Appeal No. UKEATS/0030/11/BI
EMPLOYMENT APPEAL TRIBUNAL
52 MELVILLE STREET, EDINBURGH, EH3 7HF
At
the Tribunal
On
10 January 2012
Before
THE HONOURABLE LADY SMITH
(SITTING ALONE)
MS
CLAIRE SIMPSON APPELLANT
(1)
CHIEF CONSTABLE, STRATHCLYDE POLICE
(2) SCOTTISH POLICE
SERVICES AUTHORITY RESPONDENTS
Transcript of Proceedings
JUDGMENT
THE
HONOURABLE LADY SMITH
Introduction
1.
This is an appeal against a judgment of the Employment Tribunal sitting
at Glasgow, (Employment Judge R Gall) registered on 23 February 2011, requiring the Claimant to pay a deposit order of £380. The Employment Judge had
previously, by an order of 4 November 2010, which was not appealed
against, found that the Claimant’s claims of discrimination and breach of the Public
Interest Disclosure Act 1998 had little reasonable prospect of success.
Whilst he found, at that stage, that, in principle, there should be a deposit
order, he did not quantify it. He could not do so as he did not have
information which enabled him to assess her ability to pay (see: rule 20(2) of
the Employment Tribunals (Constitution and Rules of Procedure) Regulations
2004 Sch 1). The terms of his order of 4 November 2010 were:
“The applications by the first respondents and second
respondents to have an Order made against the claimant requiring the claimant
to pay a deposit in terms of Rule 20 of the Rules are continued in order that
the ability of the claimant to comply with such an order is ascertained so that
prior to any such order being made any information so ascertained can be
considered and taken account of in assessing the amount of such a deposit all
in terms of Rule 20(2) of the Rules.”
2.
A further pre hearing review (“PHR”) was, accordingly, fixed, took place
on 18 February 2011 and the deposit order for £380 was issued.
3.
The Claimant was represented by her father, Mr T Simpson, at the
hearing on 18 February and before me. The First Respondent was
represented by Ms C Martin, solicitor, before the Tribunal and before me.
The Second Respondent was represented by Ms C Nisbet, solicitor, before
the Tribunal and by Ms Jones, solicitor, before me.
4.
I will, for the sake of clarity, continue referring to parties as Claimant
and First and Second Respondents.
The issue
5.
The issue for the Employment Judge was what should be the amount of the
deposit order?
6.
In addressing that issue, he required to have regard to (a) his having
assessed her claim as having little reasonable prospects of success; (b) his
having decided, as explained in his judgment of 2 November 2010, that the
Claimant should be ordered to pay a deposit as a condition of her being
permitted to continue with her claim; (c) her ability to comply with such an
order; and (d) that any such order could not be for more than £500: see
rule 20(1) and (2) of the 2004 Rules.
Relevant
facts
7.
The information provided to the Employment Judge, which was not disputed
was:
·
The Claimant was a student at the University of the West of
Scotland which is based in Paisley;
·
She began her then current course on September 2010;
·
The course was for four years;
·
The Claimant was in receipt of:
§
A bursary of £100 per month;
§
Student loan payments of £494 per month during the academic
session (September to May); the loan is a “Standard Loan” and will not be
repayable until her earned income exceeds £15,000 per annum;
§
Earned income from a part time job of £183.44 per week
- The Claimant
was looking for alternative part time employment which would pay a higher
wage;
- The Claimant
moved into rented accommodation in East Kilbride (from the family home in
Strathaven) in November 2010;
- The Claimant runs a car;
- The Claimant’s weekly
expenditure, at that time, was, according to a list she provided:
- rent - £75
- heating/ electricity - £8.75
- phone - £8.75
- Insurance/phone - £3.50
- Internet - £7.50
- Insurance/ laptop - £2.12
- Fuel - £15
- Parking - £15
- Car insurance £12.50
- Car Tax - £4.50
- Food/ household items - £65
- TV licence - £3
- Furniture - £13
- Uniform (for work) - £2.50
- Clothing £25
§
Books - £3.75
·
The Claimant has an overdraft facility, which she uses.
