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Appeal against the striking out of a claim of race discrimination and against a costs order made against the claimant. The strike out appeal was rejected, but the costs were reduced from £10,000 to £5,000.
The claimant brought a claim of race discrimination which centred on an email sent by the respondent to the UKBA where it was claimed that the respondent fabricated a story that the claimant had her own visa and that was for the express purpose of finding a reason to dismiss her, when in truth the reason for dismissal was that the claimant was pregnant. The ET characterised the allegation as 'totally preposterous' and concluded that there was no prospect of the claimant establishing the case identified at the CMD. There was no further fact finding necessary at trial and the claim was struck out. The Judge awarded costs of £10,000 to be paid by the claimant. The claimant appealed against both decisions.
The EAT upheld the strike out decision. The race discrimination claim was bound to fail and was indeed not only misconceived but also vexatious. However, on the costs issue, the Judge had failed to take account of the fact that the claimant was on maternity leave at the relevant time and so the costs order of £10,000 was reduced to £5,000.
Appeal No. UKEAT/0410/11/SM
EMPLOYMENT APPEAL TRIBUNAL
FLEETBANK HOUSE, 2-6 SALISBURY SQUARE, LONDON, EC4Y 8JX
At the Tribunal
On 12 January 2012
Judgment handed down on 11 April 2012
HIS HONOUR JUDGE PETER CLARK (SITTING ALONE)
MRS L S ANDORFUL (APPELLANT)
LONDON BOROUGH OF HAMMERSMITH & FULHAM (RESPONDENT)
Transcript of Proceedings
For the Appellant
MR C ADJEI (of Counsel)
Bar Pro Bono Unit
For the Respondent
MR C STONE (of Counsel)
London Borough of Hammersmith & Fulham
Legal Services Division
Hammersmith Town Hall
PRACTICE AND PROCEDURE
Limited issue before Employment Judge at Pre-Hearing Review, following CMD direction. Judge entitled to strike-out claim based on findings of fact.
Costs order made without taking into account all relevant factors; means only partially considered. Assessed costs reduced from £10,000 to £5,000.
HIS HONOUR JUDGE PETER CLARK
1. This is an appeal by Mrs Andorful, Claimant before the Watford Employment Tribunal, against the Judgment of Employment Judge Mahoney, sitting alone at a Pre-Hearing Review, promulgated with Reasons on 13 December 2010, striking out her claims brought against the Respondent, London Borough of Hammersmith & Fulham and ordering her to pay costs in favour of the Respondent in the sum of £10,000.
2. The Claimant was employed by the Respondent from 14 January 2008 until 7 April 2010. By two forms ET1, later combined, she brought complaints of unfair dismissal, race and sex discrimination. I am now concerned only with the race discrimination complaint.
3. The claims were resisted and came on for a Case Management Discussion before Employment Judge Hogarth QC on 7 September 2010. That Judge identified the race discrimination (and unfair dismissal) claim as centring on an email sent by Mrs Sorrell, an HR relationship manager, to the UKBA on 16 March 2010 and an allegation by the Claimant that Mrs Sorrell had fabricated a story that the Claimant had her own visa and that was for the express purpose of finding a reason to dismiss her when in truth the reason for dismissal was that the Claimant was pregnant. On that basis he directed a PHR to consider whether or not the Claimant's claims should be struck out under r18(7)(b) Employment Tribunal rules; alternatively whether a deposit order should be made under r20(1). Moreover, the Employment Judge directed that both parties were to prepare witness statements for the purposes of the PHR, containing the evidence upon which they intended to rely. I pause to observe that under ET r18(2)(d) at a PHR the Employment Judge may consider any oral or written representations or evidence.
4. At the PHR before Employment Judge Mahoney held on 3 December 2010 the Claimant did not attend but was represented by her husband; the Respondent was represented by Mr Stone and Mrs Sorrell was called to give evidence and was cross-examined by Mr Andorful.
5. It is important to appreciate the limited scope of Employment Judge Mahoney's enquiry at the PHR as directed by Employment Judge Hogarth at the earlier CMD. The first amended ground of appeal complains that, in addition to failing to follow his own self-direction as to the effect of the cases of Anyanwu  ICR 391 (HL) and Ezsias  IRLR 603 (CA), the Judge was wrong to hold a partial trial and make findings of fact on that basis.
6. I disagree. As Mr Stone points out in the Respondent's Answer (para. 8.3) the Claimant made four applications to vary the CMD order without success and an appeal to the EAT against that order also failed. It followed that Employment Judge Mahoney was bound to follow Employment Judge Hogarth's case management order.
7. Thus the strike out question, put simply, was whether the Claimant had no reasonable prospect of succeeding in showing, as a matter of fact, that Mrs Sorrell had deliberately fabricated the story in an email to UKBA dated 16 March 2010 that the Claimant had her own visa in order to find a pretext for dismissing her when the real reason for dismissal was that she was pregnant.
