Mr D McAndrew v Straight Edge Manufacturing Ltd: 3202881/2022
EMPLOYMENT TRIBUNALS
Case No 3202881/2022
Between
Mr David McAndrewClaimantStraight Edge Manufacturing LimitedRespondent
Before
Regional Employment Judge BurgherMr A Ohringer (instructed by Counsel) for claimantMr C Crow (instructed by Counsel) for respondentDate 10 December 2024
JUDGMENT
[1]The Respondent’s application for costs fails and is dismissed.[2]There was an erroneous indication in the notice of hearing sent to the parties on 21 August 2024 that reconsideration of revocation was to be addressed. However, there is no extant application to reconsider the revocation of the dismissal judgment that was sent to the parties on 30 May 2024. That judgment remains unchanged and whilst there was a withdrawal of the claim, there is no dismissal of it pursuant to the interests of justice and rule 52(b) of the 2013 Employment Tribunal rules.
REASONS
[1]The only matter for consideration before me was the Respondent's application for costs, made on 18 December 2023, following the Claimant withdrawing his claim on 15 December 2023 two weeks prior to the final hearing which was listed to be heard between 2 - 5 January 2024.[2]I was grateful for the clear oral submissions from both counsel that supplemented their helpful skeleton arguments outlining the law and the parties perspective of the facts. I was also taken to a large bundle of authorities and to relevant pages in an agreed 350 page bundle.
Law
[3]Rule 76 of the 2013 ET rules states 76.—(1) A Tribunal may make a costs order or a preparation time order, and shall consider whether to do so, where it considers that— (a)a party (or that party’s representative) has acted vexatiously, abusively, disruptively or otherwise unreasonably in either the bringing of the proceedings (or part) or the way that the proceedings (or part) have been conducted; or (b)any claim or response had no reasonable prospect of success. (2) A Tribunal may also make such an order where a party has been in breach of any order or practice direction or where a hearing has been postponed or adjourned on the application of a party. (3) Where in proceedings for unfair dismissal a final hearing is postponed or adjourned, the Tribunal shall order the respondent to pay the costs incurred as a result of the postponement or adjournment if— (a)the claimant has expressed a wish to be reinstated or re-engaged which has been communicated to the respondent not less than 7 days before the hearing; and (b)the postponement or adjournment of that hearing has been caused by the respondent’s failure, without a special reason, to adduce reasonable evidence as to the availability of the job from which the claimant was dismissed or of comparable or suitable employment. (4) A Tribunal may make a costs order of the kind described in rule 75(1)(b) where a party has paid a Tribunal fee in respect of a claim, employer’s contract claim or application and that claim, counterclaim or application is decided in whole, or in part, in favour of that party. (5) A Tribunal may make a costs order of the kind described in rule 75(1)(c) on the application of a party or the witness in question, or on its own initiative, where a witness has attended or has been ordered to attend to give oral evidence at a hearing. The amount of a costs order 78.—(1) A costs order may— (a) order the paying party to pay the receiving party a specified amount, not exceeding £20,000, in respect of the costs of the receiving party; (b)order the paying party to pay the receiving party the whole or a specified part of the costs of the receiving party, with the amount to be paid being determined, in England and Wales, by way of detailed assessment carried out either by a county court in accordance with the Civil Procedure Rules 1998, or by an Employment Judge applying the same principles; or, in Scotland, by way of taxation carried out either by the auditor of court in accordance with the Act of Sederunt (Fees of Solicitors in the Sheriff Court)(Amendment and Further Provisions) 1993(23), or by an Employment Judge applying the same principles; (c)order the paying party to pay the receiving party a specified amount as reimbursement of all or part of a Tribunal fee paid by the receiving party; (d)order the paying party to pay another party or a witness, as appropriate, a specified amount in respect of necessary and reasonably incurred expenses (of the kind described in rule 75(1)(c)); or (e)if the paying party and the receiving party agree as to the amount payable, be made in that amount. (2) Where the costs order includes an amount in respect of fees charged by a lay representative, for the purposes of the calculation of the order, the hourly rate applicable for the fees of the lay representative shall be no higher than the rate under rule 79(2). (3) For the avoidance of doubt, the amount of a costs order under sub-paragraphs (b) to (e) of paragraph (1) may exceed £20,000.