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Case Number 2502689/99

BETWEEN

Applicant Respondent

Ms R Maclaverty AND 1 Mr Simon Loy

, .; 2 EIW Ser\,ices(NorthEast)
t/a Eversheds
; DECISION OF THE EMPLOYMENT TRIBUNAL
;
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HELD AT Birminghan1 ON 29 September2000
~

CHAIRMAN Mr C P Rostant

i ", DECISION ON AN APPLICA TIOr-l FOR COSTS

1 The decisionof the chairman is that the secondrespondents

are orderedto pay the
~ applicantcosts.
'I The decision as to what costs ought to be paid is reserved sav~ that the second
1 respondentsare orderedto pay £30 referredto in paragraph23 of the ExtendedReasons.
1,,--, i

1
:
EXTENDEDREASONS -
1 .
The applicant was representedby Mr Aziz of Counsel. Both respondentswere
: representedby Mr Jones,solicitor.

2 The issuebefore me was whetheror not the respondentsshouldbe requiredto pay

the applicant's costs in respect of her expensesand costs incurred in respondingto a
preliminary application by the respondentsthat her complaint of sexual discrimination
and unfair dismissal be dismissedon the grounds that a binding settlement,pursuantto
section 18 of the Employment Tribunals Act 1996 and section 203 of the Employment
Rights Act 1996,had beenreached.

3 The applicant was pursuinga complaintof sex discrimination and unfair dismissal
against the respondents and the matter was being dealt" with by the Employment
Tribunals in Newcastle. During in September1999 it becameapparentthere had been

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Case Number2502689/99

communicated to a conciliation officer in connection with the performance of his

functionsunderthis sectionshall not be admissiblein evidencein any proceedingsbefore
an employmenttribunal, except with the consentof the personwho communicatedit to
that officer." The respondentstook the view that they would now be unableto obtain Mr
Nelson's evidencewithout the applicant's consentand'it was soon apparentto them that
the applicant was refusing that consent. On 18 July, they wrote to the applicant saying
that they took the view that the applicant's stancein refusing that consentwas manifestly
unreasonableas it meant that they were denied accessto a key witness. However, "in
thesecircumstanceswe cannotproceedwith the preliminary hearingwhich is likely to be
determinedupon evidenceto whi.ch,we have had no access. Accordingly, we have no
alternativebut to ask the tribunal to vacatethe hearing,which we have done today." On
the following day the respondentswrote to the tribunal saying that, although they
I remainedin their view that the applicanthadrenegeduponthe bindingagreement,
they
were withdrawing from the hearingon 27 July and had informed the applicantof that.

~ 11 Theapplicantthensoughta hearingto determinewhetheror not the respondents

I ought to pay her costsin relation to the questionof the preliminary hearing.
.
12 The tribunals powers in relation to costsare containedat Rule 12 of Schedule1 of
the Employment Rights (Constitution and Rules of Procedure) Regulations 1993.
Rule 12(1) provides that where in the opinion of the tribunal a party has in bringing or
. conductinga proceedingsactedfrivolously, vexatiously,abusively,disruptly or otherwise
; unreasonably,the tribunal may makean order for costs.
!

\ 13 The applicant'scontentionis that the respondents

have behavedfrivolously,
: vexatiously and otherwise unreasonable. Their conduct to these proceedings was
frivolous because,says Mr Aziz, they must have known that they never stood any
reasonableprospectof persuadinga tribunal that a binding settlementhad been reached
and he hasreferred me to documentationthat passedbetweenthe parties which, he says,
indicatesthat never was such a firm agreement.He invites me to draw the inferencethat
. --' on that basistheir pursuingof the mattercould only havebeenwith the intentionof
harassingthe applicantand was, therefore,vexatious. Finally, he points to the long delay
in the respondentsrealising their position and withdrawing proceedingsand the nearness
of their withdrawal to the actual hearingand saysthat that must be unreasonableconduct
of theseproceedings.

14 The respondentson the other hand say that they honestly believed that a binding
settlementhad been reachedthrough the offices of ACAS and that without hearing from
the partiesconcernedit is not opento me to decidewhat a tribunal would have decided
on that matter.They point to the fact that the respondentspursuedthe matter and incurred
;. coststhemselvesjn pursuit of the matter, apparentlysincerely, and that that from that I
can concludethat not only was tbis not frivolous conduct but that it was not vexatious
either. In respectof the late withdrawal, Mr Jonesacknowledgesthat it may, at most,
" haveamountedto poorjudgmenton the part of the respondents
to rely on the applicant
giving permissionfor them approachMr Nelson, but that that was not unreasonableand
furthermorehe saysthe reasonwhy Mr Ne1sonwas not approacheduntil relatively late in

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 ~:~'ff"

CaseNumber 2502689/99

the day was the fact that the respondentshonestlybelievedthat the whole matter could be
settledprior to thesepreliminary proceedingsand that they were reluctant to incur costs
which might eventually be thrown away.