8. Having heard evidence from Mrs Sorrell and seen the relevant email chain Employment Judge Mahoney characterised that allegation as 'totally preposterous' (Reasons, para. 6.2). It is not difficult to see why.
9. It is axiomatic that UK employers may not employ staff who do not have the right to work here. Mrs Sorrell conducted a proper enquiry into the Claimant's right to work. True it is that on 12 March 2010 her contact at the UKBA, Mr Tanvir Hussain, emailed her regarding the Claimant saying:
"From what I can work out (bit of a confusing case this one) seems she is ok to work for the time being"
(Reasons, para. 4.6)
However, on the same day, a Mr Rilke of the UKBA emailed to say that, having checked the UKBA records, he could not confirm that the Claimant had the right to work (para. 4.7).
10. In order to clarify the position Mrs Sorrell emailed Ms Jassal at UKBA at 9.19am on 16 March. Extracts from that email are recorded at para. 4.8; that summary does not specifically mention this paragraph:
"…Tanvir Hussain … advised that this was a complex case and that she might be ok."
Thus Mrs Sorrell expressly drew attention to Mr Hussain's opinion in her email. However, she made an error of fact, as she acknowledged in her witness statement (para. 21). She mistakenly said in that email that the Claimant had her own visa ('Latoya (the Claimant) had her own visa (highly skilled migrant) which expired ….')
11. In response, Ms Jassal emailed Mrs Sorrell at 9.32am on 16 March, requesting a copy of the Claimant's original visa (highly skilled migrant). Mrs Sorrell then consulted the Claimant's file, realised her mistake and corrected it by pointing out that at the time of her last visa the Claimant had already switched to dependant. She scanned a copy to Ms Jassal.
12. Thus, when the UKBA, through Ms Jassal, finally gave a definitive answer to Mrs Sorrell's enquiry on 23 March, namely that the Claimant had no legal basis for staying and working in the UK, they were not materially misled by the corrected information which Mrs Sorrell had finally provided on 16 March (paras. 4.9 and 4.10).
13. Unknown to the Respondent, Ms Jassal's advice given on 23 March was incorrect; since an appeal had been lodged the Claimant still had a right to work (para. 4.14).
14. Once that error by the UKBA was corrected the Respondent overturned its dismissal decision, made on 7 April, based on Ms Jassal's advice and fully reinstated the Claimant with effect from 17 June.
15. It follows in my judgment, that the Employment Judge was quite entitled to conclude on the facts found that there was no prospect of the Claimant establishing the case identified at the CMD and thus, unlike Anyanwu and Ezsias, there was no further fact-finding necessary at trial. The race discrimination claim was bound to fail. Indeed, Employment Judge Mahoney struck it out not only as being misconceived but also vexatious.
16. It also follows given the factual context that the remaining grounds of appeal against the strike-out order also fall. The tentative opinion proffered by Mr Hussain on 12 March was inconsistent with that given by Mr Rilke on the same day and wholly at odds with that of Ms Jassal on 23 March. Thus, the first clear indication that the Claimant had a right to work was, as the Employment Judge found (para. 4.19) contained in the UKBA email of 5 May.
17. Mr Adjei, appearing on behalf of the Claimant before me, invokes the 1996 Asylum and Immigration Act and Code of Practice applicable thereto, a point not argued below. I agree with Mr Stone that immigration law has no relevance to the factual issue which Employment Judge Mahoney was required to investigate.
18. In these circumstances I reject the Claimant's appeal against the strike-out order.
19. I accept that, having found (permissibly) that the claim had no reasonable prospect of success (whether or not it can also be properly characterised as vexatious) the Judge's discretion to order costs against the Claimant was triggered.
20. The total costs billed by the Respondent's solicitor was £10,710. Counsel's fees (inclusive of VAT) totalled a further £1,811.10. The Judge ordered assessed costs of £10,000.
21. It seems (para. 7.6) that the Employment Judge took into account the Claimant's means to the extent that he noted that she was still working for the Respondent at the date of the hearing, earning £25,000 p.a.
22. What he did not appear to take into account was, as he was told, that at the relevant time the Claimant was on maternity leave, receiving 79 per cent of her normal pay and further that the Claimant and her husband rented, rather than owned their home.
23. It is plain from the statements of principle contained in the Judgment of Mummery LJ in Barnsley MBC v Yerrakalva  IRLR 78 that an Employment Tribunal will fall into error if it fails to take account of all relevant factors in its assessment of costs payable. In my judgment this Employment Judge fell into that error in failing to take fully into account what he was told about the Claimant's financial position, having decided to exercise his discretion in taking means into account.
24. In these circumstances, rather than remit the matter for further consideration, it seems to me that the proportionate course is for me to substitute my own figure for that of the Judge below. On the material available to me I shall reduce the costs order to £5,000. The appeal is allowed to that extent only.