The Tribunal’s Judgment
8.
The Employment Judge explained that with regard to deposit orders, a
claimant’s financial circumstances were not the sole determining factor. At
paragraph 28, he points to the possibility of a deposit order being made
even where a claimant shows he has “zero assets and a zero bank balance, or
worse” (paragraph 28); he is correct – it would not be incompetent for an
Employment Judge to issue a deposit order.
9.
By way of general observations, the Employment Judge remarked that in
almost every case in which a deposit order is made, the vast majority of
claimants will suffer a degree of “financial pain” (paragraph 27). That
is, he recognised that it will not be easy for many claimants to find the sums
that are liable to be involved in a deposit order. He also took account of the
background, namely his views, as previously explained, that the Claimant’s
claim has little prospect of success (paragraph 29).
10.
The Employment Judge looked at the whole of the Claimant’s financial
circumstances. He considered that he ought to regard the Claimant’s student
loan as income. He had regard to the possibility of the Claimant rearranging
matters so as to, as he put, rebalance her income and expenditure. At
paragraph 30 - 31, he explained:
“30. I understand the claimant’s that the income which she
receives is exhausted by her expenditure. I am including in this regard her
student loan as income. I accept that it is of the nature of borrowed money.
It does, nonetheless, provide her with a source of funds at present. I am
conscious that she stays in a flat in East Kilbride. She has a car. East
Kilbride is certainly closer to Paisley than Strathaven, where her parents
stay, is. It was not said in evidence that moving back in with her parents
would result in any particular difficulty. The point did not arise in evidence
in chief or in cross examination. Certainly there would be no rental payable
to an external landlord if she did move back in with her parents.
31. I should make it clear that I am not suggesting that the
claimant follows that course. I am merely highlighting that there may be ways
in which the claimant’s income and expenditure can be rebalanced if necessary.”
11.
He noted that the Claimant’s father had sought to argue that the
imposition of the deposit order amounted to pressure being put on the Claimant
to drop her case and pointed out that that was not its purpose; rather, it was
to give fair notice to a Claimant of the risks being run regarding expenses, if
the claim was persisted with and there was an element of it being thus
highlighted to her that careful consideration should given to proceeding.
12.
Against that background, the Employment Judge set the deposit order at
£380, that being what he considered to be an appropriate amount and one which,
in his assessment, would not be impossible for the Claimant to meet (see:
paragraph 33).
13.
Regarding the arguments presented to him on behalf of the Respondents at
the PHR, the Employment Judge records that Ms Martin, in a submission
which was adopted by Ms Nisbet, submitted that costs were likely to exceed
£10,000 (the tribunal cap) and that if the assessment of costs was remitted to
the Auditor for taxation, the recoverable amount could exceed that figure; the Claimant
should have her attention drawn to the costs risk which she was running.
The appeal
Submissions for Claimant
14.
Mr Simpson made twelve submissions.
15.
First, he submitted that Ms Martin should not, at the PHR, have
been allowed to refer to the risk of the Claimant being found liable in
expenses up to £10,000. That was not the purpose of the PHR.
16.
Secondly, Ms Nisbet should not have been allowed to adopt that
submission.
17.
Thirdly, Ms Nisbet should not have been allowed to submit that the Claimant’s
student loan could be used to pay the deposit order.
18.
Fourthly, Ms Nisbet should not have been allowed to make any
reference to rule 47. It was not relevant.
19.
Fifthly, it was unjust for the Employment Judge to regard the Claimant’s
student loan as income. The Employment Tribunal was a publicly funded body.
The government regarded a student loan as being for essential maintenance; it
was for living costs. He referred, for support of submission, to two
documents. The first was the interpretation section of Part 1 of The
Education (Student Loans) (Scotland) Regulations 2007 which states:
“’loan’ means a loan towards a student’s maintenance under the
Act and any regulations made thereunder, including the interest accrued on the
loan and any penalties or charges made in connection with it;”
20.
