Appeal No. UKEAT/0402/09/JOJ

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal 
	On 17th January 2011
	   Judgment handed down on 8 June 2011

Before
THE HONOURABLE MR. JUSTICE UNDERHILL (PRESIDENT)
LADY DRAKE CBE
MR M WORTHINGTON

MR. P JACKSON	APPELLANT

– and –

(1) CAMBRIDGESHIRE COUNTY COUNCIL	
(2) MRS. KATE EVANS	
(3) MR. PHILIP HODGSON
(4) BOTTISHAM VILLAGE COLLEGE	
(5) MRS. B LLOYD 
AS THE REPRESENTATIVE OF MR. ANDREW LLOYD (deceased)	      RESPONDENTS

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For the Appellant	MR. TOM COGHLIN
(of Counsel)
Instructed by:
Messrs Russell Jones & Walker
50-52 Chancery Lane
London
WC2A 1HL	
For the first, second, third and fourth Respondents	MR. PAUL GREATOREX
(of Counsel)
Instructed by:
Cambridgeshire County Council Legal Services,
Shire Hall, 
Castle Hill,
Cambridge
CB3 0AP	

For the fifth Respondent	Neither present nor represented	

SUMMARY

PRACTICE AND PROCEDURE – Costs

Tribunal wrong to make a wasted costs order because it did not properly address the Appellant’s case that he was not acting in pursuit of profit within the meaning of rule 48 (4); and on evidence heard by the EAT he in fact was not so acting – Observations on the question of the stage at which wasted costs applications should be heard

THE HONOURABLE MR JUSTICE UNDERHILL

1.	This is an appeal against the decision of an Employment Tribunal sitting at Bury St. Edmunds, chaired by Employment Judge Cole, ordering the Appellant to pay wasted costs in the sum of £16,037.04.  The Appellant has been represented by Mr. Tom Coghlin of counsel and the Respondents by Mr. Paul Greatorex of counsel.  

2.	The order was made in the context of proceedings being brought initially by Mr. Andrew Lloyd, and, following his death, by his mother Mrs Betty Lloyd.  Mr Lloyd was a teacher at Bottisham Village College in Cambridgeshire.  The Respondents were the County Council, the school itself, the Warden, Ms. Evans, and one of the governors, Mr Hodgson.  Mr Lloyd was suspended in December 2005 following an allegation that he had struck one of the pupils.  He and his family have always maintained that the allegation was wholly unfounded, and they plainly found it very upsetting.  After prolonged internal proceedings into which it is unnecessary to go, Mr Lloyd resigned in February 2007.  He issued proceedings in April 2007 claiming that he had been constructively dismissed and also raising claims under the Sex Discrimination Act 1975 and the Disability Discrimination Act 1995.  Sadly, he had in the meantime developed cancer (to which his family believe that his treatment by the school contributed), and he died on 9 June.  The proceedings were stayed for some time until Mrs. Lloyd obtained letters of administration, but they were revived in early 2008.  The fact that the proceedings were continued following Mr. Lloyd’s death is an indication of the strength of feeling on the part of his family that he had been the victim of a grave injustice.  

3.	Both in the internal procedures within the school and in the employment tribunal proceedings Mr. Lloyd, and latterly his mother, were represented by his cousin (Mrs. Lloyd’s nephew), Mr. Paul Jackson.  Mr. Jackson is a solicitor who at all material times held a practising certificate, and was, at least in the early stages, employed as a solicitor.  However, his speciality was in non-contentious banking law: he was not an employment specialist or indeed a litigator.  

4.	The hearing of the claim began before Judge Cole and members on 9 January 2009.  The Respondents were represented by Mr. George Foxwell of counsel on the instructions of Messrs. Eversheds.  After seven days the hearing was adjourned part heard and a further hearing was fixed for 21 September.  

