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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Kovacs v Queen Mary & Westfield College & Anor [2002] EWCA Civ 352 (22nd March, 2002) URL: https://www.bailii.org/ew/cases/EWCA/Civ/2002/352.html Cite as: [2002] EWCA Civ 352, [2002] IRLR 414, [2002] ICR 919, [2002] Emp LR 940 |
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COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL
Strand, London, WC2A 2LL | ||
B e f o r e :
LORD JUSTICE CHADWICK
and
MR JUSTICE CHARLES
____________________
DR IREN KOVACS | Appellant | |
- and - | ||
QUEEN MARY & WESTFIELD COLLEGE -and- THE ROYAL HOSPITALS NHS TRUST | Respondents |
____________________
(instructed by Nigel Adams & Co) for the Appellant
Damian Brown Esq
(instructed by Messrs Beachcroft Wansboroughs) for the Second Respondent
The First Respondent did not appear and was not represented
Hearing dates : 12th March 2002
____________________
(SUBJECT TO EDITORIAL CORRECTIONS)
Crown Copyright ©
Lord Justice Simon Brown:
“(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 party in respect of the costs incurred by another party;
(b) …
(2) …
(3) An order containing an award against a party (‘the first party’) in respect of the costs incurred by another party (‘the second party’) shall be -
(a) where the tribunal thinks fit, an order that the first party pay to the second party a specified sum not exceeding £500;
(b) …
(c) in any other case, an order that the first party pay to the second party the whole or a specified part of the costs incurred by the second party as taxed (if not otherwise agreed).”
“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 Applicant 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 [the appellant’s husband who acted for her in the Tribunal proceedings] (who said he was 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. 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.”
i) In Carr -v- Allen-Bradley Electronics Limited the EAT (presided over by Waterhouse J) said this:
“The normal rule is that there is no order for costs. In the comparatively infrequent case in which the claimant has acted frivolously or vexatiously, we think that the Tribunal should consider the means of the claimant himself rather than of his trade union, in deciding, first of all, whether or not to make an order in respect of the costs, and, secondly, the form of the order to be made.” (paragraph 20)
ii) In Wiggin Alloys Limited -v- Jenkins the EAT (presided over by Browne-Wilkinson J as he then was) rejected the employers’ appeal against the Industrial Tribunal’s refusal to award them costs, notwithstanding that the applicant had acted vexatiously, in these terms:
“… Mr Glover has urged that the Tribunal should not have refused to make an order simply on the grounds that the applicant was not in a position to pay the costs. He says that if no order is made, then there is no discouragement to the bringing of frivolous and vexatious proceedings which was obviously the intention behind the regulation. We do not feel able to accept that submission although we, too, feel sympathy for the employers. The matter was within the discretion of the Industrial Tribunal. The regulation says that the Tribunal may make an order. In our view, the inability of the applicant to meet any order for costs is a matter which is properly to be taken into consideration and, therefore, we cannot see that they have erred in any way in law in exercising their discretion. We should emphasise that it is no consequence of our decision that the mere fact that for the time being an applicant is penniless is in every case a sufficient ground for refusing an order for costs. Each case depends upon its own circumstances and lies within the discretion of the Tribunal.” (paragraph 5)
iii) In Dorney -v- Chippenham College the EAT (presided over by Judge Peter Clark) said this:
“[The Industrial Tribunal] heard that the union had provided an indemnity as to costs to these applicants, and found that the union took a prominent role in this case, which raised an important point of principle for its membership. In these circumstances we can see no grounds for criticising the Tribunal for taking the costs indemnity into account when considering the means of these applicants to pay costs.”
iv) In Omar -v- Worldwide News Inc the EAT (presided over by Judge Colin Smith QC) set aside the Industrial Tribunal’s order for costs against the applicant, stating in paragraph 17:
“[Counsel for the applicant] established on authority that, as a matter of practice, Industrial Tribunals must look at an applicant’s personal means to pay before making an order for costs against him as a party. See Dorney -v- Chippenham College and also Wiggin Alloys Limited -v- Jenkins.”
