Mr S Harknett v Living Sport Cambridgeshire and Peterborough Sports Partnership Ltd: 3312301/2023

EMPLOYMENT TRIBUNALS

Case No 3312301/2023

Between

Mr Steven HarknettClaimant

Living Sport Cambridgeshire and Peterborough Sports Partnership LtdRespondent

Before

Employment Judge Hutchings

Not represented for claimant

Miss Sheerin (instructed by counsel) for respondent

Date 1 July 2024

JUDGMENT

The claim is struck out.

REASONS

Introduction

[1]Oral reasons for the decision to strike out the claim were given at the hearing. However, mindful of the following, I record the written reasons for that decision below:a. The claimant did not attend the hearing;

b. The claimant is not legally represented; and

c. At the hearing the respondent made an application for a costs award.

[2]By claim form dated 15 September 2023 the claimant claimed breach of contract relating to a failure (he says) by the respondent to assign him work during a period of garden leave. He confirms that the claimant paid his notice pay in full. By Grounds of Resistance (undated but filed with the Tribunal in time) the respondent submits that the Tribunal does not have jurisdiction to hear the claim as, by his own admission, the claimant has not suffered financial loss. Early conciliation started on 6 July 2023 and an ACAS certificate issued on 1 August 2023. A final hearing was listed for 1 July 2024, with directions ordering the parties to disclosure documents and file witness statements ahead of that hearing.

[3]On 16 May 2024 the respondent applied to strike out the claim on the basis the Tribunal does not have jurisdiction to hear it, as by his own admission the claimant has not suffered any financial loss.

[4]By a letter dated 11 June 2024 the Tribunal gave the claimant an opportunity to make representations or to request a hearing, as to why the claim should not be struck out on the basis the Tribunal did not have jurisdiction to hearing, the claimant having stated in his claim form that he has suffered no financial loss as a result of the alleged breach of contact. The claimant did not respond to the strike out warning.

[5]On 27 June 2024 at 20:39 the claimant wrote to the Tribunal stating he would not be attending the final hearing “due to work commitments”. He did not do so. As required by Rule 47 of the Employment Tribunals Rule of Procedure 2013, which applies where a party does not attend the hearing, at the start of the hearing the Tribunal clerk telephoned the claimant, who again confirmed he would not be attending due to work commitments. I am satisfied that I have considered the available information, and made all enquiries that may be practicable, about the reasons for the claimant’s absence. On these grounds alone, I consider it fair and just to dismiss the claim.

[6]However, mindful of the respondent’s application to strike out the claim I considered the evidence before me. In his claim form the claimant accepts he has not suffered financial loss as a result of the alleged breaches of contract. The claimant has not complied with the Orders of the Tribunal. In not replying to the Tribunal’s strike out warning, and not attending the final hearing, he is not actively pursuing his claim.

[7]Therefore I decided to strike the claim under Rule 37 of the Employment Tribunals Rules of Procedure 2013 for the following reasons:a. There is no reasonable prospect the claim will succeed as the Tribunal does not have jurisdiction to consider claims for breach of contract where the claimant has not suffered financial loss;

b. The claimant had not complied with the Order of the Tribunal dated 28 March 2024;

c. The claim is not actively pursued; and

d. The claimant has failed to make representations in writing why this should not be done and did not attend the hearing. The claim is therefore struck out.

[9]At the hearing the respondent made an application for costs. I have sent a case management order to the parties with directions for this application.

[1]At the hearing on 1 July 2024 the claim was struck out on the under Rule 37 of the Employment Tribunals Rules of Procedure 2013 for the following reasons: 1.1. There is no reasonable prospect the claim will succeed as the Tribunal does not have jurisdiction to consider claims for breach of contract where the claimant has not suffered financial loss; 1.2. The claimant had not complied with the Order of the Tribunal dated 28 March 2024; 1.3. The claim is not actively pursued; and 1.4. The claimant has failed to make representations in writing why this should not be done and did not attend the hearing.

[2]Judgment and the reasons for that decision have been sent to the parties. The respondent made an oral application for costs at the hearing on 1 July 2024. By a case management orders issued at that hearing and sent to both parties in writing, I ordered: 2.1. The respondent to send to the claimant and the Tribunal a schedule of the costs the respondent is seeking to recover from the claimant; and 2.2. The claimant to send to the respondent and the Tribunal written representations, or request a hearing, in response to the application and details of his financial circumstances, to enable the Tribunal to determine his ability to pay any costs award, if made.