5.	Shortly after the adjournment Mr. Jackson posted material on a Facebook site called “Justice for Mr. Lloyd” identifying himself as Mr. Lloyd’s solicitor and expressing his view of the rights and wrongs of the dispute.  He also obtained under the Freedom of Information Act, and supplied to the press, documents showing the costs which had been incurred by the Council, and he made a statement to the press complaining that those costs were wasted and that no attempt had been made to settle the case.  The Council objected, contending among other things that Mr. Jackson’s conduct amounted to a contempt of court.  We need not consider whether that contention was correct, but Mr. Jackson’s actions were certainly ill judged and inappropriate for a solicitor representing his client on a professional basis.  After various letters between the parties and the Tribunal Judge Cole directed a case management discussion, partly in order to deal with the Council’s complaint but partly also in order to consider the possibility of advancing the dates of the second tranche of the hearing (a proposal which Mr. Jackson strongly opposed).  That CMD took place on 7 April.  Mr. Jackson undertook to make no further Facebook entries concerning the case, and the Judge decided – on, as he put it, “a very fine balance” – not to refer the matter to the Attorney-General for the consideration of proceedings for contempt of court.  He directed an expedited resumption of the hearing, to commence on 10 June (a Wednesday) and conclude on 20 June (i.e. the following Friday).

6.	Shortly before the resumed hearing Mr. Jackson wrote to the Regional Employment Judge complaining about Judge Cole.  We have not seen the complaint in full, but it contained the submission
 
“ … that consideration must now be given to Judge Cole’s dismissal from the Judiciary given the seriousness of his failings, particularly as this is hardly the first time he has made highly inappropriate comments while acting in a judicial capacity.  His weaknesses seem to be legal and personal.  He has demonstrated an inadequate grasp of the law, bias and discriminatory prejudice as well as poor judgment.  My client has said that Judge Cole has ‘poisoned the wells of justice’”.

7.	Remarkably, Mr. Jackson’s complaint was supported by what were said to be transcripts of recordings of private comments made by members of the Tribunal in the Tribunal room in the absence of the parties (and indeed apparently – though we are not sure that this was ever definitively established – in its own retiring room) in the course of the January hearing.  A CD of the passages in question was enclosed.  The position about the recordings is complicated.  The Tribunal did its best, in circumstances to which we will come, to get to the bottom of how they came to be made and how the extracts relied on were selected: as to the latter point, the CD did not contain the entirety of the recordings apparently made, but the full recordings were said to have been destroyed.  The Tribunal found Mr. Jackson’s explanations unhelpful, unreliable and at times positively untruthful.  Fortunately, we do not need to grapple with the detail here.  It did not find that he was a party to the original recording (which seemed to have been done by a friend of the family, perhaps without any intention of recording anything except the public hearing); but he listened to the recordings, despite the fact that the material was plainly confidential, and sought to make use of them in support of the complaint to which we have referred.  The Tribunal also found that he had listened to more than appeared on the CD and was party to the destruction of the full recordings.  

8.	It seems, though we are not clear whether this formed part of the complaint to the Regional Employment Judge, that Mr. Jackson also believed that there were grounds to suspect what he described as “over familiarity with Judge Cole” on the part of Mr. Foxwell, since he sent him in April 2009 a list of questions intended to elicit the extent of their relationship.  

9.	Having made that complaint, at the start of the hearing on 10 June 2009 Mr. Jackson applied to the Tribunal that it should recuse itself.  That application was refused on 12 June, and reasons were given orally: they were subsequently sent to the parties in written form on 22 June.  The Respondents had made it clear, in a note from Mr. Foxwell served at the start of the hearing, that they regarded the application and/or Mr. Jackson’s associated conduct as vexatious and an abuse of process and that if the application were refused they in turn would apply to strike out the claim.  That application was duly heard on 12 June and on the following Monday, 15 June.  On Tuesday 16 June the Tribunal ordered the proceedings to be struck out.  Again, reasons were given orally but provided subsequently in written form.  In both judgments the Tribunal reviewed in some detail what had happened, in particular about the recording of its deliberations.  

10.	Mr. Foxwell had in his note of 10 June also said that if the application to strike out were successful an application would be made for costs against Mrs. Lloyd and/or for wasted costs against Mr. Jackson.  That application was heard on 16 June, following the delivery of the second judgment.  We have an agreed note of what occurred.  Judgment was reserved and the Judgment and Reasons were promulgated on 22 June, on the same occasion as the written Reasons for the first two judgments, to which the Tribunal cross-refers.  The Reasons read as if they were delivered orally on 17 June; but, as we understand it, that is slightly misleading, and neither Judgment nor Reasons were promulgated until 22 June.  Nothing however turns on this.  A slightly more significant error is that at para. 2 of the Reasons the Tribunal appears to say that the strike-out decision was made on 15 June: it is common ground that this is a mistake, and that the judgment and oral reasons were not given until the morning of 16 June.

