SUMMARY
PRACTICE AND PROCEDURE – Costs
The Claimant claimed direct sex discrimination and victimisation
against her employers. The Employment Tribunal decided that all of her
complaints were untrue. They subsequently ordered her to pay the Respondent’s
costs, principally on the basis that the claim was misconceived i.e. had no
reasonable prospect of success. They had concluded that the Claimant had not
deliberately lied but that, for whatever reason, her perception of reality was
damaged and wholly unreliable.
Held: on the Claimant’s appeal against the award of
costs
(1) The ET
were entitled in the exercise of their costs discretion to take into account their
perception of her mental health (although there was no direct medical evidence)
and her refusal or failure to seek medical help; there was no breach of Article
8; the material had been put before the ET by the Claimant.
(2) The ET
were entitled to take into account the fact that the Claimant had not put
forward a grievance. Section 207A of the 1992 Act related to a wholly
different situation and did not constitute the only circumstances in which
failure to put forward a grievance could be relevant.
(3) The fact
that the ET had concluded that the Claimant had not deliberately lied did not
prevent the ET from considering that the claim had no reasonable prospect of
success or that the claim had been reasonably brought and pursued.
HIS HONOUR JEFFREY BURKE
QC
Introduction
1.
This is an appeal by the Claimant, Ms Boras Topic, against the
Judgment of the Employment Tribunal sitting at Watford, presided over by
Employment Judge Liddington, sent to the parties with reasons on
9 August 2011. By that Judgment the Claimant was ordered to pay the costs
of the first Respondent to her claim, Hollyland Pitta Bakery Ltd, in an amount
to be determined by way of detailed assessment in the County Court. The
Respondents were the Claimant’s erstwhile employers and one of their managers,
Mr Agathangelou. The Claimant was employed by the first Respondent at
their bakery in North London from 1 February 2010 for a fixed term to June
of that year, in order to provide cover for the accounts manager who was taking
maternity leave over that period. Her employment came to an end when the
accounts manager returned. Some two months later she presented to the Tribunal
claims that, during her four months with the first Respondent, she had been the
victim of direct sex discrimination by the first and second Respondents,
harassment by the second Respondent and victimisation by both Respondents; and
she also put forward a claim for unpaid accrued holiday pay.
The Employment Tribunal
2.
After interlocutory hearings, which were to a substantial extent
concerned with the identification of the precise acts relied upon by the
Claimant, the Employment Tribunal heard the evidence of all parties over three
days in February 2011 and sent their Judgment on liability to the parties
on 25 February. The Employment Tribunal dismissed all the Claimant’s
claims. There were eight acts which, through the interlocutory process, had been
identified. They were alleged to have occurred between
6 and 25 May 2010. They included allegations against the second
Respondent that he had, on one occasion, made highly suggestive remarks to the
Claimant and asked personal questions of her, that he had on another occasion
approached her physically and made movements towards her which simulated the
sexual act, that he had continued to harass her thereafter and that he had
falsely accused her of accepting a forged £20 note. The Employment Tribunal
found that all of the Claimant’s complaints were untrue. At paragraph 14
of their liability Judgment the Tribunal said this:
“It gives the tribunal no pleasure to state that in all
instances where there was a dispute in facts, the tribunal, without hesitation,
preferred the evidence of the respondent’s witnesses, who appeared to the
tribunal to be honest and who gave cogent and coherent evidence. The
claimant’s evidence was, quite simply, unbelievable. It was neither
consistent, in itself, nor did it reflect the contents of any of the
documentation. For whatever reason, and this is not a matter upon which the
tribunal would care to speculate, the claimant’s perception of reality,
sincerely held as it might be, is damaged and, as a result, utterly
unreliable. Whilst the tribunal has sympathy for the claimant, it has also
been aware of the extreme difficulties her conduct has caused to the
respondent, both during and since her employment, and in particular to the
second respondent and, indeed, to Mr Charalambous. Both of these
individuals have behaved at all times in an appropriate way towards the
claimant and the tribunal can find no evidence of any of the acts of
victimisation or harassment which the claimant claims to have suffered.”
