Mr T Robins v CAB Special Batteries Ltd: 1400799/2017

EMPLOYMENT TRIBUNALS

Case No 1400799/2017

Between

Mr T RobinsClaimant

CAB Special Batteries LtdRespondent

Before

Employment Judge Goraj

Date 10 January 2019

JUDGMENT

FOR THE OFFICE OF THE TRIBUNALS Online publication of judgments and reasons The Employment Tribunal (ET) is required to maintain a register of all judgments and written reasons. The register must be accessible to the public. It has recently been moved online. All judgments and reasons since February 2017 are now available at: https://www.gov.uk/employment-tribunal-decisions The ET has no power to refuse to place a judgment or reasons on the online register, or to remove a judgment or reasons from the register once they have been placed there. If you consider that these documents should be anonymised in anyway prior to publication, you will need to apply to the ET for an order to that effect under Rule 50 of the ET’s Rules of Procedure. Such an application would need to be copied to all other parties for comment and it would be carefully scrutinised by a judge (where appropriate, with panel members) before deciding whether (and to what extent) anonymity should be granted to a party or a witness New Judgment Case No: 1400799/2017 EMPLOYMENT TRIBUNALS Claimant: Mr T Robins Respondent: CAB Special Batteries Limited CERTIFICATE OF CORRECTION Employment Tribunals Rules of Procedure 2013 Under the provisions of Rule 69, the Reserved Judgment sent to the parties on 8 November 2018 is corrected as set out in the attached Judgment. _____________________________ Employment Judge ______________________________ Date 10 January 2019 SENT TO THE PARTIES ON 11 January 2019 FOR THE TRIBUNAL OFFICE Important note to parties: Any dates for the filing of appeals or reviews are not changed by this certificate of correction and corrected judgment. These time limits still run from the date of the original judgment, or original judgment with reasons, when appealing. Case No: 1400799/2017 EMPLOYMENT TRIBUNALS Claimant Respondent Mr T Robins CAB Special Batteries Limited RESERVED JUDGMENT OF THE TRIBUNAL Exeter On 12,13 &14 March 2018 and 8,9,10 &11October 2018 Before: Employment Judge Goraj The Judgment of the tribunal is that: -

[1]Any basic or compensatory awards which would otherwise have been awarded to the claimant are reduced by 100 per cent pursuant to sections 122 (2) and 123 (1) of the Employment Rights Act 1996 by reason of the matters referred to at Issue 3a of the Amended List of Issues (relating to the claimant’s conduct on 2 August 2016).

[2]Further, and in the alternative, any compensatory award which would otherwise have been awarded to the claimant is also reduced by 100 per cent pursuant to section 123 (1) of the Employment Rights Act 1996 by reason of the matters referred to at Issue 3b of the Amended List of Issues (relating to the continuance of the claimant’s contract with the respondent in any event).

[3]The claimant’s contract of employment with the respondent terminated by reason of the claimant’s acceptance of the respondent’s admitted repudiatory breach of contract (Issue 12 of the Amended List of issues) and the claimant is therefore entitled to damages in respect of his agreed notice entitlement of 7 weeks.

REASONS

[1]By a claim form which was presented to the tribunals on 22 May 2017, the claimant alleged that he had been constructively unfairly dismissed and wrongfully dismissed by the respondent and further that the respondent had made unlawful deductions from his wages in respect of accrued unpaid holiday monies.

[2]The claims were resisted by the respondent save that the claim for accrued holiday pay was subsequently resolved between the parties.

[3]This is a longstanding and highly acrimonious case which has involved several telephone case management hearings, multiple disputed applications and the adjournment of the Hearing in March 2018. The background to the case is set out in detail in the Order which was sent to the parties on 28 September 2018 and is therefore only referred to in summary below.

[4]This matter has been complicated by the fact that the parties are also engaged in High Court proceedings. In February 2017, the respondent (and related parties) commenced proceedings against the claimant in the High Court for alleged breach of fiduciary duty and related claims in respect of the claimant’s previous involvement with the respondent and others as an independent financial adviser. These proceedings are ongoing. In November 2017, the respondent made an application for injunctive relief against the claimant in respect of alleged sensitive/ confidential documentation which it believed that the claimant had taken from the respondent which included in particular the documents identified in a document entitled “Traffic and frequency analysis of emails sent by Timothy John Robins on 2 August 2016” which was prepared for the purposes of such application (“the Analysis document for 2 August 2016”). The application for injunctive relief was subsequently dismissed for reasons unrelated to this case. The claimant prepared a witness statement dated 1 December 2017 in response to the respondent’s application for injunctive relief. This document is at pages 231- 234 of the Supplementary Bundle as referred to further below. The Hearing on 12 – 14 March 2018.

[5]The substantive Hearing commenced on 12 March 2018 but was subsequently adjourned on 14 March 2018 upon the application of the respondent following the termination of its instructions to its then legal representatives. The parties also confirmed at that Hearing that there was a Hearing in the High Court on 17 April 2018 relating to the application for injunctive relief referred to above. Bundle of documents

[6]The tribunal was provided with(a) an agreed bundle of documents (“the bundle”) and

(b) an agreed supplementary bundle (“the Supplementary Bundle”). At the commencement of the Hearing there was a further disputed application by the respondent to include additional documents in the bundle. The matter was however ultimately resolved by agreement on the basis that (a) the claimant confirmed that he did not challenge the veracity of the Case No: 1400799/2017 Analysis document for 2 August 2016 and (b) it was agreed that the claimant’s witness statement dated 1 December 2017 in the High Court proceedings (referred to above) would be included in the Supplementary Bundle. Witnesses

[7]The tribunal was provided with a witness statement and heard oral evidence from the claimant.

[8]The tribunal was provided with witness statements and heard oral evidence from the following on behalf of the respondent: -(a) Mr Stuart Robertson, Managing Director and majority shareholder in the respondent and

(b) Mr David Evans, Finance Manager of the Respondent. The tribunal also received witness statements from the following witnesses on behalf of the respondent :-(a) Mr Paul Kennelly HR consultant and (b) Mr Neil Mercer, solicitor advocate. The witness statements of Mr Kennelly and Mr Mercer were not however challenged by the claimant and the tribunal therefore did not hear any oral evidence from them. The Issues

[9]At the Hearing in March 2018 a List of Issues was produced following agreement between the parties / determination of certain aspects by the tribunal (“the List of Issues”). The List of Issues identified a number of alleged repudiatory breaches by the respondent upon which the claimant relied in support of his claim of constructive dismissal/ wrongful dismissal.

[10]During the course of the Hearing in October 2018 the respondent however conceded that: -(1) The respondent’s conduct in respect of Item 12 of the List of Issues (the letter from the respondent to the claimant dated 10 February 2017 concerning possible disciplinary action against the claimant in respect of the claimant’s failure to provide a witness statement in the civil case against the respondent’s former accountants) breached the implied term of trust and confidence.

(2) The claimant’s resignation in reliance on the respondent’s breach identified at Item 12 in the List of Issues constituted a dismissal for the purposes of section 95 (1) (c) of the Employment Rights Act 1996 (“the Act”) and further that the claimant had also been unfairly dismissed by the respondent for the purposes of section 98 of the Act because of such breach.

(3) The respondent further conceded that it had breached the ACAS Code of Practice in relation to Item 12 of the List of Issues and there would be an agreed percentage uplift of 15% to any compensatory award (if relevant) pursuant to section 207A of the Trade Union and Labour Relations (Consolidation) Act 1992. Case No: 1400799/2017

[11]The parties subsequently agreed an Amended List of Issues dated 10 October 2018 (“the Amended List of Issues”) setting out the remaining issues for determination by the Tribunal (save that the claimant subsequently withdrew his claim pursuant to section 38 of the Employment Act 2002). A copy of the Amended List of Issues is attached. FINDINGS OF FACT Background

[12]The claimant was employed by the respondent from 5 November 2009 until 24 February 2017. The claimant’s date of birth is 30 April 1960.

[13]The Respondent is a family business which was set up by Mr Stuart Robertson’s father in 1982. At the time of the events in question Mr Stuart Robertson (“Mr Robertson”) was the majority shareholder and Managing Director of the Respondent and had been employed by the respondent for approximately 20 years. The respondent employed 10 staff including the claimant and Mr Robertson.

[14]The claimant worked as and had dealings with Mr Robertson and the respondent as an independent financial adviser before joining the respondent as an employee in November 2009 in sales and marketing. The claimant subsequently also became a director and minority shareholder (30 per cent) in the respondent with effect from June 2010 at which time the claimant became the respondent’s sales and marketing director. The claimant invested £50,000 in the respondent in return for his 30 per cent shareholding and associated dividends.

[15]The claimant and Mr Robertson shared an office and had adjoining desks/ computers. Mr Robertson and the claimant shared their respective computer passwords to the respondent’s email system for work purposes. Prior to the events in question the claimant and Mr Robertson had a close working relationship.

[16]The respondent also employed Mr David Evans as Finance Manager. Mr Evans undertook financial and other administrative duties on behalf of the respondent. Mr Evans did not have any management responsibility for any other members of staff or any such experience. At all relevant times the claimant had a higher rate of salary than Mr Evans. The respondent also employed Mr Mike Angouras who had responsibility for production. The claim against the respondent’s former accountants

[17]Mr Robertson and the claimant had concerns regarding the conduct of a former director and also regarding the conduct of the former accountants of the respondent. Following the claimant’s appointment as a director and shareholder of the respondent, the respondent/ its shareholders/directors entered into a conditional fee agreement (“CFA”) with Enigma solicitors to pursue an action against the respondent’s former accountants. A copy of the CFA which the claimant signed on 22 June 2012 is attached to Mr Mercer’s witness statement in these proceedings. Case No: 1400799/2017 Purchase of the claimant’s shares and associated matters

[18]In 2014 Mr Robertson and the claimant decided, following professional advice, to use their respective SSAS pensions to purchase the respondent’s factory. Mr Robertson subsequently used some of the monies released by the purchase to buy back the shares which had previously been sold to the claimant as he wished to return the shareholding in the respondent to family ownership. The sale of the claimant’s shares in the respondent to Mr Robertson was agreed on 8 October 2014 (page 58 of the bundle). The transaction was subsequently deferred to June 2015 at the request of the claimant for tax purposes following professional advice. A copy of the relevant special resolution dated 26 June 2015 relating to the share purchase is at page 88 of the bundle. The claimant received £180,000 in payment for his shareholding in the respondent.

[19]The claimant contended that he was unhappy about being required to sell his shares back to the respondent but had no alternative but to agree to such request as the respondent was entitled under the terms of the respondent’s memorandum and articles of association to purchase his shareholding. The tribunal is not however satisfied that the claimant raised any concerns with the respondent at the relevant time regarding such matter.

[20]In October 2014 the claimant and Mr Robertson agreed revised working arrangements for the claimant in the light of the above changes. It was agreed that the claimant would be employed as the respondent’s sales and marketing manager for 3 days a week on a salary of £25,000 per annum with effect from 1 January 2015. The claimant requested during the discussions regarding the claimant’s revised working arrangements a salary of £50,000 per annum for a 3-day working week together with a car allowance both of which requests were refused by Mr Robertson on commercial grounds. The claimant’s terms and conditions of employment

[21]On 9 October 2014, the claimant signed particulars of employment confirming his agreement to the terms contained therein (“the Particulars”) with effect from 5 January 2015. The Particulars are at pages 60 – 67 of the bundle. The tribunal has noted in particular, the following provisions of the Particulars namely(a) paragraph 9 - job description – the person to whom the claimant was stated to be immediately responsible was “Stuart Robinson or the most appropriate person in a supervisory position”. Further, the claimant was required to “well and faithfully serve the Employer and use your utmost endeavours to promote its interests …”

(b) paragraph 23 – notice

(d) paragraph 29- internet and email use including that – “The use of the Internet and work email addresses is restricted to work related activities……All information on company IT equipment and systems is the property of the company (including emails and contact lists)…. “Use of your company email address for personal use should be restricted to essential or urgent communication” and (f) Case No: 1400799/2017 Paragraph 33 - confidentiality – the prohibition (during and after the termination of employment) of the disclosure of any trade secrets or other information relating to the respondent’s business dealings or affairs of any customers, agents or suppliers. The respondent’s disciplinary rules and procedures

[22]A copy of the respondent’s disciplinary rules and procedures are at pages 68 – 70 of the bundle. Cited examples of gross misconduct justifying summary dismissal include breaches of confidentiality and theft. The respondent’s grievance procedure

[23]A copy of the respondent’s grievance policy is at pages 74 – 75 of the bundle. The file note dated 22 February 2015

[24]On or around 23 February 2015, the claimant discovered a copy of a note of a meeting between Mr Robertson and Mr Mercer of Enigma solicitors dated 22 February 2015 concerning the litigation with the respondent’s former accountants which had been left on view in the middle of the office desks which the claimant shared with Mr Robertson. The note recorded that Mr Robertson had informed the solicitors as follows :- , “He says that Mr Tim Robins is now being essentially moved out of the company and has a job for the moment but in due course will be moving on and then Stuart says that money he has obtained from his pension he has used to pay off Tim by buying back the shares at…” (Extract at page 87 of the bundle).

[25]The claimant contended that the discovery of such note made him feel concerned about his future with the respondent and that when he raised the matter with Mr Robertson he did not receive a satisfactory explanation.

[26]The respondent contended that the note had been left out in error, that it referred only to the ending of the claimant’s role as a director and shareholder in the business and did not refer to his continuing involvement as an employee. The respondent further contended that Mr Robertson gave appropriate assurances to the claimant which were accepted by him at the time.

[27]The Tribunal is satisfied that the discovery of the above file note gave rise to genuine and reasonable concerns on the part of the claimant about his future with the respondent which he did not consider to have been satisfactorily addressed by the respondent at that time.

[28]Following the termination of the claimant’s role as a director and shareholder in the respondent in the summer of 2015 the claimant had more limited access to the respondent’s financial information and had more limited authorisation to undertake customer visits. The summer of 2016

[29]By the summer of 2016 the claimant had increasing concerns about his future with the respondent in light of the matters referred to above and the further events referred to below. Case No: 1400799/2017 The bonus payment

[30]In July 2016 the claimant did not receive a bonus payment (of around £500) which he had expected to paid to him on around 20 July 2016 in accordance with the respondent's normal practice and as had been received by him the previous year. Further, the claimant understood that he was the only employee who had not been paid such bonus payment. The claimant did not however raise any concerns with anyone in the respondent at that time concerning the non-payment of such monies. The claimant’s pension investment in the factory

[31]On or around 27 July 2016 Mr Robertson raised with the claimant, whilst they were sitting at their respective desks at the respondent’s premises, that he wished to purchase the claimant’s share of the factory which had been funded by their respective pension investments in 2014. The claimant contended that he was ambushed and unnerved by such an approach and that he took immediate legal advice to ascertain whether Mr Robertson could require him to relinquish his pension investment in the factory.

[32]The respondent contended that it was an informal approach by Mr Robertson as part of his desire to return the respondent, including the factory premises, to family ownership which was made in the context of what Mr Robertson understood to be the close working relationship between him and the claimant. The respondent further contended that Mr Robertson had not intended to upset or disadvantage the claimant in any way and that when the claimant indicated that he did not wish to sell his investment in the factory Mr Robertson did not pursue the matter further.

[33]Having considered the evidence, the Tribunal is satisfied that(a) Mr Robertson approached the claimant on an informal basis as part of what Mr Robertson understood to be a close working relationship and an understanding by the claimant of Mr Robertson’s desire to bring ownership of the respondent back into full family ownership

(b) when the claimant informed Mr Robertson that he did not wish to sell his investment in the factory Mr Robertson did not pursue the matter further and

(c) the claimant was upset and unsettled by Mr Robertson’s approach which he perceived as an attempt by Mr Robertson to secure the return of the respondent’s premises into family ownership

(d) the claimant sought urgent legal advice (page 96) regarding the matter and as a result of which the claimant understood that he could not be forced to sell his pension investment in the factory (page 102 of the bundle). Mr Robertson’s comments on 27 July 2016

[34]The claimant contended that on or around 27 July 2016, following the receipt of a telephone call from a large customer confirming that that they would continue and increase its business with the respondent, Mr Robertson made comments to the claimant which were designed to undermine and upset him. In summary, the claimant contended that following the receipt of the telephone call Mr Robertson, who was sitting at the adjoining desk, made inappropriate comments that(a) God looked after him

(b) that he would be taking £15,000 out of the Respondent to put Case No: 1400799/2017 into his pension fund and

[35]In summary, the Respondent accepted that(a) Mr Robertson was jubilant when he received the telephone call from the customer on 27 July 2016 as it had been feared that the respondent was about to lose an important and valuable client and

(b) Mr Robertson informed the claimant that he would be investing £15,000 in his pension fund and purchasing a set of Makita tools. The respondent denied however that the comments were intended by Mr Robertson to, in any way, undermine or belittle the claimant.

[36]The tribunal is satisfied that(a) the comments were made by Mr Robertson as alleged by the claimant

(b) Mr Robertson’s comments could reasonably have been regarded by the claimant as insensitive and

(c) they were however made in the context of Mr Robertson’s relief at retaining an important and valuable client and were not designed or intended by Mr Robertson to undermine or belittle the claimant. The claimant’s meeting with Mr Mercer on 20 July 2016

[37]The claimant was interviewed by Mr Mercer of Enigma solicitors on 20 July 2016 as part of the process of providing a witness statement for the purposes of the proceedings against the respondent’s former accountants. The claimant found this a difficult interview particularly because the claimant considered that Mr Mercer(a) was asking him for detailed information regarding his background prior to the claimant’s involvement with the respondent which the claimant did not consider to be relevant to the matters in issue and

(b) had made inappropriate comments during the meeting which appeared to suggest that the claimant had acted inappropriately in respect of his investment in the respondent. The events of 2 August 2018 and associated matters

[38]Mr Robertson was absent from work on leave from the afternoon of Wednesday 27 July 2016 until the morning of Tuesday 2 August 2016.

[39]There is a significant dispute between the parties regarding the events of 2 August 2016. Having given careful consideration to the oral evidence of the claimant and Mr Robertson together with the available documentary evidence (including in particular the document entitled the Analysis document for 2 August 2016”) (at pages 448-450 of the bundle) the tribunal is satisfied, on the balance of probabilities that the relevant events occurred as set out below.

[40]The claimant arrived at the respondent’s premises at around 7:30 AM. Mr Evans was not in attendance that day as he was on leave. Mr Robertson arrived at the respondent’s premises around 8.10am – 8.15am.

[41]Between 7:42 AM and 8:11 AM the claimant sent from his work email address to his personal email address the series of emails and attachments listed at paragraphs 1) – 14) of the Analysis document for 2 August 2016 (at pages 449 – 450 of the bundle). The emails and attachments were forwarded to the claimant’s personal email address Case No: 1400799/2017 without Mr Robertson’s knowledge or consent. The claimant accepted in his evidence that he had forwarded such emails and attachments to his personal email address.

[42]The Tribunal is satisfied that the documents / attachments listed at paragraphs 1) – 14) of the Analysis document for 2 August 2016 (and also the document/attachment listed at paragraph 20) referred to below) were (save for the document referred to at paragraph 12) commercially sensitive documents which were potentially useful to a competitor as they contained details of the respondent’s customers/prices. When reaching this conclusion, the tribunal has taken into account the oral evidence of Mr Robertson, the nature of the documents as described in the Analysis document for 2 August 2016 and also that the claimant accepted in his oral evidence to the tribunal in March 2018 that some of the emails which he had sent to his personal email address on 2 August 2016 would have been useful to a competitor.

[43]The claimant subsequently deleted the emails listed at paragraphs 1) – 14) (and also 20) of the Analysis document for 2 August 2016 from his sent email account at the respondent on 2 August 2016.

[44]Following Mr Robertson’s arrival at around 8:10 AM on 2 August 2016 Mr Robertson reviewed the documents which had been received during his absence on leave and there was a catch up discussion between Mr Robertson and the claimant. During this initial discussion between the claimant and Mr Robertson the claimant informed Mr Robertson that he had a GP appointment but refused to discuss the problem other than it was of a personal nature.

[45]There was a dispute between the parties regarding the arrangements for the claimant’s GP appointment and associated events including whether the claimant initially informed Mr Robertson that his GP appointment was at noon and subsequently changed it until 3pm which was denied by the claimant.

[46]The limited available documentary evidence shows that(a) the claimant contacted his GP surgery by mobile telephone at 8:58 AM on 2 August 2016 (page 137 of the bundle) and

(b) that a GP attended the claimant at his home at 16.32 PM on 2 August 2016 (the email from the claimant’s GP surgery dated 28 November 2017 at page 414 of the bundle). The claimant has not provided the tribunal with a copy of any GP records for 2 August 2016.

[47]Having given careful consideration to the conflicting evidence and limited documentary evidence the tribunal is satisfied on the balances of probabilities that(a) the claimant initially informed Mr Robertson that he had a GP appointment at midday

(b) in light of the information which the claimant gave to Mr Robertson about the timing of his GP appointment Mr Robertson left the respondent’s premises at around 9 AM to visit a local supermarket to purchase food for his breakfast and lunch and

[48]The respondent contended that during Mr Robertson’s absence from the office the claimant accessed Mr Robertson’s work computer and transferred to the claimant’s work email address at 9:07 AM, 9:28 AM, and 9:35 AM respectively the emails and attachments identified at paragraphs 15), 16) and 18) of the Analysis document for the 2 August 2016 (page 450 of the bundle).

[49]Document 15) is an email from Mr Mercer of Enigma Law to Mr Robertson dated 1 August 2016 attaching Mr Robertson’s draft witness statement for the purposes of the litigation against the respondent’s former accountants. Documents 16) and 18) are further emails from Mr Mercer of Enigma Law to Mr Robertson concerning the litigation against the respondent’s former accountants including advice/update on the litigation.

[50]The respondent further contended that whilst Mr Robertson was out of the office the claimant further acted as follows:(a) at 9.33am the claimant returned to his own work computer and forwarded the email and attachments at document 15) to his own personal email address and

(b) at 9:45 AM the claimant forwarded the email and attachments at document 18) to his own personal email address (the references at paragraphs 17) and 19) in the Analysis document for 2 August 2016. The respondent further contended that these contained privileged information and such transfers were made without Mr Robertson’s knowledge or consent.

[51]In the witness statement which the claimant prepared on 1 December 2017 for the purposes of the subsequent High Court proceedings against him (pages 231-234 of the Supplementary Bundle) the claimant(a) denied that he had accessed Mr Robertson’s work computer on 2 August 2016 (paragraph 7 i) at page 232 of the Supplementary Bundle)

(b) stated that he had no recollection and therefore denied the events asserted by the respondent in respect of the privileged material in respect of the litigation against the former accountants (paragraph 7 ii) at page 232 of the Supplementary Bundle) and

(c) accepted that he had sent a number of emails from his work email address to his personal email address on 2 August 2016 and that he had deleted those emails (but not all of his sent history) from his work email address on 2 August 2016 (paragraph 7 iv at page 233 of the Supplementary bundle).

[52]In his evidence to the tribunal the claimant stated(a) that he had no memory of transferring the documents at 15), 16) and 18 of the Analysis document for 2 August 2016 from Mr Robertson’s work email address to his work email address or of subsequently transferring any such documents (via the emails referred to 17) or 19) of the Analysis document for 2nd of August 2016) to his own personal email account and

(b) that any denial made in the High Court proceedings was made by him because he could not recall any such actions and therefore believed that he had not done so. Case No: 1400799/2017

[53]It was also contended on behalf the claimant that the emails referred to at 15), 16) and 18) of Analysis document for 2 August 2016 may have been transferred to the claimant by Mr Robertson for filing after Mr Robertson had read them on his return to the office. The claimant did not however assert as such during his oral evidence to the tribunal and this was denied by Mr Robertson during his oral evidence.

