DR I KOVACS v 1) QUEEN MARY & WESTFIELD COLLEGE 2) THE ROYAL HOSPITAL NHS TRUST [2000] UKEAT 1157_99_0112

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2000] EAT 1157_99_0112Case No Appeal No. EAT/1157/99Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
DR I KOVACSAPPELLANT1) QUEEN MARY & WESTFIELD COLLEGE 2) THE ROYAL HOSPITAL NHS TRUSTRESPONDENT
Before
His Honour Judge D M LevyDate 1 December 2000
[1]APPEARANCES For the Appellant THE APPELLANT IN PERSON For the 1st Respondents For the 2nd Respondents Neither present or represented MR DAMIAN BROWN (of Counsel) Instructed by: Messrs Beachcroft Wansbroughs Solicitors 100 Fetter Lane London EC4A 1BN JUDGE D M LEVY QC By an application sent to an Industrial Tribunal, and received by it on 20 January 1998, the Appellant, Dr Kovacs, sought relief on the grounds of sex discrimination, race discrimination and unfair dismissal. The Respondents to the application were the Queen Mary & Westfield College and the Royal Hospital NHS Trust.[2]The Appellant's complaint was determined by a Tribunal sitting at Stratford; there was a hearing of some 11 days, followed by a period in chambers for reflection by the members. The decision was promulgated to the parties on 30 July 1999; it was a 91 page decision, and at the end of the day, the unanimous decision of the Tribunal was that the Appellant's claims of unlawful direct race and sex discrimination against the First Respondent failed and were dismissed.[3]A claim for unfair dismissal against the First Respondent succeeded, and the First Respondent was ordered to pay her £1,588.05 as compensation; the Applicant was ordered to pay £500 towards the costs of the First Respondent, and her claim of unlawful race and sex discrimination, both direct and by way of victimisation, against the Second Respondents failed and were dismissed and the Appellant was ordered to pay the taxed costs of the Second Respondent.[4]The Appellant submitted a lengthy Notice of Appeal. The matter came before another panel of this Tribunal on the preliminary hearing, where the Chairman was Mr Commissioner Howell QC. In the opening paragraphs of his judgment of the preliminary hearing, the Chairman helpfully summarises the issues which were between the parties, and we are happy to adapt what he says in paragraphs 1 - 7, to summarise the background to this case. In the first paragraph, though, he said this:- "We are going to let this go forward to a full Tribunal hearing on one principal issue, but on one principal issue alone and I am about to explain the reasons and what we are going to do in the form of a short judgment". It is clear from that short paragraph that the other points which were in the Notice of Appeal were considered at that preliminary hearing, and the Appellant was not permitted to bring an appeal other than on the grounds which were allowed.[5]What was allowed to go forward is set out in paragraph 27 and in paragraph 28 of the judgment, it is said that the Tribunal would direct a full hearing of the appeal, and gave leave to amend the Notice of Appeal, with the deletion of all other paragraphs other than those which were identified. It is therefore those with which we have had to deal primarily today, and the amended Notice of Appeal is found at our bundle, with those three grounds on them, at page 22. The grounds of appeal were these; the first in paragraph 6:- "The Employment Tribunal erred in law in making cost orders in favour of the First Respondent in the sum of £500.00, and in respect of the Second Respondent costs, to be taxed, if not agreed. Pursuant to the cost order in favour of the Second Respondent by a letter dated 19 th August 1999 the costs which the Second Respondent will be seeking on taxation is £62,119.09". The next sub-paragraph reads:- "In reaching its decision, the Employment Tribunal failed to properly consider, or apply Rule 12 of the Employment Tribunal's (Constitution etc) Regulations 1993 ……and in the alternative failed to exercise its discretion judicially and/or reached a decision which was legally perverse . In particular, but exclusively, the Employment Tribunal erred in law (having regard to the cost orders made being £500 in respect of the First Respondent and open ended costs in respect of the Second Respondent) in that it: i failed to have regard or properly regard to the Appellant's ability to pay costs" And there is a reference to Rule 12(1) of the 1993 Regulations, and two reported cases, unhappily the learned pleader failed to refer the Court in his oral arguments, or this Court in the Notice of Appeal to a later case - Benyon v Scadden IRLR 701 and we note from the copy of the reports before us, that that was volume 28, number 11 of November 1999. In that decision to which we will return later, the President carefully reviewed the earlier authorities on Cost Orders. it was alleged that the Tribunal:- "ii