Mr J Davies v Martin McColl Limited and 1 other — 2023

This judgment concerned only the first respondent's wasted costs application. The underlying ET claim, presented by Mr J Davies on 5 July 2021 against Martin McColl Limited and Sara's Group Limited, had alleged unfair dismissal, entitlement to various statutory payments, and a failure to consult during a transfer of undertaking. By the time of the preliminary hearing in April 2022, the parties had settled the substantive dispute, leaving only the wasted costs application against the second respondent's representative.

The tribunal recorded that Employment Judge Ross had already treated the transfer question as a live issue requiring a preliminary hearing, and that the second respondent was entitled to dispute whether Mr Davies' employment had transferred. Applying rule 80 of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 and the Ridehalgh v Horsefield three-stage test, the tribunal held that the representative's failure to respond to correspondence and comply with case management orders was not improper or unreasonable, but was negligent. The judgment also referred to Mitchells Solicitors v Funkwerk Information Technologies York Ltd and KL Law Ltd v Wincanton Group Ltd in explaining the cautious approach required to wasted costs applications.

The tribunal found that the first respondent had not shown clear evidence that the second respondent knew of the transfer issue until 6 December 2021, when an email of 24 March 2021 was forwarded, and that the issue remained unresolved by 17 January 2022 despite further material being sent. The inaction from 2 February 2022 until the preliminary hearing date caused the first respondent to prepare for that hearing. The first respondent had initially said its costs to date were £9,980 plus VAT, but the tribunal accepted only the fixed-fee preparation cost linked to the wasted costs point.

The tribunal concluded that it was just to make a wasted costs order for the preparation costs incurred for the preliminary hearing and ordered the second respondent's representative to pay £1,980 to the first respondent.