United Kingdom Employment Appeal Tribunal

Appeal No. UKEAT/0298/15/JOJ

 

 

EMPLOYMENT APPEAL TRIBUNAL

FLEETBANK HOUSE, 2-6 SALISBURY SQUARE, LONDON EC4Y 8AE

 

 

                                                                                                             At the Tribunal

                                                                                                             On 2 February 2016

 

 

 

Before

THE HONOURABLE MRS JUSTICE ELISABETH LAING DBE

(SITTING ALONE)

 

 

 

 

 

 

MS R WAIYEGO                                                                                                     APPELLANT

 

 

 

 

 

FIRST GREAT WESTERN LTD                                                                         RESPONDENT

 

 

Transcript of Proceedings

 

JUDGMENT

 

 

 

 

 

 

 

 

 

 

APPEARANCES

 

 

 

 

 

For the Appellant	MR GEORGE YAGOMBA (Representative)
For the Respondent	MS DEE MASTERS (of Counsel) Instructed by: Kennedys Solicitors 25 Fenchurch Avenue London EC3M 5AD

 

 

SUMMARY

PRACTICE AND PROCEDURE - Amendment

PRACTICE AND PROCEDURE - Case management

PRACTICE AND PROCEDURE - Striking-out/dismissal

PRACTICE AND PROCEDURE - Costs

PRACTICE AND PROCEDURE - Appellate jurisdiction/reasons/Burns-Barke

 

The Employment Appeal Tribunal held that an Employment Tribunal had given adequate reasons for it decision not to strike out the Respondent’s Defence, not to hold that the Respondent was in Contempt of Court, and not to make any Order for costs against the Respondent.

 

 

THE HONOURABLE MRS JUSTICE ELISABETH LAING DBE

 

Introduction

1.                  This is an appeal from the Employment Tribunal (“the ET”) sitting at Bristol on a Preliminary Hearing.  I shall refer to the parties as they were below.  I shall say in a moment what the ET decided.  The ET’s Reasons were sent to the parties on 16 April 2015.  The ET consisted of an Employment Judge sitting alone (“the EJ”).  The Claimant was today represented by Mr Yagomba and the Respondent by Ms Masters of counsel.  I pay tribute to both advocates for their clear, articulate and moderate submissions.

 

2.                  Permission to appeal in this case was given by HHJ Peter Clark.  He identified two issues: (1) whether the ET failed to give a reasoned decision on the Claimant’s applications to strike out the Response to her claim and to amend the Response; and (2) if so, whether remission was necessary in the light of the reasons given by the EJ for the Costs Decision.  The Notice of Appeal raised a number of other issues: perversity, taking into account irrelevant considerations and a failure to take into account relevant considerations, for example.

 

The Claims

3.                  The EJ described the background at the start of his Reasons.  The Claimant had brought two claims.  The first claim against the Respondent was for harassment on the grounds of sex and victimisation.  There was a case management hearing in September 2014.  Various Orders were made on that occasion.  I need to mention only one of them, which is headed “Amended Response and Further Information”:

“1.1. The Respondent is ordered to present an amended response, so as to arrive with the Tribunal and the Claimant on or before 24 September 2014, which will:

1.1.1. Contain the Respondent’s final position in relation to limitation/time issues;

…”

4.                  The first claim was listed for a Full Hearing for five days beginning on 8 December 2014.  Shortly before the date listed for that hearing, on 25 November 2014, the Claimant’s then solicitors emailed the Respondent’s solicitor, Mr Finlay, as follows:

“Dear Mr Finlay,

I am now dealing with this case on behalf of the Claimant.

On reviewing the file there seems to have been slippage by both sides on the case managements [sic] orders to agree a final bundle of documents and exchange of witness statements.

As the hearing isn’t too far away I think it would be sensible to agree revised dates for compliance with the orders.

I suggest the parties agree a hearing bundle index by close of business on Friday 28^th November and witness statements exchanged by close of business on Tuesday 2^nd December.  Is this agreeable?” 