failed to make proper or adequate enquiries as to the Appellant's means. The Employment Tribunal should have made it clear that it was "not satisfied that we have in fact been told everything". This being the case, and having regard to the fact that the Appellant was represented by a lay representative, the Appellant should have been informed of the consequences of the Employment Tribunal's views on the representations on her behalf, and by this failure, failed to act judicially . iii failed to identify the scale on which the costs are to be taxed, if they were not agreed, see Rule 12(6) of the 1993 Regulations iv failed to have proper regard to the evidence and in particular the close inter-relationship as between the First and Second Respondent. v made the cost order effectively on a "punitive basis".[6]At the commencement of the hearing this morning, we were asked to deal with a further application by the Appellant, who appeared in person, before the earlier Tribunal. Her husband appeared for her, he has sat by her side, to allow amendments to the Notice of Appeal to be made, which would bring in the matters which had largely been excised by the judgment of the Commissioner and his colleagues in the preliminary hearing. In that connection, we have been referred by Mr Brown, who appears for the Second Respondent, to the decision of this Court United Arab Emirates v Abdelghafar [1995] ICR 65 where Mr Justice Mummery drew attention to time limits on appeals, and made it quite clear that the rules of the Employment Appeal Tribunal were to be observed.[7]In our judgment, it is not just a matter of the rules being observed, but the Appellant has had one bite of the cherry, and now wishes to have another. There has been reference made to her human rights being denied; we are not satisfied that they were denied. The proposed Notice of Appeal is very many days out of time, indeed weeks out of time, and, apart from the fact that the same grounds have largely been covered in the earlier appeal, we do not think it appropriate to grant leave out of time for the other matters to be added, and insofar as that was before us, we do not give leave for the Notice of Appeal to be amended.[8]We turn to the main grounds of appeal, which is on the costs order. In that connection Dr Kovacs addressed us at length, and has produced a document, setting out in summary form, as a 2 page document, her statement as to means. The second page of her document reads:
"Decision B page 63 Costs in respect of the Second Respondent ."
She makes five points and then goes on to say:
"There is not a shred of evidence to substantiate the Tribunal's above allegations made to justify the exceptionally harsh punishment"
[9]In her five points what she does is to rehearse pieces of evidence, or make complaints which have not been allowed to go forward to a full hearing. There are findings of fact throughout the Tribunal's decision which justified the decision they reached on which no appeal was allowed. We have to confine ourselves to the matter of costs on which the earlier Tribunal gave leave to go forward.[10]In that connection we start by noting that the First Respondent has chosen not to be represented today, in the light of the costs awarded to it - the sum of £500 - it would be uneconomic for it to do so, as stated in a letter from its solicitors dated 27 November 2000.[11]As regards the Second Respondent, as we said, they have been represented by Mr Brown. Mr Brown has drawn to our attention that before the hearing started, Dr Kovacs herself appreciated that the costs were likely to be heavy. We have been shown a letter signed by her dated 7 June 1999 in which she says this, in the final paragraph:- "The costs of representation of the two respondents with solicitors and barristers, including four interlocutory hearing and the 15 days full hearing is enormous. To be threatened that should I proceed, I may well be obliged to pay this costs is indecent. I expect the Tribunal to warn both solicitor firms that their co-ordinated tactics is unacceptable in a Tribunal proceedings." So there, before the hearing started on 14 June, she was herself aware that the costs were enormous.[12]We turn now to the paragraphs of the Extended Reasons which deal with the issue of costs. "29 Costs We have read and reminded ourselves of the provisions of Rule 12 of Schedule 1 to the Employment Tribunal (Constitution and Rule of Procedure) Regulations. We may award costs only where a party has in bringing or conducting proceedings acted frivolously, vexatiously, abusively, disruptively or otherwise unreasonably. 