the first defendant, the sole beneficiary under it. The trustee applied to the Grand Court for directions as to how to respond. Notwithstanding that the US proceedings were dismissed, the administrator raised further challenges to the validity of the settlement in the Grand Court, questioning the intentions and capacity of the settlor. The first defendant, a minor, sought a pre-emptive order that the costs of his participation in the proceedings be met in any event from the trust (including any costs which he might be obliged to pay to the second defendant), and an order for security for those costs from the second defendant.
    He submitted that (a) since the proceedings had been brought for the benefit of the trust as a whole, he was entitled, as a beneficiary, to his costs of participation; (b) because of the trustee’s neutral stance, he was obliged to defend his own interest in the trust—and that of his own future issue—but, as a minor, had no funds of his own other than the trust fund, from
1998 CILR 314
which to do so; (c) due to the strength of his case, it was likely that the court would award him his costs on an indemnity basis at the trial; (d) his counsel would liaise with counsel for the trustee regarding the arguments to be raised by each to avoid duplication of effort or wasted costs; (e) since the second defendant stood in the position of plaintiff vis-à-vis him, having raised the challenges to the trust, and was ordinarily resident outside the jurisdiction, an order for security for costs was appropriate.
    The second defendant submitted in reply that (a) a pre-emptive costs order in favour of the first defendant would be wrong in principle, since the resulting depletion in the trust would be borne by the beneficiaries of the deceased’s estate if the challenge succeeded, rather than the party who had been defeated in the proceedings; (b) such an order would also usurp the function of the trial judge by predetermining the issues at stake; and (c) since he did not stand in the position of a plaintiff for the purposes of the Grand Court Rules, O.23, r.1(4), no order for security for costs could be made against him.
    Held, making the following orders:
    (1) The first defendant’s costs of participating in the trial of the issues raised by the trustee for the benefit of the trust would be paid in any event on an indemnity basis. The court was satisfied on its assessment of the merits of the case, that the likely outcome of the trial was a declaration that the assets had been validly settled on the trusts, and that costs would follow the event. Since the trustee’s position was to remain neutral in the face of competing claims by the defendants, it was desirable that the first defendant’s case (and that of any future beneficiaries) be put to the court, particularly as he was a minor and without independent means. There would be no overlap in the issues presented and no wastage of costs, as it was the intention of those parties sympathetic to the trust that only one leading counsel be instructed (page 316, line 34 – page 317, line 4; page 318, lines 2–21; page 318, line 40 – page 319, line 10).
    (2) Although there might be circumstances in which a court would make a pre-emptive order covering the beneficiary’s costs alone, to avoid anticipating the trial judge’s decision on opposing costs, that would be inappropriate in this case. Accordingly, the order would include indemnity against any costs order which might be made against the first defendant, who could not realistically participate in the proceedings under the threat of a costs order which he would be unable to meet (page 320, lines 12–22).
    (3) There would, however, be no pre-emptive costs order in favour of the second defendant, since his costs were not necessarily incurred for the benefit of the trust (page 320, lines 23–30).
    (4) In view of (a) the court’s preliminary finding on the likely outcome of the case, (b) the second defendant’s residence and the location of his
1998 CILR 315
assets abroad—the court’s usual practice being to order that security for costs be given by a foreign plaintiff—and (c) the fact that he had acted as a plaintiff within the meaning of the Grand Court Rules, O.23, r.1(4) by raising past unwarranted allegations and prompting the present proceedings, the second defendant would be ordered to give security for the first defendant’s costs and those of the trustee (page 320, line 41 – page 321, line 38; page 322, lines 18–26).
Cases cited:
  (1)    Aall Foundation, In re, Grand Ct., January 30th, 1998, Cause No. 277 of 1994, followed.
  (2)    Alsop Wilkinson v. Neary, [1996] 1 W.L.R. 1220; [1995] 1 All E.R. 431.
  (3)    Beddoe, In re, Downes v. Cottam, [1893] 1 Ch. 547; (1892), 62 L.J. Ch. 233.
  (4)    Buckton, In re, Buckton v. Buckton, [1907] 2 Ch. 406; (1907), 76 L.J.Ch. 584, applied.
  (5)    Cotorro Trust, In re, 1997 CILR 1, applied.