[4]In respect of costs, I had regard to the structured approach set out in the case of Millan v Capsticks Solicitors LLP & Others UKEAT/0093/14/RN where the then President of the EAT, Langstaff J, described the exercise to be undertaken by the Tribunal as a 3 stage exercise at paragraphs 52: There are thus three stages to the process of determining upon a costs order in a particular amount. First, the tribunal must be of the opinion that the paying party has behaved in a manner referred to in Rule 40(3); but if of that opinion, does not have to make a costs order. It has still to decide whether, as a second stage, it is “appropriate” to do so. In reaching that decision it may take account of the ability of the paying party to pay. Having decided that there should be a costs order in some amount, the third stage is to determine what that amount should be. Here, covered by Rule 41, the tribunal has the option of ordering the paying party to pay an amount to be determined by way of detailed assessment in a county court.[5]I therefore considered the following issues: 1. Has the putative paying party behaved in the manner proscribed by the rules? 2. If so, it must then exercise its discretion as to whether or not it is appropriate to make a costs order, (it may take into account ability to pay in making that decision). 3. If it decides that a costs order should be made, it must decide what amount should be paid or whether the matter should be referred for assessment, (again the Tribunal may take into account the paying party’s ability to pay).[6]In submissions both Counsel referred to the case Mindimaxnox LLP v. Gover (UKEAT/0225/10/DA, unreported) where at paragraph 45, HHJ McMullen QC stated “In my judgment it is not in accordance with the overriding objective to have concurrent proceedings over exactly the same factual territory except for the unique tort of unfair dismissal in the Employment Tribunal. It cannot be right that there are two sets of proceedings on foot, each requiring teams of lawyers to be respectively in the London (Central) Employment Tribunal and the Queen’s Bench Division on different days. It cannot be in accordance with the overriding objective that duplicate proceedings are on foot.”[7]In respect of a late withdrawal of claim in the case of McPherson v BNP Paribas (London Branch) [2004] ICR 1398 Mummery LJ stated at paragraph 28. In my view, it would be legally erroneous if, acting on a misconceived analogy with the CPR, tribunals took the line that it was unreasonable conduct for employment tribunal claimants to withdraw claims and that they should accordingly be made liable to pay all the costs of the proceedings. It would be unfortunate if claimants were deterred from dropping claims by the prospect of an order for costs on withdrawal, which might well not be made against them if they fought on to a full hearing and failed. As Miss McCafferty, appearing for the applicant, pointed out, withdrawal could lead to a saving of costs. Also, as Thorpe LJ observed during argument, notice of withdrawal might in some cases be the dawn of sanity and the tribunal should not adopt a practice on costs which would deter applicants from making sensible litigation decisions.[8]The issue is not whether the late withdrawal was unreasonable, but whether the conduct of the proceedings was unreasonable. Relevant factual background[9]The Claimant sent a letter of claim dated 23 November 2021 to the Respondent outlining a letter of claim for civil proceedings personal injury claims in relation to HandArm Vibration Syndrome (“HAVS”) and mental/psychological injury (and consequential losses) following the alleged bullying, harassment and physical assault by one of his work colleagues, Mr Kerry Thompson.[10]The Claimant resigned his employment on 12 April 2022 and subsequently presented claims to the Employment Tribunal on 29 April 2022 for i harassment “related to” the Claimant’s disability by way the conduct of Mr Thompson ii. failure to make reasonable adjustments by failing to discipline or dismiss Mr Thompson; iii. Constructive unfair dismissal (the fundamental breach being said to arise from the conduct of Mr Thompson and Mr Clark) per s.98 ERA 1996 (per paragraphs 20-23 of the Grounds of Complaint); and iv. direct disability discrimination by way of the constructive dismissal.[11]In this ET claim the Claimant sought compensation for compensation for mental/psychological personal injuries (Chronic PTSD, severe; depression; anxiety) said to have been sustained as result of the bullying, harassment and physical assault by Kerry Thompson.