3.
At paragraph 15(9), referring to the alleged movements of simulated
sex, the Tribunal said:
“The fact is that, like the CCTV cameras, this entire incident
is a pure figment of the claimant’s imagination. It simply did not happen. It
should be noted that the evidence of all the respondent’s witnesses and the
photographs which were submitted, are clear: there were no CCTV cameras in the
claimant’s office nor in the corridor. Indeed, even upon questioning, the
claimant could not say where any such cameras were, although during evidence
she had said that certain people were positioned in a certain way to avoid the cameras.
If she did not know where the cameras were, how could she know that their
positioning was in order to avoid the cameras? Typically, and unfortunately,
the claimant’s evidence simply made no sense and has no rational basis.”
4.
At paragraph 15(17) the Tribunal said:
“Without going into unnecessary detail, in all of these
incidents the claimant was not even criticised, let alone harassed or
victimised as a result of these incidents she received no warning of any sort.”
5.
At paragraphs 15(10) and (13) the Tribunal referred to
the fact that the Claimant had been unwilling to give any details of what had
supposedly happened to her when asked about it. At paragraph 15(10) the
Tribunal described how, when asked by Mr Agathangelou what he had done wrong, the
Claimant simply said, “You know what I mean”, and refused to give any details;
and the Tribunal, at paragraph 15(13), made similar comments about a
subsequent incident and said this:
“The Tribunal notes again that the email is remarkable for the
lack of detail of any incident which could have been so serious as to result in
the claimant having to attend the emergency room at the hospital. It is simply
not credible that any victim of such alleged serious discrimination would not
be prepared to give details or indeed at the very least to raise the matter
formally.”
The costs decision
6.
In the light of that Judgment an application was made by the Respondents
for an order for costs against the Claimant on the basis that she had acted
unreasonably in bringing or conducting the proceedings, or that the bringing or
conducting of the proceedings by the Claimant had been misconceived. That
application was heard on 17 May 2011. The Claimant, although she had
been represented in the run‑up to the liability hearing by solicitors,
had represented herself at that hearing; and the Respondents were at that
hearing represented by Mr David Craig of counsel. At the costs
hearing the Claimant was represented by a Law Centre representative, and the
Respondents by a solicitor. Today the Claimant has been represented by
Ms Hirsch of counsel, and the Respondents, again, by Mr Craig. We
are grateful to both counsel for their helpful submissions.
7.
At the costs hearing the Respondents put forward a schedule of costs which
totalled £64,936, and asked for an order that the Claimant should pay costs to
be assessed by the County Court or, if appropriate, to pay costs up to the
Employment Tribunal’s maximum of £10,000. The Tribunal’s conclusions were
contained in paragraph 18 of their costs Judgment in these terms:
“18. Having carefully considered the arguments from both parties
and taking into account the claimant’s ability to pay, the Tribunal concludes
as follows:‑
18.1. The Claimant’s bringing of her complaints of sex
discrimination was misconceived in that there was a total lack of evidence to
support those allegations and hence no prospect of success. There were no
witnesses (which is not in itself unusual in such cases) and no supporting
documentation of any sort which could have allowed the tribunal to infer a case
of sex discrimination (even in contemporaneous documents the claimant refused
to specify what exactly it was that Mr Agathangelou had done which caused
her to feel that she was being sexually harassed by him. Nor did the claimant
raise a grievance or even attend meetings to discuss these issues when invited
to do so. The allegations were quite simply untrue, not because the tribunal
felt that the claimant was deliberately lying, but because for whatever reason
(and the tribunal suspected that the claimant suffers from some sort of mental
impairment), she believed things which on any objective basis had no foundation
in reality. We had evidence that the claimant was under a doctors’ care [sic]
although in addition to the medication prescribed by her GP, the claimant was
also self‑medicating with medication she obtained abroad. She had
refused to undergo the counselling recommended by her doctor. In addition, she
had made similar allegations of sexual harassment against two previous
employers.
