Addison Lee v H Afshar & Ors [2024] EAT 114

“(3) In this Act “worker” (except in the phrases “shop worker” and “betting worker”) means an individual who has entered into or works under (or, where the employment has ceased, worked under)— (a) a contract of employment, or (b) any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual; and any reference to a worker’s contract shall be construed accordingly.”

“11. The Claimants are not and/or were not workers of the Respondent (as defined in section 230(3)(b) of the ERA Employment Rights Act 1996 ("ERA"), Regulation 2 of the Working Time Regulations 1998 ("WTR") or Section 54 of the National Minimum Wage Act 1998 ("NMWA")). In particular (i) Drivers have at all material times carried on a business of which the Respondent was, by virtue of the Driver Contract, a client or customer.”

“Alternative contentions, if worker status were established Time of working/Working time issues Time before acceptance of journey (and after its completion) 15. Even if, contrary to the above, any of the Claimants enjoyed "worker" status whilst performing journeys, none was required to accept any journey (i) at any time (ii) alternatively from the date when any adverse consequences of not accepting journeys had been removed. 16. It follows from paragraph 15 above that (i) none was working under a worker contract prior to accepting a journey (or after its completion): see Uber v Islam [2021] ICR 657 esp. at paras 121-130; (ii) no time prior to the acceptance of a journey (or after the completion of a journey) can amount to working time (a) for the purposes of the WTR (b) for the purposes of the NMWA (c) for any other relevant purpose.”

“30. In accordance with Chapter 5, working time includes (and is limited to) the period from when the Claimant picks up a customer until the customer is dropped off at their destination. 31. If that is not accepted, in the alternative, working time includes (and is limited to) the period from when the Claimant accepts a customer job on his XDA device until the time when that job was completed. 32. If that is not accepted, in the alternative, working time includes (and is limited to) the period from when the Claimant is offered a customer job on his XDA device until the time when that job was completed. 33. If that is not accepted, in the alternative, working time includes (and is limited to) the period during which the Claimants either have their XDA device switched on and set to 'empty' or are on a customer job, and excludes any period when the XDA device is switched off or is set to 'break'.”

“2. Subject to the parties agreeing or, in default of such agreement, the Tribunal determining, which of the Leigh Day Claimants drove for the Respondent at any time in the period 1 July 2014 to 24 May 2016 inclusive (the “Deposit Claimants”), the Deposit Claimants’ applications dated 7 November 2022 for deposit orders are granted in respect of the arguments raised in paragraphs 11 and 11(i), 15 and 16, and 30 to 33 of the Amended Grounds of Response dated 6 October 2022. 3. The total amounts of the deposits to be paid in respect of the Deposit Claimants shall be limited as follows: a. In respect of the arguments raised in paragraphs 11 and 11(i) of the Amended Grounds of Response dated 6 October 2022, to the sum of £75,000; b. In respect of the arguments raised in paragraphs 15 and 16 of the Amended Grounds of Response dated 6 October 2022, to the sum of £25,000; c. In respect of the arguments raised in paragraphs 30 to 33 of the Amended Grounds of Response dated 6 October 2022, to the sum of £25,000. 4. The Leigh Day Claimants and the Respondent shall co-operate with a view to agreeing the identities of the Deposit Claimants. They shall update the Tribunal within 21 days of the date that this Order is sent to them as to whether they have been able to reach agreement in that regard, providing the names of the Claimants who it is agreed are Deposit Claimants and, if relevant, the names of the Claimants whose status is in dispute The Tribunal will determine the status of any disputed Deposit Claimants at the next case management preliminary hearing. Any statements or evidence intended to be relied upon by them in that regard shall be served on the other and filed with the Tribunal at least 14 days prior to that hearing.”

“39.— Deposit orders (1) Where at a preliminary hearing (under rule 53) the Tribunal considers that any specific allegation or argument in a claim or response has little reasonable prospect of success, it may make an order requiring a party (“the paying party”) to pay a deposit not exceeding £1,000 as a condition of continuing to advance that allegation or argument. (2) The Tribunal shall make reasonable enquiries into the paying party's ability to pay the deposit and have regard to any such information when deciding the amount of the deposit. (3) The Tribunal's reasons for making the deposit order shall be provided with the order and the paying party must be notified about the potential consequences of the order. (4) If the paying party fails to pay the deposit by the date specified the specific allegation or argument to which the deposit order relates shall be struck out. Where a response is struck out, the consequences shall be as if no response had been presented, as set out in rule 21. (5) If the Tribunal at any stage following the making of a deposit order decides the specific allegation or argument against the paying party for substantially the reasons given in the deposit order— (a) the paying party shall be treated as having acted unreasonably in pursuing that specific allegation or argument for the purpose of rule 76, unless the contrary is shown; and (b) the deposit shall be paid to the other party (or, if there is more than one, to such other party or parties as the Tribunal orders), otherwise the deposit shall be refunded. (6) If a deposit has been paid to a party under paragraph (5)(b) and a costs or preparation time order has been made against the paying party in favour of the party who received the deposit, the amount of the deposit shall count towards the settlement of that order.”