The EAT concluded in paragraph 21 of their judgment:
“… no doubt, because they felt that the union’s means were relevant, which they were not, the Industrial Tribunal never inquired at all into the means of the appellant himself. … The present costs order must be set aside and the matter should be remitted to the Industrial Tribunal to determine what order for costs, if any, should be made, in the light of their finding … that the appellant had fabricated his evidence before them, and in the light of his personal means and ability to meet any such order without any reference to the means of the union which represented him.”
v) In Beynon -v- Scadden the EAT dismissed the appellant’s appeal against a costs order which specified that “This order has been made having taken into account both the involvement of and the means of the applicant’s union, Unison”. Lindsay J’s judgment discussed each of the four earlier cases. The most relevant passages of his judgment for present purposes are, I think, these:
“19. … Each case, as Wiggin Alloys says, depends upon its own circumstances and lies within the discretion of the Tribunal. It is perhaps notable, so far as concerns parties’ means, that the present rule 12 neither requires nor provides any machinery for an inquiry 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 the prospective payer’s means one might reasonably expect the employment tribunal to have been empowered so to enquire. It is not as if the draughtsman 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 that 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 the discretion.
…
23. … 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 have pointed out above [the reference should be to rule 7(5)]. Dorney, supra, and Wiggin Alloys, supra, were cited in support of that proposition. We cannot read Dorney as 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 but that is far from saying that it would necessarily have been wrong not to have had that in mind and the EAT had emphasised that the fact that the party was penniless did not of itself invariably provide a sufficient ground for not making an order for costs against him.”
“No order shall be made under this rule [a rule which provides for the payment by a party of a deposit not exceeding £150 as a condition of being permitted to pursue a contention which the tribunal considers to have no reasonable prospect of success] unless the tribunal has taken reasonable steps to ascertain the ability of the party against whom it is proposed to make the order to comply with such an order and has taken account of any information so ascertained in determining the amount of the deposit.”
“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.”
“14(1) Where, in the opinion of the tribunal a party has in bringing the proceedings, or a party or party’s representative has in conducting the proceedings, acted vexatiously, abusively, disruptively or otherwise unreasonably, or the bringing or conducting of the proceedings by a party has been misconceived, the tribunal shall consider making, and if it so decides, may make [an order for costs].”
“the disparity between the maximum award under rule 12(3)(a) of £500 at the relevant time and what I am told is the amount claimed by the second respondent in the award to it under rule 12(3)(c), viz more than £60,000, is so great that I cannot say that it is beyond argument that the ET erred in making the unlimited award of all the second respondent’s costs in the way it did, particularly when the appellant had been successful in resisting the application to strike out the claim as frivolous.”
“… 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 which got in the way of that aim (objections by the respondents, rulings by the Chairman, the proper courtesies of the Tribunal room itself, etc) were attacked, criticised, misrepresented or ignored. We are satisfied that this was done deliberately.”
The Chairman, I may note, said by the EAT to be “very experienced in this field”, was Ms V K Gay.
“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 misrepresented 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 … 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. 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. … [She has made] 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.”
“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. … Throughout the proceedings Professor Newland was the subject of unsubstantiated allegations … 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 TSA. If that was his motive, it undermines the race and sex discrimination claim … 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.”
“that the time has not come in Employment Tribunals when we should regard ourselves as having moved to the general civil rule whereby, if you win but recover less than was offered, you pay the costs from the date of the offer.”
They accordingly, stated that they had “not been influenced” by the letter. Whilst, therefore, the offer has no relevance on this appeal, I for my part would respectfully question whether indeed such offers should be wholly ignored when tribunals come to exercise their rule 12 discretion. That, however, must be for consideration another day.
Lord Justice Chadwick:
Mr Justice Charles: