Driver v Preston Borough Council & Anor [1998] UKEAT 1274_97_0902

EAT

Driver v Preston Borough Council & Anor

[1998] UKEAT 1274_97_0902 · 1998-02-09

MR JUSTICE KIRKWOOD : This is a preliminary hearing of an appeal by Mr Driver in respect of costs applications. It arises from a complaint to the Industrial Tribunal by Mrs Harrison of sex discrimination. She was represented in those proceedings by solicitors, Mace Jones Grundy Kershaw. The first respondent to the Originating Application was Preston Borough Council. The Borough Council was represented by solicitors, Davies Wallis Foyster. The second respondent was Mr Driver. He was represented by solicitors, Messrs Pattinson & Brewer. The case was due to be heard over 15 days starting on 26th March 1997. Negotiations took place. On 21st March 1997 the applicant's solicitor wrote to Mr Driver's solicitor a "without prejudice" letter. It was sent by fax and by post and it said:

"We write to advise you that settlement terms have been agreed between our client and the First Respondent.

Our client proposes that the proceedings against your client be withdrawn subject to your client's agreement not to seek costs against our client.

We look forward to hearing from you by return fax that your client agrees this proposal so that we can notify the Tribunal accordingly."

Messrs Pattinson & Brewer, solicitors for Mr Driver, did respond by return fax that day, 21st March 1997 and said:

"We acknowledge receipt of your fax of today's date and confirm that our client will not be seeking costs against your client."

There was thus a form of agreement between the two firms of solicitors acting on behalf of their clients.

The same day Preston Borough Council's solicitors wrote to Mr Driver's solicitor, a letter that also went by fax, which said:

"We write to advise that terms for a compromise agreement of these proceedings have now been agreed.

It is a part of the agreed settlement that proceedings will be withdrawn against both First and Second Respondent and we understand that Mrs Harrison's solicitors will be communicating with you direct."

Of course they either had communicated by then or did soon after that letter.

It appears, and we go by findings of fact subsequently made by the Industrial Tribunal, that on 24th March 1997 Mr Driver learned of the compromise and contacted his solicitor who thereupon told the applicant's solicitor that the compromise of the Originating Application being withdrawn with no application for costs by Mr Driver had itself been withdrawn. Mr Driver himself telephoned the applicant's solicitor the same day to the same effect. But the applicant's solicitor took the view that a binding agreement had already been reached.

The terms of the compromise between the applicant and Preston Borough Council were put in writing and signed on 25th March 1997. Also on 25th March Mr Driver wrote to the Industrial Tribunal and said:

"Neither myself nor my representatives were party to the negotiations between the First Respondent and the Applicant, although my Professional Association, who funded my legal costs, have agreed subsequently not to make an application to the Tribunal for their costs.

I do wish to make an application for the costs I have incurred personally, which are separate from, and in addition to the costs incurred by my Professional Association. I make this application because I believe the Applicant had made the claim about me to the Tribunal frivolously and vexatiously. I also believe that the Applicant and the First Respondent have acted unreasonably and unco-operatively in their conducting of these proceedings."

On 26th March 1997 the Industrial Tribunal replied to Mr Driver that if he wished to pursue his application for costs the matter could be set down at a later date.

There was further correspondence between Mr Driver and the Industrial Tribunal in which Mr Driver set out the way in which he justified his application. By letter of 12th June 1997 the Industrial Tribunal informed Mr Driver that a Chairman had considered the case and was of the view that(a) Mr Driver's Professional Association had not sought its legal costs;

(b) Mr Driver's claim was in relation to his own personal expenses not his solicitors' costs;

(c) a tribunal award of costs may be subject to a taxation; in that context 'costs' refers to charges and disbursements of the solicitor and any expenses and losses by litigants in person;

(d) that Mr Driver was not a litigant in person;

(e) that the Chairman thought that the application was misconceived and did not intend to list it subject to any further representations from Mr Driver.

Mr Driver made further representations, as a result of which on 26th June 1997 Mr Driver was informed that his request for a hearing had been granted.

On 22nd August 1997 Mr Driver's application for his costs was heard. The Industrial Tribunal found that he was bound by the compromise agreement, the letters of 21st March 1997, to which we have referred, amounting to such agreement, that is to say the letters passing between the applicant's solicitor and Mr Driver's solicitor. Mr Driver's solicitors had ostensible authority and represented themselves as acting for Mr Driver. If it were the fact that those solicitors did not have such authority then Mr Driver's remedy may lie elsewhere, but as between himself and the applicant he was bound by the agreement not to ask for costs.

Mr Driver asked for a review of that decision. In his application for a review Mr Driver raised three matters that were dealt with by a Chairman on 24th September 1997.

The first was evidently based upon a misunderstanding by Mr Driver. He seems, going by the reasons of 24th September 1997, to have confused entitlement to have a hearing as to costs with an entitlement as to costs.

The second was failure by the Industrial Tribunal in August to deal with his claim against the first respondent. But the Chairman said that there was no claim against him by the first respondent, it was the applicant who had made the claim against Mr Driver. So it was held by the tribunal that he had no entitlement to claim costs against the first respondent.

Thirdly, Mr Driver appeared to challenge the finding on the facts as to the binding agreement of compromise on 21st March 1997.

Mr Driver's application was refused and he has appealed. He has put in a detailed Notice of Appeal. At this preliminary hearing today we have had the advantage of the assistance of Mr Vineall who has represented Mr Driver under the ELAAS scheme, and who has identified for us two points which are said to be arguable on appeal at a full hearing.

The first arises from s.77 of the Sex Discrimination Act 1975 , and relates to the question whether there was indeed an agreement of compromise that was binding under the Sex Discrimination Act 1975 . The relevant subsection of s.77 is (4A) which reads:

"The conditions regulating compromise contracts under this Act are that- (a) the contract must be in writing;

...

(f) the contract must state that the conditions regulating compromise contracts under this Act are satisfied."

Mr Vineall submits to us that there is an arguable point whether the exchange of letters 21st March 1997 satisfy the requirements of s.77 of the Act and that narrow point we are persuaded is an arguable one which should go to a full hearing.

Secondly, Mr Vineall points out to us that in that part of the reasons for refusal of review that are contained at paragraph 3 and 4, the Chairman appears to have ruled that Mr Driver had no possible claim in respect of his costs against the first respondent, since the first respondent had not made a complaint or allegation against him. Mr Vineall, helpfully, reminded us however of the provision of paragraph 12 of the First Schedule to the Industrial Tribunals (Constitution and Rules of Procedure) Regulations 1993 which is in these terms:

"12.-(1) Where, in the opinion of the tribunal, a party has in bringing or conducting the proceedings acted frivolously, vexatiously, abusively, disruptively or otherwise unreasonably, the tribunal may make- (a) an order containing an award against that part in respect of the costs incurred by another party; ..."

That rule does not confine applications for costs to applications between the direct protagonists. We consider that there is an arguable point in that regard too in respect of the application against the first respondent.

Accordingly, we allow this case to go to a full hearing on the questions:

(1) whether there was a binding agreement as to costs between Mr Driver and Mrs Harrison by the exchange of letters of 21st March 1997; and

(2) whether the tribunal was correct in its extended reasons to hold that Mr Driver had no possible claim against Preston Borough Council having regard to the provisions of paragraph 12 of the First Schedule to the 1993 Regulations.