15 I have reviewed all of the evidencein front me and concludedthat the applicant
hasnot satisfied me on the balanceof probabilities that theseproceedingswere advanced
frivolously. I am somewhattroubled by the correspondence,which suggeststhat the ~
issueof the terms of the referencemay never have been finalised with the Newcastle
ACAS officer, and that it is at least possible, even on the correspondencefrom the
respondents,that they might have had difficulty in pointing to a final agreementon all
mattersconstituting a settlementwith the ACAS officer. However, the matter is not so
clear cut that I am able to say now with any appropriatedegree of certainty that this
applicationnever stood any reasonableprospectof successand it is thereforenot opento
me to conclude tl)at it was launched frivolously nor indeed that it was pursued
\, vexatiously. I am, however,deeplytroubledby the mannerin which the respondents
haveconductedthemselvesonce the decision to go forward on the basis of a preliminary
hearinghad been reached.

16 I seeno criticism to be madeof the respondentsconduct up to and including the

hearingfor directions in January. It was at that point that they quite properly soughtto
persuadethe Regional Chairman in Newcastle that there ought to be a preliminary
hearingon this matter and he, in thesecircumstances,could have done little else other
than to ag;:eethat such a hearing should take place and provide for that in his Order
flowing from that hearing for directions. However, matters take a different turn
thereafter.

f
I
17 MrI Nelson's
that am somewhat at a loss
evidence tocrucial
is so understand whyability
to their the respondents
have
a taken
to persuade thethat
tribunal viewa
binding agreementhas beenreached.Without that evidence,in my view, the respondents
are simply in a position of adducingevidencewithin their own control, namely evidence
from Mrs Williams, partner of the respondentflrIn of conduct of these matters, and
having that evidence tested in cross-examinationin the same way that the applicant
would havegiven evidenceand had her evidencetestedin cross-~amination. In addition
to that evidence, there would have been the evidence of the correspondencepassing
betweenthe parties. Mr Nelson's absence,\\'hilst meaning that it was not possible for
him to confinn the respondentspoint of view, also would mean that it was not possible
for him to confirm the applicant's point of view. Save for the fact that the respondents
had the burden of proof resting on them, they were no worse fixed than the applicant in
their ability to succeedin the caseonceMr Nelson was not going to be available.

! 18' Neverthelessit is apparentthat at a relatively early stage,and certainly by

; 7 February2000, the respondentswere contemplatingcalling Mr Nelson and who knows
, but at that stage they had formed the view that his evidence wou]d be crucial to their
chancesof success. In thosecircumstances,it appearsto me extraordinarythat they did
not addressthemselvesto the provisionsof section 18 of the EmploymentTribunal Act at
that early stage. That sectionmakesit absolute]yclear that an ACAS officer is forbidden

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 CaseNumber 2502689/99

for giving evidence about negotiations for settlementunless the party with whom he
communicatedgives permission for that evidenceto be given. I understandfrom Mr
Jones that the respondentswere taken aback by the applicant's refusal to give that
permission once they sought it in late July. To my mind that demonstratesquite
extraordinary naivety on the part of the respondents. Why should the applicant give
permissionfor the respondentsto obtain evidencewhich might be helpful to them in their
caseagainsther? There is no earthly reasonwhy the applicant should waive the right to
confidentiality that she had in those circumstancesand the respondentshad no earthly
groundsfor assumingthat shewould, if indeedthey addressedthemselvesto that aspect
of section18 at that stagewhich, I haveto say, I greatly doubt.

19 It appearsclear that no approachwas madeby the respondentsto Mr Nelson until

14 July, sometwo weeks or so beforethe hearingon 27 July. In consequence it was not
until 18 July that they realised that Mr Nelson would not be available to them to give
~ evidenceand at that point they decidedto abandontheir position. I have already
'/ commented that I do not follow why the respondents
regardedMr Nelson'sevidenceas
the crucial plank on which their ability to succeedrested,particularly as they could have
had no idea, without speakingto him, what he was going to say in tribunal. They may
havehopedthat he would confirm their understandingof the situation but they could not,
by any means,be sure and they did not approachhim for any sort of witness statement
until 14 July. To my mind that was wholly unreasonable. IfMr Nelson was such a
crucial plank to their casethen, to my mind, they ought to have securedhis evidenceor
failed to securehis evidenceand abandonship'muchearlier in the proceedings.I take the
view that they ought to havedone that not later than one week after 7 February,by which
stage they must have adc;iressed their minds to the question of his evidence and the
necessityfor him attending. I am unimpressedby the respondents'assertionthat they
wereattemptingto savecostsby settlingthe matter.. Theymayhavebeenattemptingto
savetheir own costs but the fact of the matter is that all the while that this preliminary
was in contemplationthe applicant may have been incurring some costs in defending it
and that could only have ceasedwhen shewas finally informed by letter of 18 July that
the proceedingswere not to be followed up.
--"
20 In consideringthe actions of the respondents,I have bom~ in mind that they are a
. veryreputablefirm of solicitorspackedfull of experienced
employment
practitionersand
I haveno doubt.thatMrs Williams, the partner,with conductto theseproceedings,has the
kind of employmentexperienceand expertisethat would be indicatedby her position in
the firm. I thereforetake the view that decisionsmadeby her and proceedingsconducted
by her must be viewed in a somewhatdifferent light to the samedecisionsand conduct,
for exampleof an unrepresentedand unqualified party. In all the circumstances,I take
the view, that it would be appropriateto order that the respondentspay costs in the
mannerindicatedabove. Having deliveredthe above part of my decision,I then sought

