Industrial Tribunals Northern Ireland Decisions

THE INDUSTRIAL TRIBUNALS 

 

CASE REF:    1783/12  

 

 

 

CLAIMANT:              Robb Samuel Molloy

 

 

RESPONDENTS:      1.      Derek Fleming, t/a Fleming Financial Solutions

                                2.      Colin White

                                3.      Rodney Lethbridge

                                4.      Sam Sinclair

                                5.      The Mortgage Group NI

 

 

 

DECISION

 

The decision is that the respondents are not entitled to an award of costs against the claimant.

 

 

Constitution of Tribunal:

 

Chairman:                Mrs A Wilson

 

Members:                Ms A Hamilton

                                Mrs M J McReynolds

 

 

Appearances:

 

The claimant appeared in person and presented his own case.

 

The respondents were represented by Mr A Sands, Barrister-at-Law, instructed by John J Taylor Solicitors.

 

 

 

THE ISSUES

 

1.       Following it’s decision dated 5 March 2013 (“the decision”) dismissing the claimant’s claims, the tribunal reconvened to consider an application for costs subsequently lodged by the respondents.

 

2.       The tribunal considered the decision together with the submissions of the parties.  The tribunal considered the applicable law and in particular Schedule 1 to the Industrial Tribunal (Constitution and Rules of Procedure) Regulations (Northern Ireland) 2005 (“the Rules”) and Harvey on Industrial Relations and Employment Law Division PI, paragraphs 1026 to 1071 (“Harvey”)

 

3.       It is the respondents’ case that they are entitled to an award of costs against the claimant in accordance with paragraphs 40 and 41 of Schedule 1 to the Rules.  It is their case that the claimant in bringing and in conducting the proceedings acted vexatiously, abusively, disruptively or otherwise unreasonably and further that the bringing and subsequently the conducting of the proceedings by the claimant was misconceived.

 

4.       In considering this application, the tribunal looked at the case as a whole following the guidance given in Barnsley Metropolitan Borough Council  v  Yerrakalva [2011] EWCA Civ 1255, [2012] IRLR 78 in the following terms:-

 

                    “The vital point in exercising the discretion to order costs is to look at the whole picture of what happened in the case and to ask whether there has been unreasonable conduct by the claimant in bringing and conducting the case and, in doing so, to identify the conduct, what was unreasonable about it and what effects if had'.

 

5.       Vexatious conduct has been described variously as:-

 

                    ''If an employee brings a hopeless claim not with any expectation of recovering compensation but out of spite to harass his employers or for some other improper motive, he acts vexatiously, and likewise abuses the procedure. In such cases the tribunal may and doubtless usually will award costs against the employee …'' ET Marler Ltd  v  Robertson [1974] ICR 72 at 76, NIRC:

 

          And more recently as:-

 

                    ““Vexatious” is a familiar term in legal parlance. The hallmark of a vexatious proceeding is in my judgment that it has little or no basis in law (or at least no discernible basis); that whatever the intention of the proceedings may be, its effect is to subject the defendant to inconvenience, harassment and expense out of all proportion to any gain likely to accrue to the claimant; and that it involves an abuse of the process of the court, meaning by that a use of the court process for a purpose or in a way which is significantly different from the ordinary and proper use of the court process.'' A-G  v  Barker [2000] 1 FLR 759.

 

6.       The tribunal have no evidence upon which to base a finding that the claimant was motivated out of spite in bringing the proceedings or that it was his intention to subject the respondents to inconvenience, harassment or expense disproportionate to the gain he hoped to achieve.  Neither is the tribunal satisfied on the evidence that the claimant sought to use the tribunal for a purpose significantly different from its intended purpose which is to obtain redress for what he perceived to be a breach of employment law.

 

7.       The tribunal is satisfied that the claimant’s motive in bringing and conducting the proceedings was principally to recover the commission which he believed genuinely was owing to him.  In these circumstances the tribunal make no award of costs based upon vexatious behaviour.  In making this finding the tribunal considered the transcript of a recording of a conversation between the claimant and Mr Sam Sinclair.  The tribunal is not satisfied that the content of this transcript is sufficient to justify a finding that the claimant brought or conducted proceedings for a malevolent purpose.  His purpose was to recover monies which he believed were owing to him and the tribunal find that this is evident from the transcript.  The tribunal is satisfied that the claimant was firm in his genuine belief that monies were due to him by the respondent.

 

8.       The tribunal make no award of costs based on disruptive or abusive behaviour.  The tribunal have considered the claimant’s behaviour in bringing and in conducting the claim and find no evidence of disruptive behaviour or of abusive behaviour such as to justify an award of costs.

 

9.       The tribunal proceeded to consider whether the claimant behaved unreasonably in bringing or conducting the proceedings.

 

10.     The issues before the tribunal relative to the claimant’s case were as follows:-

 

          (i)       Was the claimant employed by the respondents collectively or by any one or more of them?

 

          (ii)      If the claimant was an employee was he subjected  to an unlawful deduction from his wages pursuant to Part IV of the Employment Rights (Northern Ireland) Order 1996 ("the 1996 Order")?