11.	The total of £16,037.04 which the Tribunal awarded comprised three elements, as follows:

(1)	50% of the costs incurred by the Respondents in considering questionnaires served by Mr. Jackson purportedly pursuant to the Disability Discrimination Act but which they submitted were unnecessarily prolix and to a considerable extent irrelevant – £1,335;

(2)	the Respondents’ costs of attending the CMD on 7 April, on the basis that this had been necessitated by Mr. Jackson’s unreasonable conduct in relation to the Facebook entries – £3,251.50;

(3)	Mr. Foxwell’s refreshers for four days in June, on the basis that those costs had been wasted in dealing with a wholly misconceived application and the consequent strike-out – £11,450.54.

12.	We pause to say that it will be apparent even from this very abbreviated summary that Mr. Jackson in the course of these proceedings behaved in several respects in a way which – to put it no higher – would not have been expected from a solicitor conducting himself in a professional manner.  The Tribunal indeed used much stronger language, referring to his behaviour in relation to the recordings as “appalling”.  But Mr. Jackson’s general manner both towards the Respondents and their solicitors and towards the Tribunal was also thoroughly reprehensible.  His correspondence, of which we have seen several examples, is arrogant and bullying in tone.  There was a regrettable incident when he told the Tribunal that he was unable to attend the CMD on the first proposed date, being 1 April, because he had a prior professional commitment but was then unable to produce any evidence of that commitment.  According to the Tribunal, his conduct during the hearings, and in particular those in June, was thoroughly objectionable.  He made loud and inappropriate interventions; he attempted to interfere in the way that witnesses gave their evidence; and he took no trouble in either his body language or his expression to conceal his opinions about the members of the Tribunal.  The most charitable interpretation of Mr. Jackson’s conduct as found is that he allowed his emotional commitment to the prosecution of his cousin’s claim, and his associated belief that a grave injustice had occurred, to cloud his judgment.  (It is right to record that Mr. Coghlin told us that the Appellant did not accept the full extent of the findings against him, but he acknowledged that he was not in a position to challenge them in this Tribunal.)

13.	The wasted costs jurisdiction of the Employment Tribunal derives from rule 48 of the Employment Tribunal Rules of Procedure, which reads (so far as material) as follows: 

“(1)     A tribunal or Employment Judge may make a wasted costs order against a party's representative.
(2)        In a wasted costs order the tribunal or Employment Judge may:—

(a)      	disallow, or order the representative of a party to meet the whole or part of any wasted costs of any party, including an order that the representative repay to his client any costs which have already been paid;

(b)	         ... .

(3)     “Wasted costs” means any costs incurred by a party:—

(a)    	as a result of any improper, unreasonable or negligent act or omission on the part of any representative; or  
(b)    	which, in the light of any such act or omission occurring after they were incurred, the tribunal considers it unreasonable to expect that party to pay.
(4)	     In this rule “representative” means a party's legal or other representative or any employee of such representative, but it does not include a representative who is not acting in pursuit of profit with regard to those proceedings. A person is considered to be acting in pursuit of profit if he is acting on a conditional fee arrangement.
(5)     	...
(6)     Before making a wasted costs order, the tribunal or Employment Judge shall give the representative a reasonable opportunity to make oral or written representations as to reasons why such an order should not be made. The tribunal or Employment Judge may also have regard to the representative's ability to pay when considering whether it shall make a wasted costs order or how much that order should be.

(7)-(9) … ” 

As was made clear by the decisions of this Tribunal in Mitchells v Funkwork Information Technologies York Ltd. (UKEAT/0541/07) and in Ratcliffe Duce and Gammer v Binns (UKEAT/100/08), in applying rule 48 tribunals should apply the principles developed in relation to the equivalent High Court jurisdiction.  The leading authorities are Ridehalgh v Horsefield [1994] Ch 205 and Medcalf v Mardell [2003] 1 AC 120. 

14.	The Appellant advances what are in substance six grounds of appeal.  As will appear, we believe that the appeal must be allowed on the basis of the ground appearing at paras. 7.2-7.4 of the Notice of Appeal.  We will accordingly take that first and confine ourselves to brief observations about one other remaining ground.  