[54]Having given the matter careful consideration, the tribunal is satisfied on the balance of probabilities that: -(1) The claimant accessed Mr Robertson’s work computer between 9:07 AM and 9:35 AM during Mr Robertson’s absence from the office and transferred, without Mr Robertson’s knowledge or consent, the emails and attachments relating to the litigation against the respondent’s former accountants as referred to at documents 15), 16) and 18) of the Analysis document for 2 August 2016 to the claimant’s own work email address.

(2) At 9.33am and 9.45 am (again during Mr Robertson’s absence from the office) the claimant transferred to his private email address, without Mr Robertson’s knowledge or consent, the emails and attachments identified at documents 15) and 18 of the Analysis document for 2 August 2016 (via the emails identified at documents 17 and 19 of the Analysis document for 2 August 2016) (page 450 of the bundle).

(3) The claimant subsequently also deleted from his work email address on 2 August 2016 the emails and attachments identified at paragraphs (1) and (2) above.

(4) For the avoidance of doubt, the tribunal rejects any contention by the claimant that he did not access Mr Robertson’s work email account on 2 August 2016 including any suggestion that the documents identified at 15) 16) and 18 of the Analysis document for 2 August 2016 were transferred by Mr Robertson to the claimant for filing and/or (b) that the claimant did not transfer the documents identified at (2) above to his personal email account on 2 August 2016.

(5) When reaching the above conclusions, the tribunal does not consider the contention that the documents were transferred to the claimant by Mr Robertson for filing (which was denied by Mr Robertson and was not contended by the claimant in the High Court proceedings) to be credible. Further, it would not, in any event, explain the emails at 17) and 19) of the Analysis document dated Case No: 1400799/2017 2 August 2016 forwarding the documents and attachments at 15) and 18) to the claimant’s personal email address.

[55]At 11.39 am (following Mr Robertson’s return to the office) the claimant transferred from his work email address the emails and attachments concerning a purchase order from a customer, identified at document at 20 of the Analysis document for 2 August 2016, to his personal email address (page 450 of the bundle). Such emails and attachments were transferred to the claimant’s personal email address without Mr Robertson’s knowledge or consent. The Tribunal is satisfied, that these were further commercially sensitive documents which would potentially have been useful to a competitor. The claimant also deleted on 2 August 2016 the emails and attachments at document 20 of the Analysis document for 2 August 2016 from his work email address at the respondent.

[56]The respondent did not produce any evidence to the tribunal to indicate that the claimant had subsequently disclosed (other than to his legal advisers) or used any of the commercially sensitive or confidential privileged documents which the claimant had taken from the respondent without consent on 2 August 2016. Subsequent events in August 2016

[57]On the evening of 2 August 2016, the claimant sent Mr Robertson an email informing him that following a visit to the doctors that day he had been signed off work for an initial period of one month and that he would send in the doctor’s certificate the following day. Following an enquiry from Mr Robertson regarding the nature of the claimant’s illness, the claimant informed Mr Robertson that he had been feeling generally unwell for a while, that he had been advised that his heart was under stress and that he would have to come to a full stop with a review in a month’s time. The claimant further advised Mr Robertson that he would inform him if there was any change in his condition (pages 98-99 of the bundle).

[58]The claimant subsequently provided the respondent with at statement of fitness from work certificate from his GP surgery (“a doctor’s certificate”) dated 2 August 2016 in which it was stated that the claimant was unfit for work because of a “stress related” condition until 6 September 2016 and that the position would be reviewed again at the end of that period (page 97 of the bundle).

[59]In the light of the claimant’s absence from work on 3 August 2016, Mr Robertson accessed the claimant’s work email address in order to ascertain whether there were any work-related matters which he needed to deal with in the claimant’s absence. Mr Robertson discovered on 3 August 2016 that the claimant had deleted sent emails from his email address. There is a dispute between the parties as to whether the claimant had deleted all of his sent emails from his work account. Although the tribunal is satisfied in the light of the findings above regarding the events of 2 August 2016 that the claimant had deleted various items Case No: 1400799/2017 from his work sent email history, it is not satisfied that the claimant had deleted his entire sent history as contended by the respondent. Mr Robertson could not understand why the claimant had deleted emails from his sent emails. Mr Robertson did not however, suspect the claimant of any wrongdoing at that time.

[60]There was a subsequent exchange of emails between the claimant and Mr Robertson between 3 August 2016 and 15 August 2016 (pages 100-105 of the bundle). During the exchange of emails Mr Robertson sent to the claimant on 8 August 2016 a copy of an email which he had received from Mr Mercer of Enigma Law a few days earlier. This email related to the claimant’s uncompleted witness statement for the purposes of the litigation against the former accountants in which Mr Mercer requested Mr Robertson to confirm whether the claimant was still available to complete the witness statement as the claimant was a critical witness in the litigation. Mr Robertson requested the claimant to contact Mr Mercer as the deadline (for the exchange of witness statements) was drawing nearer (page 103 of the bundle). In a text message dated 15 August 2016 the claimant advised Mr Robertson that he was aware that Mr Robertson been trying to contact him but that he was unable to discuss work-related issues at that time because he had been signed off for a month with stress by his doctor (page 104 of the bundle).

[61]There was a further exchange of text/emails between Mr Robertson and the claimant between 23rd and 31 August 2016 during which(a) Mr Robertson informed the claimant that he had received contact from the respondent’s mobile telephone providers informing him that the claimant had asked for his telephone number to be removed from the respondent’s account in response to which the claimant denied any such request and gave an alternative explanation

(b) Mr Robertson expressed concern for the claimant’s well-being and

(c) the claimant advised Mr Robertson that he had an appointment with his doctors to discuss how things were proceeding with his health and that he would keep Mr Robertson informed. The claimant’s doctor’s certificate dated 2 September 2016

[62]The claimant was issued with a further doctor’s certificate dated 2 September 2016 in which it was stated that(a) the claimant was unfit for work for one month and

(b) that the cause of the claimant’s absence was “stress at work” (page 113 of the bundle). The claimant’s email dated 3 September 2016 and subsequent correspondence

[63]The claimant sent an email to the respondent dated 3 September 2016 (page 114 bundle) to which he attached the doctors’ certificate dated 2 September 2016. In summary, the claimant advised Mr Robertson that his GP had signed him off for work for another month due to stress and that although he understood that his illness had come at an inconvenient time for the respondent it was beyond his control. The claimant advised Mr Robertson that he would be taking time seriously to think about his future at the respondent and that he would appreciate it if Mr Robertson would enable him to gather his thoughts. The claimant further stated that he Case No: 1400799/2017 would let Mr Robertson know as soon as he had reached a decision. Mr Robertson responded briefly by email dated 6 September 2016 thanking the claimant for his email and expressing hope that they would be in touch shortly.

[64]There was a further exchange of emails between the claimant and Mr Robertson between 23rd and 25 September 2016 (pages 117-18 of the bundle) which were initiated by the claimant. The claimant contacted Mr Robertson on 23 September 2016 suggested that they should have a face to face meeting. The claimant and Mr Robertson agreed to meet at a public house/ restaurant on 27 September 2016. The telephone call on 26 September 2016

[65]The respondent contended that on 26 September 2016 Mr Robertson received a telephone call from Mr Bob Prior, whom Mr Robertson understood to be a friend of the claimant, enquiring about the claimant’s job at the respondent as the claimant had told Mr Prior that he was retiring. The claimant accepted that he had had an informal discussion with Mr Prior around this time but denied that he had informed him that he was retiring. Having balanced the evidence, including that the claimant accepted that he had had a discussion with Mr Prior around this time, the tribunal accepts on the balance of probabilities that Mr Robertson received a telephone call as contended by the respondent above including that Mr Prior told Mr Robertson that the claimant had told him that he was retiring. The meeting on 27 September 2016

[66]The claimant and Mr Robertson had a meeting over lunch on 27 September 2016. There was a dispute between the parties concerning the nature and the outcome of their discussions. There is limited documentary evidence to assist the tribunal in resolving such disputes. Neither party kept/ has provided the tribunal with any contemporaneous notes. Mr Robertson has provided the tribunal with a copy of his notes of the meeting which are at pages 119-120 of the bundle. The tribunal has however approached this note with caution as(a) Mr Robertson confirmed that it was not prepared until around the end of October 2016 and

(b) the note goes beyond a factual recollection of the events of 27 September 2016 as it contains a highly critical analysis by Mr Robertson of the claimant’s intentions and actions at this time.

[67]In summary, the claimant’s account of the meeting on 27 September 2016 was as follows:-(1) The claimant explained to Mr Robertson that (a) he had been to see his doctor on 2 August 2016 as he had felt very stressed and (b) that he thought that the stress had been caused by the erosion of his role since the sale of his shares culminating in the events of July 2016 and the request by Mr Robertson to buy back the claimant’s share in the respondent factory. Case No: 1400799/2017

(2) The parties discussed the preparation of the claimant’s witness statement for the purposes of the litigation against the respondent’s former accountant. The claimant explained to Mr Robertson that he had not completed his witness statement as he had found the meeting with Mr Mercer of Enigma Law unsettling and stressful.

(3) Mr Robertson explained to the claimant that he was due to attend a mediation meeting with the former accountants and the respondent’s solicitors the following day and asked the claimant whether he was prepared to complete his witness statement. The claimant told Mr Robertson that he did not feel well enough to complete his statement at that time and also that he had concerns about the accuracy of any statement which would be prepared by Mr Mercer.

(4) Mr Robertson informed the claimant that if he did not complete the witness statement when he had recovered from his illness he would be pursued by the respondent’s solicitor on a personal basis.

(5) The claimant explained to Mr Robertson that he felt that he no longer fitted into the respondent and that he could not stand the pressure of being pursued in respect of his witness statement and therefore asked Mr Robertson whether he would consider giving him a settlement package to allow them to part amicably.

(6) Mr Robertson responded by asking the claimant whether £25,000 was the figure which he had in mind to which the respondent replied that he was aware that the first £30,000 could be paid tax free.

(7) Mr Robertson told the claimant that if he agreed to give a witness statement and would allow Mr Robertson to confirm as such at the mediation meeting he would give the claimant an exit package of in the region of £30,000. The claimant informed Mr Robertson that he would write his own witness statement as he did not trust the respondent’s solicitor but that Mr Robertson could confirm at the mediation meeting that he would provide a statement.

(8) Towards the end of the meeting Mr Robertson said that he needed to look into the exit package to be clear on what he needed to do but as the mediation was the following day he could not do that straight away. Case No: 1400799/2017

(9) Mr Robertson confirmed that he was happy for the respondent to continue to pay the claimant full pay until the agreed end date.

(10) The claimant and Mr Robertson shook hands on what was agreed.

[68]In summary, the respondent’s account of the meeting on 27 September was as follows:-(1) Mr Robertson asked the claimant about his intentions regarding the claimant’s return to work. The claimant responded by informing Mr Robertson that he felt that it might be better for both parties if they parted company provided that the respondent could come up with a redundancy package for the claimant to give him a cushion whilst he continued to recover and look for another job.

(2) Mr Robertson asked the claimant, in a jovial way “what are you looking for, a year’s salary?” to which the claimant responded that the respondent could pay him up to £30,000 tax free if the respondent made him redundant and explained that he was fearful that it would be difficult for him to secure another job.

(3) The claimant informed Mr Robertson that he had been the only person in the business who had not received a bonus and that he felt upset about this.

(4) The claimant asked about the litigation against the former accountants and Mr Robertson told him that there was a mediation meeting the following day.

(5) Mr Robertson asked the claimant about his intentions regarding the witness statement to which the claimant responded that he had taken advice from an employment solicitor who had advised him that he was not required to complete the witness statement if he did not want to do so.

(6) Mr Robertson explained to the claimant that he believed that the claimant had been given incorrect advice and that it was necessary for the claimant to complete his witness statement as if he did not do so the consequences could be that Enigma Law might pursue the respondent or the claimant personally for any losses incurred by reason of Case No: 1400799/2017 the claimant’s failure to comply with his agreement to provide such a statement.

(7) By the end of the meeting the claimant agreed to cooperate with regard to the completion of his witness statement for the litigation against the former accountants and Mr Robertson agreed to consider the claimant’s request for a redundancy package. Mr Robertson also agreed to pay the claimant his full salary until they had agreed an exit package.

(8) The parties shook hands on such basis.

[69]Having given careful consideration to the contentions of the parties the Tribunal is satisfied, on the balance of probabilities, as follows: -(1) The meeting on 27 September 2016 was initiated by the claimant for the purposes of endeavouring to secure an exit package from the respondent. When reaching this conclusion the tribunal has taken into account in particular (a) the contents of the claimant’s email to the respondent dated 3 September 2016 in which he stated that he wanted to take time to think about his future with the respondent and that he would let Mr Robertson know as soon as he had reached a decision (page 114 of the bundle) (b) the tribunal’s findings regarding the telephone call which Mr Robertson received from Mr Prior on 26 September 2016 (c) the claimant’s subsequent email to Mr Robertson dated 29 September 2016 (page 128) in which he states that it “was good to meet on Tuesday and discuss my exit plan from CAB” and (d) it is not contended by the claimant that he put to the respondent any proposals for a return to work.

(2) The focus of the discussions at the meeting on 27 September 2016 were on two main issues namely (a) an exit package for the claimant and (b) the claimant’s position regarding the completion of a witness statement/confirmation that he would provide such a statement for the purposes of the litigation against the former accountants.

(3) The claimant explained that he felt that he no longer fitted in the respondent following the sale of his shares and the erosion of his role and that it would be best if the parties parted company on the basis that the respondent would pay him an agreed redundancy exit package. The claimant also informed Mr Robertson that he had been upset by the fact that he had been the only person in the business who had not received a bonus in July 2016. Case No: 1400799/2017

(4) Mr Robertson and the claimant discussed the amount of any exit package and Mr Robertson asked (as accepted by Mr Robertson) the claimant whether he was looking for “ a year’s pay”. The claimant responded to this by informing Mr Robertson that he understood that the respondent could pay him up to £30,000 tax-free if the respondent made him redundant.

(5) Mr Robertson informed the claimant that he was attending the following day a mediation meeting in the litigation against the respondent’s former accountants and asked the claimant about his intentions regarding the completion of his witness statement.

(6) The claimant advised Mr Robertson of his concerns about the way in which the matter had been handled by Enigma Law including that he had been advised by employment solicitors that he was not obliged to produce a statement. As part of this discussion Mr Robertson advised the claimant of what he understood to be the potential consequences of the claimant failing to complete his witness statement including that Enigma Law might pursue the respondent/the claimant personally for any consequential losses. The claimant was distressed by Mr Robertson’s suggestion that he could be pursued personally by Enigma Law if he did not complete his witness statement.

(7) The claimant agreed to complete his witness statement and also for Mr Robertson to confirm at the mediation meeting that he had agreed to do so.

(8) The tribunal is satisfied that the meeting concluded on the basis that (a) Mr Robertson agreed to consider further paying the claimant an agreed redundancy package in the realms of a year’s salary (b) the claimant agreed to complete, when he was well enough to do so, his witness statement for the purpose the litigation against the respondent’s former accountants and authorised Mr Robertson to confirm as such at the mediation meeting the following day and (c) Mr Robertson agreed to pay the claimant his full salary until they had agreed an exit package for him (d) the parties shook hands on such basis.

(9) The tribunal is not satisfied that Mr Robertson agreed at the meeting to pay the claimant any agreed sum by way of a redundancy payment/ exit payment. When reaching this conclusion the tribunal has taken into account that the Case No: 1400799/2017 claimant accepted in his witness statement that Mr Robertson told him that he would need to look into the exit package to be clear what he needed to do and that in the claimant’s subsequent email to the respondent dated 29 September 2016 he talks about an “ ‘in the realm figure’ of a year’s salary”. The tribunal is however satisfied that the claimant left the meeting on the understanding that he would receive an exit package in the realms of a year’s salary provided that he cooperated with the provision of a witness statement in the litigation against the former accountants and which understanding was supported by the fact that Mr Robertson agreed to continue to pay his full salary until (as stated in Mr Robertson’s witness statement) they had agreed an exit package for the claimant. The claim against the former accountants

[70]Following the mediation meeting on 29 September 2016 the respondent reached a negotiated settlement with their former accountants and a witness statement was no longer requested from the claimant. The subsequent exchange of emails between the parties at the end of September and beginning of October 2016.

[71]There was a subsequent exchange of emails between the parties at the end of September 2016 and beginning of October 2016 in which there was a noticeable deterioration in the relationship including in particular in respect of the tone of Mr Robertson’s emails relating to the claimant’s short delay in submitting a further sick note.

[72]In the exchange of emails on 29 September 2016 the claimant stated that it had been good to meet with Mr Robertson to discuss the claimant’s exit plan from the respondent and that he was glad that they were able to agree an “in the realm figure” of a year’s salary and shake on it allowing them both to move forward (page 128 of the bundle).

[73]Mr Robertson responded by stating that they had never agreed such a payment, that they had agreed that Mr Robertson would consider the claimant’s request of redundancy and that he would be in touch in due course (pages 127-128 of the bundle).

[74]Following the exchange of such emails the claimant discovered that he had not been paid full pay as agreed by Mr Robertson at the meeting on 27 September 2016.

[75]On 3 October 2016 the claimant emailed Mr Robertson (page 129 of the bundle) in summary stating that(a) although Mr Robertson had agreed at the meeting on 27 September 2016 that he would continue to pay the claimant full pay until he had reached a redundancy agreement he had discovered that he was being paid SSP and queried whether Mr Robertson was aware of the position and

(b) recorded his understanding that it had been agreed at the meeting on 27 September 2016 that Mr Case No: 1400799/2017 Robertson would pay the claimant in the region of £25,000 i.e. one year’s salary as an exit strategy.

[76]Mr Robertson replied by email on 4 October 2016 (page 131 of the bundle) advising the claimant that he had given the instructions for the claimant to be placed on SSP. Mr Robertson further advised the claimant in summary that it was not a redundancy situation as his position was not being made redundant and that he would be in touch further in due course.

[77]There was an acrimonious exchange of emails between the parties at the beginning of October 2016 regarding the short delay by the claimant in providing a further doctor’s certificate during which(a) Mr Robertson notified the claimant that his failure to provide an up-to-date sicknote could result in disciplinary action

(b) Mr Robertson questioned the claimant’s explanation for the delay in submitting the doctor’s certificate after contacting the claimant’s GP practice (without the claimant’s knowledge or consent) to verify the availability of the claimant chosen GP to provide such a certificate (pages 132-136 of the bundle). The claimant subsequently provided the respondent with a letter from his GP confirming that he had been seen in the surgery and providing a copy of the consultation note for 7 October 2016 (page 152 of the bundle). The claimant thereafter continued to provide the Respondent with doctor’s certificates. The claimant’s email to the respondent dated 11 October 2016

[78]The claimant sent what he described as a “without prejudice and subject to contract” email to the respondent dated 11 October 2016 (pages 147 a- 147b of the bundle).

[79]In summary, the claimant advised Mr Robertson as follows:-(1) Having taken advice from ACAS and a solicitor specialising in employment law he was sending Mr Robertson a without prejudice letter regarding the way in which he had been treated by the respondent.

(2) He felt that he had suffered victimisation by being the only member of staff not to receive an annual bonus, bullying in the workplace and harassment resulting in him being signed off from work with “work related stress” and that he understood that such conduct constituted constructive unfair dismissal.

(3) He felt so disadvantaged that despite being a key member of staff for the previous 7 years he could not return to work.

(4) He had instigated an informal meeting with Mr Robertson when they had agreed that it was best for all concerned for Case No: 1400799/2017 the claimant to receive an exit package in the region of one year’s salary in return for which the respondent wanted him to complete a witness statement and to tie up any loose ends as reasonably required. The parties had shaken hands on such basis and Mr Robertson had agreed to pay the claimant his salary as usual until they had reached an agreement on the claimant’s exit package.

(5) Mr Robertson had since told the claimant that he had not agreed anything and that he was merely going to think about it. Further Mr Robertson had reduced the claimant’s income to SSP without warning.

(6) The tone of Mr Robertson’s emails over the previous week had caused the claimant great anxiety resulting in further stress and a recommendation from his doctor that his doctor’s certificate be extended for a further 6 weeks.

(7) The claimant felt that Mr Robertson was trying to wear him down and break his spirit and force him to leave the employment of the respondent.

(8) The claimant requested that in order for the situation to be dealt with quickly in a dignified manner and to avoid the need for expensive litigation Mr Robertson should honour his previous agreement to provide the exit package equivalent to one year’s salary

(9) That he would instruct a specialist employment solicitor to represent him in a case against the respondent if the situation could not be resolved. The respondent’s email dated 19 October 2016

[80]Having taken legal advice from Mr R Smith (Mr Mercer’s business partner at Enigma Law) Mr Robertson emailed the claimant on 19 October 2016 (pages 148-149 of the bundle) in summary as follows:-(1) Mr Robertson apologised for the delay in responding to the claimant which he attributed to heavy workload in the business and explained that he now had an opportunity to get back to the claimant to put his mind at rest at what he appreciated must be an emotionally distressing time for the claimant.

(2) Mr Robertson gave his explanation for the failure to make payments of the claimant’s bonus including that it had occurred as a result of an administrative error on the part of Mr Evans and that he had asked Mr Evans to make sure that the claimant was paid £550 (including an Case No: 1400799/2017 additional payment of £50 as a gesture of goodwill to compensate the claimant for the delay in payment).

(3) Mr Robertson expressed upset and concern about the allegations of bullying and harassment and suggested that they had a meeting so that he could get a better understanding of the claimant’s concerns and to try to find a solution. Mr Robertson asked the claimant to come back to him with possible dates for a meeting if he wished to discuss the matter further.

(4) Mr Robertson stated that it appeared that they had come away with different understandings of what had been agreed at the meeting on 27 September 2016 and set out his understanding as follows (a) he had reluctantly agreed to the claimant’s request to let him go (b) the claimant had suggested that there was a redundancy situation and had asked Mr Robertson to consider an exit package by which the claimant could be paid up to £30,000 tax-free (c) he had not however agreed to pay the claimant such a sum as he was not asking the claimant to leave (d) he had since confirmed to the claimant that there was no redundancy situation and (e) he urged the claimant to discuss with him if there was anything at work which was making him feel that he wished to leave the employment of the respondent.

(5) Mr Robertson denied that the respondent had any contractual obligation to pay the claimant full pay whilst he was absent from work because of sickness and contended that he had been appropriately treated having regard to how other staff had been paid and the affordability of such payments.

(6) Mr Robertson stated that he respected that the claimant was unwell and assured him that he was not trying to wear him down or break his spirit.

(7) Mr Robertson concluded the letter by stating that he would leave it to the claimant to decide whether he wished to discuss a phased/adjusted return to work or focus on his recovery away from the workplace. Mr Robertson further stated that he did not propose to involve the company’s GP to obtain medical advice on any steps to assist the claimant at that time (but might do so if the claimant’s absence continued for a prolonged period) but that if the claimant felt this would be worthwhile and would be happy to meet with the company’s GP to let him know. Case No: 1400799/2017

(8) Mr Robertson finally advised the claimant that ultimately the respondent wished to manage the claimant’s return to work but at the present time he would give the claimant the time and space to recover and asked the claimant to let him know if there were any issues which he would like to discuss that might speed up his recovery. The doctor’s note dated 18 November 2018

[81]On 18 November 2016 the claimant sent Mr Robertson a further doctor’s certificate certifying that the claimant was unfit for work because of stress at work from 16 November 2016 until 8 January 2017. The Claimant’s grievance dated 2 December 2016

[82]By a letter dated 2 December 2016 the claimant’s solicitors sent a detailed letter of grievance to the respondent on behalf of the claimant. This letter is at pages 155-164 of the bundle.