  (6)    Emery, In re, Emery v. Emery [1923] P. 184; (1923), 92 L.J.P. 138, distinguished.
  (7)    Evans, In re, [1986] 1 W.L.R. 101; sub nom. Evans v. Evans, [1985] 3 All E.R. 289, dicta of Nourse, L.J. applied.
  (8)    Hall, In re, 1994–95 CILR 456.
  (9)    Lemos v. Coutts & Co. (Cayman) Ltd., 1992–93 CILR 460, applied.
(10)    McDonald v. Horn, [1995] 1 All E.R. 961; [1995] I.C.R. 685, dicta of Hoffmann, L.J. applied.
(11)    Moran v. Place, [1896] P. 214; (1896), 65 L.J.P. 83, distinguished.
(12)    National Anti-Vivisection Socy. v. Duddington, The Times, November 23rd, 1989.
(13)    Parkinson (Sir Lindsay) & Co. Ltd., v. Triplan Ltd., [1973] Q.B. 609; [1973] 2 All E.R. 273, applied.
(14)    Rose v. Epstein, [1974] 1 W.L.R. 1565; [1974] 2 All E.R. 1065; on appeal, [1974] 1 W.L.R. 1565; [1974] 3 All E.R. 745; sub nom. In re Portman, Rose v. Epstein (1974), 118 Sol. Jo. 757, distinguished.
(15)    Westdock Realisations Ltd., Re, [1988] BCLC 354; (1988), 4 BCC 192, dicta of Browne-Wilkinson, V.-C. applied.
Legislation construed:
Grand Court Rules, O.23, r.1(1)(a): The relevant terms of this sub-paragraph are set out at page 320, line 43.
r.1(4): The relevant terms of this paragraph are set out at page 321, lines 21–24.
A.J.E. Foster for the plaintiff;
A.J. Bolton for the first defendant;
A.J. Taylor for the second defendant;
The third defendant did not appear and was not represented.
1998 CILR 316

              SMELLIE, C.J.: 
           
          Pre-emptive costs 
              This matter is before the court on the trustee’s application by way of  
5      “Beddoe-type” proceedings and pursuant to s.45 of the Trusts Law (1996  
      Revision). Having brought these proceedings, the trustee now acts on the  
      directions of the court and so avoids the possibility of criticism that it acts  
      in the proceedings for its own interests or otherwise unreasonably. 
              Provided the trustee acts throughout the proceedings in good faith, it  
10      can be assured that all its costs of so doing will be sanctioned by the court  
      to be met from the trust on the indemnity basis (see In re Beddoe (3)  
      ([1893] 1 Ch. at 557–558)). There is at present no issue about the trustee’s  
      entitlements in this regard. The question is whether the same protection  
      by way of a pre-emptive costs order should now be extended to the first  
15      defendant, a minor, who is the only living beneficiary of the trust. It was  
      noted in McDonald v. Horn (10) ([1995] 1 All E.R. at 970) that the  
      Chancery Courts have been willing in certain circumstances to extend to  
      other parties to trust litigation an entitlement to costs in any event by  
      analogy with that accorded to trustees. Hoffmann, L.J. did, however, go  
20      on in that case to add this condition (ibid., at 971–972): 
                  “. . .[B]efore granting a pre-emptive application [for costs] in  
          ordinary trust litigation or proceedings concerning the ownership of  
          a fund held by a trustee or other fiduciary, the judge must be  
          satisfied that the judge at the trial could properly exercise his  
25          discretion only by ordering the applicant’s costs to be paid out of the  
          fund. Otherwise the order may fetter the judge’s discretion under  
          Ord. 62, r. 3(3).” 
          The basic objection is that if after trial the fund is declared to belong to  
      the person challenging the trust then, although successful, the litigation  
30      would have been conducted entirely at his expense. This court has none  
      the less found circumstances justifying pre-emptive orders in favour of  
      beneficiaries by the application of this test (see, e.g. In re Cotorro Trust  
      (5) (1997 CILR at 15–19). 