 

5.                  On 1 December 2014 the Claimant’s new solicitors, OH Parsons, sent an email to the Tribunal, which they copied to Mr Finlay.  The email said this:

“We have been instructed by the Claimant in these proceedings as of today.

We understand that a 4 day hearing has been listed in this matter to begin on 8 December.

We make an application pursuant to rules 29 and 30 of the Employment Tribunals [Constitution and] Rules of Procedure [Regulations] to postpone the current hearing on the following grounds:

1. We have just been instructed in the matter and require some time to review the file in order to effectively represent the Claimant.  The postponement of the hearing would ensure that the claim is dealt with in line with the Overriding Objective and in the interest of justice.  In particular, that the parties are on an equal footing.

2. The parties have not yet exchanged statements and, therefore, the postponement of the claim would not disadvantage either party.  Indeed, it may save time and expense for both parties in the long term.

We understand that the Respondent representative (copied in to this application in line with rule 30 of the Tribunal Rules) will be emailing the Tribunal to confirm that the application is jointly made.”

 

6.                  The hearing that was listed for 8 December 2014 was then adjourned.  The Employment Judge recorded in his Reasons that the Claimant later withdrew her instructions from OH Parsons, and that by the time of the hearing in front of him - that is, 30 March 2015 - she was acting in person.

 

7.                  The second claim was presented on 24 January 2015.  This claim was brought against the Respondent and six named employees.  That claim alleges discrimination on the grounds of race and disability.  The EJ recorded that the Claimant is of black Guyanese origin.  By a letter dated 21 April 2015 the Claimant told the Bristol Tribunal that she is in fact black and of Kenyan origin with British ancestors.  The EJ recorded in his Reasons that the Claimant claimed to suffer from severe depression with anxiety and panic attacks and that this was a disability for statutory purposes.  The EJ went on to say that the claim form contained a long statement setting out events between 2005 and 2015.  He said he was not clear which events were said to be acts of discrimination, direct or indirect, or harassment or victimisation or on what grounds.  The EJ gave directions in the Order that he made, and which is the subject of this appeal, to clarify those points.  The EJ recorded that the Tribunal had previously ordered that the first and second claims should be consolidated and heard together, and he said that the parties had agreed that this course of action was appropriate.

 

8.                  With that background, the claim came before the EJ for a Preliminary Hearing to decide applications that had been made by the Claimant by a letter dated 27 February 2015 and to consider what further directions were necessary to get the matter ready to be listed.  The application in that letter had seven numbered pages; it consisted of a covering letter on pages 1 and 2, and, from pages 3 to 7 inclusive, what was described in paragraph 2 as “the attached application”, which set out in some detail the history of the proceedings and the reasons why the Claimant contended the ET should grant the application.  In that letter the Claimant said that she had received for the first time her entire file of papers from her previous solicitors on 10 February 2015.  She went on to say that she was making the following applications; first, an application inviting the Tribunal to strike out the Respondent’s entire Defence on the basis that the manner in which the proceedings had been conducted on behalf of the Respondent by its solicitors was unreasonable and scandalous and also because there had been deliberate non-compliance with ET Rules and the Order made in September.  The letter went on in its second numbered paragraph to say that the Claimant also applied for a formal declaration by the Tribunal that the conduct of the Respondent and its solicitors as set out in her attached application was conduct amounting to contempt of court.

 

9.                  In the third numbered paragraph the Claimant applied for a Costs Order.  The basis for that was that the proceedings had been conducted by the Respondent in a way that was unreasonable and scandalous; further, that the Respondent had fundamentally disregarded and breached the September 2014 Order and that this had led to the trial that had been listed for 8-11 December 2014 to be postponed and thus had denied the Claimant her right of access to justice.  In the fourth numbered paragraph, “Further and/or in the alternative to point (3) above” the Claimant applied for a Wasted Costs Order.  It was asserted that the Claimant had incurred those costs as the result of improper, unreasonable and negligent acts on the part of the Respondent’s solicitors.  The fifth numbered paragraph did not contain any application; it simply expanded on the meaning of the phrase “at any stage”.  The letter finished by proposing that the Tribunal give the Respondent 14 days to make written representations in response to the applications.

