At the Tribunal | |
Before
THE HONOURABLE MR JUSTICE CHOUDHURY (PRESIDENT)
(SITTING ALONE)
APPELLANT | |
RESPONDENT |
Transcript of Proceedings
JUDGMENT
For the Appellant | MR V MILHAILESCU (The Appellant in Person) and MS ANA UNTILA (Interpreter) |
For the Respondent | No appearance or representation by or on behalf of the Respondent |
SUMMARY
PRACTICE AND PROCEDURE - Costs
The Employment Tribunal erred in concluding that the threshold requirement for the exercise of discretion as to costs had been met.
THE HONOURABLE MR JUSTICE CHOUDHURY (PRESIDENT)
The Factual Background
The Costs Judgment
"12. The Tribunal is satisfied the Claimant has acted unreasonably in the bringing of these proceedings and in the manner in which they have been conducted and that the majority of the claims had no reasonable prospects of success. As such the Tribunal's discretion to award costs arises. The Claimant who at the outset had advice from a Citizens' Advice Bureau chose to pursue claims that were not within the jurisdiction of the Tribunal. This was explained to him at the preliminary hearings, but he still tried to pursue them. It does not appear that the Claimant sought further advice on his position.
13. The Claimant is aggrieved that he was working under a zero hours contract and how his pay was calculated, but the Tribunal found at a preliminary hearing that he was employed under a zero hours contract. It had to remind him on numerous occasions that it could not revisit that finding or look into whether or not it was a 'fair' term of the contract.
14. The Claimant kept changing the basis of his claims. He came to the full merits hearing claiming over £80,000. This was a significant claim that the respondent had no choice but to incur costs in defending. The Claimant cannot criticise the respondent for so doing.
15. Even at this hearing, the Claimant has sought to argue the issues in his claim rather than focus on the issue of costs."
"21. Having considered all the circumstances, the Respondent's cost schedule and the bills to the Respondent had accompanied it and giving consideration to the Claimant's ability to pay, the Tribunal has concluded an award of £5,000 inclusive of VAT and disbursements should be made to cover, in effect, some of the costs of the full merits hearing which could have been avoided had the Claimant not acted unreasonably in pursuit of these claims.
22. How that sum is to be paid will be a matter for the County Court if the Respondent seeks to enforce the award."
Legal Framework
"When a costs Order or a preparation time Order may or shall be made
76.-(1) A Tribunal may make a costs Order or a preparation time Order, and shall consider whether to do so, where it considers that-
(a) a party (or that party's representative) has acted vexatiously, abusively, disruptively or otherwise unreasonably in either the bringing of the proceedings (or part) or the way that the proceedings (or part) have been conducted; or
(b) any claim or response had no reasonable prospect of success."
"Ability to pay
84. In deciding whether to make a costs, preparation time, or wasted costs order, and if so in what amount, the Tribunal may have regard to the paying party's (or, where a wasted costs order is made, the representative's) ability to pay."
"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."
The Grounds of Appeal
Submissions
Discussion
(a) the majority of the claims had no reasonable prospect of success, and
(b) he had acted unreasonably in the proceedings and in the manner in which they had been conducted.
(a) At the Status Hearing, Mr Dhir for the Respondent had accepted in oral evidence that the letter of 30 April 2015 was a contract of employment, thereby contradicting the case that had been put by the Respondent up to that stage.
(b) The letter sent to the Claimant at the time referred to him being an employee throughout.
(c) The Tribunal accepted the evidence of the Claimant which it regarded as "entirely convincing".
(d) The Respondent sought to embark on various arguments to deny employee status which were unsupported by evidence: see, for example, paragraph 26 of the Status Judgment, in which the Tribunal said there was no evidence that Claimant had ever sent his wife in his place to do work.
(e) At paragraph 60 of the Status Judgment, the Tribunal said that, "It did not find that the arguments advanced on behalf of the Respondent to be persuasive in any way whatsoever."
(f) It was said in paragraph 62 that the Tribunal had not, at that stage, made any finding with regards to rate of payment or as to how the relationship between the parties had ended. It noted that those matters would be for the substantive hearing. In those circumstances, as I have already said, whilst the position could have been clearer, it cannot be said to be unreasonable for the Claimant to pursue the question of zero-hours contracts following that hearing.
(g) At paragraph 66 the Tribunal said, 'It is not clear to this Tribunal how and why the Respondent sought to argue that the Claimant was not a worker.' Moreover, although the Respondent was running the argument that the Claimant was self-employed, the Tribunal noted that, 'It was not even put to the Claimant that he was running his own business.'"
Conclusion