18.2. The Tribunal also finds that the claimant’s conduct of the
case was unreasonable in that the further and better Particulars, which were
not contained in the ET1 and which were drafted by the claimant’s then
solicitors on her instructions, inevitably increased the respondent’s costs in
preparing, or at least considering, rebuttal evidence. The further amended
particulars and the Application to Amend shortly before the Hearing left the
respondent in the position of having to decide whether it needed to respond to
all those allegations or whether it could be confident that that Application
would be rejected and the evidence therefore limited to the eight issues which
had been identified at the Case Management Discussion. It is not unreasonable,
given the serious allegations being levelled against the company itself and
virtually everyone who worked in it, specifically but not only
Mr Agathangelou, that the company chose to adopt what has been described
as a ‘belt and braces’ approach, which inevitably increased costs. The
Tribunal has had regard to the claimant’s ability to pay and notes that she
owns two properties one of which produces a rental income.”
8.
The Tribunal had, at paragraphs 15‑17, directed themselves as
to the statutory provisions which related to costs orders in a manner not said
to have been in error. In particular, they directed themselves, at
paragraph 16, to rule 40(3) of the Employment Tribunals
(Constitution and Rules of Procedure) Regulations 2004
Schedule 1, which provides as follows:
“(3) The circumstances referred to in paragraph (2) are where
the paying party has in bringing the proceedings, or he or his representative
has in conducting the proceedings, acted vexatiously, abusively, disruptively
or otherwise unreasonably, or the bringing or conducting of the proceedings by
the paying party has been misconceived.”
9.
In considering the jurisdiction to award costs where the bringing or
conducting of the proceedings by the paying party has been misconceived a
Tribunal has to bear in mind that rule 2 of the 2004 Regulations (what in a
statute would be called “the definition section”) expressly provides that the
word “misconceived” includes “having no reasonable prospect of success”; and it
is clear from what the Tribunal said in paragraph 18 that they had that in
mind. The Tribunal concluded, in brief, that the bringing of the claim was
misconceived and ordered the Claimant to pay the Respondents’ costs, to be
assessed by the County Court. They also found, as an alternative to those
findings, as it were, that the Claimant’s conduct of the case had been
unreasonable in that the Further and Better Particulars, which were provided in
circumstances set out in detail in the liability Judgment, and the subsequent production
of amended Particulars in an application to amend shortly before the hearing
had caused costs which had been unreasonably incurred.
The grounds of appeal
10.
Ms Hirsch, in the Notice of Appeal, puts forward three grounds of
appeal, which we can summarise in this way, although they were, perhaps to a
degree, and we say this in no critical spirit, subject to some mutation during
the course of argument:
(1) The
Employment Tribunal, in deciding that the complaints were misconceived, took
into account two irrelevant factors, those being (a) that the Claimant was
under medical care and had refused to undergo counselling as recommended by her
doctor, and (b) she had not raised a grievance.
(2) The
Employment Tribunal erred in law in finding the claim to have been misconceived
on the basis that there was no evidence to support the Claimant’s case, when
she had herself given evidence which had been found to be incorrect but not
deliberately mendacious.
(3) The
Tribunal failed to consider the narrow limits imposed on them by their
jurisdiction to award costs by authority, failed to take into account
sufficiently or at all their own conclusions as to the Claimant’s mental health
and the fact that she was not found to be a liar, and, further, as to
paragraph 18.2, had awarded costs under the unreasonable head in relation
to a period when the Claimant was unrepresented and not in receipt of legal
advice.
General principles
11.