 

10.              The attached annexe (that is, pages 3 to 7 inclusive of the application) referred in paragraph 10 to the Respondent’s amended Response to the grounds of application.  The Claimant said that in that amended Response the Respondent had admitted that:

“10. … the letter allegedly sent on 03 February 2014, was in fact sent on 12 February 2014.  It is the Claimant’s allegation that the 03 February 2014 letter was a deliberate fabrication manufactured by [the Respondent] in a bid to defeat the Claimant’s claim on limitation and technicality, and the proof of this attempted manipulation of these Tribunal proceedings is evident from the two letters with the two separate dates as provided by [the Respondent].” 

 

11.              In paragraph 11 the Claimant said that in the amended Response the Respondent had changed the position as set out in paragraph 6 of its original Response.  It then said:

“11. …

In the premises, the Respondent’s position in this regard is an unfair and irregular amendment and a shifting of the target from its original position and pleading, and as such an according application needed to have been made.  If the Respondent will be making a retrospective application to amend its case, it will be the Claimant’s position to resist such an application and hereby assert that this offending paragraph of the Respondent’s amended Response ought to be completely struck out (as part of the entire strike out of Claim 1 or individually), otherwise the parties would not be on [an] equal footing.”

 

12.              Mr Yagomba, who was present at the hearing on 30 March 2015, says that the Claimant applied orally to strike out paragraph 6 of the Respondent’s amended Response.  Ms Masters’ instructing solicitor, Mr Finlay, who was also present at that hearing, does not remember whether or not such an application was made orally.  The EJ said that the Respondent did not admit that the Claimant had a disability as defined in the Equality Act 2010 and that it would be appropriate for that to be considered at a Preliminary Hearing.  The Respondent had asked  the ET to consider as a preliminary point whether all or any of the claims were out of time and if so whether it would be just and equitable to extend time.  Those and the timing of the second claim would have to be considered, said the EJ, at a further Preliminary Hearing.

 

13.              The ET then made nine Orders with times for compliance.  Most of those related to the further conduct of the claim.  For example, the Claimant was required to provide a medical report; and the Respondent, if it wished to, was to provide an amended Response in relation to the disability claim.  Times for compliance with the Order that had been made in September 2014 for formal disclosure and for the preparation of the bundle were extended.  The Claimant was required to provide an amended Schedule of Loss.  It was clear that there would need to be a further Preliminary Hearing to consider details about witness statements, listing and other issues.

 

14.              At paragraph 10 under the heading “Orders” the Decision read as follows:

“10. Dismissal of application for costs.

The Claimant’s application set out in her letter to the Tribunal of 27^th February 2015 for an Order against the Respondent for costs or a Preparation of Time order and/or Order against the Respondent’s solicitors for a Wasted Cost Order is dismissed.  The reason [sic] for this decision are set out in the reasons annexed.”

 

15.              Under the heading “Reasons” were ten paragraphs of Reasons.  Paragraph 1 of the Reasons read as follows:

“1. In respect of the application by the Claimant set out in their letter of 27^th February 2015, I am not going to make any Order in respect of costs or a preparation time order or wasted costs order and in summary my reasons for this are as follows.”

 

16.              Paragraph 10 of that section of the Decision said this:

“10. For these reasons it is not appropriate in respect of work undertaken and costs incurred to date to make any order against the Respondents [sic] or the Respondent’s solicitors in respect of costs, preparation time or wasted costs.”

 

17.              In the body of the Reasons, which I shall summarise, the EJ set out the background.  He said that for most of the relevant period the Claimant had been represented by solicitors but more recently she had been represented by a friend: “The focus of the complaint is the way that the Respondent’s solicitors have dealt with matters” (paragraph 2).  In paragraph 3 he said:

“3. It is suggested that they have acted unreasonably and scandalously in the way they have dealt with preliminary issues and the preparation of the case to date. …”

 

18.              He said that he was quite satisfied from the documents and the submissions that it was:

“3. … not appropriate to make any such orders and I am similarly satisfied that there is no way that the Respondent’s [solicitor’s] behaviour could be said to amount to contempt of court.”