[83]In brief summary, the letter(a) contended that the claimant had been subjected to a sustained campaign of poor, unfair, unreasonable and inappropriate behaviour from, in particular, Mr Robertson and that as a result of the sustained treatment the claimant had begun to suffer from work-related stress in July 2016 which had become progressively worse until the claimant was signed off by his GP on 2 August 2016 with workrelated stress

(b) further contended that the claimant had been subjected to further unfair and appropriate behaviour from Mr Robertson during his sickness absence

(c) made reference to a wide range of issues including alleged inappropriate conduct by Mr Robertson (including with regard to such matters as the sale of the claimant’s shares in the respondent, alleged conduct following the meeting on 27 September 2017, alleged conduct on 27 July 2016 with regard to the proposed purchase of the claimant’s investment in the respondent’s factory premises, refusal to pay the claimant a car allowance, alleged inappropriate comments on 27 July 2016 following the retention of an important customer, failure to pay bonus in July 2016, failure to pay the claimant full pay and other conduct towards the claimant during his sickness absence and

(d) raised concerns relating to the conduct of Mr Mercer of Enigma Law solicitors in relation to the preparation of the claimant’s witness statement for the litigation against the respondent’s former accountants and associated matters.

[84]The claimant requested in particular the following resolution from his grievance:-(1) A full and impartial investigation into the matters raised.

(2) That Mr Robertson be removed as the claimant’s line manager.

(3) That Mr Robertson’s behaviour should be scrutinised in line with the respondent’s disciplinary rules and bullying and harassment procedures and appropriate action taken against him. Case No: 1400799/2017

(4) That the claimant would like a written apology from Mr Robertson in respect of the unfair, unreasonable and inappropriate behaviour/ treatment to which he had been subjected and,

(5) The payment of full pay (backdated in accordance with Mr Robertson’s promise on 27 September 2016 to make payment of such monies).

[85]The claimant further stated that(a) as the grievance was against Mr Robertson it was not appropriate for him to be appointed as the investigating officer or to be involved in the grievance in any way other than as a witness and

(b) further it would not be appropriate for Mr Evans to be the investigating officer as he was involved in the failure to make payments of the claimant’s annual bonus and the reduction to SSP. The appointment of an independent HR consultant

[86]The respondent appointed an external HR consultant, Mr Paul Kennelly, to investigate and “chair “the claimant’s grievance.

[87]Mr Kennelly wrote to the claimant by letter dated 16 December 2016

(a) confirming his appointment including that he would chair, conduct the investigations and reach an independent decision and

(b) inviting the claimant to attend a grievance Hearing in January 2017. The claimant’s email dated 8 January 2017

[88]The claimant emailed Mr Robertson on 8 January 2017 attaching a further doctor’s certificate dated 29 December 2016 certifying that the claimant was unfit for work due to stress at work until 26 February 2017. The claimant also requested holiday leave and asked to retrieve certain items of property which had been kept in storage which requests were granted by the respondent. The investigations into the claimant’s grievance

[89]As part of his investigation into the claimant’s grievance Mr Kennelly prepared written questions for the claimant and other key persons involved. The tribunal has had regard to the questions and responses which are pages 172-184 of the bundle. In the responses which Mr Robertson gave to Mr Kennelly’s questions he denied the allegations against him and further stated that he believed that(a) the claimant had resented him since the time that Mr Robertson had bought back the claimant’s shares in the respondent company and

(b) the claimant had been trying at the meeting on 27 September 2016 to bribe him into paying an exit package in return for the completion of his witness statement in the litigation against the former accountants (pages 183-184 of the bundle).

[90]Mr Kennelly conducted a grievance meeting with the claimant on 12 January 2017. The meeting was recorded - a copy of the transcript of the Case No: 1400799/2017 recording is at pages 185-295 of the bundle. The claimant gave Mr Kennelly a detailed account of his background and of how he became involved in the respondent. Mr Kennelly discussed with the claimant the grievances which he had raised in the grievance letter dated 2 December 2016. The main focus of the discussion related to the way that the claimant believed that he had been treated by Mr Robertson. The claimant however(a) shared his concerns with Mr Kennelly regarding the conduct and practices of Mr Mercer in relation to his dealings with Mr Mercer for the purposes of preparing his witness statement for the litigation against the respondent’s former accountants (including in respect of alleged comments by Mr Mercer suggesting that the claimant had benefitted inappropriately from his investment in the respondent) and

(b) made a number of highly critical comments regarding Mr Mercer’s professional conduct and practice.

[91]In his interview with Mr Kennelly the claimant suggested that Mr Evans had a vested interest in the claimant’s disappearance from the business as Mr Evans had raised concerns regarding the effect of the claimant’s 3 day week on the working arrangements in the office.

[92]The audio recording of the claimant’s interview with Mr Kennelly was transcribed by Enigma Law who were then acting as the respondent’s employment lawyers in respect of the claimant’s grievance and associated matters. Following authorisation by Mr Robertson, Mr Smith was provided with a copy of the transcript of the claimant’s interview with Mr Kennelly. The transcript was thereafter released to Mr Mercer without the knowledge or consent of the claimant. The events of February 2017

[93]On or around 8 February 2017, Mr Robertson(a) decided following legal advice from Enigma Law, to pursue a claim against the claimant for alleged breach of fiduciary duty and related claims relating to the claimant’s investment/ the claimant’s previous dealings with the respondent as an Independent Financial adviser and

(b) became aware that Enigma Law intended to write to the claimant in respect of the adverse comments which had been made by the claimant concerning Mr Mercer/ Enigma Law during the claimant’s interview with Mr Kennelly. The letters dated 10 February 2017

[94]On Saturday 11 February 2017 the claimant received a series of letters from the respondent and Enigma Law as follows: -(1) A letter from Mr Robertson on behalf of the respondent in summary, advising the claimant that (a) the respondent and its shareholders would be contacting him shortly through Enigma Law regarding a damages claim against him (b) the action was not been taken against him in his Case No: 1400799/2017 capacity as an employee or by the respondent in its capacity as the claimant’s employer and that their employment relationship was a separate matter (page 337 of the bundle).

(2) A letter from Mr Robertson dated 10 February 2017 on behalf of the respondent concerning the claimant’s failure to provide a witness statement in relation to the respondent’s claim against its former accountants. In summary, Mr Robertson reminded the claimant of the provisions of his contract requiring him to undertake additional duties from time to time and also to provide faithful service and promote the interests of the respondent as reasonably required. Mr Robertson advised the claimant that whilst no disciplinary action had been taken to date in respect of the claimant’s conduct relating to the above-mentioned witness statement (and that the letter should not be taken by the claimant as notice of any such action) the claimant’s conduct in relation to the witness statement was currently being considered by the respondent and the respondent fully reserved its position in respect of any such action. Mr Robertson further advised the claimant that the respondent might contact him further regarding the matter in due course. This letter, which is at page 338 of the bundle, is the letter referred at Item 12 of the Amended List of Issues which was accepted by the respondent to have constituted a breach of the implied term of trust and confidence resulting in the claimant’s consequential constructive unfair dismissal.

(3) A letter dated 10 February 2017 from Enigma Law on behalf of the respondent and the shareholders of the respondent advising the claimant (a) that they had identified claims for damages against the claimant personally and that the claimant would be informed of the details of the claims in due course. Enigma Law did not however, provide the claimant with any further details of the claims (b) that it was necessary for their clients to take immediate action to secure their position by entry into a standstill agreement in relation to time or by issuing proceedings against the claimant in the High Court and (c) to take immediate legal advice as they would take protected proceedings against the claimant if they did not hear from the claimant within the next 14 days (page 339 of the bundle).

(4) A further letter from Enigma Law (which was expressly stated to be sent on behalf Enigma Law rather than the respondent) enclosing a transcript of the claimant’s Case No: 1400799/2017 grievance interview with Mr Kennelly. Enigma Law (a) advised the claimant that they considered that the transcript contained matters relating to the reputation of Enigma and its partners which were of grave concern to them including that it contained irrelevant gratuitous personal abuse of Mr Mercer and the firm (b) invited the claimant to repeat his allegations regarding Enigma and Mr Mercer in writing outside the ongoing employment matter and to report Mr Mercer to the Solicitors’ Regulation Authority (page 340-341 of the bundle). Letter dated 13 February 2017

[95]Enigma Law sent a further letter to the claimant dated 13 February 2017 on behalf of the respondent and the shareholders in the respondent regarding the proposed claim against the claimant to which the claimant had not responded. In summary, Enigma Law advised the claimant that the claim would be pursued against him in his personal capacity because at all material times the claimant had dealt with their clients in his capacity as an independent financial adviser. Enigma Law invited the claimant to inform them whether he agreed with their proposition and advised that proceedings would be issued against him unless he entered into a standstill agreement or accepted that he was personally liable. The claimant was advised that in the absence of an appropriate response from him, proceedings would be issued against him on 27 February 2017 (page 342 of the bundle). The claimant declined to enter into a standstill agreement and High Court proceedings were subsequently issued against the claimant on 28 February 2017. Mr Kennelly’s letter to the claimant dated 16 February 2017.

[96]Mr Kennelly wrote to the claimant by letter dated 16 February 2017 advising the claimant of his findings in respect of the claimant’s grievance dated 2 December 2016. Mr Kennelly’s detailed letter is at pages 344-362 of the bundle.

[97]In brief summary, Mr Kennelly did not uphold the claimant’s grievances including that there were any grounds for(a) any disciplinary action against Mr Robertson

(b) Mr Robertson to be removed as the claimant’s line manager or

[98]Mr Kennelly however, expressed the views that(a) he believed that the working relationship between the claimant and Mr Robertson could be improved if they both focused on looking forward

(b) although he acknowledged that the continuing employment relationship and long-term friendship between the claimant and Mr Robertson was under pressure it could be restored and many of the issues resolved and

(c) that a professionally managed mediation meeting would help to bridge the gap between the claimant’s concerns and what, until the claimant’s absence on 2 August 2016, was considered by Mr Robertson to be a healthy Case No: 1400799/2017 employment relationship and friendship with a view to producing a constructive framework for the claimant’s continued future employment with the respondent. Mr Kennelly also confirmed in his letter that Mr Robertson was in agreement with the proposed way forward and was happy to arrange for mediation (pages 361- 362 of the bundle). The claimant’s letter of resignation dated 24 February 2017

[99]The claimant resigned his employment with the respondent on 24 February 2017 with immediate effect. This date is the effective date of termination for the purposes of the Act. The claimant’s letter of resignation is at pages 365 – 369 of the bundle. In summary, the claimant stated in his letter dated 24 February 2017 as follows:-(1) He was resigning his employment because of a fundamental breakdown in his employment relationship with the respondent due to the respondent’s repudiatory breach of the implied term of trust and confidence.

(2) Following the sale of his shares in the respondent in 2015 the implied term of trust and confidence had been breached on numerous occasions as his role had been steadily eroded by the conduct of Mr Robertson and the respondent. The claimant relied on the matters set out in his grievance letter dated 2 December 2016.

(3) Following the submission of his grievance and attendance at an investigatory meeting the claimant had received 2 letters from the respondent dated 10 February 2017 in which (a) the respondent stated in the 1st letter that it was considering taking disciplinary action against the claimant in respect of his conduct relating to the production of his witness statement in respect of the respondents claim against its former accountants and (b) the respondent stated in the 2nd letter that the respondent and its shareholders had engaged Enigma Law to issue a claim against him in a non-employment context however no details had provided regarding the nature of the claim.

(4) It was clear to the claimant that the respondent had written to him in such terms because he had raised a grievance.

(5) On 10 February 2017 the claimant had received a letter from Enigma Law on their own behalf in which they cited comments made by the claimant during what he believed to be a confidential grievance meeting and which he deemed to constitute a gross breach of confidential information and confidence.

(6) Enigma Law had written to him again on several occasions during February 2017 threatening High Court action and Case No: 1400799/2017 requesting the claimant to sign a standstill agreement without clearly setting out the basis of any such claims. The claimant considered that Enigma Law had been instructed and were being used by the respondent to harass, bully and victimise him because he had raised a grievance. The claimant refuted any suggestion that action was not been taken against him as an employee of the respondent including that the respondent could differentiate between his relationship with them when seeking to threaten legal action against him.

(7) the respondent’s actions in sending its letters dated 10 February 2017 and instructing Enigma Law to write its letters constituted a repudiatory breach of the implied term of the claimant’s contract of employment which had the effect of destroying the working relationship.

(8) He did not accept the findings of the grievance outcome as he believed that Mr Kennelly had not dealt with the matter appropriately including that he had not fully investigated the grievance or act impartially.

(9) That if he had not received the letters from the respondent and its solicitors dated 10 February 2017 he would have appealed the grievance outcome. The claimant did not however consider that there was any value in continuing with the grievance process given that he had been punished for raising a legitimate grievance and his trust and confidence in the respondent had been completely destroyed. The respondent’s email dated 2 March 2017

[100]Mr Robertson wrote to the claimant by email dated 2 March 2017 (pages 373-374 of the bundle). In summary Mr Robertson(a) acknowledged receipt of the claimant’s resignation

(b) expressed disappointment that the claimant not completed the grievance process particularly as Mr Kennelly had identified a positive course of action namely, the mediation process which could hopefully have resolved all of the issues regarding the claimant’s employment relationship with the respondent/his grievance(c) confirming that he considered that the proceedings which had been issued against the claimant were separate to the claimant’s employment relationship and (d) confirmed that notwithstanding the claimant’s resignation the lines of communication with Mr Kennelly remained open and that Mr Kennelly and the respondent were still willing to address the issues raised in the claimant’s grievance if he wished to do so. The tribunal proceedings

[101]The claimant presented a claim form to the tribunals on 22 May 2017 in which he alleged that he had been constructively unfairly dismissed and lawfully dismissed by the respondent and that the Case No: 1400799/2017 respondent had made unlawful deductions from his wages in respect of accrued unpaid holiday monies. The claims were fully resisted by the respondent until the course of the Hearing in October 2018 save that the claim for accrued holiday pay was resolved between the parties. The High court proceedings and associated matters

[102]The High Court proceedings against the claimant for alleged breach of fiduciary duty and related matters are ongoing. In November 2017 the respondent became aware that the claimant had accessed Mr Robertson’s computer on 2 August 2016 without his consent and had taken/ transferred to his work, and subsequently to his personal computer, confidential/commercially sensitive documents belonging to the respondent. The respondent believed that the documents included the documents identified in the Analysis Document for 2 August 2016 (pages 448-450 of the bundle) referred to previously above. The respondent commenced injunctive proceedings for the recovery of documents. In response to such application the claimant prepared the witness statement dated 1 December 2017 which is at pages 231-234 of the Supplementary Bundle. The application for injunctive relief was not granted by the High Court for reasons which are unrelated to the present proceedings. Submissions

[103]The Tribunal has had regard to the written and oral submissions provided by the parties including the additional written submissions provided by the parties in respect of the claimant’s wrongful dismissal claim. The tribunal has also had regard to the various authorities referred to by the parties in such submissions including in particular those referred to below. The tribunal has also had regard to the extracts from Harvey referred to in such submissions. The issues

[104]As stated above, the respondent conceded during the Hearing in October 2018 that the claimant had been constructively and unfairly dismissed by the respondent for the purposes of section 95s (1) (c) and 98 of the Act. The respondent conceded that it had acted in breach of the implied term of trust and confidence in respect of Item 12 of the Amended List of Issues relating to the respondent’s letter dated 10 February 2017 concerning the failure of the claimant to provide a witness statement for the respondent’s litigation against its former accountants as referred to previously above.

[105]The remaining issues which the tribunal is required to determine are therefore limited to those contained in the Amended List of Issues save that :-(1) The claimant’s claim for compensation pursuant to section 38 of the Employment Act 2002 was withdrawn by the claimant on 11 October 2018.

(2) It was agreed that the tribunal would confine its Judgment to (a) Issues 3 a and b of the Amended List of Issues (in respect of the claimant’s unfair dismissal claim) and (b) to the claimant’s wrongful dismissal claim. Case No: 1400799/2017

(3) It was agreed between the parties, for the purposes of any subsequent quantification of compensation, that (a) the claimant’s gross weekly pay at the effective date of termination of his employment with the respondent was £480.69 (which for the purposes of any basic award would be subject to a statutory cap of £479) (b) the claimant’s net weekly pay at the effective date of termination of his employment with the respondent was £387.87 and (c) that the appropriate sum for any award for the loss of any statutory rights would be £450. THE LAW The claimant’s unfair dismissal claim

[106]The tribunal has had regard in particular to sections 122 (2) and 123(1) of the Act in respect of Issue 3a and section 123 (1) of the Act in respect of Issue 3b of the Amended List of Issues (as it was agreed with the parties that section 122

(2) of the Act does not apply in respect of Issue 3b).

[107]The tribunal has also had regard to the various authorities referred to in the written submissions of the parties/referred to below.

[108]The issues at 3 a and 3 b of the Amended List of Issues give rise to 2 principal questions namely(a) should any compensation which would have otherwise have been awarded to the claimant be reduced because of the claimant’s conduct on 2 August 2016 (which only came to light after the termination of the claimant’s employment with the respondent) and

(b) what is the prospect that the claimant’s employment with the respondent would, in any event, have continued in the aftermath of the claimant’s grievance.

[109]The tribunal has reminded itself in particular that :-(1) The overriding duty placed on the tribunal is to award what is just and equitable in all the circumstances having regard to the loss sustained by the claimant in consequence of the dismissal in so far as that loss is attributable to action taken by the employer.

(2) In cases of misconduct occurring prior to the termination of employment which do not come to light until a later date, the tribunal should ensure that, notwithstanding the principles contained in W Devis and Sons Limited v Atkins

[1977] IRLR 314

HL it does not leap to the conclusion that it is invariably just and equitable to reduce any awards in such circumstances. In such situations the Case No: 1400799/2017 tribunal has to have regard to overall fairness including whether a later dismissal for such misconduct would have been fair for the purposes of section 98 of the Act.

(3) The tribunal should only make any reductions if it is satisfied that there is sufficient evidence to make such a determination and should not “embark on a sea of speculation” (King and ors v Eaton Limited (No 2)

1998 IRLR 686

Ct Sess (Inner House). The wrongful dismissal claim

[110]The Tribunal has had regard in particular in respect of the claimant’s wrongful dismissal claim to the provisions of the Employment Tribunals Extension of Jurisdiction (England and Wales) Order 1994 (“the 1994 Order”) together with the authorities referred to below/ in the written submissions/ additional submissions of the parties. THE CONCLUSIONS OF THE TRIBUNAL

[111]Issue 3 a) of the Amended List of Issues. If the Claimant was unfairly dismissed, is it just and equitable in all the circumstances to reduce (and if so by what amount) any basic award pursuant to section 122 (2) of the Act and/or compensatory award pursuant to section 123 (1) of the Act on the basis of the Claimant’s own actions prior to dismissal, specifically his gross misconduct in taking a large volume of highly sensitive and confidential documentation (including legally privileged material) from the respondent without authorisation on or before 2 August 2016?

[112]In brief summary, the claimant contended that it would not be just and equitable in all the circumstances for the tribunal to make any reductions in respect of Issue 3a) of the Amended List of Issues including on the following grounds :-(a) although the claimant admits taking the majority of the emails identified in the Analysis Document for 2 August 2016 he was suffering from stress at the time and further there is no evidence that he disseminated the information to a third party

(b) a finding of misconduct by the claimant in respect of the Analysis Document for 2 August 2016 does not necessarily justify a reduction to the basic or compensatory awards as it has to be just and equitable pursuant to sections 122 (2) and 123 (1) of the Act and

(c) no reductions should, in any event, be made to any basic or compensatory awards as the tribunal would have to determine whether the claimant would have been fairly dismissed by the respondent for such conduct and this would require the tribunal to embark on a very speculative exercise which is advised against in Eaton Limited v King referred to above. Case No: 1400799/2017

[113]In brief summary, the respondent contended that in the particular circumstances of this case and having regard in particular to W Devis &Sons Ltd v Atkins referred to above it would not be just and equitable to award the claimant any basic or compensatory awards including in particular having regard to(a) the nature of the claimant’s conduct on 2 August 2016 / the subsequent concealment of his actions and

(b) that the evidence clearly shows that the claimant would have been fairly dismissed by the respondent for the purposes of section 98 of the Act if it had been aware of the claimant’s conduct prior to the termination of the claimant’s employment. The conclusions of the tribunal regarding Issue 3a of the Amended List of Issues

[114]When reaching its conclusions regarding Issue 3 a) of the Amended List of Issues the tribunal has taken into account in particular the following matters:-(1) The claimant had 7 years’ accrued service at the effective date of termination of his employment. There was no suggestion that the claimant had been guilty of any misconduct prior to 2 August 2016.

(2) The claimant’s employment with the respondent came to an end by reason of the respondent’s admitted breach of the implied duty of trust and confidence in relation to its letter dated 10 February 2017 (Item 12 of the Amended List of Issues).

(3) The claimant contends in his Schedule of Loss that he has suffered an accrued net loss of salary to the date of the tribunal of in excess of £30,000 and that he anticipates future loss of earnings to exceed £20,000.

(4) By 2 August 2016 the claimant had become increasingly concerned about his position within the respondent including by reason of what he perceived to be unreasonable and/or insensitive treatment by Mr Robertson following the sale of the claimant’s shares in the respondent business (paragraphs 24- 36 above).

(5) The claimant also had concerns at this time by reason of what he considered to be a very difficult meeting with Mr Mercer on 20 July 2016 (paragraph 37 above).

(6) On 2 August 2016 the claimant was certified by his GP as suffering from stress (paragraphs 46- 47 above) and the claimant’s GP surgery subsequently confirmed that a GP had attended at the claimant’s home on the afternoon of 2 August 2016 (page 414 of the bundle).

(7) There was no evidence before the tribunal that the claimant had disclosed to a third party (other than his legal representatives) or Case No: 1400799/2017 used to his own advantage any of the documentation which he took from the respondent on 2 August 2016.

[115]The tribunal has also however, weighed in the balance the following matters:-(1) Although the claimant was no longer a director and shareholder of the respondent after June 2015 he continued to (a) hold a key position in sales and marketing and (b) be a trusted employee who shared an office and adjoining desks with Mr Robertson with access to Mr Robertson’s computer password (paragraph15 above).

(2) The tribunal’s findings of fact regarding the claimant’s conduct on 2 August 2016 including that without Mr Robertson’s knowledge or consent the claimant transferred to his own work/ personal email account the documents identified in the Analysis document for 2 August 2016 and further including that (a) the claimant accessed Mr Robertson’s work computer and transferred documents during Mr Robertson’s absence from the office (b) selected documents which were commercially sensitive/potentially useful to a competitor or contained confidential and privileged material relating to the respondent litigation with its former accountants (c) deleted the emails which he had sent in order to conceal what he had done (d) the claimant’s failure to give a credible or consistent account of his actions (including the inconsistencies between the evidence which the claimant gave to the Tribunal and the High Court) regarding his activities relating to the privileged material (paragraphs 38 – 55 above) and (e) the claimant’s failure overall to give any explanation for his actions other than to seek to justify them on the basis that he had transferred the documents by way of an insurance policy to demonstrate what he had achieved for the respondent as he feared that he was being manoeuvred out of the respondent.