Before we turn to those grounds of appeal specifically, it is necessary
to say something about general principles in response to the submissions made
by the parties. We start, in considering general principles in so far as they
are relevant to this appeal, with the most recent authority in that area, Barnsley Metropolitan Borough Council v Yerrakalva
[2012] IRLR 78, in which the claimant’s multiple claims had been serially
withdrawn by her, culminating in a final dismissal of her claims upon
withdrawal after a three‑day Pre‑Hearing Review which was never
completed. The Employment Tribunal ordered the claimant to pay the respondent’s
costs throughout, to be determined by assessment. The Employment Tribunal
found that the claimant had been unreasonable in her conduct of the case and
had told lies and that she should pay the costs to which we have just referred;
but they were also critical in some respects of the respondent’s conduct. The
Employment Appeal Tribunal allowed the claimant’s appeal and set aside the
costs order in its entirety. The Court of Appeal allowed the respondent’s
further appeal and concluded that the Claimant should pay 50 per cent
of the respondent’s costs. The individual facts of the case are not relevant,
but there are in the judgment of Mummery LJ, with whom Patten LJ and
Sir Henry Brooke agreed, important statements of principle both about
the approach of an Employment Tribunal to costs applications and to appeals
against costs decisions. As to the former, Mummery LJ said this at
paragraphs 39‑42:
“39. I begin with some words of caution, first
about the citation and value of authorities on costs questions and, secondly,
about the dangers of adopting an over-analytical approach to the exercise of a
broad discretion.
40. The actual words of Rule 40 are clear enough
to be applied without the need to add layers of interpretation, which may
themselves be open to differing interpretations. Unfortunately, the leading
judgment in McPherson [ v BNP Paribas [2004] ICR 1398] delivered by me has created some confusion in the ET, EAT and
in this court. I say ‘unfortunately’ because it was never my intention to
re-write the rule, or to add a gloss to it, either by disregarding questions of
causation or by requiring the ET to dissect a case in detail and
compartmentalise the relevant conduct under separate headings, such as ‘nature’
‘gravity’ and ‘effect.’ Perhaps I should have said less and simply kept to the
actual words of the rule.
41. 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 it had. The main thrust of the passages
cited above from my judgment in McPherson was to reject as erroneous the
submission to the court that, in deciding whether to make a costs order, the ET
had to determine whether or not there was a precise causal link between the
unreasonable conduct in question and the specific costs being claimed. In
rejecting that submission I had no intention of giving birth to erroneous
notions, such as that causation was irrelevant or that the circumstances had to
be separated into sections and each section to be analysed separately so as to
lose sight of the totality of the relevant circumstances.
42. On matters of discretion an earlier case only
stands as authority for what are, or what are not, the principles
governing the discretion and serving only as a broad steer on the factors
covered by the paramount principle of relevance. A costs decision in one case
will not in most cases pre-determine the outcome of a costs application in
another case: the facts of the cases will be different, as will be the
interaction of the relevant factors with one another and the varying weight to
be attached to them.”
12.
He went on to hold that the Employment Tribunal had erred in that,
having made a decision which they were entitled to make in finding the claimant
to have acted unreasonably, they had failed to factor into their judgment or
their discretion the significant criticisms of the respondent. We will return
later to paragraph 41 and the important statement that, in exercising a
discretion to order costs, the Tribunal must look at the whole picture of what
has happened.
13.
As to the appellate function Mummery LJ, at paragraphs 5‑9,
said this:
“5. This is the third round of legal argument
about the Council's costs in the ET. The parties were, of course, perfectly
entitled to exercise their statutory right of appeal; but, as both sides
appreciate, a decision to dispute the exercise of the ET's discretion and to
run up even more costs should only be taken after careful thought.
6. The tribunals below did not agree about the
exercise of the discretion. That is not surprising. A familiar feature of all
litigation is that experienced judges may sensibly differ on how, in the
particular circumstances of the individual case, a costs discretion should be
exercised. Parties and prudent advisers should take account of that factor when
considering whether a costs order is worth appealing.
7. As costs are in the discretion of the ET,
appeals on costs alone rarely succeed in the EAT or in this court. The ET's
power to order costs is more sparingly exercised and is more circumscribed by
the ET's rules than that of the ordinary courts. There the general rule is that
costs follow the event and the unsuccessful litigant normally has to foot the
legal bill for the litigation. In the ET costs orders are the exception rather
than the rule. In most cases the ET does not make any order for costs. If it
does, it must act within rules that expressly confine the ET's power to
specified circumstances, notably unreasonableness in the bringing or conduct of
the proceedings. The ET manages, hears and decides the case and is normally
the best judge of how to exercise its discretion.