[12]The Respondent’s solicitors outlined their concerns about the Claimant seeking to claim essentially the same damages in both the High Court and the Employment Tribunal for the same factual matters in correspondence and threatened to may a strike out application and made costs warnings.[13]The Claimant suggested a stay of the Employment Tribunal proceedings by letter dated on 25 July 2022. The Respondent did not agree to a stay of the Tribunal proceedings. The Claimant therefore applied for a stay of these proceedings on 27 September 2022.[14]This application was heard on 28 October 2022 by EJ Klimov. The Claimant had not yet commenced the threatened High Court claim and the application for stay was refused. Case management orders for the final hearing listed to take place on 2 – 4 January 2024 were made at this hearing and all case preparation was expected to be completed by 28 April 2023.[15]Pre-action protocols for the High Court claim continued in parallel. There was a report of Dr Turner dated April 2023 that indicated that the Claimant’s PTSD was directly related to the experience of HAVS, and by process of deduction this was not due to any alleged discriminatory poor behaviour of Mr Thompson or Mr Clark. The pre action protocols were completed in May 2023 and the Claimant subsequently issued the threatened High Court claim on 12 September 2023.[16]Without prejudice discussions ensued.[17]On 23 November 2023 the Respondent solicitors wrote to the Claimant offering to settle as follows: "Our client is prepared to offer your client a drop hand offer in relation to the Employment claims, that is that your client agrees to withdraw the claims against our client in the Employment Tribunal and, in return, they will not pursue your client for costs in relation to this claim. To confirm, this would settle the Employment Tribunal claim only, he would be free to continue with his current personal injury claim and to try and claim for any related losses that stem from that claim.'[18]This was not accepted and on 30 November 2023 the Respondent then offered to pay the Claimant £10,000 to settle the Employment Tribunal proceedings. However, there was a misunderstanding between the parties as the Respondent now required the Claimant to compromise his allegations of assault and psychiatric injury arising from the assault and not pursue them in the High Court. The Claimant was not prepared to agree to this and settlement discussions broke down.[19]On 7 December 2023 the Respondent’s solicitors wrote to the Claimant’s solicitors and in view of the impasse wrote “[The Claimant’s] options are to settle all the Tribunal claims brought for £10k as offered under these terms, reject the offer and take the significant risk to hearing and then have Res Judicate apply, or simply agree to withdraw all the claims against my client in full in the ET but he would simply have to submit a formal withdrawal of the claims under no agreed terms …”[20]On 15 December 2023 the Claimant withdrew his Employment Tribunal claims and the 4 day final hearing due to commence on 2 January 2024 was vacated. Submissions[21]The Respondent’s costs application was made on the basis that the claimant’s conduct in the proceedings has been vexatious disruptive and/or unreasonable 76(1)(a) of the ET rules.[22]Specifically, it is said that the nature of the claims the Claimant sought to bring combined with relevant the background and timing of the withdrawal was said to amount to unreasonable conduct.[23]Mr Crow stated that the objectionable, unreasonable conduct of the Claimant was the ‘riding the two horses’ seeking to claim essentially the same damages in both the High Court and the Employment Tribunal for the same factual matters. What must be avoided is the same factual territory (and even more so, the same damages claim) being traversed in two jurisdictions concurrently. Mr Crow stated that this is what the Claimant has done in this matter, seeking to claim damages from the same factual allegations relating to the actions of Mr Thompson in two forums.[24]Mr Crow highlighted that the Claimant was aware that the Respondent believed that duplicative proceedings were inappropriate following the consistent correspondence from the Respondent’s solicitors, at times warning of strike out applications and costs warnings throughout from 14 June 2022 and throughout the Tribunal litigation.[25]Mr Crow referred to the Claimant’s legal representative letter dated 25 July 2022 requesting an agreement to stay the Employment Tribunal proceedings that that stated, amongst other things: Please note given the personal injury claim that is also advanced we are of the view the employment claim should be stayed pending the outcome of the personal injury claim. We say this for the following: 1) A claim for PI in the civil courts is already at an advanced pre-action stage and proceedings will shortly be issued and served if liability is to be denied; 2) The PI claim will concern both the HAVS injury and the subsequent treatment of the Claimant at the hands of Mr Thompson and Mr Clark. 