Buckinghamshire C.C. v ST [2013] UKUT 939 (AAC)

UKUT-AAC
Buckinghamshire C.C. v ST
[2013] UKUT 939 (AAC) · 2013-09-17
[1]The appeal to the First-tier Tribunal concerned the special educational needs of Charlie. The parties reached an agreement. Subsequently, Charlie’s mother applied for costs. On 18 December 2012, the judge made this[2]I gave the local authority permission to appeal against the order. The parties have now made their submissions. Before coming to the background, I will deal with the First-tier Tribunal’s power to award costs. B. The First-tier Tribunal’s powers[3]The First-tier Tribunal had power to award costs in two circumstances. They are prescribed by rule 10(1) of the Tribunal Procedure (First-tier Tribunal) (Health, Education and Social Care Chamber) Rules 2008 (SI No 2699):
‘ 10 Orders for costs (1) Subject to paragraph (2), the Tribunal may make an order in respect of costs only (a) under section 29(4) of the 2007 Act (wasted costs); or (b) if the Tribunal considers that a party or its representative has acted unreasonably in bringing, defending or conducting the proceedings.’
Paragraph (2) applies only to mental health cases. C. The caselaw[4]The meaning of unreasonable was discussed in the context of wasted costs order by the Court of Appeal in Ridehalgh v Horsefield [1994] Ch 205 at 232-233:
‘“Unreasonable" also means what it has been understood to mean in this context for at least half a century. The expression aptly describes conduct which is vexatious, designed to harass the other side rather than advance the resolution of the case, and it makes no difference that the conduct is the product of excessive zeal and not improper motive. But conduct cannot be described as unreasonable simply because it leads in the event to an unsuccessful result or because other more cautious legal representatives would have acted differently. The acid test is whether the conduct permits of a reasonable explanation. If so, the course adopted may be regarded as optimistic and as reflecting on a practitioner's judgment, but it is not unreasonable.’ ‘We were invited to give the three adjectives (improper, unreasonable and negligent) specific, self-contained meanings, so as to avoid overlap between the three. We do not read these very familiar expressions in that way. Conduct which is unreasonable may also be improper, and conduct which is negligent will very frequently be (if it is not by definition) unreasonable. We do not think any sharp differentiation between these expressions is useful or necessary or intended.’
[5]The Court also dealt with the proper approach in what it called ‘a hopeless case’ (pages 233-234):
‘A legal representative is not to be held to have acted improperly, unreasonably or negligently simply because he acts for a party who pursues a claim or a defence which is plainly doomed to fail. … As is well known, barristers in independent practice are not permitted to pick and choose their clients. … As is also well known, solicitors are not subject to an equivalent cab-rank rule, but many solicitors would and do respect the public policy underlying it by affording representation to the unpopular and the unmeritorious. Legal representatives will, of course, whether barristers or solicitors, advise clients of the perceived weakness of their case and of the risk of failure. But clients are free to reject advice and insist that cases be litigated. It is rarely if ever safe for a court to assume that a hopeless case is being litigated on the advice of the lawyers involved. They are there to present the case; it is (as Samuel Johnson unforgettably pointed out) for the judge and not the lawyers to judge it. It is, however, one thing for a legal representative to present, on instructions, a case which he regards as bound to fail; it is quite another to lend his assistance to proceedings which are an abuse of the process of the court. Whether instructed or not, a legal representative is not entitled to use litigious procedures for purposes for which they were not intended, as by issuing or pursuing proceedings for reasons unconnected with success in the litigation or pursuing a case known to be dishonest, nor is he entitled to evade rules intended to safeguard the interests of justice, as by knowingly failing to make full disclosure on ex parte application or knowingly conniving at incomplete disclosure of documents. It is not entirely easy to distinguish by definition between the hopeless case and the case which amounts to an abuse of the process, but in practice it is not hard to say which is which and if there is doubt the legal representative is entitled to the benefit of it.’
[6]The Court of Appeal considered an equivalent provision to rule 10(1)(b) in McPherson v BNP Paribas (London Branch) [2004] ICR 1398 . The case concerned a claim for unfair dismissal and breach of contract before an employment tribunal. Having secured a postponement of the hearing on the ground of ill health, the claimant then withdrew his claim. The tribunal ordered him to pay the whole of the employer’s costs on the ground that the claimant had acted unreasonably. Mummery LJ discussed a number of points of general relevance.[7]First, the proper issue was the conduct of the proceedings, not the decision to withdraw:
‘30. … The crucial question is whether, in all the circumstances of the case, the claimant withdrawing his claim has conducted the proceedings reasonably. It is not whether the withdrawal of the claim is in itself reasonable …’
[8]Second, the costs that may be awarded are not limited to those that are attributable to the unreasonable conduct:
‘40. … The principle of relevance means that the tribunal must have regard to the nature, gravity and effect of the unreasonable conduct as factors relevant to the exercise of the discretion [whether to order costs], but that is not the same as requiring BNP Paribas to prove that specific unreasonable conduct by the applicant caused particular costs to be incurred.’
[9]Third, costs must not be punitive:
‘41. … the indemnity principle must apply to the award of costs. It is not, however, punitive and impermissible for a tribunal to order costs without confining them to the costs attributable to the unreasonable conduct.’
[10]Fourth, the unreasonable conduct is relevant at three stages:
‘41. … As I have explained, the unreasonable conduct is a precondition to order costs and it is also a relevant factor to be taken into account in deciding whether to make an order for costs and the form of the order.’
[11]The decision of the Court of Appeal in Kovacs v Queen Mary and Westfield College [2002] ICR 919 is also relevant. The court decided that:(i) a party’s ability to pay is not a relevant factor; and(ii) an award should cover as a minimum the costs attributable to the unreasonable behaviour.[12]I have taken this statement from one of my previous decisions on costs. I notice that it is reproduced in the local authority’s application to the Upper Tribunal. D. What happened at the hearing[13]The appeal to the First-tier Tribunal related to Parts 2, 3 and 4 of the statement. As so often, a number of points were agreed before the hearing. Some points remained outstanding on the day of the hearing. Most important was the school that Charlie should attend. It was agreed that he needed specialist residential provision, but there was a dispute about the school to be named. The local authority preferred PL School, whereas his mother preferred GH School. The difference in cost was said to be £70,000. There was a dispute about this, but (as the judge has said) this was not unusual and was the sort of issue that would be resolved at the hearing. The possible adjournment[14]The bundle provided to the Upper Tribunal by the First-tier Tribunal contains 1086 pages, of which only a few were generated after the hearing. At the start of the hearing, the presiding judge told the parties that one of the panel members had not received a full set of those papers. This is relevant as background to what happened at the hearing. That raised the issue of whether the tribunal could proceed without an adjournment. Naturally, Ms T opposed an adjournment if one could be avoided. Apparently, the local authority’s view was never sought. The local authority’s solicitor has said that its representatives accepted that a delay would not be beneficial to Charlie and would cause his mother anxiety. I accept that statement, especially as the judge described the authority’s solicitor as having ‘maintained a reasonably calm and constructive approach throughout the correspondence.’ This was, the judge said, in contrast to the approach taken by the solicitors for Charlie’s mother. The concern about PL School[15]The judge also drew attention to a concern about naming PL School. I take the statement of those difficulties from the submission of the solicitors for Charlie’s mother. This no doubt puts the point as strongly as it can be made: The January report [by OFSTED] noted that the school failed to meet national minimum standards for residential special schools in relation to safe recruitment and vetting procedures; arrangements made to safeguard and promote the welfare of pupils, and procedures under the local Runaway and Missing from Home protocols and procedures. The June report found that provision for pupils’ welfare, health and safety was inadequate because child protection arrangements did not follow national and local safeguarding guidance, and the child protection policy was inadequate. The judge says that the fact that the deficiencies were still present in June shows that the problems were endemic.[16]It is not clear to me exactly what the judge said to the parties. The solicitors for Charlie’s mother vary in their expression. They refer to the tribunal being ‘very reluctant’ to name PL School, but later refer to ‘the tribunal’s very firm indication that it would be perverse to name PL’. The judge has also expressed herself slightly differently. In places, she talks of perversity, but elsewhere she is a little more circumspect. She accepted in her costs decision that there is no legal bar to naming the school in those circumstances. She identified the problem as a lack of evidence before the tribunal that would allow it to decide one way or the other. She says that she put this concern to the parties so that they could consider what issues might properly be conceded or compromised. Whatever the precise terms of what the judge said, it is (I believe) fair to say that she made it clear that the tribunal could not find on the evidence that PL School was suitable. Charlie’s circumstances[17]Charlie had expressed determined opposition to attending PL School. One argument for Charlie’s mother was that the local authority had acted unreasonably in persisting with PL School despite Charlie’s views. The judge said that she was ‘less persuaded’ that his views made the local authority’s conduct unreasonable, because the relevance of Charlie’s views would have depended on the evidence. Nevertheless, she considered that the complexity of his needs compounded the authority’s unreasonableness in persisting with PL School. The compromise[18]The local authority first offered to place Charlie at GH School on an assessment basis. This was not accepted, but the parties agreed that Charlie would be placed there subject to an interim annual review in six months. The tribunal endorsed this settlement. E. Putting a tribunal’s concerns to the parties[19]Tribunals form provisional views on the issues before them. That is an almost inevitable consequence of previewing the case, which itself contributes to the efficiency and quality of the hearing. It is proper for the tribunal to put its concerns to the parties so that they know how the tribunal is thinking. Doing so contributes to the fairness of the hearing.[20]But tribunals need to be careful how they express themselves. If the judge really expressed herself in such uncompromising terms as it appears that she did, she was placing herself and the members she sat with in the position of saying that they had reached a conclusion that could not be changed on the evidence before them. And that they had come to that conclusion without hearing from the parties. That is prejudgment.