29.1 Applications by the Applicant Dr Gorog made application that the First Respondent should pay the costs in respect of interlocutory hearings and towards the cost of the bundles prepared by the Applicant which had not been used in the Tribunal. So far as the interlocutory hearings are concerned, we accede to the submissions of Miss Tracey Forster that all the points taken were reasonable points and that this is not a jurisdiction in which costs follow the event. We are not satisfied that, within the meaning of the Tribunal Rules, there was anything unreasonable, scandalous, frivolous or vexatious in having those hearings or in raising those issues. So far as the bundles are concerned, it is unfortunate that the Applicant prepared bundles in a slightly unorthodox form. The Respondents then at their own additional expense created further bundles that the Tribunal used. We are confident that it saved time to use bundles in which every page was referred to by number, rather than searching for a document number and then a page within it. Nor do we accept that the Applicant was in any way inconvenienced by the change in bundles. There were cross-referenced indexes and where necessary we took documents from one bundle to the other. There was nothing improper in the conduct of the Respondents in preparing these bundles. We decline to order costs on this basis." This paragraph, of course, refers to an application for costs made on behalf of the Appellant. In our judgment, they show that the experienced Tribunal weighed that application fairly although the decision went against the Appellant.[13]The Tribunal then considered the Respondent's application for costs:- "29.2 Application by the Respondents The Tribunal made enquiry as to the Applicant's means because this is a matter to which we are directed by precedent when considering an application for costs. We were informed upon enquiry (without having pressed the Application to give evidence, since she had decided not to do so at each previous stage of this hearing) that the Applicant has a pension in the region of £535 per month and that she runs a Harley Street clinic which just breaks even. She also has debts from previous litigation and a mortgage, both of these shared with Dr Gorog (who said he was also on a small occupational pension). We are not satisfied that we have in fact been told everything, but we do not have the resources and it is not intended that this Tribunal should engage on a full means enquiry of the sort sometimes undertaken by Magistrates' Courts." Then the next passage is very important, we will underline it:- "Nor is it intended that issues in respect of means should be binding or overwhelming when we are considering costs applications. It does not appear, on the face of the relevant Regulations, that it was intended that poor litigants may misbehave with impunity and without fearing that any significant costs order will be made against them, whereas wealthy ones must behave themselves because otherwise an order will be made. We are satisfied that the Applicant should, if it is otherwise appropriate, pay some costs despite what was said about her restricted finances. We mention here that both Respondents wrote to the Applicant in May and June 1999, warning her that they would seek costs if they succeeded at the hearing. The Applicant could not have been more properly put on notice. A Costs in respect of the First Respondent(i) The Tribunal accepts that the Applicant had some genuine sense of grievance in respect of the failure by the First Respondent to pay her a salary as a senior lecturer or to promote her to professor and in respect of the suspension. With regard to the professorship and the suspension, she was told before she commenced this litigation that they both arose out of her role in the matters which gave raise to the Xylum case. We consider that a reasonable person would have understood and recognised that that was a reasonable and appropriate course for an employer to take. In respect of the salary/senior lectureship, we recognise and have recognised above that the Applicant had live, fresh complaints and applications in 1992 to 1994 within the Haematology Department and in 1995 within the Cardiac Directorate. It is not, however, clear that she really had genuine concerns more recently than that, although we have throughout dealt with matters as if these were a continuous complaint of a lack of patronage.