, submissionsfrom Mr Aziz and Mr Joneson what amount of costs should be ordered

bearingin mind the limited powersof the tribunal in Regulations12.

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~ CaseNumber 2:2689199-

2I Mr Aziz sought costs of £ I 00 in relation to counsel's opinion about the

respondentsapplication on the preliminary grounds. He also sought costs in respectof
counsel's fee of £ 150 for attending the interlocutory hearing in Newcastle on
19January2000, and a further fee in respect of Mr Aziz's attendancehere today.
Finally, he sought costs in relation to his client's own work on this casefor 40 hours on
the basisof a hourly chargerate allowable by the County Court for such mitigation work
by a solicitor and also a nominal amount for his client's expenses.
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22 It is well establishedthat the powers of the tribunal to award costs relate only to ~:.(JJ
legitimately incurred legal costsand other expensesincidentalto the pursuit of a case. In
this case,the legitimately incurred legal costs were all of counsel's fees but not, in my
view, the applicant's own legal costs incurred, as it were, in employing herself as a
solicitor outside of nonnal work-hours. The applicant's counseldid seekto pray in aid
r the EAT's decision in Wiggins Alloy v Jenkin [1981] IRLR 275 EAT, in suggestingthat
'-' the applicant, as a qualified solicitor acting for herself, was analogousto an in-house
solicitor. I take an entirely different view. The applicant is no different to any other
party in personwho has donethe preparationwork on a casethemselves,savefor the fact
that shehappensto be the possessorof legal qualifications. In my view, it would entirely
wrong to describethe applicant's work on this caseas legal expensesalthough I have no
doubt that shehasdone a large amountof work on her own behalf.

23 I then turn my attentionto the counsel's fees. Of thosefeesI disallow the feesfor
the atten4anceat the hearing of 19 January2000. It will be seenfrom my decisionabove
that I have taken the view that there was nothing frivolous, vexatiou.o; or unreasonable
with the respondentsconduct in seekinga preliminary hearing and in raising that matter
at the hearingfor directions on 19 January2000, making it inevitablethat the tribunal, on
that occasion,would abandonthe task of setting any further directions for the hearingof
the substantivecase. The respondentsunreasonablebehaviourdoesnot commenceuntil
14 February 2000, by which time they ought to have, in my view, canvassedand
understoodthe availability or lack of availability of Mr Nelson as a witness and made
'--
their
woulddecision
be wrongabout the progress
to allow Mr Aziz'soffee
thefor
case on thattoday
attending basis. I also
since thistake
casethe view
is set thatfor
down it

a hearingfor directions aswell as to considerthe issuefor costsand Mr Aziz would have

had to havebeenhere in any caseto deal with the directionspart of the hearing. Nor am
I awarethat his brief is any larger becauseof the cost elementof this matter and, in any
case,I am not satisfied that the defending of the applicationfor costsby the respondents
is frivolous, vexatious or unreasonablein and of itself. That leavesthe fee in relation to
the opinion and at this stageI am unaware,and Mr Aziz is unableto tell me, when that
opinion was commissioned,when it was received and when it was paid. I thereforedo
not know whether it falls to be consideredas part of the costsincurredafter 14 February.
I am thereforepreparedto reservemy decision on the actualamountof costsincurredand
orderedin this case subject to the receipt, within 14 days of today's hearjng, of a letter
from the applicantexplaining when shecommjssjonedthat opjnion, when shereceivedit,
and when shepajd for jt, togetherwith documentaryevidencein supportof that Jetter. A
copy of that letter and documentaryevidence ought to be sent to the respondentsat the
sametime and the respondentsshall have a further 14 days, jfthey so wish, to comment

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 Case Number2502689/99

upon it. Upon which I will then proceedto make a decisionin relation to costs for that
amount. I am, at this stage,however,preparedto order the respondentspay £30 to the
applicantby way of her reasonablyincurred expensesin postageand photocopyingover
the period from 14 Februaryto 19July 2000 inclusive.

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DECISION ENTERED IN REGISTER
AND COPIESSENT TO PARTIES ON
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