The second was an extract from a government website entitled:
www.direct.gov.uk/en/MoneyTaxBenefits/BenefitsTaxCreditsAndOtherSupport/On
a low income? DG 070816
which contains a list of the types
of student finance which are counted as income when working out benefits and
includes:
“the majority of any Maintenance Loan you are entitled to, even
if you choose not to take it out”
and
“bursaries..”
21.
Mr Simpson accepted that the government has no control over the use
to which a student loan is put by the student but he pointed to the
governmental intention being that it be used for maintenance. To use the
student loan to pay the deposit order would be to misuse it. It was
unreasonable to say that the order was affordable.
22.
Sixthly, the Employment Judge was wrong to have considered any matter
other than the Claimant’s ability to pay. He was not entitled to look at his
prior finding that the case had little prospects of success; that was a road
already travelled.
23.
Seventhly, the Employment Judge had failed to explain his finding that
the claim had little reasonable prospects of success; neither the February 2011
nor the November 2010 judgment gave adequate reasons. He disavowed any attempt
to appeal against the November 2010 judgment. He said that he recognised that
it was too late to do that. He did, however, at a number of points in his
argument, revert to a complaint that the November 2010 judgment did not give
reasons for that finding. He relied on rule 47 for a submission that the
rules required the Employment Judge to give clear reasons for his rule 20
decision.
24.
Eighthly, the Employment Judge had failed to provide clear reasons for
setting the deposit order at £380.
25.
Ninthly, the Employment Judge had erred in his proposition that the Claimant
move back into her parents’ home. It was age discriminatory; she did not
believe that he would have done so if she had been older or male. Further, he
did not know whether she would have wished to do so or whether her parents
would have agreed to her doing so. Her rights under article 8 of the
Convention required to be considered, as did Article 14. Her right to
live where she wished required to be respected. The Employment Judge was wrong
to assess her ability to pay on the basis of a hypothetical situation.
26.
Tenthly, the Employment Judge was wrong to find it acceptable for the Claimant
to feel pain notwithstanding that she had already suffered age and sex
discrimination and victimisation (these being references to the content of her
claim).
27.
Eleventhly, the Employment Judge had misapplied the Employment Tribunal
Rules regarding his November 2010 judgment, as was apparent from his response
to the Claimant’s application for a review (which was refused by letter dated 10 March 2011, against which refusal there was no appeal).
28.
Finally, Mr Simpson stated that the Employment Judge had failed to
provide comprehensive reasons in his response to the Claimant’s review
application.
29.
In the light of these submissions, Mr Simpson asked that the order
that the Claimant pay deposit order of £380 be revoked which failing that the
Employment Judge be directed to provide reasons which failing that he be
afforded any other remedy that I considered appropriate.
Submissions for Second
Respondent
30.
Ms Jones made submissions which were adopted by Ms Martin and
which can be summarised as follows.
31.
The appeal was, she submitted, hopeless. It had not been demonstrated
that the Employment Judge erred in law. The high test for perversity was not
met. Insofar as the appeal sought to make discrete points regarding the
student loan and the provision of reasons, it was wholly ill founded.
32.
As a generality, it was not irrelevant to consider the generality of the
risk that a claimant would be running regarding an award of expenses where the
litigation was continued in the face of a determination that a claim had little
reasonable prospects of success; the need for a claimant to do so was implicit
in the making of a deposit order. The Respondents’ position was that the Claimant
in this case had failed properly to understand the risk that she was running so
far as expenses were concerned. It was, in these circumstances, incumbent on
the Respondents to spell matters out for her since she was not legally
represented. It was only fair that she be warned that an order for expenses
may be sought against her.
33.
Regarding the government guidance relied on, it did not support the Claimant’s
case. Rather, it showed that the government would regard a student loan as
available income, when assessing a student’s application for benefits. Such
loans were not conditional. There was nothing to tell a student that they were
only to be used in a restricted way.