15.	A wasted costs order can only be made against a representative who is “acting in pursuit of profit” (including under a CFA): see rule 48 (4).  When the application was first raised, at about 11 a.m. on 16 June, and before Mr. Foxwell had made any submission, the Appellant said to the Tribunal in terms that he was not acting in pursuit of profit.  The Judge responded that Mr. Foxwell should make his submissions before the Appellant was heard on that point.  In the course of those submissions Mr. Foxwell invited the Tribunal to infer that the Appellant was acting either on a conventional retainer or under a CFA.  He said that that inference could be drawn from the fact that in advance of the CMD referred to at para. 5 above the Appellant had made an application on behalf of Mrs. Lloyd for wasted costs against the Council’s solicitors: he submitted that since on the indemnity principle she could recover no costs unless she were under a liability to her representative he must have been acting in pursuit of profit.  We should set out the circumstances in relation to that application.  In a letter dated 26 March 2009 addressing issues relating to the proposed application the Appellant said:

“I hereby request that an order be made forthwith against the Respondent’s solicitors, Eversheds LLP, for wasted costs of £1,000 under Rule 48.  This will cover the additional work I have so far had to carry out as a result of their ‘Facebook’ related correspondence designed to prevent fair public comment and to change agreed hearing dates.  A reading of all the posts by ‘Facebook’ user group ‘Justice for Mr. Lloyd’ (with the exception of the recent postings and statement by Louise Browne) will reveal their legal irrelevance to Andrew’s case.  Andrew Lloyd’s undoubted excellence as a teacher, evidenced in comments from former pupils and their parents on ‘Facebook’, is not a matter for these proceedings.”

In fact the application was not pressed at the CMD, but it appears from a reference in the Reasons (para. 12) that the Appellant told the Judge that it would be prosecuted at some point in the future.  

16.	In his submissions in reply the Appellant said this:

“Appellant: I can assure you that based on my client’s costs and other costs that I believe that the application made the costs is consistent with the fact that I was not paid and will not be paid.  

Judge: It would help us no end if you can answer Mr. Foxwell’s applications.  It cannot be consistent if he made an application for costs on 7 April. 

Appellant: Not for my costs!

Judge: You are intelligent …

Appellant: Not for my costs, the costs of my client. I am not being paid. Others have to do research. Until recently I was working full time in London and didn’t have time. Throughout this case, as you known, we have had people assisting and on that basis, unless I was misinformed, we do have a middle position. No contemplation that if I was successful I’d be paid.  I am doing this case because of my cousin Andrew Lloyd.

Judge: Anything else you want to say?

Appellant: I’ll just check if I have covered everything in relation to me. There could be many more things to say but I won’t. A few days ago a picture was shown of me of a hanged man and it was public knowledge that I had made a complaint against the judge and the panel. It seems to me, that drawing sums up the situation.”

17.	The Tribunal dealt with the issue of whether rule 48 (4) was satisfied at paras. 9-13 of its Reasons, as follows:

“9. At first sight, it may be thought that an order against Mr. Jackson is inappropriate.  Mr. Jackson told us yesterday that he is not in pursuit of profit, nor indeed is there any condition fee arrangement so far as his client, Mrs. Lloyd, is concerned. 

10. Mr. Foxwell says that is a surprising assertion and one which we should ignore.  It is an assertion not supported by any kind of evidence, written or otherwise.  Mr. Jackson is clearly a highly intelligent man who has been much occupied by all parts of this claim, including its minutiae.  Clearly, it is more than minutiae for Mr. Jackson not to have anticipated the costs application today.  It is an application which has been signalled from a very early stage in the proceedings indeed.  Indeed, it was signalled last week when the proceedings returned to us by the skeleton argument and submissions prepared by Mr. Foxwell.  We are somewhat surprised, if it be the case, that Mr. Jackson came unprepared today.  That is a facet which has not been a characteristic of his involvement in this case thus far.  Perhaps some written confirmation or other evidential material in the hands of Mrs. Lloyd might have assisted.  It may indeed be the case that Mr. Jackson does not expect to be paid, hour by hour, day by day, in the conventional way.  But we suspect very strongly he is the beneficiary of a conditional fee arrangement, either formal or informal.  As Mr. Foxwell has frequently observed, Mr. Jackson has displayed a “pattern” of behaviour designed to derail these proceedings, designed to put maximum pressure upon the Respondents and to induce a financial settlement.  That, to us, seems only consistent with some kind of conditional fee arrangement.