[3]On 8 July 2024 the Tribunal received the respondent’s written application. This was referred to me by Tribunal administration on 22 July 2024. The claimant has not complied with the Tribunal’s order to send written representations, or request a hearing, in response to the application nor has he complied with the order to provide details of his financial circumstances, to enable the Tribunal to determine his ability to pay any costs award. Mindful that the claimant is not represented, I waited until 13 August 2024 to consider the respondent’s application. It is my judgement that at this point the claimant has had ample opportunity to respond to the Tribunal’s order and he has not done so. This is indicative of the approach he has taken to these proceedings generally. In this regard the respondent’s cost application is not challenged by the claimant. Costs application

[4]On 1 July 2024 the respondent made an application to recover its costs of the proceedings pursuant to Rule 76(1)(a) of the Employment Tribunal Rules of Procedure 2013 (the ‘Rules’), confirmed in writing in a letter to the Tribunal dated 8 July 2024.

[5]The application relies on the 1 July 2024 Judgment which concluded that the claimant: 5.1. Did not respond to the respondents application for strike out of the claim; 5.2. The claimant’s claim had no reasonable prospects as by the claimant’s own admission in his ET1 the claimant stated that he had suffered no financial loss as a result of the alleged breach of contract; 5.3. the claimant not actively pursuing his claim by not attending the Final Hearing and not providing an adequate reason to the tribunal for his nonattendance; 5.4. the claimant was seeking injury to feelings, something that was not achievable with a breach of contract claim.

[6]Details of the respondent’s claim for costs are set out in a schedule submitted to the Tribunal (and sent to the Claimant) as directed by the Tribunal. The respondent claims £2,903.94 as follows: 6.1. Barrister’s fee in attending and preparation for the Final Hearing on 1 July 2024: £600.00; 6.2. DAS Law legal fees from 22 May 2024 to the 1 July 2024 hearing: £2,201.40; 6.3. Sally Gibson (Head of Programmes) attendance as main witness at Tribunal: £102.54. Procedure and evidence

[7]The respondent provided a 24-page hearing bundle to support its application for costs. The claimant did not respond to the Tribunal’s order to reply to the cost’s application and provide information about his financial situation and his ability to pay any costs order.

Findings of fact

[8]The findings of fact relevant to this costs application are set out in the Judgment with reasons dated 1 July 2024, and summarised in paragraph 5 of this Judgment.

[9]Rule 77 requires the application to be made ‘up to 28 days after the date on which the judgment finally determining the proceedings in respect of that party was sent to the parties’. The respondent’s solicitor made the written application for costs on 8 July 2024; Judgment was given at the hearing on 1 July 2024; the application is in time.

[10]I find the timeline of the claim as follows. The claimant issued a claim of breach of contract on 15 September 2023. The respondent resisted the claim on the basis responded to the claim had no reasonable prospects of succeeding, as the claimant had not suffered any loss and it is not possible to be awarded injury to feelings for a breach of contract claim. On 16 May 2024, the respondent issued a costs warning to the Claimant, stating that should the claimant withdraw his claim within 7 days, the respondent would not pursue an award for costs. The claimant did not respond to this. On 11 June 2024 the Tribunal made a strike out warning under the Employment Tribunals Rules of Procedures 2013 Rule 37. The claimant did not respond to the Tribunal. On 18 June 2024, the respondent made an application pursuant to Rule 29 of the Employment Tribunals Rules and Procedures 2013 that the case management order for the respondent to provide its Witness Statements, be extended until 27 June 2024. On 27 June 2024 the claimant informed the Employment Tribunal and the respondent that he would not be attending the Hearing on 1 July 2024 due to work commitments. He did not support any evidence to the Tribunal to support this reason. The hearing took place on 1 July and the claim was struck out.

[11]On 1 July 2024 the claimant was ordered to respond to the application and provide information about his financial situation. Up to the date of this costs judgment he has hearing not filed any evidence as to his means. This is a further example of her failure to comply with an order of the Tribunal. The fact that he has been unrepresented, (and that the Respondent is represented) is no excuse; he was aware of what was required of him and he has chosen not to comply and he chosen to ignore correspondence. She has chosen not to cooperate with the Respondent’s solicitors and the Tribunal in both the management of the claim, the final hearing and this costs application.

[12]In this context I find that the claimant’s conduct of these proceedings has been unreasonable. The claimant has not complied with Case Management Orders, nor has he provided an explanation as to why he has not done so. The claimant ignored the Tribunal’s strike out warning. He has not been actively pursuing the case in any way whatsoever and in my view, she has deliberately and persistently disregarded the Tribunal’s procedural steps.

Relevant law

[13]The Employment Tribunal Procedure Rules provide as follows in relation to the 13.1. procedure for making a costs application: “77. A party may apply for a costs order or a preparation time order at any stage up to 28 days after the date on which the judgment finally determining the proceedings in respect of that party was sent to the parties. No such order may be made unless the paying party has had a reasonable opportunity to make representations (in writing or at a hearing, as the Tribunal may order) in response to the application.”