(ii) We turn to the Applicant's conduct of the litigation. We are satisfied that it has been frivolous and/or vexatious and/or unreasonable. Our reasons are as follows: (a) The Applicant made interlocutory applications which caused a hearing to be held, which applications were then not properly pursued, see her applications from January 1999 onwards to amend the Originating Application against the First Respondent and her application for discovery of documents at the same time. These culminated in the interlocutory hearing on 4 May 1999, as described at paras 3-6 above. Notwithstanding that hearing, Dr Gorog raised new issues at the start of this hearing, as set out at paras 7-8 above, and repeatedly thereafter refused to recognise the Chairman's ruling in respect thereof, whereby considerable time was wasted. (b) The Applicant has frequently and repeatedly made outrageous allegations against professional people employed or engaged by the First Respondent. She has asserted that Professor Newland intentionally misinterpreted Professor Davidson's report on the value of her work. She has asserted that he slandered, defamed and persecuted her. She has accused Professor Meade of having a vindictive personal bias. All these matters have been pursued on her behalf at this hearing and none has been proved. As our findings of fact demonstrate, she has persistently misrepresented the content of documents, insulted Professor Newland and demonstrated dislike of Professor Meade. She has abused or accused of bias everyone who expressed an opinion (or whom she perceived as expressing an opinion) which was less than glowing about her scientific achievements. (c) The Applicant has suggested that there has been a conspiracy against her. This has been without any foundation. It was pursued on her behalf by Dr Gorog in his opening submissions and during the evidence. There is the allegation of the "best friend" used to reject the 1992 funding application; the blaming of Professor Newland for the failure of her application to move to the Cardiac Department, when she must have known its true cause; the allegation in further and better particulars that he told the Cardiac Department that they had to choose whether to work with her or him; the allegation that when the dean, Professor Farthing, asserted something that was contrary to the Applicant, he was doing it because he had been told to do so by Professor Newland and many other similar groundless allegations, mainly directed at Professor Newland. There was never any scintilla of evidence to support these accusations. The conduct of the Applicant in these respects necessitated this extended hearing and the calling of witnesses to deal with the points. (d) Finally we refer to the manner in which Dr Gorog, with the Applicant actively prompting him on numerous occasions, has conducted these proceedings, as described at para 16.2 - 16.5 above. The Tribunal is satisfied that this was not merely a lay person (ie a non-lawyer) having difficulty with Tribunal procedure; we have much experience of that and considerable practice in alleviating it. Rather, this was a determined, persistent attempt to manipulate the judicial process into the witch hunt against both Respondents, as a means of getting at Professor Newland, which the Applicant desired . Things that got in the way of that aim (objections by the Respondents, rulings by the Chairman, the proper courtesies of the Tribunal room etc) were attacked, criticised, misrepresented or ignored. We are satisfied that this was done deliberately. (e) The Applicant deliberately chose in this case not to give evidence. Although Dr Gorog asserted that the Tribunal was told of a medical reason for this, there is no correspondence or other document which explains it and the Applicant was present, vigorously involved in the case throughout. The Respondents have told us that she wrote to them that it was because she did not wish to be cross-examined. In any case where allegations of discrimination are made and pursued, it must be apparent that, where the Applicant knows and relies upon things within her own knowledge, the prospects of success are significantly reduced if she chooses not to give evidence.(iii) We therefore determine that it is appropriate to make an award of costs against the Applicant in favour of the First Respondent. However we have found that she was unfairly dismissed and we have, at the Applicant's request, given consideration to making an order for re-employment. We have also found that some of the First Respondent's procedures in respect of the appointment to a senior lectureship and the award of the title of professor were not transparent. We recognise that such lack of transparency and the absence of established, known procedures are likely to feel or fuel feeling of unlawful discrimination when a person from a minority group or a woman fails to make progress. For these reasons we consider that there was some genuine underlying grievance in respect of those matters and we limit the award of costs in respect of the First Respondent to £500. We decline, although Miss Tracey Forster urged it, to order the Applicant to pay the whole or any specified part of their costs. B Costs in respect of the Second Respondent" It is this paragraph, and the paragraph succeeding it, which, we suspect, have really led to this appeal:
"We are satisfied that there was not and has never been a genuine claim of race or sex discrimination against the Second Respondent but rather that they have been dragged in as part of a determined vendetta against Professor Newland."