34.
Regarding rule 47, it was not relevant to the reasons issue.
Rule 47 was not, at this stage, a live issue.
35.
Regarding the submission that the Employment Judge was not entitled to
look beyond the Claimant’s financial circumstances, it was not well founded;
rule 20 required an Employment Judge to look at the whole circumstances.
This was a case which already had a lengthy history and despite informal and
formal questions procedures, the Claimant’s case remained unsatisfactory and
had been assessed as having little reasonable prospects of success.
36.
Regarding reasons, the November 2010 judgment did explain why the Employment
Judge had concluded as he did and it was not to be expected that he would
reiterate those reasons in the February 2011 judgment dealing only with the
matter of the amount of the deposit order.
37.
Regarding the amount of the order, an arithmetical calculation was not
to be expected. All that was required that the figure be a reasonable one,
which it was.
38.
Otherwise, the Claimant was not now entitled to appeal against the
November 2010 judgment, he had not found that she was required to move house –
he had simply pointed out that her costs were not fixed, the comment about
“pain” was being taken out of context and the Claimant was not now entitled to
seek to appeal the review decision, which she seemed to be trying to do.
Submissions for the First Respondent
39.
As above noted, Ms Martin adopted Ms Jones’ submissions. She
added that the Claimant was entitled to fair notice about the expenses risk she
was running; that was all that was sought by referring to their likely amount,
the Employment Judge had not made any error of law and the appeal was
misconceived.
Discussion and decision
40.
By way of preliminary, I would observe that this is an appeal only
against the amount of the deposit order. It is not an appeal against the
determination that the Claimant’s case has little reasonable prospects of
success and that a deposit order should, in principle, be made. There are no
statutory rules requiring an Employment Judge to calculate a deposit order in
any particular way; the only requirement is that the figure be a reasonable
one. Provided the figure arrived at is not unreasonable in all the
circumstances, it will be unappealable as no question of law arises.
41.
The Employment Judge was correct to take as his starting point that he
had previously satisfied himself that the Claimant’s claim had little
reasonable prospects of success and that the circumstances were such that a
deposit order should be issued. The nature and circumstances of those findings
provide the context in which the amount of the order is to be assessed.
Mr Simpson was wrong to suggest that the Employment Judge could only
consider the Claimant’s finances, closing his mind to the circumstances which
had led up to the continued PHR. It would have been wrong for him to consider
the amount of the deposit order in a vacuum, which, essentially, was Mr
Simpson’s argument.
42.
The context to which I refer was, to use a colloquialism, that the
Employment Judge had, in November 2010, concluded that it was fair to require
the Claimant to “put her money where her mouth was” before she took the claim
any further. It is to be assumed that claimants will not readily part with
money that they are likely to lose – particularly where it may pave the way to
adding to that loss a liability for expenses or a preparation time order (see
rule 47(1)). Both of those risks are spelt out to a claimant in the order
itself (see rule 20(2)). The issuing of a deposit order should, accordingly,
make a claimant stop and think carefully before proceeding with an evidently weak
case and only do so if, notwithstanding the Employment Tribunal’s assessment of
its prospects, there is good reason to believe that the case may, nonetheless
succeed. It is not an unreasonable requirement to impose given a claimant’s
responsibility to assist the tribunal to further the overriding objective which
includes dealing with cases so as to save expense and ensure expeditious
disposal (rule 3(1)(2) and (4).
43.
Insofar as the present appeal proceeded on the basis that the Employment
Judge was wrong to allow any submissions to be made about the extent of the
likely costs of continuing with the case (whether as awarded by the Tribunal or
after taxation by the Auditor of Court), it was manifestly ill founded. It is
not an error of law to allow submissions to be made. If the point was intended
to be that questions of the nature and extent of the likely expenses were
irrelevant, it too was ill- founded; as explained above, the expenses risk to
a claimant of proceeding in the face of a rule 20 deposit order are an
inherent part of the procedure.