(3) The claimant has not produced any medical evidence in support of any contention that his judgment was impaired / his actions on 2 August 2016 were the consequence of any stress related illness.

(4) The terms of the respondent’s disciplinary rules and procedures including the cited examples of gross misconduct justifying summary dismissal included breaches of confidentiality and theft (paragraph 22 above).

[116]Further, having regard to all of the above, the tribunal is satisfied that it has sufficient information to be able properly to determine what is Case No: 1400799/2017 likely to have happened if the claimant’s conduct on 2 August 2016 had become known to the respondent prior to the termination of his employment and the respondent had adopted a fair process/ procedure in response to such discovery.

[117]Having given the matter careful consideration the Tribunal is satisfied that :-(1) In the light of Mr Robertson’s limited experience of HR matters and his potential involvement as a witness in any disciplinary process he would have instructed an HR consultant such as Mr Kennelly to have conducted an investigation and either to chair or make any recommendations regarding any disciplinary action/ sanction (as with the grievance process).

(2) If the respondent had conducted a proper investigation and disciplinary Hearing in accordance with the ACAS Code prior to its own repudiatory breach on 10 February 2017 the claimant would have been dismissed for gross misconduct. When reaching this conclusion the tribunal has taken into account in particular the following matters (a) the claimant’s senior and trusted position within the respondent (b) the nature of the claimant’s conduct on 2 August 2016 including his selection of commercially sensitive / privileged information and his covert actions (including the accessing of Mr Robertson’s work computer during Mr Robertson’s absence from the office and the deletion of the relevant sent emails before leaving the office to conceal his actions)(c) the absence of any medical evidence to support any contention that the claimant’s judgment and actions were adversely affected on 2 August 2016 by any stress-related illness and (d) the claimant’s inability to give any credible explanation regarding the accessing and transfer of the relevant material.

(3) The Tribunal is further satisfied, in all the circumstances, the respondent would reasonably have concluded that the claimant had by his actions destroyed the implied term of trust and confidence and further that it would have been within the range of responses of a reasonable employer (having regard to the provisions of section 98(4) of the Act) to have dismissed the claimant for his conduct on 2 August 2016.

[118]The Tribunal has gone on to consider whether in the light of all of the above it is just and equitable to award the claimant any compensation including whether it is appropriate to make any reductions to any basic or compensatory award pursuant to section 122 (2) and 123 (1) of the Act and if so, the amount of any such reduction. Case No: 1400799/2017

[119]The tribunal is satisfied having weighed carefully all of the above factors, including(a) that the claimant’s employment ultimately came to an end by reason of the admitted repudiatory breach of contract by the respondent in respect of its letter dated 10 February 2017 and

(b) the significant financial losses which the claimant contends that he has suffered as a result of the respondent’s repudiation of contract, that it would not nevertheless be just and equitable in all the circumstances of this case to award the claimant any basic or compensatory award as the tribunal is satisfied that the claimant has not suffered any injustice by his dismissal in the light of his conduct on 2 August 2016 and the associated matters identified above.

[120]For the avoidance of doubt(a) this means that the Tribunal is satisfied that any basic and compensatory awards which would otherwise have been awarded to the claimant should be reduced by 100 percent in the light of the claimant’s conduct on 2 August 2016 and

(b) that although the wording of sections 122(2) and 123 (1) of the Act are not identical the same broad legal principles apply and it is therefore appropriate on the facts in this case for the same reduction to be made to both awards. Issue 3 b of the Amended List of Issues In addition or in the alternative to (a) above, is it just and equitable in all the circumstances to reduce (and if so by what amount) any compensatory award pursuant to section 123 (1) of the Act on the basis of the prospect of the continuance of the claimant’s employment with the respondent following the aftermath of his grievance.

[121]In summary, the claimant relied on similar arguments to those identified above including that it would be too speculative for the tribunal to make any reduction to any compensatory award particularly given(a) the possibility of the continuance of the grievance process if the respondent had not committed a repudiatory breach of contract and

(b) the positive views expressed by Mr Kennelly and Mr Robertson at the time of the termination of the claimant’s employment including regarding mediation.

[122]In summary, the respondent contended that the claimant’s continued employment with the respondent was untenable by 2 December 2016 as(a) by that time the claimant had made it abundantly clear that he wanted to leave the respondent and could not return and

(b) the claimant stated in his grievance letter that he could no longer be managed by Mr Robertson and wanted Mr Robertson to be disciplined. The conclusions of the tribunal regarding Issue 3 b

[123]The tribunal has considered what (if there is sufficient information for it to make such a determination) is likely to have happened(a) if the respondent had not committed a repudiatory breach of contract by reason of Item 12 of the Amended List of Issues ( the letter dated 10 February 2017 at paragraph 94 above) and

(b) following/in the light of the contents of and recommendations contained in Mr Kennelly’s letter dated 16 February 2016 responding to the claimant’s letter of grievance dated 2 December 2016 (pages 344-362 of the bundle). Case No: 1400799/2017

[124]The Tribunal is satisfied, in the light of its findings of fact, that it has sufficient material to be able properly to determine what is likely to have happened in the aftermath of the outcome of the claimant’s grievance if the respondent had not committed the above mentioned repudiatory breach of contract.

[125]Having given the matter careful consideration the tribunal is satisfied that if the respondent had not committed the admitted repudiatory breach of contract(a) the parties would have engaged in an independent professional mediation process and

(b) that such process would have taken 4 weeks to organise and complete.

[126]When reaching the above conclusions the tribunal has taken into account in particular that Mr Kennelly advised in his letter dated 16 February 2017 that such meeting should take place as quickly as possible and that Mr Robertson had agreed to and was happy to arrange such a meeting (page 362 of the bundle).

[127]The tribunal is further satisfied that if the parties had engaged in such a process there would nevertheless have been no realistic prospect of them reaching an agreement whereby the claimant would have returned to work as an employee of the respondent.

[128]When reaching this conclusion the tribunal has taken into account the following:-(1) Although Mr Kennelly did not uphold the claimant’s grievances he expressed the following views (a) that he believed that a working relationship between the claimant and Mr Robertson could be improved if they both focused on looking forward (b) that although he acknowledged that the continuing employment relationship and long-term friendship between the claimant and Mr Robertson was under pressure he believed that it could be restored and many of the issues resolved and (c) that a professionally managed mediation meeting would help to bridge the gap between the claimant’s concerns and what until the claimant’s absence on 2 August 2016 was considered by Mr Robertson to be a healthy employment relationship and friendship with a view to producing a constructive framework for the claimant’s continued employment within the respondent. Further, Mr Kennelly confirmed in his letter dated 16 February 2017 that Mr Robertson was in agreement with the proposed way forward and was happy to arrange for mediation.

(2) Mr Robertson had previously written to the claimant by letter dated 10 February 2017 (paragraph 94 above) seeking to assure the claimant that the actions which were been taken by Enigma on behalf of the respondents regarding the damages claim against him were not been pursued in relation to his capacity as an employee of the Case No: 1400799/2017 respondent and that the employment relationship between the respondent and the claimant was a separate matter.

(3) Further in his letter to the claimant dated 2 March 2017 Mr Robertson expressed his disappointment that the claimant had not concluded the grievance process (page 373) and stated that he remained willing to address the issues raised in the claimant’s grievance.

(4) Mr Robertson confirmed in his oral evidence to the tribunal that he would have been prepared to have engaged in a mediation process.

[129]The tribunal has however also weighed in the balance the following factors:-(1) The respondent is a small business with 10 employees at the relevant time. Mr Robertson was the key person in the business as the managing director and majority shareholder and had been employed in the business for approximately 20 years. Mr Robertson had day to day responsibility for the respondent including the overall responsibility for sales and marketing (paragraph 13 above).

(2) In all the circumstances, the tribunal is satisfied that it would have been wholly unrealistic for the claimant to have returned to any working arrangement which would not have involved the claimant having regular contact with Mr Robertson regarding sales and marketing matters/ being managed by him. The tribunal is also satisfied that it would have been wholly impracticable for the claimant to have reported instead to Mr Evans instead having regard to the matters referred to above and further that Mr Evans was a Finance manager with no involvement in sales and marketing and no experience of managing staff.

(3) By the summer of 2016 (and long before any repudiatory breach of contract by the respondent), the claimant had found it difficult to adjust to a working relationship as an employee of the respondent following his loss of status as shareholder and director.

(4) By 2 August 2016 the claimant had become increasingly concerned about his position within the respondent including by reason of what he perceived to be a course of unreasonable and/or insensitive treatment by Mr Robertson following the claimant’s change in status (paragraphs 27- 36 above).

(5) Further, by 3 August 2016 the claimant had withdrawn from the workplace by reason of sickness and did not return to work/make any proposals to return to work at any time prior to the respondent’s repudiatory breach of contract in February 2017.

(6) The claimant initiated the meeting with Mr Robertson on 27 September 2016 (having been given time to consider his position at the respondent as requested by the claimant during his period of sickness) for the purposes of endeavouring to secure an exit package from the respondent. Further, the claimant expressed the view at Case No: 1400799/2017 that meeting on 27 September 2016 that it would be best if the parties parted company on the basis that the respondent would pay him an agreed redundancy exit package (paragraphs 63- 69 above).

(7) The focus of the claimant following the meeting on 27 September 2016 was on securing the exit package which he believed had been agreed at that meeting as evidenced by his without prejudice and subject to contract email to Mr Robertson dated 11 October 2016 (paragraphs 78 - 79 above).

(8) Further the relationship between the claimant and Mr Robertson deteriorated at the beginning of October 2016 with both parties considering that the other had acted inappropriately and in breach of what had been agreed at the meeting on 27 September 2016 (paragraphs 71 – 77 above).

(9) The claimant did not respond to the proposals contained in Mr Robertson’s email dated 19 October 2016 for the claimant’s possible return to work (paragraphs 80 and 82 above).

(10) In the claimant’s subsequent letter of grievance dated 2 December 2016 the claimant (a) sought the resolutions of the matter referred to at paragraph 84 above (including that Mr Robertson should be removed as the claimant’s line manager/Mr Robertson’s conduct should be scrutinised in accordance with the respondent’s disciplinary rules and bullying and harassment procedures and appropriate action taken against Mr Robertson).

(11) The claimant remained absent on certified sick leave from 3 August 2016 until the termination of his employment on 24 February 2017 and not propose to return to work at any time during that period.

(12) Enigma Law wrote to the claimant on 10 and 13 February 2017 (pages 339 and 342 of the bundle) on behalf the respondent and the shareholders in the respondent advising the claimant that a claim for damages had been identified against him personally in respect of his capacity as an independent financial adviser to the respondent (which would have placed additional significant pressure on any day to day working relationship between the claimant and Mr Robertson).

[130]The Tribunal has gone on to consider whether in the light of all the above it would be just and equitable (disregarding for the present purposes the findings which it has already made in respect of issue 3 a) to award the claimant any compensatory award pursuant to section 123 (1) of the Act including to make any reduction to any such award in respect of Case No: 1400799/2017 the matters identified at issue 3 b) of the Amended List of Issues and if so, the amount of any such reduction.

[131]The Tribunal is satisfied having weighed carefully all of the above factors that, disregarding for present purposes the subsequently discovered pre-termination misconduct on the part of the claimant, it would have been just and equitable in all the circumstances having regard to the provisions of section 123(1) of the Act to have awarded the claimant 4 weeks’ net salary in respect of the period which it would have taken the parties to have concluded the independent professional mediation.

[132]The Tribunal is also satisfied however having carefully weighed all of the above matters (and again disregarding for present purposes any subsequently discovered pre-termination misconduct on the part of the claimant) that it would be just and equitable in all the circumstances to have reduced for the purposes of section 123 (1) of the Act any further compensatory award for any period after the 4 week period for mediation by 100%. When reaching this conclusion, the Tribunal is satisfied, for the reasons explained above at paragraph 129, that there was no realistic possibility by February 2017 of the parties being able to continue/ to resume a tenable employment relationship.

[133]Moreover, the Tribunal is satisfied that it is not, in any event, just and equitable in all the circumstances having regard to the findings which it has previously made in respect of issue 3 a (namely that it is just and equitable in all the circumstances to reduce any compensatory award by 100 per cent in the light of the claimant’s conduct on 2 August 2016) to award the claimant any compensation for the 4-week period of mediation pursuant to section 123 (1) of the Act.

[134]The claimant is therefore not awarded any compensation in respect of his unfair dismissal. The claimant’s wrongful dismissal claim

[135]It is accepted by the respondent that the claimant was entitled to 7 weeks’ notice absent any gross misconduct / actionable repudiatory breach by the claimant.

[136]The issues which the tribunal is therefore required to determine in respect of the claimant’s wrongful dismissal claim are whether:-(1) The claimant without reasonable and proper cause conducted himself in a manner calculated or likely to destroy or seriously damage the relationship of confidence and trust between employer and employee in respect of his conduct on 2 August 2016 which would have entitled the respondent to have terminated his contract without notice if it had Case No: 1400799/2017 been aware of such alleged breach during the course of his employment and if so,

(2) Whether in such circumstances the respondent is entitled to rely, in particular, on the principles contained in the Judgment of Boston Deep Sea Fishing & Ice Company v Ansell [1888] 39 CHD 339 CA and subsequently in Williams v Leeds United Football Club

[2015] EWHC 376

(QB) IRLR 383 in defence to the claimant’s claim for damages for wrongful dismissal in relation to the respondent’s later admitted repudiation of contract (in respect of item 12 of the Amended List of Issues relating to the provision of a witness statement in respect of the respondent’s claim against its former accountants).

[137]During the course of the oral closing submissions a dispute arose between the parties in particular as to whether the principles contained in Boston Deep Sea Fishing & Ice Company v Ansell and Williams v Leeds United Football Club (in which cases the employment contracts came to an end by way of termination by the employer) also apply to cases where the contract is terminated by an employee in response to a repudiatory breach of contract by the employer (as in the present case). The parties were given an opportunity to submit further written submissions on this issue which have been taken into account by the tribunal (including the further judgments and extracts from Harvey referred to in the submissions) when determining this matter.

[138]In summary, the claimant made the following contentions in support of his claim for damages for breach of contract: -(1) The claimant denied that his conduct on 2 August 2016 amounted to a breach of the implied term of trust and confidence having regard in particular to (a) the claimant’s ill health at that time and (b) the claimant did not use or pass on any information which he transferred to his own email address that day.

(2) Further and in any event, the claimant contended that the principle (as contained in the Boston Deep Sea Fishing and Williams cases) by which an employer can rely upon a previously undiscovered repudiatory breach by the employee to justify a dismissal is not applicable to the present case.

(3) In summary, the claimant contended in support of such a proposition as follows:- (a) contract law does not recognise Case No: 1400799/2017 a concept of dismissal which is a statutory concept which arises from the Act (b) a repudiatory breach of contract entitles the innocent party to discharge themselves from future performance of the contract (Suisse Atlantic SA v Rotterdamsche Kolen Centrale

[1967] 1 AC 361

and (c) the claimant elected to treat the breach by the respondent on 10 February 2017 (Item 12 of the Amended List of Issues) as a repudiation of contract and pursue a claim for damages for his notice pay in accordance with the elective or acceptance theory in Geys v Society Generale London Branch

[2012] UKSC 63

[2013] 2 WLR.

(4) The claimant further contended that the situation in the present case was distinguishable from that in Boston Deep Sea Fishing and Williams as in order for there to be a legitimate summary dismissal as in those cases there needed to be two things namely (a) conduct which entitled the respondent to terminate the contract and (b) an exercise of such contractual right of termination (albeit that they did not have to be a causal connection between the facts which entitled the employer to terminate the contract and the reason for the termination).

(5) If the respondent had terminated the claimant’s contract of employment by way of an express termination in early 2017 it could have relied upon the principles in Boston Deep Fishing and Williams to avoid being in breach of contract and therefore paying any notice pay. However, the principles in Boston Deep Sea Fishing and Williams cannot apply in the present case because the claimant rather than the respondent terminated the contract and a repudiatory breach of contract can never be justified. The claimant’s claim for wrongful dismissal is a claim for damages flowing from the respondent’s repudiatory breach and is therefore a valid one.

(6) If the claimant committed a repudiatory breach of contract on 2 August 2016 (which is denied) the respondent’s remedy is a claim for damages flowing from such breach and the only way which the respondent can avoid liability for the claimant’s claim for damages for wrongful dismissal is by way of counterclaim/set off (which the respondent could not in any event pursue as Mr Robertson confirmed his evidence that there was no quantifiable loss sustained by the respondent flowing from the claimant’s conduct on 2 August 2016).

(7) The claimant’s claim for damages must therefore succeed. Case No: 1400799/2017

[139]In summary, the respondent made the following contentions in support of its defence of the claimant’s wrongful dismissal claim:-(1) The claimant’s conduct on 2 August 2016 constituted for the purpose of any contractual claim a repudiatory breach of his contract of employment being gross misconduct and/or a breach of the implied term of trust and confidence.

(2) At common law an employer can defend a wrongful dismissal claim on the basis of facts discovered after dismissal/during a period of notice if such conduct viewed objectively amounted to a repudiatory breach of contract entitling an employer to rely on such conduct to justify the dismissal (Boston Deep Sea Fishing and Williams).

(3) The claimant is incorrect in his contention that the common law does not recognise dismissal and further if he was correct the claimant could not claim a breach of contract dismissal because he resigned.

(4) The principles contained in Boston Deep Sea Fishing and Williams apply to all wrongful dismissal claims and there is no authority which distinguishes a claim for wrongful dismissal based on whether the employee resigned or not.

(5) The position is confirmed in Harvey (A11(7) (A)(1) (c) at paragraph 392 -392 .01) including as the purpose of the rule contained in Boston Deep Sea Fishing is to protect an employer from an undisclosed rogue whose serious misconduct is only discovered after dismissal to the extent that it prevents such rogue from recovering compensation which would offend normal ideas of reasonableness and which can be justified as striking a fair balance.

(6) By accepting the respondent’s repudiatory breach the claimant accepted the termination of the contract which was a dismissal at common law under the elective termination doctrine in Geys v Society Generale.

(7) The claimant has failed to provide any authority to support the contention that an employee who is guilty of gross misconduct and subsequently resigns his employment can claim his notice pay with impunity as no such authority exists and the argument is entirely misconceived The conclusions of the tribunal regarding the claimant’s wrongful dismissal claim Case No: 1400799/2017

[140]The Tribunal has considered first whether, viewed objectively, the claimant’s conduct on 2 August 2016 amounted to a breach of the implied term of trust and confidence namely, whether the claimant without proper cause conducted himself in a manner calculated or likely to destroy or seriously damage the relationship of confidence and trust between him and the respondent/ committed gross misconduct.

[141]Having given careful consideration to all of the above, the tribunal is satisfied that, viewed objectively, the claimant’s conduct on 2 August 2016 amounted to a breach of the implied term of trust and confidence for the reasons explained at paragraphs 115 – 117 above.

[142]For the avoidance of doubt, the tribunal is not satisfied, viewed objectively, that the fact that the claimant was certified by his GP as suffering from stress on 2 August 2016 or that the respondent has produced no evidence to the tribunal to show that the claimant had disclosed to a 3rd party or otherwise used to his own advantage any of the documentation which he took from the respondent on 2 August 2016 is sufficient defence (having regard to the other factors identified above) to justify the claimant’s conduct as conduct falling short of a breach of the implied term of trust and confidence/ gross misconduct.

[143]The tribunal has therefore gone on to consider the 2nd question namely whether the respondent is able to rely upon the principles contained in the Judgment of Boston Deep Sea Fishing (and also Williams) in defence of the claimant’s claim for damages for breach of contract in respect of his agreed notice entitlement of 7 weeks.

[144]The claimant pursues his claim for notice pursuant to Article 4 of the 1994 Order which entitles the claimant to bring proceedings before an employment tribunal in respect of a claim for the recovery of damages as permitted by such article including as identified at paragraph 3 (2) of the Employment Tribunals Act 1996 and provided that the claim arises or is outstanding on the termination of the claimant’s employment. This Article therefore applies in circumstances where the contract is terminated by an employee (including in response to a repudiatory breach of the contract by an employer) as well as where the contract has been expressly terminated by an employer provided that the claim arises or is outstanding on termination. The pursuit of such a claim does not therefore require any “dismissal” by the employer.

[145]The Tribunal is satisfied, as a matter of contract law, that notwithstanding that the claimant committed a repudiatory breach of contract in respect of his conduct on 2 August 2016 (of which the respondent was unaware until after the termination of his employment), the claimant’s contract of employment continued until it came to an end by reason of the claimant’s election on 24 February 2017 to accept the respondent’s own admitted repudiatory breach of contract in respect of its letter dated 10 February 2017 relating to the provision of the claimant’s Case No: 1400799/2017 witness statement in respect of litigation against the respondent’s former accountant (Item 12 of Amended List of issues).

[146]Having given careful consideration to the Judgments in Boston Deep Sea Fishing and Williams the tribunal is satisfied that they establish the principle that if an employer discovers during a period of notice or after it has dismissed an employee that the employee acted dishonestly/in breach of the implied term of trust and confidence during his employment that the employer is entitled to rely upon such dishonesty/repudiatory breach of contract as justifying the employer’s dismissal of the employee.

[147]The tribunal is not however satisfied that the principles contained in Boston Deep Sea Fishing and Williams apply on the particular facts of this case as the claimant’s contract of employment came to an end by reason of his election to accept the respondent’s own admitted repudiatory breach of the claimant’s contract of employment (Item 12 of the Agreed List of issues) rather than by dismissal by the respondent and the tribunal therefore prefers the claimant’s submissions on this point.

[148]For the avoidance of doubt the tribunal is not satisfied that the Boston Deep Sea Fishing and/or Williams/ judgments and/or the quoted extract from Harvey can properly be considered to support the respondent’s contentions that those cases also extend to a situation where a respondent admits having committed a subsequent repudiatory breach of its own which results in the termination of the contract by the claimant (in accordance with the elective/ acceptance theory as explained in Geys v Society Generale v referred to above) in acceptance of such breach rather than by termination by the respondent.

[149]The Tribunal fully appreciates that is has reached a different conclusion on the same facts in respect of the claimant’s unfair dismissal claim and breach of contract claims. The Tribunal is however satisfied that this is explained by the fact that when determining the claimant’s unfair dismissal claim the tribunal has to have regard to the clear statutory language of the Act which requires the tribunal to award what is just and equitable in all the circumstances pursuant to sections 122 (2)/ 123 (1) of the Act whereas when determining the claimant’s breach of contract claim the Tribunal is required to apply strict contractual principles which have resulted in a different outcome.

[150]In all the circumstances, the Tribunal is satisfied that the claimant, having elected to accept on 24 February 2017 the respondent’s admitted repudiatory breach of contract of 10 February 2017 (item 12 of the Amended List of Issues) and thereby bring the contract of employment to an end, is entitled to damages in respect of his contractual notice entitlement of 7 weeks. Case No: 1400799/2017 ________________________ Employment Judge Goraj Date: 30 October 2018

[1]The respondent’s application for costs against the claimant dated 4 December 2018 is dismissed.

[2]The claimant’s application for costs against the respondent dated 5 December 2018 is dismissed save that the claimant is awarded, and the respondent is ordered to pay to the claimant the sum of £833.28 (inclusive of VAT) pursuant to paragraph 75 below. INTRODUCTION

[1]The purpose of this Hearing was to determine applications by both parties (against the other) for costs.

[2]By a claim form which was presented to the Tribunals on 22 May 2017, the claimant alleged that he had been constructively unfairly and wrongfully dismissed by the respondent and further that the respondent had made unlawful deductions from his Case number 1400799/2017 2 wages in respect of unpaid holiday monies. The claims were resisted by the respondent save that the claim for unpaid holiday monies was subsequently resolved between the parties by agreement.