 

19.              The EJ set out the background, which I have recited above, about the September 2014 Order and the adjournment of the hearing listed for December.  He said that the Respondent’s solicitor accepted that he had failed to deal with all of the issues by the dates in the directions Order but that it was clear to him from the documents and submissions that there had been failings also on behalf of the Claimant.  She had been represented by solicitors.  It was relevant that they had not argued that they had fully prepared and that the Respondent’s solicitors had been responsible for the delay, and indeed in their email of 25 November they had acknowledged that there had been slippage by both sides in complying with the provisions of the case management Order in relation to preparation of the final bundle of documents and exchange of witness statements.  In the light of the text of the email of 27 November, which I have already read out, that finding was plainly open to the EJ.  He said that it was “very regrettable” that both sides had not complied with the directions Order, but there was nothing to show that there had been significantly greater default by one side than the other.  I mention that the annexe to the letter of 27 February 2015 (see above) explained that the Claimant had withdrawn instructions from her former solicitors:

“18. … due to their conspiracy (with Kennedys) to engage in incompetent and derisory progression of her claim, and their failure to hold [the Respondent] or Kennedys to any account for their complete disregard of Tribunal Rules and Orders. …”

 

20.              In paragraph 5 of his Reasons the EJ recorded the Claimant’s complaint that the Respondent had had until 24 September to file an amended Response and had only asked the ET for an extension on the day on which that period expired, but he said they had asked the ET, the Claimant’s solicitor had consented, and the ET had allowed the extension.  He said that it would be quite wrong now to criticise the Respondent in that instance since the ET had itself allowed the extension of time.  He said that the Claimant also criticised the Respondent for not preparing witness statements in time for exchange on the date provided for in the order - that is, 17 November - and for not providing a fully paginated bundle and an index by the due dates in the September Order, but the Claimant had acknowledged to the ET that her solicitors would not have complied with the direction to make full disclosure by 1 October 2014.  That could not have been done until 15 October 2014.  It was not surprising, said the EJ, that the Respondent could not then provide a full index by 15 October 2014.

 

21.              The EJ recorded that the Claimant also argued that but for the Respondent’s delays there could have been a Full Hearing on 8 December 2014.  The EJ did not accept that.  The EJ had been told that towards the end of November the Claimant instructed new solicitors.  They were instructed on 1 December.  They told the ET than an adjournment was appropriate because they needed time to get on top of the case.  They also said that not all of the directions had been complied with.  But even if they had been, it was quite clear that the solicitors would not have been ready by 8 December.  That finding was clearly open to the EJ on the basis of the text of the Claimant’s solicitor’s email of 1 December (see above).  Indeed, it would have been perverse for the EJ to have held, on the basis of that material, that the December hearing could have gone ahead, and was ready to go ahead.  In that situation, said the EJ, it was quite wrong to apportion blame to one side or to the other or to say that the Respondent’s solicitors had behaved unreasonably.  He went on to point out that in any event there was bound to be further delay because the Claimant had issued a new claim in January 2015, a fact that was known to the EJ because this hearing took place in March 2015.  He said that the two claims had since then been consolidated and that further directions would need to be complied with before there could be a trial.  The further delay caused by that was not the Respondent’s fault at all.

 

The Law

22.              It is apparent from the text of the Claimant’s application dated 27 February 2015 that the tests under the ET Rules on which the Claimant relied both in respect of her costs application and in respect of her strike out application are the same.  The test is whether the conduct of the representative has been unreasonable or scandalous.  In Blockbuster Entertainment Ltd v James [2006] EWCA Civ 684, [2006] IRLR 630 the Court of Appeal considered the scope of the power of the ET to strike out a claim on the grounds that the way in which the proceedings had been conducted had been scandalous, unreasonable or vexatious.  The Court of Appeal said in paragraph 5:

“5. This power, as the employment tribunal reminded itself, is a draconic power, not to be readily exercised.  It comes into being if, as in the judgment of the tribunal had happened here, a party has been conducting its side of the proceedings unreasonably.  The two cardinal conditions for its exercise are either that the unreasonable conduct has taken the form of deliberate and persistent disregard of required procedural steps, or that it has made a fair trial impossible.  If these conditions are fulfilled, it becomes necessary to consider whether, even so, striking out is a proportionate response. …”

 

23.              In Bennett v London Borough of Southwark [2002] EWCA Civ 223, [2002] ICR 881 the Court of Appeal considered the meaning of the word “scandalous” in the context of the Rules.  At paragraph 27 Sedley LJ first of all referred to the colloquial meaning of the word “scandalous”.  He then said this:

“27. … The trinity of epithets “scandalous, frivolous or vexatious” has a very long history which has not been examined in this appeal, but I am confident that the relevant meaning is not the colloquial one.  Without seeking to be prescriptive, the word “scandalous” in its present context seems to me to embrace two somewhat narrower meanings: one is the misuse of the privilege of legal process in order to vilify others; the other is giving gratuitous insult to the court in the course of such process. …”

 

24.              The test for making a Wasted Costs Order was decided by the Court of Appeal in Ridehalgh v Horsefield [1994] Ch 205, [1994] 3 WLR 462.  The headnote, which refers to the power conferred by section 51(7) of what is now the Senior Courts Act 1981 says this:

“… on a true construction of section 51(7) the words “improper, unreasonable and negligent” bore their established meaning; that “improper” applied to conduct which amounted to any significant breach of a substantial duty imposed by a relevant code of professional conduct and included conduct so regarded by the consensus of professional opinion; that “unreasonable” described conduct which did not permit of a reasonable explanation; that “negligent” was to be understood in an untechnical way to denote a failure to act with the competence reasonably to be expected of ordinary members of the profession; that in any event orders should only be made under section 51(6) where and to the extent that the conduct so characterised had been established as directly causative of wasted costs …”

 

 

 

Discussion

25.              The main issues, on this appeal are two short points about the way in which the EJ expressed his decision.  They are: first, whether the EJ dealt with, and/or gave reasons for not refusing, the application by the Claimant to strike out the Respondent’s claim; and secondly, whether the EJ dealt with and/or gave reasons for not striking out the employer’s amendment to paragraph 6 of the amended grounds.

 

26.              I accept that the EJ’s Decision is not as carefully worded as it might be.  In particular, there are passages in the Decision that suggest that at some points the EJ has used the various costs applications that were made in the Claimant’s letter of 27 February as a shorthand way of referring to all of the applications made in that letter and/or that he has not dealt with the strike out application at all, but I reject the submission that the Decision read as a whole discloses a failure by the EJ to give reasons for his decision not to strike out the Respondent’s whole Defence.

 

27.              There are six broad reasons why.  The first overarching point is a submission that Ms Masters made and that I accept.  That is that even if the threshold for striking out the claim had been met, on the facts of this case it was not arguably proportionate to strike out the Respondent’s Defence.  There are two broad reasons for this which are alluded to in the EJ’s Reasons.  The first is that both sides were at fault to some extent for the delays that had happened in the case.  In particular that it was the Claimant’s solicitors who were the moving force behind the application for an adjournment.  Secondly the issue of the new claim in January 2015 meant that a whole new set of directions and timetable would in any event be necessary.  I accept the submission that the overall importance of proportionality to the decision whether or not to strike out the whole Defence means that, contrary to ground 5 of the Notice of Appeal, the conduct of the Claimant’s solicitors was relevant to the EJ’s assessment, because it would not be proportionate to strike out if not all of the fault lay at the door of the Respondent’s solicitors.  Indeed that is the way that the EJ, correctly, in my judgment, approached this matter.