11. As will be seen from our earlier judgments, we have been able to find Mr. Jackson to be a witness of consistent reliability.  Very many aspects of that which he has told us both as an advocate and by his evidence have not stood the test of close scrutiny and much so very obviously.

12. If we have any doubt, says Mr. Foxwell, then there is material to assist us, he asserts.  He reminds us that when, at a Case Management Discussion before the Judge of this Tribunal of 7 April 2009, the Respondents signalled an application for costs against the Claimant, Mr. Jackson, for the Claimant, retorted by his own application for costs in a specified sum, albeit not arithmetically particularised in great detail.  He told the Judge then and continued to do so that that the application for costs remains extant and will be prosecuted at some future time.  Quite when Mr. Jackson envisages that we do not know.

13. Nevertheless, as Mr. Foxwell observes, a solicitor with conduct of proceedings is in no way able to make or even threaten to make a costs application against the other party unless the party on behalf of whom the application is made (by Mr. Jackson) incurs legal costs.  Thus, we agree with Mr. Foxwell it so obviously follows that, by his own recognition in April this year, Mr. Jackson accepted, by obvious and direct implication, that either he, as a solicitor, was acting in pursuit of profit or pursuant to a conditional fee arrangement.”

18.	In his excellent skeleton argument on behalf of the Appellant Mr. Coghlin submitted that it was wrong in principle that a finding that he was acting in pursuit of profit should be made on the basis, as the Tribunal explicitly put it, that it “suspected” – even if the suspicion was “very strong” – that he was the beneficiary of a CFA.  He went so far as to submit that a finding of fact under rule 48 should only be made on the criminal standard of proof.  We do not accept the latter submission.  As to the former, we do accept that suspicion is not enough, but we think that on a fair reading of these paragraphs the Tribunal meant to make a positive finding.  Nevertheless Mr. Coghlin is entitled to rely on the loose use of language in this regard as evidence of a certain fuzziness in the Tribunal’s expressed reasoning, which lends support to his more substantial point, which is that both the expressed bases for its conclusion were flawed.  Those bases are: (1) that the Appellant’s behaviour in seeking “to put maximum pressure upon the Respondents … to induce financial settlement” was “only consistent with some kind of conditional fee arrangement”; and (2) the application for costs referred to at para. 15 above.  We take those in turn.  

19.	As to (1), Mr. Coghlin submitted that it was simply wrong to say that the pursuit of a financial settlement was an indication that the Appellant was acting under a CFA, let alone that it was “only consistent with” such an arrangement.  On the contrary, pursuit of a settlement, financial or otherwise, is equally consistent with a representative acting on a pro bono basis.  This is more than simply another piece of loose language.  There was in the present case a very obvious reason why the Appellant might be acting pro bono, namely family affection and loyalty.  No doubt he might nevertheless have agreed with the family to take a part of any ultimate award or settlement, but there was no reason to assume that he done so. 

20.	As to (2), Mr. Coghlin referred to the Appellant’s explanation set out at para. 16 above, namely that the “costs” that he was seeking constituted expenses incurred by Mrs. Lloyd in respect of “research” done by others.  Mr. Coghlin pointed out that the definition of “costs” in rule 38 (3) includes not only “fees” but “disbursements or expenses”, and that a party could make a claim for such disbursements or expenses even where he was being charged nothing by his representative.  No doubt that explanation was given very briefly, but the Tribunal was obliged to address it and should not have rejected it without giving its reasons for doing so: in fact, the point is not dealt with in the Reasons at all.  There were also particular reasons why the Appellant’s explanation was brief and unparticularised.  He had only had notice of the intended application when Mr. Foxwell served his note on the morning of the first day of the resumed hearing, and it was of course at that stage contingent on the strike-out application succeeding, which was not known until the morning of 16 June.  Mr. Foxwell’s note included no submissions in support of the application (understandably, since even if the strike-out succeeded it would be necessary to know the precise grounds), and the Appellant would not therefore have known, for example, of the significance attached to his letter of 26 March 2009.  It was reasonable in those circumstances that he should not have had full particulars of the “expenses” argument at his fingertips, still less supporting evidence.  He had indeed asked the Judge, when Mr. Foxwell’s application was first adumbrated “is it absolutely necessary for me to deal with these matters today ?”; but the Judge had replied “yes”.  He had been given half-an-hour to prepare, but that was before, not after, Mr. Foxwell had developed his detailed submissions. 
 
