How to Approach Costs Applications

How to Approach Costs Applications

The Employment Appeals Tribunal (EAT) has recently been called upon to consider what is the correct approach that Tribunals should take when a party makes an application for costs or wasted costs.

In Single Homeless Project Ltd v Abu the Claimant brought a series of claims under nine different jurisdictions and all of these were dismissed by an Employment Tribunal. The Tribunal indicated that they had a provisional intention to make a costs order against the Claimant of £500 and against his representative for £12550 + VAT. The Claimant and his representatives provided written submissions to the Tribunal after the hearing and after these were considered the Tribunal only awarded the Claimant’s representatives to pay £500 towards the Respondent’s costs and ordered the Claimant to pay nothing. The Respondent was not given an opportunity to see or to comment on the evidence and submissions provided by the Claimant to the Tribunal.

Both parties were unsatisfied and appealed against the decision on costs. At the EAT following the previous guidance provided in Godfrey Morgan Solicitors Ltd v Cobalt Systems Ltd it was stated that the Respondent should have been given an opportunity to make submissions in response to the Claimant’s submissions. It also held that the Tribunal had a discretion to take the paying party’s financial means into account but this was not an obligation. It was held that the Tribunal was not obliged to restrict its order to one that the paying party could pay.

The correct approach in relation to a costs application is that it must be fair with both sides having full opportunity to comment on each other’s submissions and should normally be resolved swiftly.

The EAT determined that the Tribunal had given no reasoning for its decisions either on liability or costs and as a result both appeals were allowed. The matter was passed back to the same Employment Tribunal for re-consideration.

The issue of costs is a complex one and it is often up to the discretion of the Tribunal to determine whether or not a party has behaved maliciously vexatiously or otherwise unreasonably and whether a costs award should be made. What is clear from this case is that both parties must be given the same opportunity to comment on and to provide submissions to the Tribunal for consideration. Otherwise any decision would be unfair.

If your employer’s actions have made it necessary for you to pursue a claim to assert your legal rights in an Employment Tribunal or you are considering issuing a claim please contact the employment law team at Michael Lewin Solicitors in order to discuss whether we can assist you.

Written by Anthony Fox

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