United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MISS ELISABETH LAING (of Counsel) 11 King's Bench Walk Temple London EC4Y 7EQ
For the Respondent	NO APPEARANCE BY OR ON BEHALF OF THE RESPONDENT


 


MR JUSTICE KEENE: This is the restored hearing of an appeal by Mr V M S Bruce, a disabled person, against the decision of an Employment Tribunal sitting at Bedford and entered on the Register on 10th May 1999. The decision which is challenged was that any allowances which would be paid to the appellant for attendance before the tribunal be disallowed pursuant to Rule 12(4) of the Schedule 1 of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 1993.

1. This matter came before the Appeal Tribunal on 1st March 2000 when it was determined in part but adjourned so as to give the Secretary of State for Trade and Industry the opportunity of making representations. In the event he has decided not to intervene and the only appearance before this Appeal Tribunal today has been on behalf of the appellant.
2. The background to this matter is set out in detail in the judgment of this tribunal dated 1st March 2000 and it is unnecessary for present purposes to do more than just indicate the basic facts.
3. The appellant made an application under the Disability Discrimination Act 1995 claiming that there had been discrimination against him on grounds of disability by the respondent.
4. On the first day of what was listed as a three day hearing the respondent sought an adjournment on the ground of the late expansion of or change to the appellant's case. That adjournment was granted. The tribunal went on to say that it was satisfied that the application to adjourn arose as a result of the appellant's actions and that it was appropriate to exercise its powers under Rule 12(4) so as to disallow any allowances which would have been paid to the appellant in connection with his attendance at the tribunal that day.
5. At the hearing before this Appeal Tribunal on 1st March 2000 this tribunal rejected a submission that it had been perverse of the Employment Tribunal to allow the adjournment. It concluded that there were grounds on which the tribunal below was entitled to conclude that an adjournment was needed and that this was the fault of the appellant.
6. There are two matters which have been canvassed before us this afternoon on behalf of the appellant.
7. The first is whether Rule 12 gave the Employment Tribunal any power to do what it did, namely to disallow in advance any allowance which would be paid at some future date to the appellant for his attendance. Rule 12(1) reads as follows:

"Where, in the opinion of the tribunal, a party has in bringing or conducting the proceedings acted frivolously, vexatiously, abusively, disruptively or otherwise unreasonably, the tribunal may make-

(a) an order containing an award against that party in respect of the costs incurred by another party;

(b) an order that that party shall pay to the Secretary of State the whole, or any part, of any allowances (other than allowances paid to members of tribunals) paid by the Secretary of State under paragraph 10 of Schedule 9 to the 1978 Act to any person for the purposes of, or in connection with, his attendance at the tribunal."

Paragraph 10 of Schedule 9 of the 1978 Act is now section 5 of the Employment Tribunals Act 1996. Section 5(3) of the 1996 Act provides:

"The Secretary of State may pay to any other persons such allowances as he may with the consent of the Treasury determine for the purposes of, or in connection with, their attendance at employment tribunals."

Rule 12(4) of the 1993 Regulations deals with a situation where there is a postponement or an adjournment. It states:

"Where the tribunal has on the application of a party postponed the day or time fixed for or adjourned the hearing, the tribunal may make orders, of the kinds mentioned in paragraphs (1)(a) and (1)(b), against or, as the case may require, in favour of that party as respects any costs incurred or any allowances paid as a result of the postponement or adjournment."

8. On behalf of the appellant Miss Laing draws attention to the wording of those provisions and submits first that the power under Rule 12(4) only arises in respect of allowance which have already been paid by the Secretary of State. In other words, it does not enable a tribunal to disallow in advance the payment of an allowance which is to be paid by the Secretary of State at some date in the future. It is contended that even if this construction points to an impractical conclusion, nonetheless that is what the language of the Regulations indicates. Moreover, Miss Laing argues that until the allowance or allowances have been paid the tribunal will not know what the impact will be of such an order. On the practicalities of the interpretation for which she contends, she submits that there would not always have to be a future hearing to determine whether such an order should be made. It is a matter, it is said, which could be dealt with by written representations or even by arguments in principle advanced at the end of the hearing itself. Finally, on this aspect of the case, it is argued that the effect of orders of this kind is penal rather than compensatory because no money is being paid to the other party or to anyone who has suffered a loss and consequently the wording should be construed strictly and narrowly.
9. We can see some force in the appellant's argument about the language of Rule 12(4) when read with Rule 12(1). On the face of it, it could be seen as dealing with an order to pay to the Secretary of State money which has been paid in the past.
10. The Employment Appeal Tribunal, presided over Burton J, hearing this matter in March 2000 commented on this aspect of the case as follows:

"It appears to us that that cannot be the meaning of this sub rule, because it would make a nonsense of its purpose, given that it is almost in every case likely that the order arising out of the adjournment would be made on the occasion of the adjournment, and that it is wholly unlikely that the Secretary of State will, at that stage, have paid allowances which may not have been claimed for him, and are certainly unlikely to have been paid by him before the making of the order, and if that be right it would mean that on every occasion there would have to be an adjournment of an application for an order under this paragraph until after the allowances have been paid, which would only add to costs and inconvenience all round. We are satisfied therefore that the word "paid" must include the gerundive "to be paid" and that the Employment Tribunal was entirely right in the interpretation of the order that it made, and which is set out in the order which is at the very outset of their decision."