21.	Mr. Greatorex, whose submissions also were clear and cogent, emphasised that the question of whether the Appellant was acting in pursuit of profit was one of fact.  The only evidence before the Tribunal that he was not so acting consisted of the Appellant’s bare denial.  That was wholly unsupported.  The “expenses” explanation was so unparticularised that the Tribunal had not been obliged to address it specifically.  It was sufficient for it to make the point, as it did at para. 11 of the Reasons, that the Appellant’s evidence could not be treated as reliable.  Mr. Greatorex emphasised that there was ample material supporting that conclusion: he took us through the history, identifying the points at which the Appellant could be shown to have been manipulative or untruthful.  He endorsed the Tribunal’s observation at para. 10 of the Reasons that the Appellant must have seen the point coming: indeed he had at the very start of the hearing of the application raised the objection that he was not acting in pursuit of profit – see para. 15 above.  He had not asked for more time in order to produce evidence.  Mr. Greatorex also questioned whether payment for research by third parties of the kind referred to would fall within the definition of “costs”.  

22.	We acknowledge the force of Mr. Greatorex’s submissions, but in the end we feel obliged to say that the Tribunal’s reasoning was flawed.  We are very conscious of the need to avoid a hyper-critical approach to the language of the Reasons, or the precise detail of the reasoning; and if we thought that there were ample grounds for the decision we might have found it possible to uphold it.  But just how tolerant we can be of such flaws is sensitive to the facts of the particular case.  The starting-point here is that there was no a priori reason to believe that the Appellant might be acting in pursuit of profit.  On the contrary, this is just the sort of case where, because of the family element, he might be expected to be acting pro bono; and that is what he asserted in terms to the Tribunal – “No contemplation that if I was successful I’d be paid.  I am doing this case because of my cousin”.  In those circumstances the Tribunal needed solid grounds for a finding to the contrary.  Of the grounds that it gave, the first seems to us to be plainly wrong, for the reasons given by Mr. Coghlin (see para. 19 above). As to the second – that is, the claim for “costs” made by the Appellant himself – he did himself no favours by the patronising and unforthcoming way in which he advanced his explanation; but the fact remains that he did explicitly advance it.  It seems to us that the Tribunal was obliged to address it.  We do not accept that it was enough to observe generally that the Appellant was an unreliable witness.  It is axiomatic that unreliable witnesses cannot be assumed never to be telling the truth; and what the Appellant was saying was not inherently implausible.  It is true that he gave almost no detail, but nor was he asked for any.  In our view, once the point was squarely raised fairness required that it should not rejected without the Appellant having the opportunity to particularise.  Probably the right course was for the Judge to have said in terms that if the Appellant wanted the Tribunal to accept what he was saying he would have to give more detail and – perhaps – to do so on oath and/or provide supporting evidence.  (We appreciate that there are dicta in Ridehalgh deprecating the use of any elaborate procedures; but we are not sure that they would preclude a tribunal from requiring formal evidence in circumstances like the present.)  If the Appellant had continued unco-operative, appropriate inferences could have been drawn.  If he had volunteered more particulars, they would have had to be assessed.  If he offered verification that was not available there and then, the Tribunal would have had to decide whether an adjournment was appropriate, taking into account whether the Appellant had had adequate notice of the issue: we address this aspect briefly at para. 28 below.  But what was not acceptable was for the Appellant’s explanation of the only available facts which potentially justified a finding that he was acting in pursuit of profit to be rejected (a fortiori without reasons) without any notice that his explanation was disputed or that it needed to be developed.  We have every sympathy with the Tribunal dealing with a party who was his own worst enemy; but that is precisely the kind of situation in which it is particularly important to see that he appreciates what is expected of him.  