[14]The Employment Tribunal Procedure Rules provide as follows in relation to the time when a deadline is to be complied with: “4.—(1) Unless otherwise specified by the Tribunal, an act required by these Rules, a practice direction or an order of a Tribunal to be done on or by a particular day may be done at any time before midnight on that day. If there is an issue as to whether the act has been done by that time, the party claiming to have done it shall prove compliance.”

[15]The Tribunal has the power to order the payment of costs and witness expenses. The Employment Tribunal Procedure Rules rule 75 sets out the nature of these orders: “75.—(1) A costs order is an order that a party (“the paying party”) make a payment to— another party (“the receiving party”) in respect of the costs that the receiving party has incurred while legally represented or while represented by a lay representative; […] or another party or a witness in respect of expenses incurred, or to be incurred, for the purpose of, or in connection with, an individual’s attendance as a witness at the Tribunal.”

[16]The Employment Tribunal Procedure Rules rule 76 sets out when a costs order or a preparation time order may be made: “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 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 any claim or response had no reasonable prospect of success;[…] (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.”

[17]The test for imposition of a costs order under rule 76(1) is a two-stage test: first, a tribunal must ask itself whether a party’s conduct falls within rule 76(1); if so, it must go on to ask itself whether it is appropriate to exercise its discretion in favour of awarding costs against that party.

[18]The decision to make a costs order is the exception rather than the rule. This was made clear in Yerrakalva v Barnsley Metropolitan Borough Council

[2011] EWCA Civ 1255

;

[2012] ICR 420

(3 November 2011) by Mummery LJ giving the lead judgment in the Court of Appeal at paragraph 7 as follows: “The employment tribunal's power to order costs is more sparingly exercised and is more circumscribed by the employment tribunal's rules than that of the ordinary courts. There the general rule is that costs follow the event and the unsuccessful litigant normally has to foot the legal bill of the litigation. In the employment tribunal costs orders are the exception rather than the rule. In most cases the employment tribunal does not make any order for costs.”

[19]Vexatious, abusive, disruptive, or unreasonable conduct of proceedings was considered in the case of Scott v Russell

[2013] EWCA Civ 1432

; [2014] 1 Costs L.O. 95 (12 November 2013) Beatson LJ, giving the judgment of the Court of Appeal, cited with approval the definition of “vexatious” given by Lord Bingham in Attorney General v Barker [2000] 1 F.L.R. 759 (16 February 2000). That definition is as follows: “The hallmark of a vexatious proceeding is in my judgment that it has little or no basis in law (or at least no discernible basis); that whatever the intention of the proceeding may be, its effect is to subject the defendant to inconvenience, harassment and expense out of all proportion to any gain likely to accrue to the claimant; and that it involves an abuse of the process of the court, meaning by that a use of the court process for a purpose or in a way which is significantly different from the ordinary and proper use of the court process.”

[20]According to the EAT in Dyer v Secretary of State for Employment EAT 183/83 (20 August 1983), “unreasonable” has its ordinary English meaning and is not to be interpreted as if it means something similar to “vexatious”. It will often be the case, however, that a tribunal will find a party’s conduct to be both vexatious and unreasonable. The Court of Appeal in Yerrakalva at paragraph 41 commented that it was important not to lose sight of the totality of the circumstances.

[21]A party’s lies may be the basis of an allegation of vexatious or unreasonable conduct. In this regard, in the case of Arrowsmith v Nottingham Trent University

[2011] EWCA Civ 797

; [2012] I.C.R. 159 (10 June 2011) the Court of Appeal approved of the following passage in HCA International Ltd v May-Bheemul EAT 0477/10 (23 March 2011): “39. Thus, a lie on its own will not necessarily be sufficient to found an award of costs. It will always be necessary for the tribunal to examine the context and to look at the nature, gravity and effect of the lie in determining the unreasonableness of the alleged conduct. “40. As this last case makes abundantly clear, no point of principle of general application is established in any of the cases being relied upon by Mr Beyzade [and they included the Daleside case]. In our judgment the employment tribunal's reasoning in the present case, at para 12 of their judgment, is unimpeachable. Where, in some cases, a central allegation is found to be a lie, that may support an application for costs, but it does not mean that, on every occasion that a claimant fails to establish a central plank of the claim, an award of costs must follow.”