“When determining whether to make a deposit order an Employment Tribunal is given a broad discretion. It is not restricted to considering purely legal questions. It is entitled to have regard to the likelihood of the party being able to establish the facts essential to their case. Given that it is an exercise of judicial discretion, an appeal against such an order will need to demonstrate that the order made was one which no reasonable Employment Judge could make or that it failed to take into account relevant matters or took into account irrelevant matters.”

“…the making of a deposit order is a matter of discretion and does not follow automatically. It is a power to be exercised in accordance with the overriding objective, having regard to all the circumstances of the particular case.” “16. (…) Deposit orders are necessarily made before the claim has been considered on its merits and in most cases at a relatively early stage in proceedings. Such orders have the potential to restrict rights of access to a fair trial. Although a case is assessed as having little prospects of success, it may nevertheless succeed at trial, and the mere fact that a deposit order is considered appropriate or justified does not necessarily or inevitably mean that the party will fail at trial. Accordingly, it is essential that when such an order is deemed appropriate it does not operate to restrict disproportionately the fair trial rights of the paying party or to impair access to justice. That means that a deposit order must both pursue a legitimate aim and demonstrate a reasonable degree of proportionality between the means used and the aim pursued (…) 17. An order to pay a deposit must accordingly be one that is capable of being complied with. A party without the means or ability to pay should not therefore be ordered to pay a sum he or she is unlikely to be able to raise. The proportionality exercise must be carried out in relation to a single deposit order or, where such is imposed, a series of deposit orders. If a deposit order is set at a level at which the paying party cannot afford to pay it, the order will operate to impair access to justice.”

“A deposit order has two consequences. First, a sum of money must be paid by the paying party as a condition of pursuing or defending a claim. Secondly, if the money is paid and the claim pursued, it operates as a warning, rather like a sword of Damocles hanging over the paying party, that costs might be ordered against that paying party (with a presumption in particular circumstances that costs will be ordered) where the allegation is pursued and the party loses. There can accordingly be little doubt in our collective minds that the purpose of a deposit order is to identify at an early stage claims with little prospect of success and to discourage the pursuit of those claims by requiring a sum to be paid and by creating a risk of costs ultimately if the claim fails. That, in our judgment, is legitimate, because claims or defences with little prospect cause costs to be incurred and time to be spent by the opposing party which is unlikely to be necessary. They are likely to cause both wasted time and resource, and unnecessary anxiety. They also occupy the limited time and resource of courts and tribunals that would otherwise be available to other litigants and do so for limited purpose or benefit.”

“The assessment of the likelihood of a party being able to establish facts essential to his or her case is a summary assessment intended to avoid cost and delay. Having regard to the purpose of a deposit order, namely to avoid the opposing party incurring cost, time and anxiety in dealing with a point on its merits that has little reasonable prospect of success, a mini-trial of the facts is to be avoided, just as it is to be avoided on a strikeout application, because it defeats the object of the exercise. Where, for example as in this case, the preliminary hearing to consider whether deposit orders should be made was listed for three days, we question how consistent that is with the overriding objective.”

“In truth, the conviction is only proof that another court considered that the defendant was guilty of careless driving. Even were it proved that it was the accident that led to the prosecution, the conviction proves no more than what has just been stated. The court which has to try the claim for damages knows nothing of the evidence that was before the criminal court. It cannot know what arguments were addressed to it, or what influenced the court in arriving at its decision. Moreover, the issue in the criminal proceedings is not identical with that raised in the claim for damages…”

“Despite the eminence of those who constituted the members of the Court of Appeal that decided it (Lord Greene M.R., Goddard and du Parcq L.JJ.) that case is generally considered to have been wrongly decided…”

“(6) The procedure for the determination of costs is a summary procedure, not necessarily subject to all the rules that would apply in an action. Thus, subject to any relevant statutory exceptions, judicial findings are inadmissible as evidence of the facts upon which they were based in proceedings between one of the parties to the original proceedings and a stranger: see Hollington v. F. Hewthorn & Co. Ltd. [1943] K.B. 587; Cross on Evidence, 7th ed. (1990), pp. 100-101. Yet in the summary procedure for the determination of the liability of a solicitor to pay the costs of an action to which he was not a party, the judge's findings of fact may be admissible: see Brendon v. Spiro [1938] 1 KB 176, 192, cited with approval by this court in Bahai v. Rashidian [1985] 1 WLR 1337, 1343D, 1345H. This departure from basic principles can only be justified if the connection of the non-party with the original proceedings was so close that he will not suffer any injustice by allowing this exception to the general rule.”