23.	At a preliminary hearing of this appeal the parties agreed that if we were to find, as we have, that the Tribunal’s reasoning was flawed, we should ourselves resolve any issue on which its conclusion was vitiated, using our powers under section 35 of the Employment Tribunals Act 1996.  In anticipation of that, the Appellant lodged affidavits from Mrs. Lloyd herself and from a Ms. Wong.  In summary:

(a)	Mrs. Lloyd’s affidavit explained that there was a close bond between her son and the Appellant, and that the Appellant believed that his cousin had been unjustly treated.  She says that that was the only reason why the Appellant had acted in the claim, which was in accordance with her son’s dying wish.  She says in terms that neither she nor her son ever made any arrangement for the Appellant to receive any payment, and indeed the subject was never discussed between her and him.  At paras. 9 and 10 she says: 

“9. In January 2009 I did pay a little money for assistance in note taking, research and general administrative support of the case of two non-family members.  Sharon Wong (“Sharon”) and Mrs. A. O’Reilly each received £500 for assisting.  I gave Paul cheques to pass on to them.  I now produce marked “BL1” a copy of my Lloyd’s Bank current account statement showing the two £500 cheque withdrawals.  There was never any formal arrangement for payment but I gave what I thought were tokens for the hard work of Paul’s assistants and the fact that they gave up so much of their own time for the January hearing.

 10. In February, March and April 2009 additional work was required in relation to the Respondents’ complaints about ‘Facebook’ and their demands for a case management discussion.  Paul needed Sharon’s assistance.  Sharon had previously used up a lot of her annual leave to support the case.  In recognition of this, I made an oral agreement with Paul in February 2009 to pay Sharon a total of £1,000 for her to continue assisting him.  Sharon said she preferred to be paid in cash.  I now produce marked “BL2” a copy of pages from my Cambridge Building Society savings account showing cash withdrawals from Sharon.  The total sum paid does not reflect all the work that Sharon did because as a pensioner I have to very careful with my limited funds.”

The exhibit shows payments/withdrawals in the sums referred to.

(b)	Ms. Wong said that she was an administrator in a law firm, who had met the original Claimant, Mr. Lloyd, at university and been a friend of the family ever since.  She had done a great deal of work supporting the Appellant in his conduct both of the original dispute with the school and of the proceedings in the Tribunal.  She knew that he was receiving nothing, not even expenses, from the Claimant or Mrs. Lloyd and that he was acting out of love for his cousin and his aunt.  At paras. 5 and 6 she says: 

“5. After the January 2009 hearing Betty Lloyd (“Betty”) wrote me a cheque for £500, which Paul passed on to me, as an informal gesture of appreciation for my help with the case.  I had not expected to receive it.  I deposited it into my current account.  I now produce marked “SW1” a copy of my bank statement showing the cheque deposit.  My work on the case included note taking, research, data management and general administrative support.  When the hearing was postponed until September 2009 I did not expect to have more involvement in the case until then.

6. In February, March and April 2009 Paul, who was busy trying to find work, needed me to help because he was short of time and the Respondents were putting him under pressure.  This led to the Respondents insisting on having a case management discussion.  I carried out research for Paul, drafted letters, did preparatory work, and managed all the date and files and took notes at the CMD.  In February 2009 Betty agreed to pay me £1,000 to continue assisting Paul.  I preferred to be paid in cash.  Over the following months she gave me small cash sums of between £100 and £300. They were not regular payments and I assumed she gave me cash when she had some available.” 

No evidence was lodged from the Appellant himself. 

24.	Both Mrs. Lloyd and Ms. Wong attended the hearing before us and were cross-examined by Mr. Greatorex.  As regards Ms. Wong’s evidence, Mr. Greatorex did no more than query the description of the relevant credit entry in her exhibited bank statement.  As regards Mrs. Lloyd, he also raised some questions on her bank statements, which went nowhere; but he focused principally on a letter written by the Appellant to the Tribunal on 12 February 2009 (which had not in fact been relied on by the Tribunal).  In that letter the Appellant complained of Eversheds’ conduct and concluded:

 “I hope to raise this again in relation to costs at the conclusion of Andrew’s case.  The Respondents are hereby put on notice that arrangements are being made to ensure that I am remunerated for my work thereby facilitating their potential liability for the Claimant’s costs.”

Mr. Greatorex put it to her that that showed that, contrary to her evidence, there was an understanding that the Appellant would be paid.  She denied having seen the letter at the time and maintained her evidence that no such arrangements had ever been made.  The most that there had been was a suggestion, which came from her, that she should pay something to the two “clerks” who seemed to have been doing a lot of work.  She said that nothing else had ever been discussed “and I wouldn’t have had the money anyway”.