[3]There were substantive Hearings on 12 – 14 March 2018 and 8 – 11 October 2018. On 10 October 2018 the respondent conceded (as explained further below) that the claimant had been constructively and unfairly dismissed. The Judgment

[4]The Tribunal determined by a reserved Judgment which was sent to the parties on 8 November 2018 (as subsequently corrected by a Certificate of Correction dated 10 January 2019) (“the Judgment”), that(a) in respect of the claimant’s unfair dismissal claim, the claimant was not entitled, pursuant to sections 122 – 123 of the Employment Rights Act 1996 (“the Act”) to any basic or compensatory awards ( including by reason of his conduct on 2 August 2016) and

(b) in respect of the claimant’s breach of contract claim for notice, the claimant’s contract of employment with the respondent terminated by reason of the claimant’s acceptance of the respondent’s admitted repudiatory breach of contract, and that the claimant was therefore entitled to damages in respect of his agreed notice entitlement of seven weeks.

[5]It was subsequently agreed between the parties that the claimant was entitled to damages in the sum of £3,364.83 in respect of his breach of contract claim for notice. This was recorded in a consent Judgment which was sent to the parties on 11 January 2018. THE COSTS HEARING

[6]This Hearing was listed to consider: -(1) The respondent’s application for costs against the claimant dated 4 December 2018.

(2) The claimant’s application for costs against the respondent dated 5 December 2018 and

(3) The respondent’s further/alternative application dated 4 December 2018 against its former legal representatives DAS Law Limited (“DAS Law”) for wasted costs. The respondent’s application against DAS Law is addressed in a separate Judgment.

(4) All applications are resisted.

[7]The purpose/ambit of the costs hearing was agreed as recorded in the Case Management Orders dated 9 February 2019 and 9 May 2019 including that if the Employment Judge determined that it was appropriate to make any award of costs the assessment of any such costs award would be determined by the Tribunal at a separate hearing. It was however agreed with the parties at the costs hearing that if the Tribunal determined that it was appropriate to make any award of costs in respect of the respondent’s email to the claimant dated 7 October 2018 (page 140 of the bundle) as referred to further below, the Tribunal would also determine the amount of any such award. Case number 1400799/2017 3 Documentation

[8]The parties submitted/ relied upon(a) the applications referred to above together with associated schedules of costs

(b) an agreed bundle of documents (“the bundle”)

(d) the bundle which was used during the substantive hearing (“the hearing bundle”) and (c) written skeleton arguments. The parties also relied on the Employment Tribunals – President Guidance (relating to disclosure, costs and judicial mediation) and the Civil Procedure Rules (paragraph 44.2).

[9]The Tribunal has not heard any oral evidence in support/defence of the applications and has therefore not made any formal findings of fact. BACKGROUND AND MATTERS WHICH ARE RELEVANT TO THE COSTS HEARING

[10]This is a long -standing and highly acrimonious matter. The Tribunal proceedings have involved multiple disputed applications, several telephone case management hearings, the adjournment of the substantive hearing in March 2018 (12-14 March 2018) and a final restored hearing in October 2018 (8- 11 October 2018). The original listing of the matter for Hearing in September 2017 and subsequent postponement

[11]Following the acceptance of the claimant’s claim form, the Tribunals wrote to the parties by letter dated 25 May 2017(pages 17 – 19 of the bundle) notifying the respondent of the claimant’s claim and listing the matter for a one-day hearing on 12 September 2017. This letter also included a standard timetable of case management orders including an order requiring the disclosure of documents by list by 6 July 2017.

[12]The claimant’s solicitors wrote to the Tribunal by letter dated 20 July 2017 explaining that they did not consider that a one-day hearing would be sufficient to hear the case in the light of the matters identified in that letter including having regard to the volume of documents identified following the exchange of lists of documents on 6 July 2017 and the proposed number of witnesses for both parties. The claimant’s solicitors accordingly requested the postponement of the existing hearing date together with a variation of the existing case management orders. The claimant solicitors confirmed that the application had been copied to the respondent’s then representatives (DAS Law) advising them of their right to object to the application.

[13]The respondent’s representatives wrote to the Tribunal by letter dated 31 July 2017 confirming their agreement to the claimant’s application and requesting that the matter be relisted for hearing for four days.

[14]The Tribunal wrote to the parties by letter dated 11 August 2017 acceding to the joint application of the parties for the postponement of the hearing in September 2017 and listing the matter for a telephone case management preliminary hearing (“CMPH) on 29 August 2017. The parties were further directed to agree various matters in preparation for the CMPH including a list of issues and remaining directions. The subsequent conduct of the case Case number 1400799/2017 4

[15]The matter was the subject of CMPHs on 29 August 2017 and 15 January 2018 during which directions were given requiring the parties to agree a list of issues for determination (including with regard to remedy). The matter was listed for a 4-day hearing commencing on 12 March 2018.

[16]A summary of the subsequent conduct of the case prior to the restored hearing in October 2018 is contained in particular in(a) the written reasons dated 13 June 2018 relating to the adjournment of the hearing in March 2018 (“ the Reasons dated 13 June 2018”) and

(b) the Order dated 28 September 2018 determining the respondent’s application for relief from sanctions dated 25 August 2018 in respect of the Unless Order dated 27 February 2018 and an associated application (“ the Order dated 28 September 2018 ”).

[17]The above mentioned documents record, amongst other matters, the disputes between the parties regarding disclosure including in respect of the respondent’s failure to comply with the terms of an Unless Order dated 27 February 2018 requiring it to disclose any documents upon which it sought to rely in support of any contention that any compensation awarded to the claimant for the purposes of remedy should be reduced pursuant to sections 122 - 123 of the Act. The Hearings on 12 – 14 March and 8 – 11 October 2018

[18]The hearing commencing on 12 March 2018 was adjourned, upon the application of the respondent on the basis set out in the Order dated 16 March 2018 (“the Order dated 16 March 2018”) and in the Reasons dated 13 June 2018. The matter was relisted for hearing from 8 – 11 October 2018. DAS Law subsequently made settlement of the claimant’s wasted costs of the adjournment of the hearing in March 2018. The concessions by the respondent and amended list of issues

[19]On 10 October 2018 the parties agreed an amended List of Issues for determination by the Tribunal in which it was recorded that(a) the respondent admitted that the alleged breach of contract ( previously identified as item 12 of the List of Issues) relating to the respondent’s letter to the claimant dated 10 February 2017 ( in which it intimated that it might take disciplinary action against the claimant in respect of the claimant’s witness statement in the civil case against the respondent’s former accountants) breached the implied term of trust and confidence

(b) in such circumstances the claimant’s resignation on reliance on such breach constituted a dismissal for the purposes of section 95 (1)

(c) of the Act and consequentially, the respondent admitted that the claimant had been unfairly dismissed (c) the respondent further accepted that it had breached the ACAS Code in relation to issue 12 of the List of Issues and

(d) the parties had agreed a percentage uplift of 15% in respect of such breach. The remaining issues in dispute were set out at paragraph 3 of the Amended List of Issues (in respect of the unfair dismissal) namely respect of remedy, and paragraphs 1-2 in respect of the claimant’s wrongful dismissal claim (the damages for breach of contract in respect of notice). The High Court proceedings

[20]This matter has been complicated further by the fact that the parties have also been engaged in High proceedings which were initiated by the respondent against the Case number 1400799/2017 5 claimant as summarised at paragraph 4 of the Judgment (page 26 of the bundle). The parties confirmed at the commencement of the Costs Hearing that the High Court proceedings against the claimant had all been dismissed save that there is an ongoing dispute relating to the respondent’s application for the claimant to be committed to prison in respect of the claimant’s alleged conduct in respect his affidavit in the High Court proceedings dated 10 May 2018 relating to the events of 2 August 2016. The involvement of the police and the Solicitors Regulation Authority

[21]The parties also confirmed at the commencement of the Costs Hearing that(a) the police had declined to pursue a complaint by the respondent concerning documentation allegedly taken by the claimant from the respondent on or around 2 August 2016 and

(b) the Solicitors Regulation Authority (“the SRA”) had dismissed a complaint by the respondent in respect of the alleged conduct of the claimant’s solicitor in respect of the matters referred to in the respondent’s solicitors’ email to the claimant’s solicitor dated 7 October 2018 (page 140 of the bundle referred to below). The Respondent’s solicitors email dated 7 October 2018

[22]In summary, the respondent’s solicitors stated in the email to the claimant’s solicitors dated 7 October 2018 ( which is recorded as having been sent at 16.29 on Sunday, 7 October 2018 – the afternoon prior to the restored hearing on 8 October 2018) (at page 140 of the bundle) that(a) it was the professional view of the respondent’s solicitors that the claimant’s Counsel may be professionally embarrassed as he had allowed into evidence at the hearing on 12 March 2018 a schedule of emails (relating to the traffic of emails on 2 August 2016) which were likely to damage the claimant’s interests and credibility and thereby giving rise to a conflict of interests between the claimant’s Counsel, the claimant and the claimant’s solicitor

(b) a potential conflict of interest had arisen as a result of the admission of the emails in evidence as the claimant’s prospects of success were likely to be lower and that the claimant should therefore be informed of that fact

(c) further that such issue might motivate Counsel or the claimant’s solicitor to advise the claimant to continue to advance a claim against his own interests in order that professional negligence did not crystallise against Counsel or the claimant’s solicitors

(d) the claimant’s Counsel and solicitors could have no reasonable objective belief in the claimant’s case on the emails and generally having considered the relevant material which established on a criminal burden of proof that the claimant had taken emails which he had denied taking on oath in the High Court action (d) that there was a risk that claimant’s Counsel and solicitors might inadvertently mislead the Tribunal by calling the claimant to give oral evidence in relation to the events of 2 August 2016

(e) the Tribunal would have been misled if the original hearing had gone ahead on 12 September 2017 as the claimant did not voluntarily disclosure the documentation which he had taken from the respondent until December 2017

(f) if the claimant’s Counsel proceeded with the hearing on 8 October 2018 and the respondent did not receive confirmation that the claimant had been informed of the contents of the email dated 7 October 2018, the respondent would report the claimant’s Counsel to the Bar Standards Board at the end of the Tribunal hearing and also the Claimant’s solicitors to the SRA and

(g) the Respondent’s solicitors asked for confirmation that the claimant’s Counsel and the claimant had been put on notice/ had received a copy of the email and confirmed that they had notified their own Counsel of the above matters that day. Case number 1400799/2017 6

[23]The claimant quantified its claim in respect of this element of the claimant’s application in the total sum of £833.28 (inclusive of VAT) (as confirmed in an email dated 19 August 2019) which was comprised of(a) £494 plus VAT in respect of the claimant solicitors’ costs and

(b) £240 (inclusive of VAT) in respect of Counsel’s fees. The claimant contended that VAT was recoverable as the claimant was not registered for VAT. Without prejudice discussions judicial mediation and associated matters relating to costs

[24]It is agreed between the parties that(a) the claimant made a without prejudice offer to settle the outstanding Tribunal claims (the holiday pay claim having previously been settled) in the sum of £25,000 in full and final settlement (the letter dated 7 February 2018 at pages 100-114 of the bundle)

(b) the Respondent did not respond to such letter and

(c) the claimant made a further without prejudice offer to settle the outstanding Tribunal claims in the sum of £20,800 (to include £13,904.28 in respect of the claimant’s claim for costs relating to the adjourned hearing in March 2018) (the letter dated 23 May 2018 at pages 119-121 of the bundle) which was rejected by the respondent (without a counteroffer) by letter dated 30 May 2018.

[25]It is recorded in the case management order of the Tribunal dated 22 August 2018 (at page 21 of the bundle) that the Tribunal discussed with the parties whether, even at such a late stage of the proceedings, there was any possibility of the matter have been dealt with by way of judicial mediation (subject to the agreement of the Regional Employment Judge) in the light of escalating costs. The claimant subsequently wrote to the Tribunal by letter dated 30 August 2018 (page 134 of the bundle) confirming that he did not wish the matter to be considered for judicial mediation. The respondent wrote to the Tribunal by letter dated 28 August 2018 confirming that the respondent wished the matter to be considered for judicial mediation and that they had communicated such position to the claimant solicitors (page 135 of the bundle).

[26]The respondent wrote to the claimant by letters dated 25 September 2018, 26 September 2018 and 7 October 2018 regarding costs (pages 136, 137-138 and 139 of the bundle). In the letter dated 26 September 2018 the respondent advised the claimant that, in the event that the Tribunal concluded that the claimant had given evidence on oath denying that he had sent relevant emails on 2 August 2016 when he had in fact sent them, the costs of the entire defence of the claimant’s claim would be sought from the claimant on the basis that such behaviour constituted unreasonable behaviour within the scope of Rule 76 (1) of the Rules (page 138 of the bundle).

[27]Neither party requested the Tribunal to consider making a deposit order pursuant to rule 39 of the Rules as a condition of the other being allowed to pursue or defend its claims/ response.

[28]There are no issues in this case regarding the claimant’s ability to make payment of any award of costs. Case number 1400799/2017 7 THE RESPONDENT’S APPLICATION FOR COSTS AGAINST THE CLAIMANT DATED 4 DECEMBER 2018 AND ASSOCIATED SUBMISSIONS

[29]The respondent has made an application for costs against the claimant dated 4 December 2018 (“the respondent’s costs application “) pursuant to Rules 76 and 77 of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 (“the Rules”). The respondent’s costs application is at pages 1-8 of the bundle. The respondent’s costs application is made in respect of the following alleged unreasonable conduct by the claimant in the bringing or conducting of proceedings against the respondent namely:-(a) breach of his duties of disclosure

(b) refusal to engage in judicial mediation and

(c) dishonest oral and written evidence including, but not limited to, his sworn affidavit evidence in the High court and Tribunal proceedings. . (a) The claimant’s alleged breach of his duties of disclosure

[30]In summary, the respondent relied in respect of the claimant’s alleged breach of his duties of disclosure, in particular on the following: -(1) Paragraphs 6-12 of the respondent’s costs application.

(2) The Employment Tribunal Presidential Guidance (“the Guidance”) -note to paragraph 8.

(3) The Case Management Order dated 25 May 2017 requiring the parties to comply with their disclosure obligations by 6 July 2017 (pages 18 and 19 of the bundle).

(4) The alleged discovery by the respondent in late November 2017 that the claimant was in significant breach of his disclosure obligations.

(5) The subsequent disclosure by the claimant on 11 December 2017 of a cache of relevant documents following the production of a witness statement dated 1 December 2017 in the High Court proceedings in which he stated that he fully understood his obligations of disclosure.

(6) The claimant’s alleged attempt deliberately to conceal the existence of relevant documents because they would have impacted directly on any compensation in his unfair dismissal claim. Accordingly, if the substantive hearing (which was originally listed for hearing in May 2017) had gone ahead it could have resulted in the claimant obtaining compensation which would have been manifestly unjust. (b) the claimant’s alleged refusal to engage in judicial mediation

[31]In summary, the respondent relied in respect of the claimant’s alleged unreasonable refusal to engage in judicial mediation, in particular, on the following:-(1) Paragraphs 13-15 of the respondent’s costs application.

(2) It was apparent following the evidence of the claimant during the hearing in March 2018 that the claimant had admitted taking on 2 August 2016 commercially sensitive documents belonging to the respondent. Case number 1400799/2017 8

(3) At the case management hearing on 22 August 2018 the Tribunal had made it plain to the parties that judicial mediation would be a sensible way to deal with the case in the light of mounting costs and the claimant’s previous admissions regarding the events of 2 August 2016 (page 21 of the bundle).

(4) The claimant was not prepared to engage in judicial mediation (page 134 of the bundle).

(5) The respondent was however, prepared to engage in mediation and further wrote to the claimant on 26 September 2018 to warn the claimant of the costs that could be consequential in respect of the claimant’s unreasonable refusal to engage in mediation (pages 135 and 137-138 of the bundle).

(6) Although there was no obligation on the claimant to engage in judicial mediation there was a strong onus, particularly upon represented parties, to understand their duties to consider alternative dispute resolution and the claimant’s refusal to engage in such process was in all the circumstances unreasonable. The respondent relied in support of its contentions in particular on the Court of Appeal Judgment in Halsey v the Milton Keynes General NHS Trust

[2004] 1 WLR 3002

. (c) The Claimant’s alleged dishonesty

[32]In summary, the Respondent relied, in particular, in respect of the claimant’s alleged dishonesty, on the following: –(1) Paragraphs 16-29 of the respondent’s application for costs.

(2) The claimant’s alleged dishonesty was a repeated and serious attempt to mislead the Tribunal. The claimant had been found to have lied on oath and by affidavit in the following written documents :- (a) the claimant’s witness statement for the High Court proceedings dated 1 December 2017 (page 84 of the bundle) (b) the claimant’s sworn affidavit in the High Court proceedings dated 10 May 2018 (page 76 of the bundle) and in the letter submitted to Tribunal by his representatives in the present proceedings dated 31 July 2018 (page 128 of the bundle) and (d) the claimant’s sworn affidavit for the purposes of the Tribunal proceedings pursuant to an order of the Tribunal dated 29 August 2018 (page 81 of the bundle).

(3) The Tribunal made clear findings in relation to the sending of commercially and legally sensitive emails to the claimant’s personal email account on 2 August 2016 (paragraphs 23-25 of the respondent’s costs application) which make a mockery of the claimant’s denials that he had taken the disputed emails/accessed Mr Robinson’s computer and that he had deleted his sent emails to cover his tracks. The claimant’s deliberate attempt to mislead the Tribunal should sound in costs being awarded against him on the basis of his patently unreasonable conduct.

(4) The respondent submits that the claimant predicated his claims on fundamentally dishonest grounds in relation both to his disclosure failures and continued denials about his misconduct in relation to the 2 August 2016 emails. Case number 1400799/2017 9 The claimant’s conduct had caused significant costs on the part of the respondent and the claimant ought to be required to bear such costs.

(5) Further, the Tribunal and the respondent both made it clear to the claimant the seriousness of lying under oath and by affidavit. The claimant was given every opportunity to pull back from his assertions but did not do so (pages 22, 136 and 137-138 of the bundle.)

(6) The respondent relies in particular on the authorities of Zurich Insurance plc v Romaine [ 2019] EWCA Civ 851, Daleside Nursing Home Limited v Mathew UK EAT / 0519/08, Arrowsmith v Nottingham Trent University

[2012] ICR 159

(CA) and HCA International Limited v May- Bheemul UK EAT/ 0477/10.

(7) Further, the respondent contended, in summary, that (a) it accepts that there is no rule of law that dishonest testimony in the Tribunal will necessarily result in costs been awarded and the Tribunal will always have to consider whether the threshold of conduct is met (b) however the wording of rule 76 (1) of the Rules is clear and the Tribunal is required to consider a costs award when the threshold is met and (c) further, it may be perverse not to award costs where there has been serious dishonesty by a party such as in the case of the Daleside. THE CLAIMANT’S RESPONSE TO THE RESPONDENT’S COSTS APPLICATION AND ASSOCIATED SUBMISSIONS

[33]The claimant resists the respondent’s costs application and, as explained above, brings its own application for costs against the respondent which is summarised below.

[34]In summary, the claimant resists the respondent’s costs application, in particular, on the following grounds:- Generally(1) The claimant succeeded in his constructive unfair dismissal (which was conceded by the respondent) and wrongful dismissal claims.

(2) The respondent’s application for costs is fundamentally misconceived as a claimant has a right under section 94 of the Act to have his claim decided by an Employment Tribunal and to pursue his claim for such purposes. The claimant relies on the authorities of Information Services Ltd v Wilkinson [ 1991] IRLR 148 and in particular, the Court of Appeal judgment in Gibb v Maidstone and Tunbridge Wells NHS Trust [2010] IR LR 786. The allegations of dishonesty

(3) Taking the respondent’s application at its highest, the claimant’s alleged dishonesty had no impact upon the finding of either constructive unfair dismissal or wrongful dismissal or upon the compensation which the claimant received in respect of his wrongful dismissal claim. Even if the claimant had withdrawn his constructive dismissal claim the Tribunal would have heard the Case number 1400799/2017 10 same evidence and submissions regarding the emails in the context of the claimant’s wrongful dismissal claim.

(4) It is not accepted that the Tribunal found that the claimant had deliberately attempted to mislead the Tribunal or that he had lied or advanced his claims on fundamentally dishonest grounds.

(5) Paragraphs 54 and 115 (2) of the Judgement (pages 35 and 58 of the bundle) make it clear that the Tribunal made its findings of fact on the balance of probability. The findings of the Tribunal fall short of a finding of fundamental dishonesty.

(6) The issue of the traffic of emails on 2 August 2016 was not a central plank of the claimant’s claim as it only went to the issue of remedy.

(7) The claimant relied in particular on the judgment in Kapoor v Governing Body of Barnhill Community High School UK/ EAT / 0352/ 13 and also the Judgments in Arrowsmith and HCA ( also relied upon by the respondent as referred to above). Judicial mediation

(8) The respondent’s application in this respect is without foundation. The claimant relies in particular on paragraph 1 of appendix 3 to the ET Presidential guidance on Alternative Dispute Resolution (22 January 2018) in which it is clearly stated that the process of judicial mediation is entirely voluntary. It would therefore be perverse for the Tribunal to extend the ambit of Rule 76 (1) of the Rules to cover situations where a party had declined to enter into a voluntary process. Further the claimant disputes any contention by the respondent that the respondent made any offer to pay for the costs of judicial mediation.

(9) Further both parties were in any event legally represented throughout and the respondent could have made a without prejudice offer at any stage however no offer of settlement was forthcoming by the respondent including a, “drop hands” offer. The claimant relies in particular on (a) its without prejudice offers of settlement contained in its letters to the respondent dated 7 February 2018 and 23 May 2018 and (b) the letters from the respondent dated 25 and 26 September 2018 in which the respondent placed the claimant on notice of/ reiterated its intention to seek costs against the claimant. Disclosure

(10) The claimant denies any suggestion by the respondent that the claimant had been hoping for a hearing in September 2017 in order to conceal his alleged deceit with regard to the emails of 2 August 2016. The claimant made an application to the Tribunal to postpone the hearing on 20 July 2017 which was agreed by the respondent on 31 July 2017 and it cannot therefore be said that the claimant was trying to conceal the fact of the emails by applying for an adjournment.

(11) The claimant further contended that (a) the respondent did not confirm until the CMPH on 15 January 2018 that an argument was being pursued pursuant to sections 122/123 of the Act and (b) if the Tribunal found that there Case number 1400799/2017 11 had been any breach by the claimant of its disclosure obligations such obligations were, in any event, rectified at least three months prior to the hearing in March 2018 and (c) any alleged breaches of disclosure should, in any event, be considered in the context of the respondent’s own repeatedly failed to disclose potentially relevant information as of 16 February 2018 prompting the issue of an unless order by the Tribunal.

(12) Further, if the Tribunal considers that the claimant acted unreasonably it, in any event, has to analyse what effects such conduct had in accordance with the judgment in Yerrakalva. The claimant disclosed all of the relevant emails to the respondent by 11 December 2017 and the respondent is seeking its costs almost exclusively from the period of 9 January 2018 onwards. The claimant costs therefore have no bearing on the issue of late disclosure. THE CLAIMANT’S COSTS APPLICATION AGAINST THE RESPONDENT DATED 5 DECEMBER 2018 AND ASSOCIATED SUBMISSIONS

[35]The claimant has made an application dated 5 December 2018 for costs against the respondent pursuant to rules 76 and 77 of the Rules (the claimant’s costs application). The claimant’s costs application is at pages 11-16 of the bundle.