“…the principles adumbrated in Hollington v Hewthorn remain applicable in cases where none of the statutory or common law exceptions operate. Those principles prevent the findings made in earlier civil cases from being used subsequently as evidence of the facts found. They do not in themselves operate as a bar to the findings being put by way of cross-examination as to credit, subject to the control of the court, but that is a different topic with which it will be necessary to deal later in this judgment. But in so far as it was sought to adduce the findings of Ferris J. in order to establish that the Respondent had committed fraud and forgery in fact against Sheikh Ahmed and had therefore been involved in a fraudulent claim on the travellers cheques in this action the learned judge was correct to rule that those findings were inadmissible in law.”

“…the finding of Ferris J. as to the Respondent's fraudulent conduct could be highly relevant to the Respondent's credibility. It relates to his honesty or dishonesty, just as a conviction for fraud would have been relevant to his credibility: see Thomas v. The Commissioner of Metropolitan Police [1997] QB 813. It may seem highly unrealistic to suggest that the Respondent if asked about it would admit to forgery and fraud over the property transfers, but it is nonetheless something which the court should have allowed to be put, albeit briefly. To that limited extent I accept the Appellant's argument. Some limited questions about why he took no part in the High Court trial and why he did not appeal the decision should also be permitted. However, the County Court judge was fully entitled to adopt the view that he was not going to allow the circumstances of the alleged fraud on Sheikh Ahmed to be explored, even on the issue of credit, in any depth. If the Respondent denies any fraud over the property transfers because, for example, he says he had Sheikh Ahmed's authority to sign the transfers, the topic could not then be explored in any depth without involving a re-run of the High Court action, though this time with the Respondent participating and Sheikh Ahmed probably not. The judge was right to wish to avoid that outcome. Therefore it is only to the limited extent indicated that the allegedly fraudulent transfers should be put by way of cross-examination as to credit. The County Court is entitled to use its normal powers under the CPR to prevent any substantial time being taken on an aspect which goes only to credit.”

“As the judge [i.e. Leggatt J] rightly recognised the foundation on which the rule must now rest is that findings of fact made by another decision maker are not to be admitted in a subsequent trial because the decision at that trial is to be made by the judge appointed to hear it (“the trial judge”), and not another. The trial judge must decide the case for himself on the evidence that he receives, and in the light of the submissions on that evidence made to him. To admit evidence of the findings of fact of another person, however distinguished, and however thorough and competent his examination of the issues may have been, risks the decision being made, at least in part, on evidence other than that which the trial judge has heard and in reliance on the opinion of someone who is neither the relevant decision maker nor an expert in any relevant discipline, of which decision making is not one. The opinion of someone who is not the trial judge is, therefore, as a matter of law, irrelevant and not one to which he ought to have regard.”

“I have also been informed in the matter by a practical consideration highlighted by Mr Jeans and Ms Belgrove [on behalf of Addison Lee], namely that if, as Ms Tether contends, I were to strike out the relevant parts of the AGoR that relate to the period from June 2014 to March 2020 (or even the shorter period from June 2014 to August / September 2017, when the Respondent says that practices began to be overhauled “on the ground”), that would leave the Tribunal next year in the unenviable position of having to make findings of fact and reach conclusions in respect of the periods immediately prior to June 2014 and immediately after March 2020 (alternatively, immediately after August / September 2017), potentially hamstrung by my decision in respect of the period in between or, at the very least, labouring under a potential weight of expectation on the part of the Leigh Day Claimants that it should make findings that enable it to arrive at effectively the same outcome in respect of those two contiguous periods. In my view, any strike out would weigh heavily on the final hearing yet might not achieve any, or any material, saving in time or costs, since the Tribunal would still have to hear evidence, make findings and come to a judgment about the same business model and working arrangements in place both immediately before and after the period covered by the strike out. Certainty would give way to greater uncertainty, including potential confusion in the minds of the parties and even the advocates as to what evidence and arguments might properly be advanced by them, including whether the period of time covered by any strike out would be entirely ‘off limits’. There would be significant potential for satellite disputes to develop, with a corresponding increase in costs. And, most significantly, there is the very real risk that the administration of justice could be brought into disrepute if the Respondent were to prevail next year in circumstances where part of their AGoR had been struck out by me in respect of a specified period in time that involved the same business model, working arrangements and driver contracts. It seems to me that the potential for the administration of justice to be brought into disrepute increases if there are different outcomes in the course of the same proceedings in respect of the same business model and working arrangements, not least where one decision, namely mine, is arrived at on a summary basis, but the other is reached after the Tribunal has heard detailed evidence which has been tested in the normal way. For the reasons below, these same considerations do not apply in relation to the applications for deposit orders.”