              Here I interpolate—notwithstanding precedents—that in my view, the  
35      test of certainty, or near certainty, as to what the trial judge (in the view of  
      the judge taking the application) could conclude, is not without its  
      difficulties. On the basis that costs usually follow the event, it is a test, in  
      my view, which requires a pre-assessment of the issues to the point of  
      discerning the near certain outcome of the case—an approach which is  
40      hardly likely to be available at any stage prior to trial itself. 
              I think it is more reasonable at the earlier stages to expect an  
      assessment of the merits as to the “likely outcome.” That is how the test  
      was stated by Browne-Wilkinson, V.-C. in Re Westdock Realisations Ltd.  
      (15) ([1988] BCLC at 359): “Unless satisfied that after trial a judge would  
45      be likely to make an order that the costs of all parties are to come out of 
1998 CILR 317

      the fund it cannot in general be right to make such an order at this stage.”  
      The likely outcome and order for costs at trial (as postulated in Re  
      Westdock Realisations) is the test approved by our Court of Appeal in  
      Lemos v. Coutts & Co. (Cayman) Ltd. (9) (1992–93 CILR at 476). 
5              In the Lemos case the discretionary power to make the pre-emptive  
      order was thus recognized to exist by our Court of Appeal, even while  
      refusing a beneficiary, such an order in the particular circumstances of the  
      case. There is a challenge to this trust brought by the second defendant,  
      the administrator of the estate of the settlor, who was the father of the first  
10      defendant. The challenge to the trust goes to the validity of the settlement  
      upon it of all its assets. The administrator had also earlier raised a  
      challenge to the competence of the settlor—as to his state of mind at the  
      time of the creation and settlement of the trust. Moreover, the relationship  
      between the settlor and the first defendant was also questioned by the  
15      administrator. The administrator had brought an action against the trust in  
      New York—since dismissed on jurisdictional grounds—in which he  
      raised the challenges to paternity, competence and validity. But the New  
      York action having been dismissed, these challenges are no longer being  
      maintained by the administrator. 
20              I am told by Mr. Taylor that they are no longer considered to have any  
      merit. Unwarranted though they have been shown to be, all these  
      challenges have none the less resulted in considerable expense to the  
      trustee and to the first defendant in resisting them. The New York  
      proceedings were the most direct reason for the institution of these  
25      proceedings by the trustee which sought the court’s directions on how to  
      respond to them. Notwithstanding the disclaimer of the earlier grounds of  
      challenge, the administrator has now raised in these proceedings other  
      challenges based upon technical points. These are now specified in the  
      affidavits of Mr. Taylor filed in support of the administrator’s application  
30      for leave to cross-examine the witnesses of the trustee. 
              The issues raised by these latter challenges involve the ascertainment  
      of the intention of the settlor. This is to be construed from written and oral  
      communications relating to the transfer of assets and from the chronology  
      of events covering the crucial four days between the establishment of the  
35      trust and the tragic death by suicide of the settlor. The question is whether  
      the settlor, prior to his death, had clearly and effectively expressed his  
      intention that the assets be transferred to and settled upon the trust. It is  
      against that background that the first defendant seeks a pre-emptive order  
      for his costs of further participation in these proceedings. 
40              Not only is he a minor, he also claims impecuniosity. I am told he has  
      no other assets or means apart from his interests in the trust and I accept  
      that to be so. At earlier stages of these proceedings he was given a  
      protective order for his costs but that order has now expired, although his  
      circumstances have not materially changed. The challenges to his  
45      entitlement under the trust are still alive now that the technical challenges 
1998 CILR 318

      have been raised, and that will be the case so long as the trustee’s  
      application for directions is pending. As these are in essence adminis 
      trative proceedings in which the trustee remains neutral as to the  
      competing claims, the trustee’s duty is to be completely open and frank  
5      with the court as to the strengths and weaknesses of the case and to put  
      before the court such matters as it may be advised. For a further example  
      of how this principle is stated see McDonald v. Horn (10) ([1995] 1 All  
      E.R. at 970). 
              That being so, unless the first defendant is funded in the action, there is  
10      the risk that arguments which should be put in his favour—and hence in  
      favour of the wider potential class of beneficiaries (his future unborn  
      children)—may not be put. However unlikely that risk (and given the  
      technical nature of the remaining grounds of challenge I regard it as  
      unlikely) the beneficiaries, including the first defendant, do have a  
15      separate and identifiable interest, apart from the trustee’s, to be  
      represented (see the headnote to Lemos v. Coutts & Co. (Cayman) Ltd.  