 

          (iii)     If the claimant was an employee was he unfairly dismissed contrary to Article 120 of the 1996 Order as claimed by him at section 7 of his claim form?

 

          (iv)     If the claimant was unfairly dismissed what compensation (if any) is he entitled to? 

 

          (v)      If the claimant was an employee is he entitled to holiday pay as claimed at section 7.4 of his claim form? 

 

11.     All issues to be determined by the tribunal rested on the status of the claimant.  If it was determined that he was employed by the respondents collectively or by any one of them he was entitled to have his claim considered by the tribunal.  If, as was found to be the case he was found not to be an employee then his claim would fail in its entirety for want of jurisdiction.

 

12.     In these circumstances the question for this tribunal is whether the claimant knew or should reasonably have known that his claim had no reasonable prospect of  success because he was not an employee of the respondents or any one of them and as a consequence that the tribunal had no jurisdiction to consider the complaints.

 

13.     In considering this issue the tribunal gave due weight to the fact that the law relative to employee status is by no means straightforward or settled.  According to Harvey “the definition of employee has proved elusive”.  Further a person may be considered an employee for one purpose and self employed for another (Division AI Harvey paragraph 10).

 

14.     The claimant was not legally represented and in these circumstances the tribunal may apply a different standard to him (AQ Ltd v Holden [2012] IRLR 648, EAT).  In Holden, Judge Richardson commented as follows:-

 

                    ''A tribunal cannot and should not judge a litigant in person by the standards of a professional representative.  Lay people are entitled to represent themselves in tribunals; and, since legal aid is not available and they will not usually recover costs if they are successful, it is inevitable that many lay people will represent themselves. Justice requires that tribunals do not apply professional standards to lay people, who may be involved in legal proceedings for the only time in their life. ......., lay people are likely to lack the objectivity and knowledge of law and practice brought by a professional adviser.  Tribunals must bear this in mind when assessing the threshold tests in rule 40(3).  Further, even if the threshold tests for an order of costs are met, the tribunal has discretion whether to make an order.  This discretion will be exercised having regard to all the circumstances.  It is not irrelevant that a lay person may have brought proceedings with little or no access to specialist help and advice.''

 

15.     The claimant was not served with a costs warning letter.  He was however informed by counsel for the respondent during a break in proceedings on the evening of the first hearing date that if he persisted with his claim that an application for costs would follow should his claim fail.  In all of the circumstances pertaining in this case including those recited and in the absence of a costs warning letter the tribunal is not minded to make any award of costs in respect of the bringing of the proceedings or in respect of the conduct of the proceedings during the first day of the hearing.

 

16.     The tribunal considered the transcript provided during the hearing of a conversation between the claimant and Mr Sam Sinclair.  This conversation was recorded by the claimant, a fact initially denied by him.  It is clear from this transcript that the claimant was meeting with Mr Sinclair in an effort to recover from him the commission to which he believed he was entitled.  It is the respondent’s case that this meeting was set up with the intention of seeking a settlement using the threat of tribunal proceedings.  The tribunal is satisfied that the claimant warned Mr Sinclair of his intention to institute tribunal proceedings should his claim not be settled.  Mr Sinclair in response indicated that any such proceedings would be defended.  As became clear the claimant was genuine in warning Mr Sinclair of his intention to bring proceedings and whatever the merits of the claimant’s claim the tribunal is satisfied that he (the claimant) believed his case was meritorious.

 

17.     The tribunal considered its findings as recorded at paragraphs 19 and 33 of the decision as follows:-

 

                    19.     The claimant was registered as self employed for the purposes of tax and national insurance.  The claimant applied for insurance policies and significantly described himself on 26 May 2011 in the relevant application forms as “self employed”.  Under cross examination the claimant admitted that it was his view at that time, i.e. 26 May 2011, that he was self employed.  There was no variation to the Agreement and no change in the claimant’s working arrangements on or after that date which would explain why the claimant would have regarded himself as self employed in May 2011 but subsequently an employee.

 

                    33.     Significantly the claimant described his occupational status as one of self employment in May 2011 when completing an application for insurance and indicated in evidence that he viewed himself as self employed at that time.

 

18.     It is the respondent’s submission that these extracts from the decision can be relied upon to demonstrate that the claimant knew that he was self employed and for that reason also knew that his claim had no reasonable prospect of success.

 

19.     Mr Sands was persuasive in his submission and particularly so relative to this point.  However in circumstances where the law relative to employment status is complex and evolving and taking into account the fact that a person may be considered an employee for one purpose and not for another the tribunal is not satisfied that the claimant believed that he was self employed when on the termination of his contract he applied his mind to the business of recovering the monies which he believed remained outstanding to him.  In the alternative even if he did regard himself as self employed at that time the tribunal is satisfied that he did not understand the significance of that fact in terms of the applicable law.

 

20.     In these circumstances and taking into account Harvey division PI para 1026 “the fundamental principle remains, however, that costs are the exception rather than the rule, and that costs do not follow the event in employment tribunals” the tribunal makes no award of costs in this case.

 

 

 

 

 

 

 

Chairman:

 

 

Date and place of hearing:       24 May 2013, Belfast.

 

 

Date decision recorded in register and issued to parties: