Costs

Is the fact that legal expense insurers have authorised litigation enough for a 'get out of jail free' card when the Claimant faces a costs application?

No, held the EAT in Radia v Jefferies International Limited.

Costs do not follow the event in the employment tribunal and have traditionally been viewed as the exception rather than the rule. In the present case a substantial award of costs (£550,000) was awarded against the Claimant.

The Claimant appealed to the EAT on various grounds, challenging the reasons for the costs award. All grounds failed.

1. That the claims enjoyed no reasonable prospects of success. During settlement discussions with his employer the Claimant had raised, for the first time, allegations of disability discrimination dating back 5 years which the tribunal assessed to have no merit;

2. That the Claimant knew or ought reasonably to have known that his claims had no prospects of success and had acted unreasonably in pursuing them;

3. That he was held to have unreasonably conducted the proceedings by continuing the claims after receiving the Grounds of Resistance and/or a costs warning letter which he did not respond to; and;

4. More crucially perhaps, that the Claimant had lied to the tribunal or misled the tribunal in respect of certain complaints and the tribunal said it would have awarded costs anyway in respect of those claims alone.

5. That the fact the Claimant was granted the support of his insurer did not help him, because the insurer's stance was entirely dependent on what the Claimant told them.

This is an alarming judgment for any Claimant lawyer but one which merits a full reading of the very specific facts of the case.

Thanks to Karen Jackson of didlaw for preparing this case summary.