[14]We pause to interpolate that Mr Brown, for this Respondent, has submitted that here the Tribunal was finding a collateral purpose for the Second Respondent being brought into these proceedings, and in the light of that finding, this was a proper submission for him to make. The judgment continues:
"This is typified by what is said in the further and better particulars at page 30 onwards and by Dr Gorog's opening at page 28, where there is a list of supposed harassing activities by Professor Newland. We also refer to page 6 paragraph 19 of Dr Gorog's witness statement. Throughout the proceedings, Professor Newland was the subject of unsubstantiated allegations, along the lines which we have set out above. The only real criticism of the Second Respondent was that in and from 1994/95 funds were made available by the agreement and with the support of Professor Newland to pay 50% of Dr MacCullum's salary. We have found above that Dr MacCullum did not have a position which the Applicant wanted or which she would have accepted. No other allegation has been made out against the Second Respondent. We have not heard of any general applications for funds to the Second Respondent (although the Applicant asserted in further and better particulars that there were); there were no outstanding applications for funds from them in late 1997. The Applicant did not apply for job vacancies which were advertised in 1994 - 1997 within the Second Respondent. She asserted in the further and better particulars at page 28 of the bundle, under paragraph 1.5, that there were numerous vacancies within the Second Respondent "for which I could have been employed"
. She did not at any stage in these proceedings identify any and none were suggested to Professor Newland in cross examination. For these reasons and for those set out in respect of the First Respondent at (ii)(a)-(e) above, we are satisfied that the litigation has been conducted in a way which is frivolous, vexatious and unreasonable . The Second Respondent has been and has had to be represented throughout these entirely unmeritorious proceedings. The use of the Employment Tribunal and extensive litigation to pursue one man is wholly improper, particularly when the motivation of that man is identified as being something entirely different from race and sex discrimination. We rely on the fact that Dr Gorog said both in evidence and in submissions to the Tribunal that the proof of the pudding was that what Professor Newland really wanted was to have control of the haemostatometer or the TSA. If that was his motive, it undermines the race and sex discrimination claim, as this Chairman attempted to point out to the Applicant at a time when she was represented by a solicitor in May 1999. We cannot think of a more flagrant abuse of the purposes of litigation. We are satisfied that in these exceptional circumstances it is appropriate to order, within Regulation 12(3)(c), that the Applicant should pay the whole of the costs of the Second Respondent, to be taxed if not agreed. By this we mean all the costs incurred by the Second Respondent in this litigation." And then there is the last paragraph - it is not necessary for us to read it in the context of this decision.[15]Now we return to the amended Notice of Appeal, and before doing that, we will just draw attention to certain findings made by the President in Benyon to which we have already alluded. There, having at paragraph 2 set out the same Rule which is material in these proceedings, and set out the facts of that case, and looked at certain earlier decisions, certain findings are made.[16]First, having considered the decision in Wiggin Alloys Ltd v Jenkins paragraph 19, the second paragraph within that, the President said:- "The present Rule 12 is not precisely as was the rule 10 that applied then, but consistently with Wiggin Alloys Ltd even if it had been shown (as it was not) that the appellant employees in our case were unable to pay the costs they were ordered to pay, that of itself would not have vitiated the exercise of the Chairman's discretion. Each case as Wiggin Alloys says depends upon its own circumstances and lies within the discretion of the Tribunal. It is perhaps notable, as far as parties' means, that the present Rule 12 neither requires nor provides any machinery for an enquiry into a party's means. If, in every case, as a precondition of any order as to costs, there had to be an inquiry into prospective payors' means, one might have reasonably expected the employment tribunal to have been empowered so to inquire. It is not as if the draftsman of the rules had no such empowerment in mind; only a little earlier in the Rules, rule 7(5) makes the taking of reasonable steps to ascertain ability to pay, a precondition of an order. Whilst it will, no doubt, usually be desirable to look into means when it is possible, before an order for costs is made, it cannot be said that a failure to do so necessarily makes the order an improper exercise of discretion."