44.
Regarding the reasons for the Employment Judge’s conclusion that rule
20(1) applied, it was not, contrary to Mr Simpson’s submission, incumbent
on him to set out those reasons in his judgment of 23 February 2011. The
application of rule 20(1) was not an issue at the continued PHR; indeed,
Mr Simpson accepted as much, in his reference to it being a road already
travelled. The order contained in the judgment of 2 November 2010 was not appealed against and it is not open to the Claimant to do so now – the same can
be said of the Employment Judge’s response to the application for review. In
any event, any complaint that the November 2010 judgment lacked adequate
reasons is not sustainable. The Employment Judge explains, in that judgment,
that he had considerable sympathy with the Respondents’ submissions (which he
refers to in detail) to the effect that the Claimant had had an informal and
formal opportunity to clarify her claim yet her averments remained unclear in
many significant respects. Further, he accepted that it could well be the case
that the Claimant would be able to go no further than demonstrate that she felt
that had been unfairly treated (though not in a manner which amounted to
discrimination or victimisation). That concerned him.
45.
Mr Simpson presented an argument that there was a failure to comply
with the rules regarding the provision of reasons because rule 47 required
reasons to have been given at the earlier stage. I am not persuaded that rule 47
is of any relevance as regards the issue of reasons. Rule 47
considerations are not a live issue between parties. Further, it does not
contain any requirement regarding reasons. It refers only to those “grounds”
which were, at the rule 20 stage, identified as having little reasonable
prospects of success, not the reason why the earlier Employment Judge decided
that those grounds had little reasonable prospects of success.
46.
Turning to the amount of the deposit order, it is clear from a reading
of the Employment Judge’s decision as a whole that he arrived at the figure of
£380 in the light of the whole circumstances of the case, without taking
account of any irrelevant considerations.
47.
Regarding the Claimant’s available resources, he was not wrong to include
her student loan. First, it was money which was available to her and was,
accordingly, a resource. Secondly, it was not ring fenced so as to be spent
only on essential living costs but even if it had been, it was not the only
money available to the Claimant from which the deposit could have been paid.
48.
Regarding the Employment Judge’s comments about the possibility of the Claimant
returning to live at home (as she appears to have done for the first couple of
months of her course) thereby avoiding having a rental liability to a
commercial landlord, contrary to what was argued, he did not suggest or
indicate that that was what she should do. It was plainly referred to as being
an example of a means by which she could rebalance her income and expenditure
in circumstances, I would add, where her costs were not fixed, her expenditure
list was not backed by vouchers and it disclosed a number of other items that
could also have been subject to adjustment – weekly expenditure of £25 on
clothes, for instance. Articles 8 and 14 of the Convention are not
engaged. The Employment Judge did not make any decision which impinged on
those rights.
49.
Regarding the Employment Judge’s reference to “pain”, the ground of
appeal takes the comment out of context and the ground of appeal proceeds on
the basis that the Claimant had as a matter of fact suffered the discrimination
and victimisation complained of (issues which, at that stage, had not been
determined). The observation was no more than a statement that it is not enough
for a claimant to show that it will be difficult to pay a deposit order; it is
not, in general, expected that it will be easy for claimants to do so. It also
showed recognition on the part of the Employment Judge that the Claimant fell
into that category.
50.
Otherwise, Mr Simpson’s submissions related to the response to the Claimant’s
application for review and the original November 2010 but those decisions were
not the subject of this appeal.
51.
In these circumstances, no error of law was identified by Mr Simpson.
The appeal is, accordingly, refused.
Disposal
52.
I will pronounce an order dismissing the appeal and upholding the order
of the Employment Tribunal that the Claimant be required to pay a deposit of
£380 as a condition of being permitted to continue with her claim. I will also
order that that deposit be paid to Employment Tribunal at Glasgow within 21
days of 20 January 2012.