3) Findings of fact in the PI case in relation to HAVS suffered by the Claimant will most likely also determine the question of whether he was disabled at the material time for the purposes of his Tribunal claim. 4) There is a significant factual overlap between the complaint in the PI claim concerning Mr Thompson and Mr Clark and the complaint of disability harassment by them in the Tribunal. It would be inappropriate to have the facts of the complaint litigated in two different jurisdictions simultaneously. 5) From a chronological point of view it would be sensible for the PI claim to go ahead before the discrimination claim in the Tribunal… 6) …[26]Mr Crow added that by continuing with the Employment Tribunal proceedings when it was obvious that the High Court was the most appropriate forum was unreasonable.[27]Mr Ohringer countered by submitting that the separate complaints had to be brought both in the employment tribunal and the civil courts. The claim for breach of duty resulting in the Claimant suffering HAVS could only be brought in the civil courts, as could his claims for harassment and assault by Mr Thompson. However, claims for disability discrimination, disability harassment and constructive unfair dismissal could only be brought in the employment tribunal.[28]Mr Ohringer stated that the Respondent originally made no offers, then encouraged the Claimant to withdraw his Tribunal Claim on 23 November 2023 under the threat of costs. The Respondent’s application is therefore contradictory claiming costs for what it initially offered.[29]Mr Ohringer submitted that there was no unreasonable conduct in this matter, there was simply hard-fought litigation and that the withdrawal of the Tribunal complaints ultimately saved both parties costs by allowing the dispute to be resolved more efficiently in one forum.
Conclusions
[30]I considered whether the Claimant has acted unreasonably. There are three elements of potential unreasonableness to consider namely:30.1 Bringing damages claims arising from the same facts in both the Employment Tribunal and the High Court. I do not conclude that this was unreasonable. Mr Ohringer is correct in submitting that there were claims that only the Employment Tribunal had jurisdiction to consider. There was a strict limited time frame for Employment Tribunal claim to be presented and the pre action protocols for the High Court claim had not been completed. Mindimaxnox LLP v. Gover is not authority to the effect that it is unreasonable for there to be concurrent claims. It is authority to the effect that it is unreasonable for the proceedings to be actually being heard at the same time.30.2 Continuing with the claims arising from the same facts in both the Employment Tribunal and the High Court following the completion of the pre action protocols in May 2023. I accept that, given the terms of Dr Turner’s report that consideration of the propriety of continuing with aspects of the damages claims in the Employment Tribunal claims with a view to withdrawing them would have been reasonable. However, given the nature of the complaints being advanced, which only the Tribunal had jurisdiction to determine I do not conclude that it was unreasonable conduct to continue with the claim.30.3 Withdrawing the Employment Tribunal claim on 15 December 2023. The High Court claim was issued on 12 September 2023, without prejudice discussions relating to the Employment Tribunal complaint ensued and the Claimant withdrew the Employment Tribunal claim, without a settlement, on 15 December 2023 to focus on the High Court claim. I do not conclude that this was unreasonable in all the circumstances, it was a sensible litigation decision that ultimately saved costs. I refer to McPherson v BNP Paribas (London Branch) in this regard.[31]I therefore do not conclude that the Claimant has acted unreasonably in the conduct of the proceedings.[32]Had I concluded that the threshold of unreasonable conduct was met, I would have declined to exercise my discretion to award costs. I would have had regard to the Respondent’s approach to the stay application and the content of the without prejudice correspondence. The Claimant’s withdrawal accorded with a drophands without prejudice offer made on 23 November 2023 and these factors would have pointed against making a costs award.[33]In these circumstances the Respondent’s application for costs fails and is dismissed.