8. There is therefore a strong, soundly based
disinclination in the appellate tribunals and courts to upset any exercise of
discretion at first instance. In this court permission is rarely given to
appeal against costs orders. I have noticed a recent tendency to seek
permission more frequently. That trend is probably a consequence of the
comparatively large amounts of legal costs now incurred in the ETs.
9. An appeal against a costs order is doomed to failure, unless
it is established that the order is vitiated by an error of legal principle, or
that the order was not based on the relevant circumstances. An appeal will
succeed if the order was obviously wrong. As a general rule it is recognised
that a first instance decision-maker is better placed than an appellate body to
make a balanced assessment of the interaction of the range of factors affecting
the court's discretion. This is especially so when the power to order costs is
expressly dependent on the unreasonable bringing or conduct of the
proceedings. The ET spends more time overseeing the progress of the case
through its preparatory stages and trying it than an appellate body will ever
spend on an appeal limited to errors of law. The ET is familiar with the
unfolding of the case over time. It has good opportunities for gaining insight
into how those involved are conducting the proceedings. An appellate body's
concern is principally with particular points of legal or procedural error in
tribunal proceedings, which do not require immersion in all the details that
may relate to the conduct of the parties.”
14.
Until that recent decision, the principal authority as to matters of
principle was perhaps McPherson. That was also a case in which
the claimant had withdrawn his claims and had been ordered to pay costs. The
Court of Appeal held that it was not necessary for it to be proved that the
particular acts of unreasonableness which they found to exist caused particular
items of cost; it was the way in which that decision should be applied that
Mummery LJ clarified in paragraphs 41 and 42 of his
Judgment in Yerrakalva, which we have earlier set out. It is
important to remember, though, that both McPherson and Yerrakalva
were decisions on whether costs should be ordered on the basis that the claimant
had behaved unreasonably and not decisions on whether the bringing or
conducting of proceedings was misconceived, although there is nothing to
suggest, and we certainly do not suggest, that the general principles that
those two decisions that the Court of Appeal set out do not apply equally to
both.
15.
While other decisions are referred to in the parties’ skeletons, we have
not been referred to most of them, and it is not necessary for us to go further
in relation to the general principles upon the basis of which we must approach
this appeal and which also provided guidance to the Employment Tribunal below.
We turn therefore to the individual heads of appeal.
Irrelevant matters
16.
The rival submissions can be briefly stated. As to the Claimant’s
medical circumstances, Ms Hirsch submits that the Claimant’s lack of
treatment history was a private matter which should not have been taken into
account by the Tribunal when considering a costs order; they were matters as to
which privacy was protected by Article 8 of Schedule 1 to the Human Rights Act 1998,
embodying within domestic law the ECHR right to respect for private and family
life. As to the Claimant’s failure to pursue a grievance process,
Ms Hirsch submits that, if there had been a compensation award made to the
Claimant, the Tribunal, pursuant to section 207A of the Trade Union and
Labour Relations (Consolidation) Act 1992, as amended, could have deducted
up to 25 per cent from such award for that failure, that being the
statutorily provided potential repercussion of a failure on the part of a
Claimant to comply with the ACAS Code; the Claimant should not be punished for
such failure in another way, for example in the guise of a costs award.
17.
In the course of her submissions Ms Hirsch has added a further
development of these points, which amounts to what was the central thrust of
her argument - that the Tribunal had failed to take into account the Claimant’s
impaired mental ability in reaching the conclusion that they did. We intend to
address the arguments as to the Claimant’s mental state first. It is necessary
to say that there was very little material available to the Employment
Tribunal. The Claimant herself, we are told, does not accept that she has any
mental health problem; and at the costs hearing the only submission put before
the Tribunal as to that was by way of reliance upon what the Tribunal had said
at paragraph 14 of their liability Judgment, which we have set out
earlier, but for these purposes we can repeat, namely, these words:
“For whatever reason, and this is not a matter upon which the
tribunal would care to speculate, the claimant’s perception of reality,
sincerely held as it might be, is damaged and, as a result, utterly
unreliable.”
18.
However, the Tribunal had seen and heard the Claimant’s and the
Respondents’ evidence and were able from that to say in their costs Judgment
what they said at paragraph 18.1: that although the allegations were
untrue, that was because the Tribunal felt that the Claimant was not
deliberately lying but for some other reason - and they suspected some form of
mental impairment but did not find it; for they could not find it without much
more evidence - she believed things which on any objective basis had no
foundation in reality. There was, during the course of argument before us,
discussion as to whether consideration of the Claimant’s problems of the type
we have just been referring to was relevant to the Employment Tribunal’s determination
as to whether the bringing or continuation of proceedings by the Claimant had
been misconceived. Mr Craig submitted that, particularly because the
words of rule 2 provide that “misconceived” includes having no reasonable
prospect of success so that the absence of such prospects was sufficient for,
although not necessary to, there being a finding that the bringing or
conducting of the proceedings was misconceived, subjective matters such as the
Claimant’s intent or her state of health were irrelevant and that a wholly
objective test needed to be applied. Of course, matters such as intention and
mental health, if they arose, had to be considered by the Tribunal; but they
were factors in the Tribunal’s exercise of discretion rather than in their consideration
of whether it was proved that the bringing or conducting of proceedings was
misconceived.
19.
After some debate Ms Hirsch conceded that this was the correct
analysis; and we therefore adopt it for the purpose of this appeal, although we
should not be taken to be setting out a general statement of law. In the case
of HCA International v May‑Bheemul
UKEAT/0477/10, judgment given on 23 March 2011, Cox J presiding,
the EAT, at paragraphs 60 and 61, said in relation to
consideration of a costs order on the basis of unreasonableness, that the fact
that the Claimant had a genuine belief in her allegations and that she was
unwell was a factor to be taken into account in the exercise of discretion. However,
at whatever stage of the task which confronted the Employment Tribunal in
considering the Respondents’ application for costs in this case the Claimant’s
mental state came to be considered, in our judgment it plainly was considered
by the Tribunal, who devoted much of paragraph 18.1 of their Judgment to
that topic. It having been agreed before us that the Claimant’s mental state
was a matter for the Tribunal’s discretion, the weight given to that factor was
a matter for the Tribunal. It is not argued that the Tribunal, in considering
that factor, came to a perverse conclusion.
20.
The second criticism advanced under ground 1 is the perhaps
contradictory criticism that the Tribunal ought not to have considered against
the Claimant the fact that her mental state was as they described and that she
had refused to undergo counselling as advised by her doctor because, as we have
already said, these were private matters, on the basis set out above. We are
told that the evidence as to these matters was given by the Claimant without
protest or without any invocation of Article 8, whether as incorporated
into the law of this country or otherwise; and, in our judgment, once the
material to which the Tribunal refer was before them, they were entitled to
take it into consideration; and, indeed, had they not done so an argument that
they had failed in their duty to consider the whole picture (an argument to
which we will come soon), would not have been bound to fail. The evidence was put
before the Tribunal without objection; and they were entitled to consider it.
Whether they were, in the part of paragraph 18.1 of their Judgment in
which they address it, being critical of the Claimant, as Ms Hirsch
submits, or were explaining in her favour, as Mr Craig submits, why they
believed that she was not deliberately lying or were just neutrally describing
the facts, which is also a potential interpretation of paragraph 18.1,
does not matter. The objection to this passage of the Tribunal’s Judgment
based on Article 8 cannot now be sustained.
21.