25.	We regarded both Ms. Wong and Mrs. Lloyd as truthful witnesses.  We accept their evidence – which, as we have already said, is in no way implausible – that there was never any agreement, formal or informal, that the Appellant would be paid for his work.  In our view the Appellant’s application for costs in March/April 2009 is readily explicable by reference to the payments made to Ms. Wong and Ms. O’Reilly.  It is immaterial whether they would in fact have fallen within the definition of “costs” in rule 38 (though on the face of it we cannot see why they would not): the question is whether the Appellant thought they did, or might.  As for the letter of 12 February, that too may have been a reference to these payments, but it may simply have been bluster, of a kind characteristic of the Appellant’s correspondence: it does not of course say that any arrangements entitling the Claimant to claim costs had in fact been put in place.  (Indeed it is good evidence – because it is, in context, an “admission against interest” – that none was in place as at that date, which would undermine in any event element (1) in the award.)  But, whatever was going on in the Appellant’s head when he wrote these letters, they cannot undermine the clear and credible evidence of the witnesses from whom we heard. 

26.	 Mr. Greatorex submitted that we should be very slow to accept the Appellant’s denial that he was acting in pursuit of profit in circumstances where we had not heard evidence from him.  We take the point, but it is not as if the Appellant has been wholly silent.  The evidence of Mrs. Lloyd and Ms. Wong only confirms – with, it is true, much greater particularity – what he told the Tribunal.  It might have been better if he had himself made an affidavit; but we do not regard it as essential that he should have done so, and we can see why he might have regarded it as futile or inappropriate in view of what the Tribunal had already said about his credibility.  

27.	We therefore find that the Appellant was not acting in pursuit of profit.  It follows that the Tribunal was not entitled to make a wasted costs order and that this appeal must be allowed.  Given the way that the Appellant behaved, that may be a matter of regret; but the rules do not permit the making of wasted costs orders against representatives who are not acting in pursuit of profit, and that must be respected.  

28.	As already trailed, we do not propose in those circumstances to deal with the other grounds of appeal, save to make observations in relation to one point.  At para. 7.1 of the Amended Notice of Appeal the Appellant contends that he was given inadequate notice of the wasted costs application and that he should not have been required to deal with it there and then on 16 June.  We have set out the essential facts in this regard in the course of summarising Mr. Coghlin’s submissions at para. 18 above.  We have some sympathy with the Appellant’s contention.  Although he had a one-line warning that a wasted costs application would be made if the strike-out were successful, he knew no more than that; and, as we have observed, although he was given half-an-hour to prepare, that was before, not after, Mr. Foxwell made his submissions.  The Tribunal was available on the following day, though of course that would have involved some further costs.  There is a real tension between two conflicting desiderata in the wasted costs jurisdiction.  On the one hand, it is intended to be summary: the Court of Appeal made it clear in Ridehalgh that elaborate satellite litigation about wasted costs was strongly to be deprecated.  On the other hand, it must be fair.  A finding that a solicitor or other professional representative has been negligent is a serious matter for the person affected, and if a summary procedure is an unfair procedure fairness must come first.  In the context of employment tribunal proceedings, it is our experience that this tension quite commonly emerges, as here, in relation to the question of the stage at which a wasted costs application should be heard: should it be at the conclusion of the hearing which provides the basis for it ? or should it be adjourned to a later date ?   There can be no general rule.  The starting-point is that it is obviously better from the point of view of efficiency and economy that the application be dealt with at the selfsame hearing, and in many cases there will be no valid objection to that course being taken.  Either the representative will have been notified in advance that the application will or may be made, with a sufficient indication of its basis to enable him to prepare, or the issue will be one which is sufficiently straightforward for a professional to be able to deal with it without substantial prior notice (to take a very simple example, where costs have been wasted because through carelessness the representative has appeared late).  But there will be cases where it will not be fair to proceed in that way – typically because the issues are not straightforward, or perhaps simply because time is too short: bad decisions are sometimes made at the end of a long day.  In many such cases, where the hearing is an interim one, there may be no real difficulty in postponing the application to a later stage in the proceedings (though if it is important that the same Judge or tribunal hear it that may sometimes create a problem).  If, however, there would have to be a special hearing to determine the application, the tribunal will need to consider whether that is a proportionate course to take.  If it is not, the application may simply be refused: it is clearly stated in Ridehalgh (see at p. 239 D-F) that there may be cases where the game is not worth the candle.  We need not, however, express a definitive view about whether the Tribunal got the balance right in the present case, and we do not propose to do so.

29.	We regret the time taken to promulgate this judgment, which is principally the result of the pressure of work in this Tribunal.