 

28.              The second reason is that in paragraph 1.6 of the Decision when he was setting out the background, the EJ referred to all the applications made in the letter of 27 February.  He also in paragraph 3 of his Reasons referred to the suggestion that the Respondent’s solicitors had been guilty of contempt of court, which was not material to any of the costs applications.  So, it is clear, in my judgment, with one reservation, which I shall come to, that the EJ understood the scope of the applications that the Claimant was making in the 27 February letter.

 

29.              The third reason is that the EJ rightly said that the focus of the applications was the conduct of the Respondent’s solicitors.  He gave sufficient reasons, in my judgment, for his conclusion that the conduct of the Respondent’s solicitors had not been unreasonable and/or scandalous.

 

30.              The fourth reason is that the issue whether the conduct of the Respondent’s solicitors had been unreasonable and/or scandalous was the same issue whether he was considering the strike out application or the costs application.  It follows, ineluctably, that a decision that the conduct of the Respondent’s solicitors was not unreasonable or scandalous entailed a decision both that the costs application and that the strike out application must fail; as I think Mr Yagomba accepted in his oral submissions.

 

31.              The fifth reason is that it seems to me unavoidable that if the conduct of the solicitors had not been unreasonable or scandalous it could not be a contempt of court.

32.              The sixth reason is that it follows that the EJ complied with his duty to give reasons, as the Claimant knows why her applications failed.  There is nothing more that the EJ could say about it if he were required to give further reasons.  That flows from the similarity of the tests both for strike out and for awarding costs and for making a Wasted Costs Order.  In other words, if the EJ was entitled to decide that the solicitor’s conduct was not unreasonable or scandalous and/or the costs application failed, he was bound also to find that the strike out application must fail and that the wasted costs application must fail.  It follows that if he gave sufficient reasons for the first view, as I have found that he did, he gave sufficient reasons for the dismissing of the strike out and wasted costs applications.  If I am wrong about that, I would not remit the matter to the Employment Tribunal on the reasons point as the conclusion that the ET would have to reach on the undisputed facts is obvious (see paragraph 21(a) of Jafri v Lincoln College [2014] ICR 920).

 

33.              I turn to ground 4 of the grounds of appeal.  This is the point that the EJ did not deal with or give reasons for his decision on the application to strike out paragraph 6 of the Respondent’s amended grounds of resistance.  In fairness to the EJ, on its proper construction the letter of 27 February 2015, including the annexe, is not an application to strike out paragraph 6 of the amended grounds of resistance.  As I have recorded, Mr Yagomba told me that the application was made orally, and because Mr Finlay’s recollection on the point is not clear, I feel in fairness to Mr Yagomba I should accept that the application was made orally.  If the application was made orally, it is absolutely clear, in my judgment, that the EJ did not deal with it in his Reasons, and that is clearly an error of law.  However, there would be no purpose in remitting this question to the ET.  This is an immaterial error.  That result flows from the undisputed fact that the September case management Order (from which I have read the relevant paragraph) gave the Respondent a wide permission to amend its case on limitation in its amended grounds of resistance.  In that situation, it seems to me clear that any application to strike out the amendment that the Respondent had drafted was bound to fail.

 

Conclusion

34.              For those reasons, I dismiss the appeal on all the grounds except ground 4.  I allow the appeal on ground 4, but my decision is that there should be no remission to the ET.

 

Costs

35.              Ms Masters asks for the Respondent’s costs of this appeal.  This appeal was permitted to go to a Full Hearing by HHJ Peter Clark at a Rule 3(10) Hearing, and he was satisfied that the appeal had some reasonable prospect of success, which is why he permitted it to go to a Full Hearing.  Although the upshot of the appeal is that the Claimant has effectively lost because I have not remitted any part of the decision to the Employment Tribunal I did allow the appeal on ground 4, and it does seem to me that in the circumstances where a litigant in person has been given the green light on a Rule 3(10) Hearing and has partly succeeded on appeal it would be quite wrong for me to order her to pay the costs of the appeal, and I therefore refuse this application for costs.