We therefore turn to the third alleged irrelevance; and that is the
absence of a grievance. The Claimant’s submission here we have already
described; it is based on section 207A of the 1992 Act. However, it is
only open to a Tribunal to act against a Claimant under section 207A for
failure to institute a grievance against her employers if the Claimant has won
and been awarded compensation, at least in part. Costs are usually only
claimed against a Claimant after a full hearing if that Claimant loses. If the
Claimant has lost, section 207A has no relevance. The fact that
Parliament has provided for a step to be taken contrary to the interests of a
party when that party wins, by way of deduction from that party’s compensation
if it is regarded as appropriate to do so, in no way indicates that a Tribunal,
in considering a costs order, cannot consider that a party has failed to comply
with the ACAS Code, whether by instituting a grievance or otherwise. The
Tribunal were, in our judgment, entitled to consider whether the Claimant had
pursued a grievance as material to the question of whether there were ever
reasonable prospects of success. They had in their liability Judgment referred
to the Claimant’s refusal to give details of her allegations and to her failure
to raise those allegations formally with the Respondents as factors relevant to
the Claimant’s credibility. In making an objective assessment of the prospects
of success or lack thereof, the Tribunal were, in our judgment, entitled to
take into account both the Claimant’s refusal to give details and the absence
of the initiation of any grievance process.
Ground 2
22.
The basis of Ms Hirsch’s argument under this ground is that the Tribunal
erred in law or made a perverse finding in concluding that there was a total
lack of evidence to support the Claimant’s allegations and hence no prospect of
success and in failing to take into account the fact that she was found not to
be lying. The Tribunal, it is argued, could not reasonably have expected the
Claimant, bearing in mind the type of allegations which she was making, to have
had any supporting evidence in relation to matters which, by their very nature,
took place in circumstances of privacy and appear to have forgotten that the
Claimant had given evidence herself, evidence which the Tribunal found or
perhaps indicated that they felt was not mendacious.
23.
In our judgment, the Claimant’s argument involves a misunderstanding of
what the Tribunal were saying in paragraph 18.1. The Tribunal should not
be taken to have been saying that they would expect supporting evidence in a
case such as this; indeed, they expressly said that the absence of witnesses to
support the evidence of a Claimant in a case such as this was usual. The point
which they were making, and were in our judgment entitled to make, was that
there was no support for the Claimant’s account, and that, without the benefit
of that support, the prospects of success, whether such support was likely to
be found or not, were less than there would have been if there had been such
support. The absence of corroborative evidence did not, of course, lead
inevitably to failure; and the Tribunal did not so suggest. There is no reason
to suppose they had forgotten the Claimant’s evidence: they made multiple
findings about the Claimant’s evidence. Had there been supporting evidence,
that would have substantially enhanced the Claimant’s prospects of success; the
absence of any supporting evidence was, in our judgment, relevant to the
statutory question which arose under rule 40(3) as to whether the bringing
or conducting of the proceedings by the Claimant had been misconceived.
24.
Ms Hirsch referred under this head too to the Tribunal’s
conclusions as to the Claimant’s damaged perception of reality. Her submission
was that, having so found, the Tribunal should not have concluded that a costs
order should be made, especially on the basis of their express finding that
there was no evidence to support the case and the Claimant had not told lies.
However, Ms Hirsch accepted that, in reality, this ground of appeal
amounted to a perversity argument. She suggested that, once the primary facts
had been found by the Tribunal, the full rigour of the Court of Appeal’s
decision in Yeboah v Crofton [2002] IRLR 634, in which
Mummery LJ said that, for a perversity argument to succeed, it must be
shown overwhelmingly that there was perversity, did not apply; when asked
whether there was an authority for that proposition, Ms Hirsch frankly
told us that the answer was in the negative; and we do not accept her proposition.
The Tribunal had to make a secondary conclusion of fact, namely whether the
bringing or conducting of the proceedings by the paying party had been
misconceived, based on their decision as to the primary facts; but their
conclusion was one of fact; and they then had to exercise their discretion. In
either case an allegation of perversity can only succeed if an overwhelming
case is made out. The Tribunal gave reasons for their decision on both of
those issues based on their findings of primary fact; and no perversity has
been demonstrated.
Ground 3
25.
