Sud v London Borough of Ealing - Tribunal entitled to make 50% costs order

17 September 2013

Ian Hunter, David Samuels

In Sud v London Borough of Ealing, the Court of Appeal considered the case where a claimant was ordered to pay 50% of the respondent employer’s legal costs.

Under Tribunal procedure rules, a costs order may be made against a party who has conducted proceedings unreasonably.

In this case, the claimant had succeeded in one of her claims but -

  • She had made many other claims that she either withdrew shortly before the hearing, or was unsuccessful on at the Tribunal.
  • She wanted to rely on an expert’s report which she produced late and without permission from the Tribunal.  Therefore an expert had to be called to give evidence in person, which unnecessarily wasted Tribunal time.
  • Similarly, unnecessary time was spent, and expense was incurred, on the preparation and submission of a witness statement when the claimant knew the witness would not be able to attend the hearing.
  • She also rejected several offers of settlement which, in that circumstance, was held to be unreasonable conduct.

Over the years the claimant had made a large number of unspecified allegations, in many cases without a proper factual basis, and continued to do so in these proceedings. The Court of Appeal held that ‘unreasonable conduct of proceedings’ does not only relate to the conduct of the hearing, but also the background to, and events leading up to the hearing.

Her previous conduct could also be taken into account and the Tribunal was within its rights to make the costs order against her.

Points to note –

  • A Tribunal cannot make a finding of unreasonable conduct leading to an order for costs whenever a claimant withdraws a claim. Conversely, it would be wrong to follow a practice on costs which might encourage speculative claims. The crucial question is whether, considering all circumstances of the case, the claimant withdrawing the claim has conducted the proceedings unreasonably.
  • Before making a costs order, the Tribunal may consider the financial resources of the paying party. In this case the Tribunal had established that the claimant and her husband were both employed and owned their own home, albeit with mortgage commitments, before making the costs order.

This article is part of the UK Employment Law Update for September 2013