[36]The claimant’s costs application is pursued in respect of the following matters:-(a) that the respondent’s defence to the constructive and wrongful dismissal claims allegedly had no reasonable prospects of success for the purposes of rule 76 (1)

(b) of the Rules (b) that the respondent’s failure to engage with the settlement/offer letters of 7 February and 23 May 2018 amounted to unreasonable behaviour for the purposes of Rule 76 (1) (a) of the Rules and

(c) the alleged vexatious conduct on behalf of the Respondent in respect of the email which was sent by the respondent’s solicitor to the claimant’s solicitor on 7 October 2018 (page 140 of the bundle). (a) The respondent’s defence to the constructive and wrongful dismissal claims allegedly had no reasonable prospects of success

[37]In summary, the claimant relied in respect of this contention, in particular, on the following: -(1) The respondent made an extremely late concession to the repudiatory breach of contract relied upon for the claimant’s constructive unlawful dismissal claims in respect of the respondent’s letter dated 10 February 2017 (item 12 of the List of Issues). The concession occurred during the evidence of Mr Robertson on day three of the adjourned hearing (on 10 October 2018) and prior to Mr Robertson’s cross examination regarding such letter.

(2) The claimant had previously sent to the respondent on 7 February 2018 a without prejudice letter in which it had set out in detail its position regarding the respondent’s case including in respect of the respondent’s letter to the claimant dated 10 February 2017 (item 12 of the list of issues) (pages 109 – 110 of the bundle). Case number 1400799/2017 12

(3) By 26 September 2018, the respondent had had the benefit of Counsel’s advice and it could not be sensibly argued by the respondent that there was a material change in circumstances between the time of Counsel’s advice and the making of the concession in respect of item 12 of the list of issues as Mr Robertson had not yet been cross-examined on such matter.

(4) Relying on the authorities of Keskar v Governors of All Saints Church [ 1991] ICR 493 and Cartiers Superfoods Limited v Laws

[1978] IRLR 315

the claimant contended that (a) the only logical explanation open to the Tribunal was that the respondent’s response to the pleaded repudiatory breaches of contract had no reasonable prospects of success and (b) the respondent was aware by 7 February 2018 that it had failed to address the issues and that its position was indefensible. (b) the respondent’s failure to engage with the without prejudice letters from the claimant dated 7 February 2018 and 23 May 2018.

[38]In summary, the claimant relied, in respect of the respondent’s alleged failure to engage with its without prejudice letters, in particular, as follows: -(1) Although the respondent must have been aware of the futility of advancing its defence to issue 12 of the list of issues relating to the respondent’s letter dated 10 February 2017, the respondent did not even acknowledge the claimant’s without prejudice letter dated 7 February 2018 (or respond in substance to the subsequent letter dated 23 May 2018) and it therefore acted unreasonably in the face of the claimant’s reasoned approach. The respondent could, instead, have conceded liability and elected to have had a hearing limited to remedy which would saved significant time and expense.

(2) It is clear from the authorities that a failure to engage with a costs warning letter, or in this case the detailed settlement letters, (including any arguments as to why the parties case was unlikely to succeed) constitutes unreasonable conduct for the purposes of costs. The claimant relied in particular, on the EAT judgment in Peat v Birmingham City Council

UKEAT/0503/11

[2012]. (c) the alleged vexatious conduct of the respondent in respect of the email dated 7 October 2018

[39]In summary, the claimant relied in respect of the respondent’s alleged vexatious conduct regarding the respondent’s solicitors’ email dated 7 October 2018 (page 140 of the bundle) on the following: -(1) The email dated 7 October 2018 constituted vexatious behaviour on behalf of the respondent as (a) it was sent at 16:29 hours on Sunday, 7 October 2018 on the day before the adjourned hearing was due to recommence (b) it had little or no discernible basis in law and (c) its obvious intention, having regard in particular to the timing of the email, was to subject the claimant to “inconvenience, harassment and expense” in accordance with G v Barker

[2000] 1 FLR 759

at paragraph 19.

(2) The matters to which the Respondent’s solicitors referred in the email dated 7 October 2018 occurred on 12 March 2018 and were well known to the Case number 1400799/2017 13 respondent’s solicitors as they were in attendance at the hearing at the relevant time. It was therefore untenable for the respondent to contend that it was a matter of which it had only recently become aware/ that there was any good reason for any such concerns not having been notified earlier.

(3) Having regard to the authority of Yerrakalva (which required the claimant to identify the conduct, what was unreasonable about it and what effects it had) the claimant contended that the respondent’s solicitors’ vexatious conduct had the effect of creating additional cost for the claimant on the morning of 8 October 2018 which also created additional stress in the process for which there was no proper motive. THE RESPONDENT’S RESPONSE TO THE CLAIMANT’S COSTS APPLICATION AND ASSOCIATED SUBMISSIONS

[40]In summary, the respondent resisted the claimant’s application for costs, in particular, on the following grounds: –(a) The concession of liability (including the timing of the concession) (1) Whilst the respondent accepted that it could theoretically be unreasonable for a party to concede liability at a late stage in the proceedings the position would always depend upon the specific context of the concession and whether there was something unreasonable about it. (2) The respondent denied that it had acted unreasonably in resisting the allegation that the respondent’s letter of 10 February 2017 (page 338 in the hearing bundle and item 12 in the list of issues) amounted to a repudiatory breach of contract. It was reasonably arguable that the respondent’s letter of 10 February 2017 did not constitute a threat of disciplinary action but rather a notice that disciplinary action might follow. (3) Further, the contents and substance of the respondent’s letter dated 10 February 2017 fell to be considered in the context of the other issues to be determined by the Tribunal. In the light of the unusual set of circumstances facing the respondent, it was reasonably arguable that it could defend the fairness of the alleged dismissal including having regard to its duty to protect the respondent’s legal interests and that in all the circumstances it had genuine, reasonable and proper cause to send the letter dated 10 February 2017. (4) The respondent should not be criticised for the timing of the concession of liability in respect of the unfair dismissal claim. A Tribunal hearing is a living thing. It is common practice for practitioners to pick up on indicators from the flow of evidence and from the Judge. In this case the respondent was responding in a sensible way in order to allow the Tribunal to focus on the essential elements of the case which was especially pertinent given the clear evidence from the claimant that he had taken commercially sensitive information

(b) the respondent’s alleged vexatious conduct in respect of the email dated 7 October 2018. Case number 1400799/2017 14 (5) The respondent denied that there had been any vexatious conduct on the part of the respondent’s solicitors in respect of its email to the claimant’s solicitors dated 7 October 2018 (page 140 of the bundle). The respondent contended in particular that (a) the respondent’s solicitors were acting in accordance with their professional obligations regarding the conduct of the claimant’s legal advisers and (b) there was nothing inherently vexatious in the correspondence as the matters raised in the email related to the conduct of the claimant relating to the emails taken on 2 August 2016 and associated matters. THE LAW

[41]The Tribunal has had regard in particular to the following statutory and associated provisions :- (1) Rule 76 (1) (a) and (b) of the Rules provides that:- “ (1) A Tribunal may make a costs order or 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”;

[42]The Tribunal has also had regard, in particular, to the legal authorities and other documents referred to above and in the attached list.

[43]The Tribunal has reminded itself in particular of the following matters: -(1) When considering an application for costs the Tribunal is required to adopt a two stage process namely (a) firstly to consider whether the costs threshold has been triggered including whether the conduct of the party against whom costs are sought was unreasonable or vexatious and if so, in what way and (b) secondly, if the costs threshold is triggered the Tribunal is required to consider whether to exercise its discretion in favour of the party claiming costs having regard to all the circumstances of the case.

(2) When exercising its discretion to award costs the Tribunal is required to consider the whole picture when deciding whether there has been unreasonable conduct by the parties in bringing/ defending and/or conducting the case and further to identify such conduct including (a) what was unreasonable about it and (b) the effects thereof (Yerrakalva).

[44]Cost awards are compensation for the successful party and not punishment for the loser. Costs awards in the employment tribunals are still regarded as the exception rather than the rule Gee v Shell (UK) Limited [ 2002] EWCA Civ 1479.

[45]In order for conduct to be considered as vexatious there needs to be either(a) evidence of some spite or desire to harass the other side or the existence of some other improper motive or

(b) in the light of the judgment of the Court of Appeal in Scott Case number 1400799/2017 15 v Russell

2013 EWCA Civ 1432

, that whatever the intention may be, its effect is to subject the other party to inconvenience, harassment and expense out of all proportion to any gain likely to accrue and that it involves an abuse of the process of the court namely, a use of the court process for a purpose or in a way which is significantly different from the ordinary and proper use of such process.

[46]For the purposes of Rule 76 (1) (a) of the Rules “unreasonable” has its ordinary English meaning and is not to be interpreted as something similar to “vexatious”. When determining whether to make an order under this ground a Tribunal should (a) take into account the nature gravity and effect of a party’s unreasonable conduct (b) consider the whole picture including whether there has been unreasonable conduct by the paying party including the nature of any such conduct, what was unreasonable about it and the effect thereof. THE CONCLUSIONS OF THE TRIBUNAL THE RESPONDENT’S COSTS APPLICATION .

[47]The Tribunal has considered first the respondent’s costs application. When determining this application, the Tribunal has however also had regard to the(a) the matters raised in the claimant’s costs application

(b) the overall position including the matters referred to at paragraph 48 below and

(c) the relevant legal and associated provisions. The Tribunal has adopted a similar approach when determining the claimant’s costs application.

[48]This is an unusual case for a number of reasons including as(a) the parties are pursuing applications for costs against each other (and in the case of the respondent in the further and/alternative against its former legal advisers DAS Law)

(b) both parties have to some degree been successful/unsuccessful in the proceedings including in particular, that although the respondent conceded that the claimant was constructively unfairly dismissed for the purposes of section 95 (1)

(c) and 98 of the Act and was held to have wrongfully dismissed the claimant (in respect of notice), the Tribunal did not award the claimant any compensation in respect of his unfair dismissal by reason in large part of the claimant’s conduct (c) the Tribunal proceedings have been conducted in a highly acrimonious manner with multiple disputed applications

(d) the proceedings have been conducted against the background of related High Court Proceedings which were not fully disclosed to the Tribunal by either party until the hearing in March 2018 and

(e) at the time of the costs hearing there was an extant application/ cross application by the parties in the High Court in respect of the respondent’s application to commit the claimant to prison for alleged dishonesty in those proceedings as identified at paragraph 20 above.

[49]The Tribunal has considered first whether the costs threshold has been triggered for the purposes of Rule 76 (1) of the Rules in respect any of the grounds of claim contained in the respondent’s costs application. (a) the claimant’s alleged breach of his duties of disclosure

[50]Having given the matter careful consideration, the Tribunal is not satisfied that the costs threshold has been triggered for the purposes of Rule 76 (1) of the Rules in respect of the claimant’s alleged breach of his duties of disclosure as alleged by the respondent at paragraph 6-12 of the respondent’s cost application.

[51]When reaching this conclusion, the Tribunal has had regard in particular, to the matters referred to at paragraphs 10 – 17 above together with the matters referred to below: - Case number 1400799/2017 16(1) The respondent’s allegations relate to the claimant’s failure to give full disclosure of documents (including in particular in respect of sensitive/ commercially sensitive documentation taken by the claimant from the respondent on 2 August 2016 without the respondent’s knowledge or consent which conduct was discovered by the respondent in November 2017 following the termination of the claimant’s employment with the respondent ) by 6 July 2017 in breach of the Tribunal’s standard order for directions dated 25 May 2017.

(2) This failure however, occurred at an early stage of the proceedings (July – November 2017) at which time the issues in the case were not fully identified (including in particular regarding remedy) and at which time it was recognised /agreed by both parties that the original listing of one day was insufficient and that the matter would need to be relisted for hearing (and which was subsequently relisted for hearing for 5 days in March 2018). Further there is no evidence to indicate that the claimant’s application to postpone the one day hearing originally listed for hearing in September 2017 was made for any reason other than the recognition by the claimant’s solicitor that a one day hearing would be insufficient to determine the matter having regard to the complexity and volume of evidence.

(3) The documents in question (as identified above) primarily relate to remedy.

(4) The claimant subsequently complied with his disclosure obligations providing further documents to the respondent between 27 December 2017 and 9 February 2018.

(5) The issues in dispute between the parties were still not finalised in January 2018 (including in respect of the respondent’s position with regard to sections 122/ 123 of the Act) and the parties were required by the terms of the Order dated 17 January 2018 to agree an updated list of issues (including with regard to remedy).

(6) The respondent’s own failure to comply with its obligations of disclosure including in particular, with regard to any documents relating to sections 122 - 123 of the Act culminating in the issue of the Unless Order dated 27 February 2018 debarring the respondent from relying on any contentions pursuant to the above provisions unless such documents were served on the claimant by 1 March 2018 ( which the respondent failed to do) (further details are contained in the Tribunal’s Order dated 28 September 2018.)

[52]In all the circumstances, the Tribunal is not satisfied that there has been any unreasonable conduct by the Claimant in respect of its obligations of disclosure as alleged by the respondent such as to trigger the costs threshold for the purposes of Rule 76 (1) of the Rules.

[53]Further, if any reason the Tribunal is incorrect and the threshold is triggered for the purposes of Rule 76 (1) of the Rules by reason of the claimant’s failure to give disclosure of the relevant remedy documents until December 2017 the Tribunal is, in any event, satisfied that it is not appropriate in all the circumstances of this case to exercise its discretion to award any costs to the respondent in respect of any such failure by the claimant having regard in particular to the respondent’s own conduct regarding such matters as referred to above. Case number 1400799/2017 17

[54]This element of the respondent’s claim for costs is therefore dismissed. (b) the claimant’s refusal to engage in judicial mediation

[55]The claimant accepts that he declined to engage in judicial mediation (paragraph 25 above and page 134 of the bundle). Having given the matter careful consideration, the Tribunal is not satisfied however, that the costs threshold has been triggered for the purposes of Rule 76 (1) of the Rules in respect of such refusal.

[56]When reaching this conclusion, the Tribunal has had regard in particular, to the matters referred to at paragraphs 24- 27 above together with the matters referred to below:-(1) It is clear from the provisions of the Presidential Guidance (Rule 3 Alternative Dispute Resolution issued on 22 January 2018 – Appendix 3 - explanation for the parties) that the process of judicial mediation is entirely voluntary. Further, in order for a case to be accepted for the judicial mediation process the Regional Employment Judge has to be satisfied that there was a high prospects of success including that the parties must demonstrate a real willingness to compromise.

(2) The purpose of judicial mediation is not to allow one party to explain to the other why they consider that their claim/ defence will not succeed.

(3) It is clear from the documentation which has been provided for the purposes of this costs hearing (as referred to at paragraphs 24-26 above) and from the confirmation which was received from the parties at the costs hearing that the respondent did not at any point during the course of these proceedings put forward any proposals of settlement including by way of any financial offer (including in response to the claimant’s monetary proposals) or a “drop hands agreement”.

(4) In all the circumstances, the Tribunal is satisfied there is no reasonable prospect that the matter would have been considered by the Regional Employment Judge as a suitable case for judicial mediation/ that the matter would, in any event, have been resolved by judicial mediation.

(5) Accordingly, the Tribunal is not satisfied that there has been any unreasonable conduct by the claimant in respect of his refusal to engage in judicial mediation such as to trigger the costs threshold for the purposes of section Rule 76 (1) of the Rules. This element of the respondent’s application for costs is therefore dismissed. (c) the claimant’s alleged dishonesty

[57]The respondent’s application for costs relates in particular to the matters of alleged dishonesty by the claimant identified at paragraph 32 above.

[58]Having given the matter careful consideration, the Tribunal is not satisfied that the costs threshold has been triggered for the purposes of Rule 76(1) of the Rules in respect of the claimant’s alleged dishonesty and/or that it is, in any event, appropriate Case number 1400799/2017 18 in all the circumstances of this case to exercise its discretion to award any cost to the respondent in respect of any such conduct having regard to the matters referred to below:- (1) The findings of fact of the Tribunal at paragraph 38-56 of the Judgment were reached by the Tribunal, on the balance of probabilities, having regard to the available documentary and oral evidence including in particular the contents of the Analysis document for 2 August 2016. Further, whilst the Tribunal rejected the claimant’s evidence regarding his conduct that day (including in respect of the accessing of Mr Robertson’s work computer and the subsequent transfer of documents) the Tribunal did not find as a matter of fact that the Claimant had been dishonest in his evidence including that he had lied on oath. Further, the issue as to whether the claimant has been dishonest (including whether he has lied on oath in respect of his actions on 2 August 2016) were extant issues in the High Court at the time of the costs hearing.

(2) Although the findings in respect of the events of 2 August 2016 were important to the question of remedy, including the claimant receiving no compensation for his unfair dismissal claim pursuant to sections 122 / 123 of the Act, such findings were not central to the claimant’s complaint of constructive unfair dismissal and/or wrongful dismissal which were both found in the claimant’s favour (by concession in respect of the constructive unfair dismissal). Further, the respondent did not make any concession regarding the fairness of the claimant’s constructive unfair dismissal claim until 10 October 2018.

(3) The Tribunal is satisfied, in all the circumstances, that the facts of this case are distinguishable from Daleside and the further authorities referred to at paragraph 32 above.

[59]Further, the Tribunal is not satisfied that if the threshold has in fact been triggered for the purposes of Rule 76(1) of the Rules that it is, in any event, appropriate in all the circumstances of this case to exercise its discretion to award any costs to the respondent in respect of the claimant’s alleged dishonest conduct. When reaching this conclusion the Tribunal has taken into account the matters referred to above together with the further matters relied upon by the claimant as summarised at paragraph 34 above including the right of the claimant to have his claim decided by an Employment Tribunal in the light of the authorities referred to at paragraph 34

(2) above).

[60]This element of the respondent’s claim for costs is therefore also dismissed.

[61]The respondent’s application for costs against the claimant is therefore dismissed. THE CLAIMANT’S COSTS APPLICATION

[62]The Tribunal has gone on to consider the claimant’s costs application. When determining this application, the Tribunal has approached the matter as set out at paragraph 47 above. (a) the respondent’s defence to the claimant’s constructive and wrongful dismissal claims allegedly had no reasonable prospect of success.

[63]The claimant’s application relates to the matters summarised at paragraph 37 above including in particular(a) the respondent’s late concession on 10 October 2018 in Case number 1400799/2017 19 respect of the alleged breach of contract (for the purposes of the claimant’s constructive unfair dismissal and wrongful dismissal claims) relating to the respondent’s letter dated 10 February 2017 (item 12 of the List of Issues) and

(b) that the respondent’s contentions in respect of such alleged breach of contract in any event had no reasonable prospect of success as identified in the respondent’s without prejudice letter to the claimant dated 7 February 2018 (pages 109 of the bundle).

[64]Having given the matter careful consideration, the Tribunal is not satisfied that the costs threshold has been triggered for the purposes of rule 76(1) of the Rules in respect of the matters referred to above and/or that it is, in any event appropriate in all the circumstances of this case to exercise its discretion to award any costs to the claimant in respect of such matters for the following reasons:- (1) The Tribunal is not satisfied that the respondent acted unreasonably, in all the circumstances of the case in making a concession on 10 October 2018 in respect of the alleged breach of contract relating to the respondent’s letter dated 10 February 2017 (item 12 of the list of issues). When reaching this conclusion the Tribunal has taken into account in particular, that the concession came about as part of agreed amendments to the existing list of issues following (a) sensible cooperation between the parties’ respective Counsel having taken stock of the evidence to date in accordance with the principles of the overriding objective and (b) in recognition by 10 October 2018 of the fact that the any award of compensation in respect of the claimant’s unfair dismissal claim was likely to be subject to significant reduction by reason of the claimant’s admitted conduct on 2 August 2016.

(2) Further, The Tribunal is not satisfied that the respondent’s defence to the alleged breach of contract in respect of the respondent’s letter to the claimant dated 10 February 2017 (item 12 of the list of issues) had no reasonable prospect of success and/or that the respondent should have appreciated as such in the light of the claimant’s without prejudice letter dated 7 February 2018 (pages 109-110 of the bundle).

(3) When reaching this conclusion the Tribunal has taken into account in particular:- (a) the claimant’s previous involvement in the respondent as a director and shareholder in the business and (b) the findings of the Tribunal regarding the deteriorating relationship between the claimant and Mr Robertson of the respondent between in particular August 2016 and February 2017, including the contribution of the claimant to such deteriorating relationship (paragraph 129 of the Judgment). The Tribunal has also taken into account that the claimant’s without prejudice letter to the respondent dated 7 February 2018 (pages 100-113 of the bundle) contains lengthy and wideranging contentions regarding the alleged weaknesses in the respondent’s case and does not set out its contentions regarding the respondent’s letter dated 10 February 2017 until the 10th page of that letter (page 109 of the bundle).

(4) The damages awarded to the claimant in respect of his wrongful dismissal claim Case number 1400799/2017 20

[65]In all the circumstances, this element of the claimant’s application for costs is dismissed. (b) the respondent’s failure to engage with the without prejudice letters from the claimant dated 7 February 2018 and 23 May 2018

[66]The respondent accepts that it did not respond/respond in a substantive manner to the claimant’s without prejudice offers of settlement.

[67]The Tribunal is not however satisfied, in all the circumstances of this case, that the costs threshold has been triggered for the purposes of rule 76 (1) of the Rules in respect of such conduct/ that it is, in any event, appropriate in all the circumstances of the case to exercise its discretion to award in respect thereof.

[68]When reaching this conclusion the Tribunal has taken into account in particular :-(a) that the monies recovered by the claimant in respect of his wrongful dismissal claim were significantly less than the monies sought by the claimant in his letter dated 23 May 2018 (page 120 of the bundle)

(b) the claimant’s conduct on 2 August 2016 (including the concessions which were made during the course of his evidence on 13 March 2018 when he acknowledged that he had taken commercially sensitive information from the respondent without their authorisation/knowledge) and in respect of which the Tribunal is satisfied that the respondent was entitled to conclude that any compensation awarded to the claimant was likely to be significantly limited and

[69]This element of the claimant’s claim for costs is therefore dismissed. (c) the respondent’s alleged vexatious conduct in respect of the email dated 7 October 2018

[70]The respondent accepts that it sent the email dated 7 October 2018 but contends that it was entirely appropriate in all the circumstances of the case. The respondent further, in any event, disputes the amount of costs claimed in respect of claim (which it says should, in any event, be no more than £500).

[71]Having given the matter careful consideration, including the contents and timing of the email dated 7 October 2018 (paragraph 22 above and page 140 of the bundle) the Tribunal is satisfied that the claimant has established that the costs threshold has been triggered for the purposes of rule 76 (1) of the Rules including that the respondent’s conduct in respect of such email constituted both unreasonable and vexatious conduct for the purposes of such provisions.

[72]When reaching such conclusion, the Tribunal has taken into account in particular, the following matters: -(1) The email was sent by the respondent’s solicitors to the claimant solicitors on Sunday, 7 October 2018 at 16.29 pm which was the afternoon immediately prior to the resumed hearing on 8 October 2018.

(2) The email was sent at such time notwithstanding that the matters in respect of which the respondent raised concerns (the admission of the Analysis document for 2 August 2016) had occurred on 12 March 2018. Case number 1400799/2017 21

(3) The respondent had had plenty of opportunity since 12 March 2018 to (a) discuss any concerns with its new legal adviser/ Counsel and (b) raise any such concerns with the claimant. Further the respondent has been unable to provide to the Tribunal with a cogent explanation for its conduct on 7 October 2018 . For the avoidance of doubt, the Tribunal does not accept that any such conduct can be justified by the receipt of the claimant’s further affidavit in August 2018 as contended by the respondent as (a) there is no reference to any such affidavit in the email dated 7 October 2018 and (b) the respondent in any event had over a month to raise any such concerns following receipt of such affidavit.

[73]In all the circumstances, the Tribunal is satisfied that the email dated 7 October 2018 constituted vexatious conduct on the part of the respondent including that its intention, on a balance of probabilities and having regard to all of the above, was to subject the claimant to inconvenience harassment and expense (Barker) immediately prior to the commencement of the restored hearing and further, in any event, also constituted unreasonable conduct for the purposes of rule 76 (1) (a) of the Rules.

[74]The Tribunal has gone on to consider whether, in all the circumstances, to exercise its discretion to award costs against the respondent in respect of such conduct including what effects it had the purposes of any award of costs. The claimant’s claim in respect of such conduct is summarised at paragraph 23 above and in the letter dated 19 August 2019.

[75]The Tribunal is satisfied that in the light of its findings above it is appropriate to exercise its discretion to award costs against the respondent in respect of such conduct. The Tribunal is further satisfied that the costs sought by the claimant in the total sum of £833.28 (inclusive of VAT as the claimant is not VAT registered) as identified above flow from the respondent’s conduct and are further reasonable in all the circumstances. Employment Judge Goraj Date: 16 October 2019 Judgment sent to parties on:16 October 2019 FOR THE OFFICE OF THE TRIBUNALS Online publication of judgments and reasons The Employment Tribunal (ET) is required to maintain a register of all judgments and written reasons. The register must be accessible to the public. It has recently been moved Case number 1400799/2017 22 online. All judgments and reasons since February 2017 are now available at: https://www.gov.uk/employment-tribunal-decisions The ET has no power to refuse to place a judgment or reasons on the online register, or to remove a judgment or reasons from the register once they have been placed there. If you consider that these documents should be anonymised in anyway prior to publication, you will need to apply to the ET for an order to that effect under Rule 50 of the ET’s Rules of Procedure. Such an application would need to be copied to all other parties for comment and it would be carefully scrutinised by a judge (where appropriate, with panel members) before deciding whether (and to what extent) anonymity should be granted to a party or a witness Case number 1400799/2017 1 EMPLOYMENT TRIBUNALS Claimant Respondent Mr T Robins CAB Special Batteries Limited RESERVED COSTS JUDGMENT OF THE TRIBUNAL IN RESPECT OF THE APPLICATION OF THE RESPONDENT DATED 4 DECEMBER 2018 FOR WASTED COSTS AGAINST DAS LAW LIMITED PURSUANT TO RULES 80 – 82 OF SCHEDULE 1 OF THE EMPLOYMENT TRIBUNAL (CONSTITUTION AND RULES OF PROCEDURE) REGULATIONS 2013 Exeter On 19 and 20 August 2019 Before: Employment Judge Goraj Representation. The claimant –Mr J Bromige of Counsel, (in attendance on 19 August 2019 only) The respondent – Mr G Probert, Counsel DAS Law Limited - Mr M Smith, Counsel The Judgment of the tribunal is that: - The respondent’s application for wasted costs against DAS Law Limited pursuant to Rules 80 - 82 of Schedule 1 of the Employment Tribunal (Constitution and Rules of Procedure) Regulations 2013 is dismissed. INTRODUCTION 1. This judgment determines the application by the respondent dated 4 December 2018 (“the application”) for alleged wasted costs against the respondent’s Case number 1400799/2017 2 former legal representatives, DAS Law Limited (“DAS Law”) pursuant to Rules 80 – 82 of Schedule 1 of the Employment Tribunal (Constitution and Rules of Procedure) Regulations 2013 (“the Rules”). The application is resisted by DAS Law. THE APPLICATION 2. The application is contained at paragraph 34-37 of the respondent’s consolidated costs application which is to be found at pages 8-9 of the bundle (“the core bundle”) which was provided for the purposes of the associated costs application between the parties. The application for wasted costs is set out below “35. DAS Law Limited were negligent and/or unreasonable in their conduct of the case on behalf of the Respondent in that:a. DAS Law failed to comply with the Unless Order of the Tribunal dated 28 February 2018 and specifically to disclose to the Claimant and the Tribunal any documentary evidence that the Respondent would wish to rely upon in support of arguments in relations to sections 122-123 of the Employment Rights Act 1996 by 1 March 2018.

b. DAS Law failed to comply with the Unless Order, despite there being a number of significant documents in their control that would have assisted the Respondent and the Tribunal in determining the issues. The result was that the Respondent was debarred from producing such documents at the final hearing.

c. DAS Law failed to instruct the Respondent’s then counsel, Mr Tibbitts, about the existence of the Unless Order resulting in Mr Tibbitts becoming professionally embarrassed. 36. As a direct result of the DAS Law’s unreasonable and negligent conduct, the Respondent suffered the following wasted costs: a. Costs relating to the adjournment of the substantive Tribunal hearing on 14 March 2018. b. From 14 March 2018, the cost of the new professional legal representation (including counsel) for a final substantive hearing that began on 8 October 2018 and continues to date. For the avoidance of doubt, but for DAS Law’s negligence, the Tribunal would have been determined by the end of the March 2018 listing. Thus, the further costs incurred by the Respondent in defending the action were unnecessary and ultimately wasted. c. The respondent’s application in July 2018 for relief from sanctions (the barring of the documentary evidence supporting the section 122- 123 ERA issue). Case number 1400799/2017 3

d. the Respondent’s attendance at the Case Management Preliminary Hearing on 22 August 2018 and related preparation”. 37. It is submitted that it is just and equitable to make the wasted costs order against DAS Law Limited in favour of the Respondent”. DOCUMENTS AND ASSOCIATED MATTERS 3. When determining the application, the Tribunal has had regard in particular, to the following: -

(1) The contents of the application and DAS Law’s response.

(2) The agreed bundle of documents which was submitted for the purposes of the application (“the DAS bundle”).

(3) The Order dated 16 March 2018 (“the Order dated 16 March 2018”) together with the subsequent written reasons which were provided by the Tribunal dated 13 June 2018 (“the Reasons dated 13 June 2018”).

(4) The Order dated 28 September 2018 (“the Order dated 28 September 2018”) in which the Tribunal refused an application by the respondent for relief from sanctions in respect of the Unless Order dated 27 February 2018 (referred to further below).

(5) The email from the respondent’s solicitors to the claimant’s solicitors dated 7 October 2018 which is at page 140 of the core bundle (which was prepared for the associated costs application between the parties (“the core bundle”)).

(6) The contents of the reserved Judgment (as subsequently corrected) which was originally sent to the parties on 8 November 2018 (“the Judgment”) which is at pages 24-70 of the core bundle.

(7) The respondent’s updated costs schedule (containing a breakdown of costs claimed including against DAS Law) dated 9 February 2018 (“the respondent’s Costs Schedule”). BACKGROUND AND MATTERS WHICH ARE RELEVANT TO THIS COSTS HEARING 4. By a claim form dated 22 May 2017 the claimant in this matter, Mr T Robins, brought various claims against the respondent including for constructive dismissal and breach of contract for notice which were resisted by the respondent. 5. During the course of the substantive Hearing in October 2018, the respondent conceded that the claimant had been constructively and unfairly dismissed by the respondent. The Tribunal however subsequently held in a Judgment which was originally sent to the parties on 8 November 2018 (pages 24- 70 of the core bundle) that any basic or compensatory awards which would otherwise Case number 1400799/2017 4 have been awarded to the claimant in respect of such unfair dismissal were reduced by 100 percent pursuant to sections 122 - 123 of the Employment Rights Act 1996 (“the Act”) for reasons relating to the claimant’s conduct on 2 August 2016 6. Much of the relevant background in this matter is set out at paragraphs 1 – 27 the Costs Judgment determining the associated application for costs between the claimant and the respondent (“ the Costs Judgment ”) and such matters are therefore not repeated in this judgment. 7. The Tribunal has not heard any oral evidence in support/defence of the application and has therefore not made any formal findings of fact 8. DAS Law were appointed by the respondent’s insurers to act in defence of the Tribunal proceedings pursuant to the terms of a Legal Expenses Insurance Policy. At the time of the events in question, the Tribunal proceedings were being dealt with at DAS Law by an Associate solicitor (pages 20- 21 of the DAS bundle). 9. The instructions of DAS Law in the Tribunal proceedings were formally terminated by an email which was sent at 11:32am on 14 March 2018 by Enigma solicitors on behalf of the respondent. This email (which is at page 49 of the DAS bundle) is set out in full at paragraph 23 below. The High Court proceedings 10. As stated at paragraph 20 of the Costs Judgment, the claimant and the respondent are also engaged in High Court proceedings which were originally initiated by the respondent in February 2017 for alleged breach of fiduciary duty. As part of the High Court proceedings the respondent made an application for an interim injunction on 12 December 2017 in respect of the respondent’s discovery (following the termination of the claimant’s employment with the respondent) that the claimant had transferred (without the authorisation of the respondent) copies of the respondent’s emails to his personal email address or around 2 August 2016. The claimant and the respondent were both represented by different solicitors in the High Court proceedings. The respondent was represented by Mr Neil Mercer of Enigma solicitors referred to above. 11. The Tribunal was not made aware until 13 March 2018 (on the second day of the original Tribunal Hearing) of the extent of the potential overlap between the High Court proceedings and the Tribunal proceedings in respect of the matters to be considered at a Hearing in the High Court on 17 April 2018 relating to the alleged transfer of emails by the claimant from the respondent on or around 2 August 2016. The Order dated 27 February 2018 and subsequent events 12. On 27 February 2018, the Tribunal sent 2 orders to DAS Law by email. The first order (at pages 8-9 of the DAS bundle) was an order to provide by 1 March 2018 specific documentation previously requested by the claimant in a letter Case number 1400799/2017 5 dated 16 February 2018. The second order (page 10 of the DAS bundle) was an unless order (“the Unless Order dated 27 February 2018”) which stated as follows: - “ On the application of the claimant, Employment Judge Goraj ORDERS that - The respondent be debarred from relying on any documentary evidence in support of any contention that any compensation awarded to the claimant should be reduced pursuant to sections 122 or 123 of the Employment Rights Act 1996 unless any such documents are served on the claimant by noon on 1 March 2018.” 13. It is acknowledged at paragraphs 17 and 23 of the skeleton argument prepared for this costs hearing on behalf of DAS Law (“the skeleton argument of DAS”) that (a) DAS Law did not comply with the Unless Order dated 27 February 2018 and (b) the respondent was not informed of the existence of the Unless Order dated 27 February 2018 until the deadline for compliance had passed. 14. It is further stated at paragraph 17 of the skeleton argument of DAS, by way of explanation for the failure of DAS Law to comply with the Unless Order dated 27 February 2018, that :- “ The omission followed an unfortunate misinterpretation by the recipient at DAS Law of the two orders attached to the email of 27 February 2018; the recipient mistakenly believed that the Unless Order related to the Specific Disclosure Order, rather than pertaining to distinctly separate material. 15. It was further stated at paragraph 55 of the skeleton argument of DAS that:- “Whilst it is perhaps understandable how such an error could have been made, given the demands of a busy litigation office and the nature of the two orders been sent together, it is conceded that the nature of the Unless Order ought to have been appreciated at the time”. 16. On 8 March 2018 DAS Law (whom it is acknowledged were unaware of the above-mentioned error) emailed the claimant’s representative with a request to add further documents to the hearing bundle. These included documents relating to the emails which the respondent alleged that the claimant had sent to his personal email account on 2 August 2016 and upon which the respondent sought to rely to demonstrate that the claimant had committed acts of gross misconduct by taking commercially sensitive information without the knowledge of the respondent and, consequentially, that any compensation awarded to the claimant in respect of his unfair dismissal claim should therefore be reduced pursuant to sections 122 - 123 of the Act. The relationship between the respondent and DAS Law 17. It appears from the emails with which the Tribunal has been provided for the purposes of the application (pages 95 – 138 of the bundle) that there was a deteriorating relationship between the respondent/ Enigma solicitors (who appear from the emails to have been assisting the respondent in respect of the Tribunal proceedings during this period) and DAS Law from 9 March 2018 onwards. Further, it appears from the available documentary evidence that Case number 1400799/2017 6 although the deteriorating relationship was due in part to the issues arising as a result of the Unless Order dated 27 February 2018, it formed part of wider differences between the parties relating to (a) the High court proceedings including in respect of both the previous provision of information to the Tribunal and the requested further information regarding such proceedings / the potential overlap between the High Court and the Tribunal proceedings and (b) the wider conduct of the Tribunal proceedings by DAS Law. The events of the substantive hearing on 12 – 14 March 2018 12 March 2018 18. It is accepted by DAS Law (paragraph 23 of the skeleton argument of DAS) that the Counsel for the respondent was unaware of the Unless Order dated 27 February 2018 until he was informed of its existence on the morning of 12 March 2018. At this time, the respondent’s Counsel provided the claimant’s Counsel with a copy of a document entitled “Traffic and frequency analysis of emails sent by Timothy John Robins on 2 August 2016 (“the Analysis document for 2 August 2016”) which had been prepared by the respondent for the purposes of the application for injunctive relief in the High Court proceedings (paragraph 4 of the Judgment) and which listed the alleged sensitive / confidential documentation which it believed that the claimant had taken from the respondent. The respondent’s Counsel had received a copy of the Analysis document for 2 August 2016 during the weekend prior to the commencement of the Hearing ( paragraph 24 of the skeleton argument of DAS). 19. As subsequently recorded at paragraph 12 of the Order dated 28 September 2018 and at paragraph 4 of the Judgment, a number of matters were agreed between the parties on the morning of 12 March 2018 including that the Analysis document for 2 August 2016 would be admitted into the Hearing bundle. Following such agreement, no application was made by the respondent’s Counsel (a) for relief from sanctions in respect of the Unless Order dated 27 February 2018 (paragraph 14 of the skeleton argument of DAS and paragraph 12 of the Reasons dated 28 September 2018). 13 March 2018 20. The claimant commenced his oral evidence on the morning of 13 March 2018 (at which time it was agreed between the parties that the Hearing was likely to be concluded within the 5 day time allocation). 21. As recorded at paragraph 12 (c) of the Reasons dated 28 September 2018, the claimant gave evidence regarding the Analysis document for 2 August 2016 on 13 March 2018 during which he accepted that some of the information which he had forwarded to his personal email address that day would have been useful to a competitor. 22. On 13 March 2018 an issue arose regarding the nature of the Hearing in the High Court on 17 April 2018 including the extent to which there was an overlap between the issues to be determined in High Court and in the Tribunal proceedings following which (a) the Tribunal requested further information form the solicitors dealing with the High Court proceedings on behalf of the parties ( Kitsons and Enigma) regarding any potential overlap ( a previous Case number 1400799/2017 7 request for information having been made to them by the Tribunal on 26 January 2018) and (b) the respondent subsequently made an application to postpone and stay the Tribunal proceedings pending, at least , the outcome of the Hearing in the High Court on 17 April 2018 which application was resisted by the claimant. The Tribunal declined to determine this application pending the provision by Messrs Kitsons and Enigma of further information regarding the High Court proceedings which they were required to bring to the Tribunal the following day. 14 March 2018 23. As stated above, the retainer of DAS Law was formally terminated by Enigma, solicitors on behalf of the Respondent by an email to DAS Law sent on the morning of 14 March 2018 (page 49 of the DAS bundle). The email is set out below. “This email is sent with the approval of Stuart Robertson. Your firm’s retainer is terminated on the grounds that the Claimant has indicated today (counsel to counsel) an intention to seek wasted costs against both DAS and CAB. A conflict of interest therefore now exists between us because you say that CAB is liable to pay costs Orders and CAB thinks that your firm should pay in the light inter alia ; Inadequate trial preparation, Failure to produce the List of Issues in time,

[3]The making of an Unless Order and failure to comply with it leading to the debarring of further relevant evidence,

[4]A failure to inform the tribunal that injunctive relief proceedings are extant despite being explicitly informed on at least 10 January 2018 and earlier,

[5]Failure to ensure that the witness statements reflected the correct issues, and

[6]Failure to pass key documents to counsel and Ignoring client instructions to read such documents. Further, your client and customer service has fallen below the standard of a competent solicitors firm. I will now instruct new solicitors to mitigate my losses in these proceedings . I will then instruct litigation solicitors to recover any losses and costs. Please treat this email as a formal complaint and escalate it. Yours faithfully Case number 1400799/2017 8 Enigma””

[24]The Tribunal has noted that Enigma, solicitors state on behalf of the respondent that there was a conflict of interest between DAS Law and the respondent because of a dispute concerning costs and lists 6 reasons why the respondent considered that DAS Law should be responsible for any costs orders.

[25]Following the termination of DAS Law’s retainer the respondent’s then Counsel withdrew from the case. The adjournment on 14 March 2018

[26]The Hearing was subsequently adjourned on 14 March 2018 upon the application of Mr Robertson of the respondent. The grounds for such application are set out at paragraphs 3 and 5 of the Written reasons dated 13 June 2018. In summary, Mr Robertson contended that the respondent would be prejudiced if it was required to proceed without an alternative barrister including as the case was complex and of high value and that he would not be in a position to take over the cross examination of the claimant which had hitherto been conducted by the respondent’s Counsel. Mr Robertson did not rely in his application for an adjournment upon the Unless Order dated 27 February 2018 or upon any conflict of interest between the respondent and DAS Law.

[27]The application was opposed by the claimant but was granted by the Tribunal on(a) the basis set out in the Order dated 16 March 2018 and

(b) on the grounds set out in the Reasons dated 13 June 2018 (paragraph 10 thereof).

[28]In the light of the above, it was not necessary for the Tribunal to determine the respondent’s disputed extant application for an adjournment/ stay of the Tribunal proceedings pending the outcome of the High proceedings. The Tribunal however explained in its conclusions (paragraph 10(6) of the reasons dated 13 June 2018) that when deciding to grant the respondent’s application to adjourn the Tribunal proceedings, the Employment Judge had taken into account that the Tribunal may, in any event, have decided to stay the Tribunal proceedings pending the outcome of the hearing in the High Court in April 2018 in the light of the further information regarding such proceedings which had come to light during the course of the Tribunal hearing. Preliminary Notice pursuant to the Professional Negligence Pre – action Protocol

[29]On 26 March 2018 Enigma solicitors sent to DAS Law on behalf of the respondent (at pages 56-59 of the DAS bundle) a Preliminary Notice pursuant to Part 5 of the Professional Negligence Pre- Action Protocol. In this letter the respondent’s solicitors identified a number of alleged breaches of contract/ negligence by DAS Law including with regard to the failure to comply with the Unless Order dated 27 February 2018 and associated matters. It was confirmed at the Costs Hearing that(a) the respondent had not, to date, taken Case number 1400799/2017 9 any further action against DAS Law in respect of such letter and

(b) any further claim against DAS Law was likely to be a High Court action for professional negligence and

[30]By a letter dated 9 April 2018, the claimant applied for costs against the respondent or, in the alternative against DAS Law (page 60 onwards of the DAS bundle) in respect of three distinct areas relating to the claimant’s alleged wasted costs including the respondent’s alleged violation of the Unless Order dated 27 February 2018 on 8 March 2018 and the respondent’s successful application to adjourn the hearing on 14 March 2018. The claimant’s application for costs was settled by DAS Law on the terms contained in a consent order dated 14 June 2018 (pages 79-80 of the DAS bundle). No contribution to the settlement was sought from the respondent by DAS Law. The Case Management Preliminary Hearing on 22 August 2018

[31]The Tribunal conducted a Case Management Preliminary Hearing (“CMPH”) on 22 August 2018 . The associated order dated 29 August 2018 is at pages 20-23 of the core bundle. The stated purpose of the CMPH was to consider the respondent’s application dated 21 July 2018 for specific disclosure of documents namely, 2 emails which the respondent contended that the claimant had sent from his work email account to his personal email account on 2 August 2016. It is further recorded that the respondent acknowledged that it had copies of the relevant emails in its possession but, in summary, took issue with the fact that the claimant had failed to return or to admit taking the emails or their attachments. The application was resisted by the claimant. The application by the respondent was refused (for the reasons set out at page 21 of the core bundle) save that the claimant was ordered to swear a further affidavit confirming his position with regard to his possession / control of such documents as directed by the Tribunal including to return them forthwith if they subsequently came to light. The Tribunal also dealt during the CMPH on 22 August 2018 with other matters as set out at page 22 of the core bundle The application for relief from sanctions dated 25 August 2018

[32]On 25 August 2018, the respondent made an application for relief from sanctions in respect of the Unless Order dated 27 February 2018. This application was refused by the Tribunal for the reasons set out at paragraphs 33 of the order dated 28 September 2018 including(a) as the claimant had given evidence at the hearing in March 2018 in respect of the Analysis document for 2 August 2016 which had been admitted by agreement between the parties in the agreed bundle of hearing documents and

(b) although the respondent had stated in its application dated 25 August 2018 that it wished to adduce important documentary evidence in support of its contentions pursuant to sections 122 - 123 of the Act, it had not given any details of the nature, date or volume of any further documentation upon which it sought to rely. Case number 1400799/2017 10 The respondent’s solicitors’ email dated 7 October 2018

[33]As stated at paragraph 22 of the Costs Judgment, the respondent’s solicitors wrote to the claimant’s solicitors on 7 October 2018 (page 140 of the core bundle) regarding the inclusion of the Analysis document for 2 August 2016 in the hearing bundle on 12 March 2018. The respondent’s solicitors expressed their professional view that the inclusion of such document was likely to damage the claimant’s interests and credibility / lower the claimant’s prospects of success in the Tribunal proceedings and made associated allegations regarding the claimant’s Counsel and solicitor in relation to such matters. The Judgment

[34]The Judgment is at pages 24 – 70 of the core bundle. The Judgment included a finding (issue 3a of the Amended List of issues) that any basic or compensatory awards should be reduced by 100 percent pursuant to sections 122 (2) and 123 (1) of the Act for reasons relating to the claimant’s conduct on 2 August 2016.

[35]The Tribunal’s factual findings regarding the events of 2 August 2016 (in respect of the transfer by the claimant of emails from the respondent to his personal account) and associated matters are at paragraphs 38-56 of the Judgment (pages 32-36 of the core bundle). Further, the Tribunal’s conclusions regarding Issue 3 a of the Amended List of Issues are at paragraphs 114 – 120 of the Judgment (pages 57 – 60 of the core bundle). The respondent’s Costs Schedule

[36]The respondent’s Costs Schedule states that it was prepared by a costs lawyer/ assistant. The Costs Schedule is divided into 2 parts namely,(a) Part 1 – Costs which the Respondent considers the Claimant is liable to pay and

(b) Costs which the Respondent considers that DAS Law is liable to pay . The Tribunal has noted in particular that (a) The respondent’s Costs Schedule states that some of the alleged wasted costs claimed had been apportioned on a 50/ 50 basis between the claimant and DAS Law (b) that the respondent did not claim any costs against DAS Law for any period prior to 16 April 2018 and

[37]During the course of the Hearing it became apparent that the respondent’s position regarding the wasted costs sought by the respondent against DAS Law had changed including, in particular that(a) the respondent was no longer seeking wasted costs against DAS Law in respect of the adjournment of the Hearing on 14 March 2018 (Limb a of paragraph 36 of the application) and

(b) the respondent was seeking wasted costs against DAS Law in respect of the adjourned hearing in October 2018 (Limb b of paragraph 36 of the application) although no costs had been claimed in the respondent ‘s Cost Schedule against DAS Law in respect of the relisted hearing ( the costs being claimed instead against the claimant – at pages 5 -10 of the respondent’s Costs Schedule). Case number 1400799/2017 11

[38]The respondent was afforded two opportunities during the hearing to clarify its position with regard to the costs sought. The respondent initially confirmed that it was seeking wasted costs against the respondent for costs of(a) the hearing on 14 March 2018

(b) 3 days of hearing in October 2018

(d) the CMPH on 22 August 2018.