Ground 3 comes in two tranches. First of all, ground 3, put
generally, attacks principally the Tribunal’s conclusions in
paragraph 18.1 on the basis that the Tribunal failed to take into account
the guidance of the Court of Appeal in McPherson, and now in Yerrakalva
as well, that the power of an Employment Tribunal to make costs orders is not
only more restricted than the power of the ordinary courts under the Civil Procedure Rules
but it has for long been accepted that the costs regime in ordinary litigation
does not fit the particular function and special procedures of Employment
Tribunals. That submission cannot succeed, in the face of the fact that, at
paragraph 14 of their costs Judgment, the Tribunal expressly said this:
“The Tribunal is reminded that Cost Orders are relatively rare and remain the
exception rather than the rule”. Plainly the Tribunal had that guidance in
mind.
26.
The argument continues by reference to an EAT decision, Matthew v Daleside Nursing Home
[2009] All ER (D) 99 that “where there is a clear‑cut finding that the
central allegation of racial abuse is a lie, it would be perverse not to make a
costs order”; in the case of May‑Bheemul, UKEAT/0477/10 a
more nuanced approach to cases where the central allegation is not one of lying
was taken; it was said that an award of costs did not automatically follow when
a party fails to establish a central allegation in their case, whether by lying
or otherwise.
27.
What emerges, in our judgment, from the authorities to which we were
taken is this: first that the fact that a claimant has based his or her claim
on lies does not lead automatically to a finding either that the proceedings
have been conducted unreasonably or that they have been commenced and conducted
on the basis that they were misconceived; secondly, the fact that there have
been no lies, equally, does not mean that there cannot be a finding that the
proceedings have been brought or conducted unreasonably or as misconceived; and
thirdly, it is a question in each case for the Tribunal, in making their
findings within rule 40(3) of Schedule 1 to the 2004 Rules and in
exercising their discretion, if they have found as a matter of fact that there
has been unreasonableness in conducting the proceedings or that the bringing or
conducting of the proceedings has been misconceived, to look at the whole
picture, bearing in mind that costs are rarely awarded in the Employment
Tribunal and that the ordinary common law principles under the CPR do not
apply.
28.
The Employment Tribunal in this case have not, in our judgment, been
shown to have committed any error either in terms of reaching their findings of
fact in paragraph 18.1 or in the exercise of their discretion. They took
into account factors which it was open to them to take into account, did not
take into account any factors that it was not open for them to take into
account, and came to a permissible conclusion on the issue as to whether the
proceedings had been commenced as misconceived and in the exercise of their
discretion.
29.
The second focus of ground 3 was limited to paragraph 18.2,
the Tribunal’s fallback position (which is one way, perhaps, of describing it).
Here, Ms Hirsch submitted, the Tribunal should not have found the Claimant
to have acted unreasonably at all at any stage or at least in relation to a
period when she was not represented; at the time of the giving of the Further
and Better Particulars she was represented, but thereafter she ceased to be
represented and was not represented when the further amended Particulars and an
application to amend were put forward. Mr Craig’s response to this was
threefold: first of all, this was not covered by the Notice of Appeal;
secondly, without having had notice of these points he was not in a position to
accept the facts that we have summarised; and thirdly, in any event there was
no error of law.
30.
As to the first point, we will assume in Ms Hirsch’s favour,
without finding, that the Notice of Appeal does, just about, cover this
argument. Secondly, we will accept her account of the facts and of the history
of what occurred. Thirdly, however, we are unhesitatingly of the view that no
error of law is made out. This is, in reality, an attempt to re‑argue
the facts. It was open to the Employment Tribunal to regard the Claimant as
acting unreasonably both in the period when she was represented and in the
period when she was not. They knew perfectly well when she was and was not
represented; the history of what happened is set out to a substantial degree in
the first part of their liability Judgment. Eight individual acts of
discrimination, harassment and victimisation were eventually identified, yet
thereafter the Claimant sought to add further allegations and to amend her
claim only a few days before the liability hearing. The fact that the Claimant
was unrepresented for part of the relevant period was not an answer to the
allegation of unreasonable conduct and is not something which the Tribunal can
be shown to have failed to have in mind. That being so, ground 3 in its second
incarnation, in our judgment, cannot succeed.
Conclusion
31.
For those reasons, this appeal fails and must be dismissed.