      (9) in The Cayman Islands Law Reports (1992–93 CILR at 464)). 
              Where the interests are those of beneficiaries who are minors and  
      impecunious, those are factors, taken with the risk (however slight),  
20      which weigh in favour of the exercise of the discretion to grant the pre- 
      emptive order: see In re Cotorro Trust (5) and In re Evans (7). In the  
      Evans case, the basic objection advanced to a pre-emptive order—that put  
      forward by Mr. Taylor in this case—was that if the challenge to the trust  
      were ultimately to succeed, a pre-emptive order for costs in favour of the  
25      applicant would have served only to diminish the fund to which the  
      plaintiff would be entitled and the applicant would have been able to  
      litigate at the expense of the successful party and at no risk to himself.  
      Nourse, L.J. in delivering the judgment of the court, resolved that issue as  
      follows ([1985] 3 All E.R. at 293): 
30                  “In my view, in a case where the beneficiaries are all adult and sui  
          juris and can make up their own minds whether the claim should be  
          resisted or not, there must be countervailing considerations of some  
          weight before it is right for the action to be pursued or defended at  
          the cost of the estate. I would not wish to curtail the discretion of the  
35          court in any future case but, as already indicated, those consider- 
          ations might include the merits of the action. I emphasise that these  
          remarks are directed only to cases where all the beneficiaries are  
          adult and sui juris. The position might be entirely different if, for  
          example, one of the beneficiaries was under age.” 
40          Here, not only is the beneficiary (the first defendant) under-age and  
      impecunious, but he will be acting in a representative capacity for all  
      beneficiaries (by order separately made) and in the interests of the trust as  
      a whole. Moreover, the attorney engaged by his guardian will act in  
      connection with the trustee to ensure that there is no duplication of  
45      effort—and therefore no waste of costs—in putting forward the 
1998 CILR 319

      arguments which need to be raised. In this regard, it has already been  
      agreed and the intention is that only one leading counsel will be engaged.  
      This economy of effort in putting forward the necessary arguments can be  
      a relevant consideration: see In re Cotorro Trust (5). 
5              Underlying all this is implicitly my own view as to the likely outcome  
      of the case. My assessment now of the merits is that they are weighted in  
      favour of the validity of the settlement of assets upon the trust. The merits  
      as a relevant factor to be considered is a matter of settled law: see In re  
      Evans (7), National Anti-Vivisection Socy. v. Duddington (12), Alsop  
10      Wilkinson v. Neary (2) and In re Hall (8) (1994–95 CILR at 461). 
              Here the first defendant acts to protect the trust, in the context of  
      proceedings brought by the trustee seeking the determination of  
      challenges which have arisen in the administration of the trust. In a case  
      of this nature, the discretion I exercise is well recognized and long- 
15      standing (pre-dating McDonald v. Horn (10)) and has its genesis in the  
      dictum of Kekewich, J. in In re Buckton (4), where that learned judge  
      identified three categories of trust cases into which the consideration of  
      applications for costs may be framed. It is within the first category  
      described as follows that I regard this case as falling ([1907] 2 Ch. at  
20      414): 
                      “In a large proportion of the summonses adjourned into Court for  
          argument the applicants are trustees of a will or settlement who ask  
          the Court to construe the instrument of trust for their guidance, and  
          in order to ascertain the interests of the beneficiaries, or else ask to  
25          have some question determined which has arisen in the adminis- 
          tration of the trusts. In cases of this character I regard the costs of all  
          parties as necessarily incurred for the benefit of the estate, and direct  
          them to be taxed as between solicitor and client and paid out of the  
          estate. . . .” 
30          A further issue arose for consideration. The expansion of the discretion to  
      award costs for parties on the indemnity basis does not answer the  
      question I raised—ex proprio motu—whether the discretion was wide  
      enough to cover a party’s (other than the trustee’s) liability to costs  
      incurred to another party. Such would be the situation here in the event  
35      that the first defendant did not prevail against the technical challenges of  
      the administrator. There could, in that event, be an order for costs not  
      only against the trustee but also against the first defendant in favour of the  
      administrator. 