“In paragraph 25 of these Reasons, I refer to the practical consequences of potentially striking out aspects of the AGoR [Amended Grounds of Resistance]. The same considerations do not apply should I make deposit orders since if the deposits are paid and the claims go forward on the strength of the AGoR as they currently stand, the Tribunal will have a free hand to consider the evidence and the parties’ submissions, make findings and come to a judgment; only then will it be required to consider whether, in accordance with Rule 39(5) of the Employment Tribunals Rules of Procedure, it has decided any specific allegation or argument against the Respondent for substantially the reasons identified in these Reasons. The effect of any deposit orders I make will not be to fetter or embarrass the Tribunal that hears any sample cases next year. On the contrary, that Tribunal will be best placed to determine why, if it is the case, any specific allegation or argument has failed and, accordingly, whether costs consequences should follow. The principal impact of the deposit orders will be to encourage the Respondent to actively consider whether time and resource (both the parties’ and the Tribunal’s) should be devoted to litigating issues that have previously been litigated and determined in favour of other Claimants, rather than to impinge on the exercise by the Tribunal of its judicial function.”

“(1) The Employment Judge considers that the Respondent’s allegations or arguments raised in paragraphs 11 and 11(i), 15 and 16, and 30 to 33 of its Amended Grounds of Response dated 6 October 2022 have little reasonable prospect of success. (2) The Respondent is ORDERED to pay the following deposits in respect of the Deposit Claimants identified below not later than 21 days from the date these Orders are sent as a condition of being permitted to continue to advance those allegations or arguments: a. In respect of the arguments raised in paragraphs 11 and 11(i) of the Amended Grounds of Response dated 6 October 2022, the sum of £75,000; b. In respect of the arguments raised in paragraphs 15 and 16 of the Amended Grounds of Response dated 6 October 2022, the sum of £25,000; c. In respect of the arguments raised in paragraphs 30 to 33 of the Amended Grounds of Response dated 6 October 2022, the sum of £25,000. The Judge has had regard to any information available as to the Respondent’s ability to comply with the orders in determining the amount of the deposits. REASONS (1) The Tribunal adopts and repeats the reasons contained within the orders sent to the parties on 17 May 2023 following the hearing on 30 and 31 March 2023 and in its further reasons contained within the orders following the hearing on 19 July 2023. (2) Subject to the parties agreeing or, in default of agreement, the Tribunal determining that any further Leigh Day Claimants are Deposit Claimants, the names of the Deposit Claimants are set out in the pages that immediately follow.”

“I have looked at the Respondent’s publicly available records at Companies House. The available filed accounts are in respect of Atlas Topco Limited, albeit which trades primarily as Addison Lee. Group gross profit in the year ending 31 August 2021 was some £43 million, though in particular as a result of administrative expenses it had an operating loss of nearly £9 million. I have not explored the accounts further in that regard.”

“In my view it would be disproportionate to make deposit orders equal to or indeed which exceed the Deposit Claimants’ potential legal costs in relation to the issues that I consider to have little reasonable prospect of success. Whilst I do not think such an amount would make it difficult for the Respondent to access justice or that it would be effecting strike out through the back door, I still consider that the deposit orders should be proportionate to the costs likely to be incurred potentially unnecessarily. I do not know the likely value of the Deposit Claimants’ claims should they succeed and accordingly am not in a position to assess what level of deposits might be proportionate to the sums at stake.”

“I have regard to the fact that the Pearl Tribunal hearing lasted five days and that a similar amount of time might need to be allocated to determine the arguments that are to be the subject of deposit orders. I work to the assumption that the Leigh Day Claimants will be represented by Leading Counsel, assisted by Junior Counsel. I have recently determined a costs application in which Leading Counsel’s Brief fee was £90,000 plus VAT for a five day case, albeit where there was a single Claimant and the issues were not as wide ranging or complex as those that arise in these proceedings. Although I was a solicitor in practice until 2021, it is nevertheless difficult for me to arrive at a fully informed and reliable view as to Junior Counsel’s likely fee or Leigh Day’s likely additional costs should the relevant arguments go to trial. However, assuming for these purposes that the former’s fees might be £20,000 plus VAT and the latter’s costs perhaps £50,000 plus VAT, even allowing for the fact that much of the relevant evidence may be readily available in the Lange Claimants’ files, that would indicate total potential costs in the region of £192,000 inclusive of VAT.”

“The power to make a deposit order is a discretionary one. Whilst that discretion must be exercised judicially, there is no requirement within Rule 39 or by reason of any decision of the appellate courts that has been drawn to my attention, that the Tribunal must necessarily consider and weigh in the overall balance the merits of other allegations and arguments outside the ambit of the application for a deposit order. Indeed, it begs the question why an arguable issue should rescue one with little or no prospect of success?”