[39]After further consideration, the respondent confirmed that it was pursuing wasted costs in respect of the items from the respondent ‘s Costs Schedule as identified in the attached sheet. The Tribunal noted in particular that(a) the respondent confirmed that it no longer seeks wasted costs in respect of the Hearing on 14 March 2018 (Limb a of the respondent’s costs application

(b) that the respondent confirmed that it does now seek costs against DAS Law in respect of the Hearing in October 2018 and

(c) the respondent was unable to identify any specific costs in respect of the application for relief for sanctions ( which it identifies in the respondent’s application as having been made in July 2018). The submissions of the parties and legal authorities

[40]The Tribunal has given careful consideration to the written and oral submissions of the parties and to the authorities upon which they rely including in particular as follows: - Re A Barrister (Wasted Costs Order (no 1 of 1991 [1993] QB. Ridehalgh v Horsefield

[1994] Ch 205

CA. Tolstoy- Miloslavsky v Aldington [ 1996] I WLR 736 CA. Turner Page Music v Torres Design Associates Limited [1998] Times, 3 August CA. Medcalf v Weatherill

[2002] UKHL 27

HOL. Brown v Bennett (Wasted Costs) (No 1) [ 2002] I WLR 713 HC. Ratcliffe Duce and Gammer v Binns

UKEAT/0100/08

(23 April 2008) EAT. Hedrich v Standard Bank London Limited [ 2009] P.N.L.R CA. Wentworth – Wood v Maritime Transport Limited UK EAT/ 0184/17 (17 January 2018) EAT. THE LAW

[41]The Tribunal’s jurisdiction to make a wasted costs order is set out at Rules 80 – 82 of the Rules. A wasted costs order may order the representative (in this case DAS Law) to pay the whole or part of any wasted costs of the receiving party (the respondent).

[42]Having regard to the above Rules and authorities (including in particular, the leading authorities of Ridehalgh and Medcalf) the Tribunal has reminded itself that it has to have regard in particular to the matters referred to below.

[43]The Tribunal is required to apply a three stage namely:-(1) has DAS Law acted improperly, unreasonably or negligently,

(2) if so, did such conduct cause the respondent to incur unnecessary costs Case number 1400799/2017 12

(3) if so, is it, in all the circumstances, just to order DAS Law to compensate the respondent for the whole or part of the relevant costs. Unreasonable or negligent conduct

[44]Unreasonable or negligent conduct is defined, in summary in Ridehalgh as follows: -(1) Unreasonable conduct - describes conduct which is vexatious, designed to harass the other side rather than advance the resolution of the case. It makes no difference that the conduct is the product of excessive zeal and not improper motive. The acid test is whether the conduct permits of a reasonable explanation.

(2) Negligent conduct - should be understood in an untechnical way to denote failure to act with the competence reasonably to be expected of ordinary members of the profession. However, the adoption of an untechnical approach does not mean that the respondent is required to prove anything less than it would have to prove in an action for negligence. Causation

[45]The Tribunal has jurisdiction to make a wasted costs order only where the improper, unreasonable or negligent conduct complained of has caused a waste of costs and only to the extent of such wasted costs. The demonstration of a causal link is therefore essential. Where the conduct is proved but no waste of costs is shown to have resulted it is not appropriate for the exercise of the wasted costs jurisdiction ( Re A Barrister and Ratcliffe).

[46]The jurisdiction to make a wasted costs order must be exercised with care and only in a clear case (Tolstoy – Miloslavsky).

[47]The Tribunal is required to consider, whether on the balance of probabilities, the respondent would have incurred the costs which it is claiming from DAS Law if they had not acted or advised as they did (Brown).

[48]An application for wasted costs is inappropriate in cases requiring a detailed investigation into the facts as the procedure is a summary one which is to be applied in uninvolved and clear cases where unnecessary costs are incurred (Turner Page Music and Hedrich). THE CONCLUSIONS OF THE TRIBUNAL Was DAS Law’s failure to comply with the Unless Order dated 27 February negligent or unreasonable conduct.

[49]The Tribunal has considered first whether DAS Law’s admitted failure to comply with the Unless Order dated 27 February 2018 constituted unreasonable or negligent conduct for the purposes of Rule 80 (1) of the Rules.

[50]The respondent contended that it was plain that DAS Law had acted negligently in respect of such failure including, having regard in particular, to(a) the clear wording of the Unless Order dated 27 February 2018 which contained a clear warning that if the respondent failed to comply with its terms it would be Case number 1400799/2017 13 debarred from relying on any documentary evidence in support of its contentions pursuant to sections 122 -123 of the Act

(b) DAS Law had in fact appreciated the seriousness of the unless provisions ( the email dated 28 February 2018 at pages 20-21 of the DAS bundle) (c ) the comments of the claimant in the letter to DAS Law dated 9 March 2018 (page 24 of the DAS bundle) and (d) any contention by DAS Law that the conduct was not negligent was doomed to failure.

[51]DAS Law did not concede the alleged negligent conduct however, it made the acknowledgements and concessions identified in paragraph 13-15 above including that the nature of the Unless Order dated 27 February 2018 ought to have been appreciated by DAS Law at the time. The conclusions of the Tribunal

[52]Having given the matter careful consideration, the Tribunal is satisfied that the failure of DAS Law to comply with the terms of the Unless Order dated 27 February 2018 (paragraph 35 a of the respondent’s application) constituted negligent conduct (as defined in Ridehalgh) for the purposes of Rule 80(1) of the Rules. When reaching such conclusion the Tribunal has taken into account in particular, the following matters :- (1) the conduct of the matter was being dealt with by an Associate solicitor who acknowledged the importance of dealing with an unless order and the consequences of failing to do so (pages 20- 21 of the DAS bundle)

(2) DAS Law have not offered any proper explanation for the failure to comply with the Unless Order dated 27 February 2018 and further, have made the concessions referred to at paragraph 13 – 15 and 51 above including that the nature of the Unless Order dated 27 February 2018 should have been appreciated at the time.

[53]As a result of such negligence the respondent was debarred from relying on any documentary evidence in support of its contentions pursuant to sections 122 - 123 of the Act (save to the extent subsequently agreed on 12 March 2018). Was DAS Law’s failure to instruct the respondent’s Counsel about the existence of the Unless Order dated 27 February 2018 negligent or unreasonable conduct?

[54]DAS Law acknowledges that the respondent’s Counsel did not become aware of the existence of the Unless Order dated 27 February 2018 (and therefore DAS Law’s failure to comply with it) until he was informed of its existence on the morning of 12 March 2018 (paragraph 18 above). DAS Law’s failure to do so was a direct consequence of its earlier failure to recognise the terms of the Unless Order dated 27 February 2018 and the Tribunal is therefore satisfied that this further failure on the part of DAS Law also constitutes negligent conduct for the purposes of Rule 80 (1) of the Rules. Did such conduct cause the respondent to incur unnecessary costs?

[55]The Tribunal has therefore gone on to consider the question of causation namely, whether the negligent conduct of DAS Law identified above (in respect Case number 1400799/2017 14 of both the failure of DAS Law to comply with the Unless Order dated 27 February 2018 and to inform Counsel thereof) caused the respondent to incur unnecessary costs (including as contended at paragraph 35 c of the application whether such alleged conduct resulted in the respondent’s Counsel becoming professionally embarrassed). The respondent’s submissions

[56]The respondent contends that DAS Law’s negligence in dealing with the Unless Order dated 27 February 2018 directly caused a breakdown and eventual conflict in the relationship between the respondent and DAS Law resulting in(a) DAS Law being dis- instructed partway through the Hearing in March 2018

(b) the respondent having to request an adjournment and

[57]The respondent relies in support of its contentions in particular, on the following :-(a) that the respondent’s confidence in DAS Law was clearly shaken by the end of 12 March 2018 as a result of DAS Law’s negligence coming to light and the events of the day

(b) the inability of the respondent to challenge the claimant’s oral evidence on 13 March 2018 (during which he denied transferring items 15-19 of the Analysis document for 2 August 2016) in the absence of the relevant emails

(d) DAS Law acknowledged in an email on the morning of 14 March 2018 that it understood that the respondent had no confidence in DAS Law and that DAS Law did not believe that it could continue to act for the respondent in such circumstances and

(e) Enigma solicitors subsequently wrote to DAS Law on behalf of the respondent on 14 March 2018 (page 49 of the DAS bundle) to dis – instruct DAS, the final nail in the coffin being the Claimant’s indication that it would seek a wasted costs order against both DAS Law and the respondent – the clear conflict being caused by DAS Law’s negligence in dealing with the Unless Order dated 27 February 2018

(f) DAS Law accepted its liability for wasted costs by a subsequent consent order in favour of the claimant (page 79 of the DAS bundle) and

(g) the potential overlap with the High court proceedings was not the reason for the adjournment which was allowed because of the lack of legal representation which was caused by DAS Law’s negligence and the resulting conflict of interest between DAS Law and the respondent. The submissions of DAS Law

[58]DAS Law denied that its failure to comply with the Unless Order dated 27 February 2018 had caused the respondent to incur any wasted costs. The respondent contended, as a general point, that this case was not appropriate for consideration pursuant to Rule 80 of the Rules as the summary nature of the wasted costs procedure was emphasised in the authorities which make it clear that the jurisdiction must only be exercised in a clear case (which did not apply in this matter).

[59]In summary, DAS Law also contended as follows :-(a) the Unless Order dated 27 February 2018 related to documentary evidence in support of the respondent’s contention that any compensation awarded to the claimant should be reduced pursuant to sections 122 - 123 of the Act by reason of the Case number 1400799/2017 15 claimant’s conduct on 2 August 2016 in emailing commercially sensitive and confidential documents to his personal email address

(b) the Tribunal found as a fact that the claimant did act as alleged and reduced the claimant’s compensation accordingly

(c) matters relating to the documents covered by the Unless Order dated 27 February 2018 were resolved by around midday on 12 March 2018 on the basis of the agreed submission of the Analysis document for 2 August 2016. There was therefore no need for the respondent to rely on the documentation covered by the Unless Order dated 27 February 2018 and no application for relief from sanctions was accordingly required/made

(d) the respondent did not terminate the retainer with DAS Law on 12 March 2018 despite knowing by that stage that the claimant was seeking costs in respect of the breach of the Unless Order dated 27 February 2018

(e) On 13 March 2018 ( and after the claimant had commenced his evidence) concerns emerged regarding the potential conflict between the Tribunal and High Court proceedings and in the light of which the respondent instructed its Counsel to seek a postponement of the Tribunal proceedings

(f) in response to such an application the Tribunal sought further information which gave rise to a difficult exchange of correspondence between DAS Law and Enigma solicitors

(g) the respondent terminated its retainer with DAS Law by an email on 14 March 2018 which raised a number of complaints only one of which referred to the Unless Order dated 27 February 2018. It was the respondent’s decision to terminate the retainer with DAS Law notwithstanding that there was no question of any conflict of interest between them as there was never any suggestion by DAS Law that the respondent would be responsible for the failure to comply with the Unless Order dated 27 February 2018

(h) it is factually incorrect to suggest that Counsel for the respondent had become professionally embarrassed as a result of not been informed about the Unless Order dated 27 February 2018 as he was fully aware of it by the morning of 12 March 2018 and moreover, resolved the issues relating thereto as indicated previously above. Once DAS Law ceased to act for the respondent Counsel was without instructions and that is why he ceased to act and

(i) it is likely that the hearing in March 2018 would have been adjourned in any event in the light of the potential overlap with the High Court proceedings.

[60]DAS Law further contended in closing submissions that the respondent’s difficulties in clarifying during the Hearing the actual costs allegedly flowing from the negligence of DAS Law (including its attempt to recover for the first time significant additional costs in respect of the hearing in October 2018 which had not previously been identified in the respondent’s Costs Schedule as wasted costs) clearly demonstrated that the matter was not suitable for the summary jurisdiction of wasted costs. The conclusions of the Tribunal

[61]Having given the matter careful consideration, the Tribunal is not satisfied that the respondent has established, on the balance of probabilities, that DAS Law’s failure to(a) comply with the Unless Order dated 27 February 2018 or

(b) its subsequent failure to instruct the respondent’s Counsel about the existence of the Unless Order dated 27 February 2018 caused the respondent to incur the alleged unnecessary costs (including that it caused the respondent’s Counsel to be professionally embarrassed). When reaching its conclusions, the Tribunal has had regard to (a) the general considerations referred to below and has then Case number 1400799/2017 16 gone on further to consider (b) the position with regard to the alleged wasted costs identified in respect of limbs a – d at paragraph 36 of the application as amended during the course of the Hearing ( as set out in the attached sheet).

[62]When reaching the above conclusions the Tribunal has taken into account in particular the following matters:-(1) The wasted costs procedure pursuant to Rule 80 (1) of the Rules is a summary jurisdiction which must be exercised with care and only in a clear case. The application is however predicated on the basis of a chain of events namely, that the negligence, “ directly caused a breakdown and eventual conflict in the relationship between the Respondent and DAS, resulting in DAS being dis – instructed half way through the full hearing at the Employment Tribunal. The Respondent had to request an adjournment and a new final hearing was listed” (paragraph 3 of the respondent’s skeleton argument). Moreover, there is a dispute between the parties as to whether (a) there was any conflict of interest between the parties arising from the negligent conduct of DAS Law in respect of the Unless Order (including regarding any responsibility for costs) and (b) the reasons for any breakdown in the relationship

(2) It is essential to demonstrate a causal link in claims for wasted costs including that the identification of the actual loss flowing from the negligence must be identified.

(3) It is however clear from the available evidence that the failure by DAS Law to comply with the Unless Order dated 27 February 2018 was fully appreciated by the morning of 12 March 2018 (including by the respondent’s Counsel).

(4) Further, It was subsequently agreed between the parties on 12 March 2018 that the Analysis document for 2 August 2016 would be admitted into the hearing bundle.

(5) In the light of the above (and the other associated matters of agreement) :- (a) the hearing was able to continue (b) no application was made for relief from sanctions (c) the claimant commenced his oral evidence on the morning of 13 March 2018 and (d) it was agreed between the parties that the Hearing was likely to be concluded within the original 5 day time allocation (paragraphs 19- 21 above).

(6) The issues relating to DAS Law’s failure to comply with the Unless Order dated 27 February 2018 were therefore resolved for the purposes of the conduct of the Hearing by 13 March 2018.

(7) During his evidence on 13 March 2018 the claimant made admissions regarding the Analysis document for 2 August 2016 including that he had forwarded the emails belonging to the respondent to his personal email address and that some of the information which he had Case number 1400799/2017 17 transferred would have been useful to a competitor (paragraph 21 above).

(8) By 13 March 2018, a new issue had arisen namely, the Tribunal’s concern regarding the potential overlap between the Tribunal proceedings and the proceedings in the High Court in relation to the events of 2 August 2016 and in the light of which the respondent’s Counsel was instructed by the respondent to make an application to stay the Tribunal proceedings pending the outcome of the High Court proceedings on 17 April 2018. Further, although this application was not ultimately determined by the Tribunal, in the light of the decision of the Tribunal to accede to the respondent’s application on 14 March 2018 to adjourn the Hearing, it was :- (a) factor which the Tribunal took into account when deciding to accede to the respondent’s application and (b) the Tribunal stated that it might, in any event, have decided to stay the Tribunal proceedings pending the outcome of the hearing in the High Court in the light of the further information which had come to light during the course of the Tribunal hearing (paragraph 9 (6) of the Reasons dated 13 June 2018).

(9) It is apparent from the documents (pages 95- 138 of the DAS bundle) that there was a deteriorating relationship between the respondent/ Enigma solicitors and DAS Law from 9 March 2018 which appears to be for number reasons including not only because of the Unless Order dated 27 February 2018/ the claimant’s intimated claim for wasted costs against DAS Law/ the respondent but also because of wider issues including matters related to the High Court proceedings (paragraph 17 above).

(10) The position is reflected in the email which was sent to DAS by Enigma solicitors on behalf of the respondent on the morning of 14 March 2018 terminating the retainer of DAS Law which cites a number of reasons why the respondent believed that DAS Law should be responsible for wasted costs (page 49 of the DAS bundle and paragraphs 23 – 24 above).

(11) Mr Robertson of the respondent did not seek to rely on the Unless Order dated 27 February 2018 or any alleged conflict of interest between the respondent and DAS Law in his application to postpone the hearing on 14 March 2018 (paragraphs 3- 5 of the Written Reasons dated 13 June 2018).

(12) The respondent’s solicitors subsequently contended in the email to the claimant’s solicitor dated 7 October 2018 (page 140 of the core bundle) that the admission of the Analysis of document of 2 August 2016 was likely to damage the claimant’s interests and lower his prospects of success in the Tribunal proceedings (paragraph 33 above).

(13) The Analysis document for 2 August 2016 subsequently played an important in the findings of fact contained in the Judgment Case number 1400799/2017 18 regarding the events of 2 August 2016 and the Tribunal’s consequential determination that any basic or compensatory awards which would otherwise have been awarded to the claimant in respect of his successful unfair dismissal claim should be reduced by 100% (paragraphs 34 – 35 above).

[63], The Tribunal is further satisfied that the respondent’s failure to establish, on the balance of probabilities, for the purposes of this summary procedure, a clear causal connection between the negligence of DAS Law and any wasted costs is demonstrated by the difficulty which the respondent experienced at the costs hearing in seeking to identify the costs which allegedly flowed from the negligence of DAS Law (paragraphs 36 -39 above) including(a) the withdrawal during the costs hearing of its claim for wasted costs in respect of the adjournment of the Hearing on 14 March 2018 (paragraph 36 a of the respondent’s application) in the absence of any supporting claim for wasted costs against DAS Law prior to 16 April 2018 in the Costs Schedule and

(b) seeking to add ( albeit still imprecise) a claim for wasted costs in respect of the Hearing in October 2018 notwithstanding that such claim was brought against the respondent rather than DAS Law in the Costs Schedule and (d) the failure to provide any details of the claim for costs in respect of the respondent’s application for relief from sanctions dated 25 August 2018( which is erroneously dated by the respondent as July 2018). The Tribunal’s conclusions regarding the heads of wasted costs claimed at Paragraph 36 of the application Paragraph 36 a of the application

[64]As stated above the Claimant withdrew, during the course of the costs hearing, his claim for wasted costs in respect of the hearing on 14 March 2018. The Claimant sought instead to pursue a claim for the costs identified in respect of paragraph 36 a of the application as identified on the attached sheet.

[65]The Tribunal is not however satisfied that the respondent has established, on the balance of probabilities the necessary causal connection between DAS Law’s negligence in respect of the Unless Order dated 27 February 2018 and the wasted costs claimed on the attached sheet in respect of paragraph 36 a of the application. When reaching this conclusion the Tribunal has taken into account in particular(a) the reasons set out at paragraph 62 above and

(b) such costs were not originally claimed as part of paragraph 36 a of the application and further

(c) the respondent has failed to provide any proper explanation of the basis upon which it now contends that such costs are recoverable. Paragraph 36 b of the application

[66]The Tribunal is not satisfied that the respondent has established, on the balance of probabilities, the necessary causal connection between DAS Law’s negligence in respect of the Unless Order dated 27 February 2018 and the wasted costs identified on the attached sheet in respect of paragraph 36 b of the application (the bulk of which relate to the preparation for and attendance at the restored hearing in October 2018). Case number 1400799/2017 19

[67]When reaching this conclusion the Tribunal has taken into account in particular :-(a) that the costs claimed in respect of paragraph 36 b of the application include the bulk of costs of the restored hearing in October 2018 notwithstanding, as explained at paragraph 39 above, such costs were not originally claimed in the Costs Schedule. Further the respondent was still unclear as to the number of days claimed in respect of the Hearing in October 2018 (leaving that to be determined by the Tribunal)

(b) the reasons at paragraph 62 above including that the issues relating to the respondent’s failure to comply with the Unless Order dated 27 February 2018 including the associated issues relating to admission of documentation concerning the claimant’s conduct on 2 August 2016 were resolved by the agreed admission of the Analysis document for 2 August 2016 in the hearing bundle on 12 March 2018. Paragraph 36 c of the application - the application for relief from sanctions

[68]The Tribunal is not satisfied that the respondent has established, on the balance of probabilities, the necessary causal connection between DAS Law’s negligence in respect of the Unless Order dated 27 February 2018 and the alleged wasted costs in respect of paragraph 36 c of the application. When reaching this conclusion the Tribunal has taken into account in particular :-(a) as stated at paragraph 39 above the respondent was unable to identify any specific costs in respect for the application for relief from sanctions dated 25 August 2018 ( erroneously described as dated July 2018)

(b) the reasons at paragraph 62 above

(c) the application for relief from sanctions was unsuccessful (for the reasons given at paragraph 33 of the Order dated 28 September 2018 including in the light of the admission of the Analysis document for 2 August 2016 in the agreed hearing bundle and further, notwithstanding that the respondent stated in support of its application that it wished to adduce important further evidence in support of its case pursuant to sections 122 - 123 of the Act it did not provide any details or copies of such documentation in support of its application and

(d) the application for relief from sanctions was, in any event, unnecessary in the light of the resolution of the issue on 12 March 2018 and the subsequent admissions by the claimant in evidence on 13 March 2018 regarding his actions on 2 August 2016 (paragraph 19 – 21 above). Paragraph 36 d of the application – the respondent’s preparation for and attendance at the CMPH on 22 August 2018

[69]The Tribunal is not satisfied that the respondent has established, on the balance of probabilities, the necessary causal connection between DAS Law’s negligence in respect of the Unless Order dated 27 February 2018 and the CMPH on 22 August 2018 ( the associated Order dated 29 August 2018 is at pages 20 -23 of the core bundle) . When reaching this conclusion the Tribunal has taken into account in particular the contents of the Order dated 29 August 2018 which(a) records that the CMPH listed to deal with a discrete application by the respondent for specific disclosure of documents and

(b) also dealt with the wider issues also referred to in the Order dated 29 August 2018 (which were unrelated to the Unless Order dated 27 February 2018) . FINAL CONCLUSION Case number 1400799/2017 20

[70]In all the circumstances, the Tribunal is not satisfied that the respondent has established any entitlement to wasted costs pursuant to Rule 80 – 82 of the Rules and the respondent’s application against DAS Law is therefore dismissed. Employmet Judge Goraj Date: 15 October 2019 Judgment sent to parties: 16 October 2019 FOR THE OFFICE OF THE TRIBUNALS Online publication of judgments and reasons The Employment Tribunal (ET) is required to maintain a register of all judgments and written reasons. The register must be accessible to the public. It has recently been moved online. All judgments and reasons since February 2017 are now available at: https://www.gov.uk/employment-tribunal-decisions The ET has no power to refuse to place a judgment or reasons on the online register, or to remove a judgment or reasons from the register once they have been placed there. If you consider that these documents should be anonymised in anyway prior to publication, you will need to apply to the ET for an order to that effect under Rule 50 of the ET’s Rules of Procedure. Such an application would need to be copied to all other parties for comment and it would be carefully scrutinised by a judge (where appropriate, with panel members) before deciding whether (and to what extent) anonymity should be granted to a party or a witness