              Mr. Foster and Mr. Bolton both responded that the pre-emptive order,  
40      by its very nature, is meant to cover all liability for costs which may arise.  
      Emphasis was laid in this regard on the analogy with the indemnity given  
      to the trustee which is a full indemnity and the very analogy drawn in  
      McDonald v. Horn (10) as the basis for extending to other parties to trust  
      litigation a pre-emptive entitlement to costs. 
45              Such an expressed and complete pre-emptive order has been given by 
1998 CILR 320

      this court before. That was done in In re Aall Foundation (1). There the  
      Attorney General (in the role of parens patriae) was expressly protected  
      not only in respect of his own costs of litigating on appeal to the Judicial  
      Committee of the Privy Council, but also in respect of any opposing costs  
5      for which he might be held liable. As parens patriae he appealed in the  
      public interest in seeking to uphold the validity of a trust expressed to be  
      for the benefit of charity. Mr. Foster before me submitted that the express  
      provision in that order was unnecessary, as the completeness of the  
      indemnity was implicit once the pre-emptive order became one which in  
10      principle was appropriate to be made. However, no authority directly on  
      point was cited. 
              Whilst I remain unpersuaded that there could never be a case in which  
      the court would allow a protective order limited only for a party’s own  
      costs (other than the trustee) to enable him to participate while not pre- 
15      empting the trial judge on the issue of opposing costs, I am satisfied that  
      that is not the proper approach to take in this case. This is primarily for  
      the reason advanced both by the trustee and the first defendant himself— 
      that it would be unduly onerous for a minor to embark upon litigation  
      with the possibility of an adverse order for costs hanging over him, one  
20      which he would have no means of satisfying. I therefore grant the first  
      defendant a complete pre-emptive order for indemnity for costs from the  
      trust fund, including any order which may be made against him. 
              The administrator’s own ex tempore application for a pre-emptive  
      order for costs to be met from the trust fund I regard as misconceived. He  
25      brings and pursues his challenges not for the benefit of the trust estate but  
      seeking to destroy it. His position is certainly not like that of the parties  
      whose costs are “necessarily incurred for the benefit of the estate” as  
      contemplated by Kekewich, J.’s first category in In re Buckton (4). His  
      application for a pre-emptive order for costs to be paid from the trust is  
30      therefore refused. 
           
          Security for costs 
              The trustee and the first defendant seek orders for security for their  
      costs against the administrator. They cite the considerable costs already  
35      incurred and wasted in addressing and resisting the challenges of  
      incompetence and lack of paternity which are now disavowed by the  
      administrator. Jointly those costs already amount to some $73,000. Any  
      costs recovered by the trustee or the first defendant from the administrator  
      will of course be for the benefit of the trust. This follows in light of the  
40      protective costs orders which have been made. 
              The application for security for costs is based on the Grand Court  
      Rules, O.23, r.1(1)(a). The argument is that the administrator who is to be  
      deemed the plaintiff is “ordinarily resident out of the jurisdiction” and  
      that, having regard to all the circumstances of the case, it is just to order  
45      him to give security for costs. The major issue arising in this context is 
1998 CILR 321

      whether the administrator ought to be regarded as being in the position of  
      a “plaintiff” so as to make him amenable to the rule. There is no dispute  
      that he resides out of the jurisdiction of the court and I had no difficulty in  
      concluding that any order for costs ultimately made against him would be  
5      difficult, if not impossible, to enforce. The assets of his estate are reported  
      to be abroad in Mexico and elsewhere. These are factors relevant to the  
      exercise of the discretionary power: see Sir Lindsay Parkinson & Co. Ltd.  
      v. Triplan Ltd. (13). 
              Another important matter to consider is the likelihood or otherwise of  
10      the plaintiff succeeding (see also in this context In re Hall (8) and the  
      notes to 1 The Supreme Court Practice 1997, para. 23/1–3/3, at 408). The  
      case law suggests that although it is a matter of discretion, it is the usual,  
      ordinary or general rule of practice of the court to require a foreign  
      plaintiff to give security for costs, because it is ordinarily just to do so. 
