Jackson v Cambridgeshire County Council and others
This case related to proceedings brought by Mr Lloyd against Cambridgeshire County Council and others claiming constructive dismissal, sex discrimination and disability discrimination. Mr Lloyd died, but the proceedings were continued by his mother. Mr Lloyd and subsequently his mother were represented in the proceedings by his cousin, Mr Jackson, a solicitor specialising in banking law.
During an adjournment of the hearing, Mr Jackson posted material on Facebook regarding the proceedings, supplied documents to the press concerning costs incurred by the council, and made a statement complaining that no attempt had been made to settle. He also complained to the regional employment judge that the tribunal judge was biased, supported by reference to selective extracts of secret recordings of comments made by tribunal members in the tribunal room. He applied to the tribunal to recuse itself.
The council made an application to strike out the claim and the tribunal ordered that the proceedings be struck out. The council made an application for wasted costs.
The tribunal awarded wasted costs of £16,037.04 relating mainly to costs incurred in attending a case management discussion necessitated by Mr Jackson’s unreasonable conduct in relation to the Facebook entries and in dealing with the recusal application and strike out.
A wasted costs order may be made against a party’s representative where costs are incurred as a result of any improper, unreasonable or negligent act or omission on the part of any representative. A representative means a legal or other representative, but only if the representative is “acting for profit”.
The tribunal held that Mr Jackson’s behaviour in seeking, as it found, to put maximum pressure on the council to induce financial settlement was only consistent with some kind of conditional fee arrangement, and that an application for costs made by Mr Jackson must mean that he was acting for profit. Mr Jackson appealed.
The EAT held that the tribunal’s reasoning was flawed. There was no reason to believe that Mr Jackson was acting in pursuit of profit, and the tribunal needed solid grounds for a finding to the contrary. The tribunal had no basis for their first finding, and Mr Jackson had given an explanation for the costs application which the tribunal failed to address.
The EAT considered evidence from Mrs Lloyd that she had paid some cash sums to an assistant who helped Mr Jackson with the case but had made no financial arrangement with Mr Jackson, and found that Mr Jackson was not acting in pursuit of profit. The tribunal was therefore not entitled to make a wasted costs order and the appeal was dismissed.
Costs do not “follow the event” in the employment tribunal, as they do in the civil courts but a tribunal can make costs orders in favour of legally represented parties, preparation time orders in favour of unrepresented parties and wasted costs orders against parties’ representatives.
However, as this case demonstrates, wasted costs orders will be made only against a representative who is acting for profit. Representatives who act on a not-for-profit basis include trade union representatives, Citizens Advice Bureau advisers and representatives from voluntary bodies. The EAT made observations in this case about the stage at which a wasted costs application should be made, stating that, while there is no general rule, the starting point is that a wasted costs application should be dealt with at the hearing to which it relates.
However, there will be cases in which it is not fair to proceed in this way, for example where the issues are not straightforward or time is short. In these circumstances, the application should be postponed to a later hearing or a specific hearing should be listed if it is proportionate to do so.
Alan Chalmers, employment partner, DLA Piper
Practical guidance from XpertHR on employment tribunals