11. The "nonsense" identified there by the Appeal Tribunal is certainly is very striking. The allowances in question are, as we understand the system, paid by the Secretary of State after the hearing in respect of expenses incurred. Indeed, that would seem to be inevitable because the amount in question will be affected by the duration of the tribunal hearing which cannot be known in advance with any certainty. The form on which a claim for an allowance has to be made reflects that. Mr Bruce's form is in the papers before us and the claimant on that form has to provide information about where the hearing was held and the dates on which the claimant attended. Actual expenditure then has to be stated. None of that is at all surprising. Yet it would be absurd if a tribunal had to wait until at some date after the hearing the allowances have been paid to the claimant and then it could consider exercising its powers under Rule 12(1) or Rule 12(4). It might well have to have a further hearing on this issue with all the attendant expenses involved, including expenditure by at least the party most directly affected. In some cases an oral hearing might be avoided but so far as we can see there is a strong likelihood that in many cases the would have to be a further oral hearing. Moreover, Rule 12(4) is expressly dealing with "any allowances paid as a result of the postponement or adjournment". By definition, those allowances cannot be paid until the postponement or adjournment is known about. That means, again, that if Miss Laing's construction were to be accepted, there would have to be some subsequent consideration of the matter by the tribunal with the regrettable consequences to which we and this tribunal in March 2000 have referred.
12. It seems to us that the construction contended for by the appellant cannot have been the intention of the legislature. There is an alternative construction, however, which avoids absurdity. Rule 12 does not prevent as such a tribunal making an order in advance of the payment of an allowance by the Secretary of State. There are no express words containing such a prohibition. Indeed, Rule 12(1)(b) does say that the order to be made is one whereby the party "shall pay" rather than, as one would expect on the appellant's construction, an order that the party do pay. There is a contrast between that wording and the wording appearing elsewhere within this Rule, for example, at Rule 12(3)(a) which deals with an order in respect of costs and provides for an order "that the first party pay to the second party". It seems to us that the inclusion of that word "shall" in Rule 12(1)(b) is to be accorded some significance. Consequently, this provision can be construed as allowing an order to be made dealing with the future situation in which the Secretary of State would have paid an allowance and the order would then require the recipient to pay that allowance back to the Secretary of State. In reality, the Secretary of State would no doubt decline to pay the allowance once a Rule 12 order had been made and, in our judgment, he would be entitled to decline to do so. In most cases the claimant would not bother to make the claim, once he or she were faced with such an order.
13. We recognise that, strictly speaking, the power of the tribunal remains one of ordering repayment by a party of an allowance which he will have received. But there is no reason why that should not be expressed in the language used by the tribunal in the present case, namely that of disallowing payment of allowances. There is no requirement on the tribunal to use the express language embodied in Rule 12 itself. This construction accords, in our judgment, with the intention of the legislature and the purpose of these provisions. It avoids absurdity. We conclude, therefore, that the power exercised by the tribunal in the present case did exist in so far as it related to the future payment of an allowance by the Secretary of State.
14. However, the second point made on behalf of the appellant seems to us to have more validity. Attention is drawn to the wording of Rule 12(4) itself and to the fact that under that Rule the language indicates that an order can be made "against or, as the case may require, in favour of that party". The words "that party" clearly refer back to the earlier part of Rule 12(4) where there is reference to the tribunal acting "on the application of a party" when it makes a postponement or an adjournment order. Consequently, Miss Laing submits that Rule 12(4) only allows a tribunal to make an order in favour of or against the party which applied for the postponement or the adjournment. It does not empower the tribunal, under this provision at least, to make an order in respect of allowances against a party which made no application for a postponement or adjournment, even if it was the action of that party which led to the other party making the application for the adjournment. Miss Laing argues that if the tribunal wishes to exercise its powers in relation to allowances so as to penalise the party truly at fault and responsible for the postponement or adjournment, then it should and can exercise the powers which are contained in Rule 12(1), so long as the tribunal concludes that the preconditions for the exercise of that power have been met. It is said that it may well be the case that the tribunal would be able to conclude that the party at fault had, in the conduct of the proceedings, acted abusively, disruptively or otherwise unreasonably. However, there is no finding to that effect in the present case and consequently, it is submitted, the order made by the tribunal in this instance should be quashed and there should be no order remitting the matter to the tribunal.
15. We find the reasoning in this part of the appellant's submissions persuasive. It seems to us that significance must be attached to the express inclusion of the words "that party" in Rule 12(4), which is undoubtedly a reference back to the party making the application for the postponement or adjournment. It does not seem to be possible to construe those words in such a way that an order in respect of an allowance against the party which did not apply for the adjournment is to be seen as making an order in favour of the party which did apply for the adjournment. After all, the party who applied for the adjournment receives no benefit from the order in question and in that situation the order cannot be said to be made in favour of that party. The situation is wholly different from that which arises where a costs order is being made, because that is truly an inter partes order benefiting one party while, at the same time, it disbenefits the other party. That is not the case where one is dealing with an order in respect of allowances.
16. Consequently, we have concluded that Miss Laing's arguments are correct. There is no power under Rule 12(4) to make an order in respect of allowances other than in relation to the party which applied for the postponement or the adjournment. If, in a case like the present, the underlying cause of the application for that postponement or adjournment being made is to be found in the unreasonable or disruptive conduct of the other party which does not apply for the adjournment, the tribunal should consider exercising its powers under Rule 12(1) which do give it the ability to make the appropriate order against the party at fault.
17. In the present case the tribunal does not appear to have considered exercising its powers under Rule 12(1), nor is there any finding upon which such an order could be made. It seems to us that the correct outcome in this case is to allow the appeal for the reasons, which we have indicated, and simply to quash the order made below for the disallowing of the allowances which may be paid to the appellant in this case.