15              However, the power does not exist unless the administrator—who is  
      not styled as “plaintiff” but as second defendant on the record—can none  
      the less properly be regarded as being in the position of a plaintiff. An  
      order for security for costs cannot be made against a defendant who is not  
      counterclaiming but who is instead compelled to respond by simply  
20      defending the claim brought by the real plaintiff. The relevant part of the  
      Grand Court Rules, O.23, r.1(4) provides: “The references . . . to a  
      plaintiff and a defendant shall be construed as references to the person  
      (howsoever described on the record) who is in the position of plaintiff or  
      defendant . . . in the proceedings in question. . . .” 
25              There appears to be little or no guidance from the case law on what  
      circumstances would enure to the treatment of a defendant as being in the  
      position of plaintiff. Once again, the axiom that it depends on the circum- 
      stances of the case in question comes to the fore. I must consider the real  
      nature of the positions assumed by the parties in the action, whatever they  
30      may be described to be on the record. In the light of the history of this  
      matter—the administrator’s action in New York (which went on for six  
      years before it was finally dismissed); the unwarranted allegations of  
      incompetence and of lack of paternity and the latest technical challenges  
      which together caused the trustee to bring these proceedings and to  
35      pursue them in the hope of obtaining determinative declaratory orders of  
      validity—the plain and undeniable reality is that the administrator is in  
      the position of plaintiff. He has caused the trustee to seek relief from the  
      court. 
              Mr. Taylor sought to refute this by drawing an analogy between the  
40      position of the administrator and that of a defendant caveator in  
      contentious probate or administration proceedings. It was held in Rose v.  
      Epstein (14) (following In re Emery (6)) that a defendant caveator could  
      not be regarded as being in the position of a plaintiff for the purposes of  
      O.23, r.1 of the Rules of the Supreme Court so as to be able to order him to  
45      give security for costs, even though the caveator had put in a counterclaim. 
1998 CILR 322

              In Rose v. Epstein ([1974] 1 W.L.R. at 1571) it is fair to say that the  
      court reluctantly arrived at the conclusion it did but felt obliged to follow  
      the earlier cases, including In re Emery (which had in turn followed  
      Moran v. Place (11)). The courts in the cases which followed regarded  
5      Moran v. Place as the seminal authority for the proposition that a  
      caveator in a probate action, because of the special nature of a caveat and  
      what it is intended to achieve, cannot be regarded as being in the position  
      of plaintiff in the subsequent action, even though his caveat may have  
      prompted the executor or administrator to seek determination of the  
10      validity of the challenge raised by his caveat. It is therefore worth noting  
      that in Moran v. Place itself Lindley, L.J., in delivering the judgment of  
      the Court of Appeal, expressed distinct doubt ([1896] P. at 217–218): “I  
      confess I am rather sorry for the conclusion at which I have arrived. . . .” 
              Because of the special nature of the caveat—as a recourse invited by  
15      statute and the special rules in succession proceedings—I do not regard  
      myself as required by the authority of the line of cases discussed to apply  
      the rules to this case by analogy, as Mr. Taylor urged, with the similar  
      equitable nature of these proceedings. Instead, I am firmly of the view  
      that the administrator is here in the position of plaintiff, having caused the  
20      institution of the proceedings by his challenges which continue to be the  
      reason for the trustee’s need for directions and determination of issues.  
      The position of the first defendant must be regarded similarly. I therefore  
      order that the administrator provide security for their costs in the amounts  
      pleaded and that he does so within 21 days, failing which he will be  
25      barred from further conduct in the proceedings. Security is to be provided  
      by payment into court. 
              I should end by stating that I see no conceptual difficulty in regarding  
      the administrator as being in the position of a plaintiff even while  
      regarding these proceedings, as I have already, as being in the nature of  
30      the first category in In re Buckton (4), for the purposes of granting the  
      first defendant beneficiary a pre-emptive protective order for costs. Even  
      while they stem from the Beddoe (3) summons which instituted them and  
      remain administration proceedings (in the sense that there are no issues of  
      fact to be tried but matters essentially of construction) the proceedings are  
35      none the less the result of the challenges raised by the administrator. In  
      this regard, I considered the form of the proceedings to be less important  
      than their genesis. 
Order accordingly.
Attorneys: W.S. Walker & Co. for the plaintiff trustee; Hunter & Hunter for the first defendant; Orren Merren & Co. for the second defendant.