Who Pays Legal Costs When an Ontario Will Challenge Fails?

Who pays legal costs when a will challenge fails in Ontario?

When a will challenge fails or is abandoned without credible evidence, Ontario courts will generally order the challengers to pay the other side’s costs — not the estate. That is the core message from Orde v. Foster, 2026 ONSC 4090 (CanLII), a recent Superior Court decision that draws a sharp line between legitimate estate disputes and poorly supported litigation.

What is the “public policy” exception in Ontario estate costs?

The public policy exception allows an estate to pay everyone’s legal costs when the litigation was genuinely caused by the testator’s own actions or conduct. If a deceased person left behind contradictory wills, raised real questions about their mental capacity, or created circumstances that made a challenge reasonable, courts have historically been willing to treat the legal costs as a proper estate expense.

The rationale is fairness: it would be unjust to punish family members for asking legitimate questions that the testator’s own conduct made necessary. Ontario courts have applied this principle in cases like McDougald Estate and McGrath. But the exception only applies when there is a genuine evidentiary foundation for the challenge — not simply a family dispute or a disappointed beneficiary.

What happens when a will challenge is abandoned in Ontario?

Abandoning a will challenge does not protect the challengers from a costs award. Under Rule 38.08(3) of the Rules of Civil Procedure, respondents are entitled to their costs when an application is abandoned. The court still has discretion over the amount, but the entitlement itself is clear.

In Orde v. Foster, the applicants abandoned their challenge after it became clear there was no evidence meeting the minimum threshold required to raise a triable issue. The court found that the litigation was not caused by anything the testator did, and that proper administration of the estate was never genuinely at stake. As a result, there was no basis to invoke the public policy exception, and costs followed the ordinary rule.

What does “substantial indemnity” costs mean in estate litigation?

Substantial indemnity is a higher level of costs award in Ontario — roughly 1.5 times the standard “partial indemnity” rate. Courts reserve it for situations where a party’s conduct warrants a stronger response, such as bringing litigation that was unreasonable from the outset or abandoning a challenge after putting the other side to significant expense.

In this case, the court awarded costs on a substantial indemnity basis against the applicants, but moderated the final amount to $80,000 plus disbursements given the modest size of the estate. This reflects the court’s balancing of the indemnity principle — compensating the respondents — against proportionality, so that the costs award does not itself swallow the estate.

Are passive respondents entitled to recover their costs from the estate?

No — a respondent who participates in estate litigation purely as a precaution, without being accused of any wrongdoing, is generally not entitled to have the estate pay their legal fees. The court in Orde v. Foster addressed two passive respondents specifically: one was a sibling against whom no allegations were made, and the other was the estate of a stepdaughter whose estate had actually supported the will challenge.

The court held that choosing to retain counsel in those circumstances was a personal decision. Participation by necessity alone does not automatically entitle a party to cost recovery from the estate. These respondents were required to bear their own legal costs.

How do courts decide the amount of costs in Ontario estate disputes?

Courts weigh several factors under section 131 of the Courts of Justice Act and Rule 57.01(1), including the principle of indemnity (making the winning party whole), proportionality to the amount actually in dispute, and the relative simplicity or complexity of the proceeding. The size of the estate matters — awarding $200,000 in costs against a $300,000 estate would be disproportionate and would undermine the very interests the litigation was supposed to protect.

In this case, the court fixed costs at $80,000 plus disbursements, a figure that reflected the legitimate expenses incurred by the respondents while remaining proportionate to the estate’s value. If you are involved in estate litigation — whether as a challenger or a beneficiary defending a will — understanding how costs are calculated is essential before you commit to a course of action. Our Ontario wills and estates lawyers can help you assess the risks before you proceed.

Practical takeaways for estate beneficiaries and potential will challengers

• Evidence first, litigation second. Before challenging a will, you need concrete evidence — medical records, witness accounts, or documentation of suspicious circumstances. A feeling that something is unfair is not enough to meet the evidentiary threshold.
• Abandoning a challenge still costs money. Walking away from an application does not erase your exposure to a costs order. The respondents’ entitlement to costs survives abandonment.
• The estate is not an unlimited fund. Courts will not automatically treat the estate as the source of everyone’s legal fees. If your challenge lacks a reasonable foundation, you may pay personally.
• Passive participation carries its own costs. If you are named as a respondent but have no real stake in the outcome, think carefully before retaining counsel — you may not be able to recover those fees from the estate.
• Proportionality matters. Even when costs are awarded, courts will consider the size of the estate. A large costs award against a modest estate may be reduced to avoid a disproportionate result.

If you are navigating an estate dispute in the Hamilton or Burlington area, our Burlington wills and estates team and Hamilton estate lawyers are available to discuss your situation.

UL Lawyers offers a free initial consultation from our Burlington office and works with clients across Ontario. If you have questions about a will challenge, a costs dispute, or any other estate matter, reach out to our estate litigation team to understand your options before taking the next step.

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This article is automated commentary on a public court decision and is for general information only — not legal advice. Decisions rely on facts unique to each case. If you are affected by a similar issue, contact a lawyer for advice specific to your situation.