[21]It is always wise to bear in mind what Megarry J said in John v Rees [1970] Ch 345 at 402 As everybody who has anything to do with the law well knows, the path of the law is strewn with examples of open and shut cases which, somehow, were not; of unanswerable charges which, in the event, were completely answered; of inexplicable conduct which was fully explained; of fixed and unalterable determinations that, by discussion, suffered a change. Nor are those with any knowledge of human nature who pause to think for a moment likely to underestimate the feelings of resentment of those who find that a decision against them has been made without their being afforded any opportunity to influence events.[22]However firm the tribunal’s provisional opinions, it is sensible to state them to the parties in a way that avoids any suggestion of prejudgment and allows for the possibility of being persuaded by argument. F. Analysis[23]I have set aside the costs order because the judge failed to take sufficient account of the fact that the issue of PL School had never been fully considered. The local authority did not accept that its argument was not sustainable. It settled by a compromise that was acceptable to both parties and to the tribunal. No doubt, the authority took account of the view expressed by the judge when it decided to settle on those terms. But it was also influenced by the pressure to reach a decision on the day. And it did so on terms that preserved its position on PL School – the interim review allowed for the possibility that it might still decide to name that school, perhaps on the basis of further information about the safeguarding issues.[24]The solicitors for Charlie’s mother say that this was not a concession in any meaningful sense as the tribunal had effectively told the local authority that it would lose on this point. I do not accept that. It was a compromise. The agreement made provision for an interim review after six months, which allowed for the possibility that the local authority might then name PL School, by which time the safeguarding issue might have been resolved. Charlie’s mother accepted that possibility, although no doubt see was under pressure to reach a final decision on the day of the hearing.[25]The judge expressed the tribunal’s views at the hearing and has maintained that position in her costs decisions, but that position has never been the subject of full argument. I consider that she was not entitled to form the opinion that it was unreasonable to adopt and pursue the preference PL School. There are three positions. The local authority’s position is that there was evidence that could have resolved the tribunal’s concerns. The mother’s position is that it could never be appropriate to name a school that had failed this aspect of an inspection. The judge’s position is that there was no legal bar to doing so, but that it might be inappropriate in the circumstances of a particular case; specifically, it might have been perverse to name the school on the evidence available at the hearing. I have looked at the Ofsted reports. I note that the June report says that some problems had been remedied, but that some remained. I accept the honest view of the experienced panel that there were evidential problems on the face of the case as presented. But the problems as they are stated in the two reports do not seem to me insuperable, even in the context of Charlie’s particular difficulties and needs. It is possible that, with the benefit of full argument and in light of the findings that the tribunal may have made after a full hearing, a tribunal might have been persuaded that they were not an impediment.[26]Moreover, I do not accept that it will always be unreasonable to present and pursue an argument that the tribunal decides it would be perverse to accept. The test in the caselaw is not one that is applied with the benefit of hindsight. Applying the Court of Appeal’s acid test does not require either that approach or that result. The local authority has presented arguments in response to the tribunal’s concerns. The judge does not accept that they were practical in the circumstances, but that does not mean that they are not relevant to the issue of whether the conduct of the proceedings was unreasonable. G. Conclusion[27]In conclusion, I consider that the judge was not entitled in the circumstances of this case to characterise the conduct of the local authority as unreasonable.[28]There are two lessons to be taken from this case. One is that judges should be cautious in how they express concerns to the parties. The other is that they should make appropriate allowance when judging the reasonableness of a party’s conduct for the fact that the proceedings were compromised with the result that arguments were left undeveloped and unexplored in the context of a full analysis of a child’s needs. This does not mean that a party is entitled to pursue a hopeless argument for tactical advantage. That is not what has happened in this case. Signed on original on 17 September 2013 Edward Jacobs Upper Tribunal Judge

order

The LA shall pay to Ms S T… her costs of bringing this appeal incurred from 1 September to date, such costs to be agreed, or in default of agreement within 21 days from the date of this Order, to be assessed by a Registrar of this tribunal. The date reflects the start of the new academic year. The application had been based on a number of grounds. The judge rejected some. As I read her reasons, her principal reason for making the order was the local authority’s ‘unreasonableness in persisting in naming’ its preferred school. This was compounded by ‘the strength of Charlie’s views, along with his significant mental health difficulties and history of school refusal’. My reading of the judge’s decision is that this latter point alone would not have justified making a costs order. I proceed on that basis.

Cited in 2 later judgments