[17]We bear that in mind the Chairman then considered the decision in Omar v Worldwide News Inc [1998] IRLR 291, and at paragraph 23 of the judgment said:- "Lastly in Omar it was held as established that an industrial tribunal must look at an applicant's personal means to pay before making an order for costs against him. The rule contains no such requirement, in contrast with Rule 7(4), as we pointed out above. Dorney , supra, and Wiggin Alloys, supra, were cited in support of that proposition. We cannot read Dorney as an authority for such a view; means were considered by the industrial tribunal in that case, but the case does not suggest that that was a necessary precondition of a proper award. In Wiggin Alloys the total inability of the employee to pay costs was borne in mind by the industrial tribunal, that is far from saying that it would necessarily have been wrong not to have had that in mind, and the Employment Appeal Tribunal had emphasised that the fact that a party was penniless, did not of itself, invariably provide sufficient ground for not making an order for costs against him. We have no quarrel at all with the Order for Costs in Omar (the question of costs remitted to the industrial tribunal). In particular we have no quarrel, as the Employment Appeal Tribunal there held, that the union had no means of knowing that the claim held by their members was fabricated………..However for the reasons given, the case cannot be taken as introducing any fetters on the broad jurisdiction which rule 12 confers. It is to be remembered that the Employment Appeal Tribunal had the benefit of argument from only one side, nor, of course, was the more recent case of Globe Equities cited to the Employment Appeal Tribunal." The preceding paragraphs look at the question as whether it was appropriate to disturb the Chairman's exercise of the unfettered discretion upon him.[18]Further on in the decision, at paragraph 31 there was an argument whether indemnity costs should be awarded, and within that paragraph, there is this:- "Any award of costs by the employment tribunal can be made under Rule 12(1) only if there has been some category of unreasonable behaviour. Thus to order costs to be made on the indemnity basis amounts, says Mr Galbraith-Marten, to a double penalty. However it is not correct to regard an order for costs as penal; it is rather, compensatory, compensating the successful respondent for the expense to which it has unreasonably been put. Further it is not, in any event, the case that the indemnity basis can be ordered only when, there is, for example, some deception or underhand conduct."[19]With those references in mind, we turn back to the Grounds of Appeal which we are considering. We find no error of law, as set out in paragraph 6 in the Notice of Appeal, which is the first ground, having carefully considered the way the Tribunal looked at the grounds, the Order against the First Respondent and the Second Respondent, so far as proportionality is concerned. We well understand why the Tribunal felt that the Order against the First Respondent should be so limited. The fact that the amount which the Second Respondent would be seeking on taxation is large, was foreseen in the letter of 7 June 1999 by the (Defendant) and of course there will be a proper taxation of those costs.[20]As to paragraph 7, having carefully looked at the decision again, in the light of the President's decision, we do not find the Rule 12 of the 1993 Regulations was not properly considered, or that the discretion was not exercised judicially or that a decision was reached which was legally perverse. The rest of the paragraph, in part, refers to proportionality; we see nothing in that point and it is a permissible conclusion of the Tribunal. We did not refer to the passage in Brydon where the President reminded us of the limited role of the Employment Appeal Tribunal in considering the review of costs, but we do bear that passage, of course, in mind.[21]The numbered paragraphs in paragraph 7 in the Notice of Appeal can be dealt with quite shortly; the cases cited have to be read in the light of the decision in Benyon and in our judgment, the fact that there was nothing to stop the Tribunal making the Order it did, and what it then knew of the Appellant's ability to pay costs.[22]As to sub-paragraph (2) the Tribunal did make inquiries as to means, and in the light of the passage at page 87 of the extended reasons we are satisfied that the matter was fully argued before the Tribunal and there was no impropriety by the Tribunal. As to sub-paragraph (30 it is clear from the authorities that the standard costs which should be taxed are not indemnity costs, not having been ordered. As to sub-paragraph (4) the Tribunal was careful to distinguish in its reasons the relationship in between the First and Second (Defendants) and as to sub-paragraph 5, it is quite clear from our reading of the judgment that the cost was not made on a punitive basis, it was made because of the way the litigation had been conducted by the Appellant for reasons the Industrial Tribunal, in an exceptionally well reasoned judgment, set out.[23]The Chairman in this case is very experienced in this field, and we can see nothing wrong in the Order which is made on the question of costs, and in these circumstances, while we thank Dr Kovacs for the assistance which she has given us today, we are unable to do other than dismiss this appeal. We will retire for a few moments, and then come back. Dr Kovacs, we have considered your application for leave to appeal; we think that the grounds which you mentioned are ones, which if they are to be pursued, should be given leave by the Court of Appeal and not by us. Accordingly, we will refuse leave to appeal. The fact that you do not have a copy of the judgment now does not mean to say that any Notice of Appeal you put in will be invalid, no doubt you will write a letter to the Court saying "We want to appeal, these are the grounds, but we cannot do more until we get the transcript of the judgment, and we have had an opportunity to consider it", then I am sure that you will be given that opportunity.