[22]In Kapoor v Governing Body of Barnhill Community High School EAT 0352/13 (12 ecember 2013) the Employment Appeal Tribunal confirmed that costs should not automatically be awarded simply because a party has knowingly given false evidence. As Pill LJ noted when giving the lead judgment in the Court of Appeal case of Lodwick v Southwark London Borough Council

2004 ICR 884

(18 March 2004), it remains a fundamental principle that the purpose of an award of costs is to compensate the party in whose favour the order is made, and not to punish the paying party. Given that costs are compensatory, it is necessary to examine what loss has been caused to the receiving party. In this regard in the case of Yerrakalva at paragraph 54 Mummery LJ held that costs should be limited to those ‘reasonably and necessarily incurred’.

[23]Ability to pay is a relevant factor for the Tribunal to consider. The Employment Tribunal Procedure Rules rule 84 provides as follows in relation to ability to pay: ‘84. In deciding whether to make a costs, preparation time, or wasted costs order, and if so in what amount, the Tribunal may have regard to the paying party’s […] ability to pay.’

[24]A tribunal is not obliged by rule 84 to have regard to ability to pay — it is merely permitted to do so. That said, in Benjamin v Interlacing Ribbon Ltd EAT 0363/05 (1 November 2005) the EAT held that where a tribunal has been asked to consider a party’s means, it should state in its reasons whether it has in fact done so and, if it has, how this has been done. As noted by the EAT in Howman v Queen Elizabeth Hospital Kings Lynn EAT 0509/12 (30 April 2013) at paragraph 13, any tribunal when having regard to a party’s ability to pay needs to balance that factor against the need to compensate the other party who has unreasonably been put to expense. The former does not necessarily trump the latter, but it may do so.

Conclusions

[25]The decision to make a costs order is the exception rather than the rule. The test for imposition of a costs order under rule 76(1) is a two-stage test: first, a Tribunal must ask itself whether a party’s conduct falls within rule 76(1); if so, it must go on to ask itself whether it is appropriate to exercise its discretion in favour of awarding costs against that party.

[26]It is clear the claimant’s conduct falls within Rule 76(1). In my Judgment dated 1 July 2024 I set out my reasons for striking out the claim; bringing a claim at the outset for which the claimant had suffered no loss and then a complete failure on the claimant’s part to engage with a process he started. The threshold as to whether the claimant has acted vexatiously or otherwise unreasonably in her conduct of the proceedings has clearly been satisfied under rule 76(1)(a).

[27]The respondent further submits that the claimant breached multiple orders (rule 76(2)). He did, as my findings in the judgment dated 1 July 2024 and in this judgment evidence. On balance, I conclude that the first part of the test is satisfied.

[28]Therefore, I must go on to ask itself whether it is appropriate for the Tribunal to exercise its discretion in favour of awarding costs against the claimant. In deciding whether to make an order for costs I may have regard to the paying party’s ability to pay, hence my ordering the claimant to provide with this information. He has not done so. Therefore I may draw adverse inferences, including that the claimant has sufficient means to meet the liability of any costs order. I conclude he does.

[29]I bear in mind that it is exceptional to make a costs order in the Tribunal. However, the fault in the conduct of this case lies entirely with the claimant. His actions, including ignoring the opportunity to produce evidence as to his financial position, invariably lead to the conclusion this case is one of the exceptions. The claimant’s conduct in this case caused the respondent to incur unnecessary costs.

[30]I also bear in mind that relevant to my discretion in making an order for costs is the fundamental principle that the purpose of an award of costs is to compensate the party in whose favour the order is made, and not to punish the paying party. Again, if I had evidence as to ability to pay, I would take this into account. It was the claimant’s choice not to assist the Tribunal with such evidence. Therefore, I must consider what costs are involved, and limit any award to ‘those reasonably and necessarily incurred’ [Yerrakalva v Barnsley Metropolitan Borough Council and anor

[2021] ICR 420

, CA]. Costs award

[31]In assessing amount, I apply the rule that costs are compensatory not punitive. Given this rule, it is necessary to examine what loss has been incurred by the receiving party. Much of the time incurred is preparation time. I have reviewed the Tribunal file. I consider the amount sought reasonable for the unnecessary correspondence undertaken by the respondent’s representative as a result of the claimant’s conduct and for the barristers fee for attending a hearing which did not need to take place in the manner it did had the claimant responded to the Tribunal’s correspondence.

[32]As such, I order the Claimant to pay a total of £2,903.94 inclusive of VAT composed of: 32.1. Barrister’s fee in attending and preparation for the Final Hearing on 1 July 2024: £600.00; 32.2. DAS Law legal fees from 22 May 2024 to the 1 July 2024 hearing: £2,201.40; 32.3. Sally Gibson (Head of Programmes) attendance as main witness at Tribunal: £102.54. JUDGMENT on RECONSIDERATION APPLICATION

Conclusions

[1]The Tribunal determined that a hearing is necessary in the interests of justice.

[2]The Claimant’s reconsideration application is refused.