Legal Update
Autumn 2011

Article 1 - Wasted Costs in Tribunal Hearings? - Daniel Piddington

With the Government’s consultation on "Resolving Workplace Disputes" proposing to extend the principle of wasted costs to include those of the tribunal itself, it has never been more important for representatives to have a clear understanding of wasted costs orders.

The starting point must always be that any costs order in the Employment Tribunal is an exception rather than the rule. The tribunal’s discretion to award wasted costs derives from rule 48 of the Employment Tribunal Procedural Rules where wasted costs are defined as "costs incurred by 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".

The proposal outlined in the consultation paper would therefore represent a significant departure from the current position and without clear guidance on what ‘tribunal costs’ are envisaged to be recoverable the suggestion immediately sits uncomfortably with any representative who regularly appears on behalf of litigants. Defensive propositions immediately jump to the frame; surely it cannot be appropriate for a tribunal to have a financial interest in cases, surely it will only add to the cost pressure being applied to unrepresented parties? It is at least arguable that both postulations are fundamentally flawed. Costs recovery has always remained within the discretion of the tribunal bench and/or judge. There is no suggestion that any award for tribunal costs will in any way benefit those hearing the case and, therefore, impartiality remains. The potential use of these provisions to add pressure to unrepresented parties is nonsensical as any wasted costs award is only applicable as a result of conduct by a representative and they do not apply to the conduct of a litigant in person.

Upon further consideration the proposed variation of wasted costs orders may have one overwhelming benefit: They may be seen as an even greater mechanism for ridding the tribunal of the plague of unqualified and inexperienced individuals who seek to take advantage of the lax rights of audience within the tribunal system to offer ‘cheap and cheerful’ representation, but who fail to deliver any benefit and simply frustrate the proceedings. Perhaps some extortionate bill for the wasted tribunal time and resources is exactly what such individuals require to make them think again. Regardless of the outcome of the consultation in relation to the wasted costs issue, it remains that only negligent and/or unreasonable representatives need be concerned!

Article 2 - Removal From The Jurisdiction: Still A Payne? - Andrew Skinner

...Perhaps not! This topic has been the focus of much academic and legal debate in recent times. In timely fashion the Court of Appeal handed down the decision of MK v CK [2011] EWCA Civ 793 on 7 July 2011. The case considered the significance of the well-known decision of Payne v Payne (2001) EWCA Civ 166. The Appellant father appealed against a decision allowing the mother to relocate with the two children to Canada. The children were aged four and two; the mother was of Canadian origin. Following their divorce a shared residence order was made allowing the children to spend five nights with the father and nine nights with the mother every 14 days. The mother applied for leave to remove, citing she felt isolated and stressed and wished to return to Canada to live with her parents and for family support. The father contested on the basis of his commitment to the children and the shared residence situation. A CAFCASS report recommended the application be refused and that the balance came down against the move. The judge however rejected the recommendation and referred to the effect that such refusal would have on the mother, directing herself to the guidance set out in Payne.

The Court of Appeal found for the father. In the first instance there was a clear recommendation from CAFCASS which the judge had rejected and had offered no real analysis why.

Thorpe LJ set out that as the father was providing much care and input into the children’s lives the judge should have considered Re Y (Leave to Remove from Jurisdiction) [2004] 2 FLR 330 rather than Payne. The only principle to be extracted from Payne was the paramountcy principle. All the rest was guidance as to factors to be weighed in search of the welfare paramountcy. The Payne guidance was given on the basis that the applicant was the primary carer. It was the practical arrangements for sharing the burden of care between two equally committed carers which was significant, rather than the label "shared residence". Where each was providing a more or less equal proportion and one sought to locate externally, the approach which was suggested in Payne should not be utilised; the judge should instead exercise his discretion to grant or refuse the application by applying the statutory checklist in the Children Act 1989, s1(3). The only authentic principle in relocation authorities was that the child’s welfare was the Court’s paramount consideration.

So what of non-shared residence cases? Even where the case concerned a true primary carer, there was no presumption that the reasonable relocation plans of that carer would be facilitated. When a relocation application fell to be determined, all the facts needed to be considered, Payne and Re Y considered.

Article 3 - McKenzie Advocates! - Jason Hughes

ADVOCATES! As legal professionals we all know the commitment and dedication required to succeed as practising lawyers and no doubt we have all come up against litigants in person supported by McKenzie friends. In a recent matter, my opponent who was a litigant in person applied to the court for his McKenzie friend to be granted rights of audience and to provide formal legal representation which was supported by a CV of the McKenzie friend documenting a comprehensive legal resume including appearances in the High Court. The statutory framework for the granting and obtaining such rights of audience is set out in the Legal Services Act 2007, which describes the exercise of a right of audience as one of several "reserved legal activities" that may be carried on only by "authorised persons" and "exempt persons". An authorised person being someone authorized, for example, by the Law Society or General Council of the Bar, i.e. barristers and solicitors.

The grey area pertains to the definition of exempt persons, one such category being a person who is not an authorised person but who has been granted rights of audience by the court in relation to those proceedings. In determining whether to grant rights of audience the practice note in McKenzie Friends: Civil and Family Courts [2010] 1 WLR 1881, provided guidance on the matter and explained that McKenzie friends have no right to act as advocates but did acknowledge the court’s power to grant such a right on a case by case basis to McKenzie friends, although it further notes that this right should be granted in ‘exceptional circumstances’ as otherwise this would be contrary to the will of Parliament.

The key argument advanced in the matter I was faced with was that the litigant in person stated that he no longer trusted qualified legal personnel and consequently his only recourse to a right to a fair trial was to be ‘legally’ represented by his pseudo-qualified, pseudo-professional McKenzie friend!

The concern of such an approach on the client is obvious, an unqualified representative may cause undue delay with consequential increased stress and costs although the court may feel that pseudo-legal representation may improve upon no representation. The counterweight powers of the court to address this are to make provision for costs together with the right to rescind the right of audience. Having granted a right of audience this needs to be continually appraised throughout the court process and if the balancing of the parties respective rights are tipped one way or the other an application could be brought for the McKenzie friend’s rights of audience to be rescinded.

In the current economic climate with the anticipated increase in litigants in person together with the cuts in legal aid it remains to be seen whether the courts will see an increase in the number of pseudo-professional McKenzie friends seeking to legally represent their clients.

Article 4 - A Necessary Evil For The Beautiful Game? - Adam Langrish

For anyone who, like me, starts reading a newspaper from the back page and still mourns the loss of Sky Sports News from ‘Freeview’, the reports of which football player is being ‘tapped up’ with a view to transferring to a rival club make essential reading. Despite the frequent news stories and subsequent transfers, the rules on approaching players contracted to a football club are very clear - it is not allowed. The Premier League Rules on this issue echo the FIFA Regulations with Section K(3) stating:-

"Any Club which by itself, by any of its Officials, by any of its Players, by its Agent, by any other Person on its behalf or by any other means whatsoever makes an approach either directly or indirectly to a Contract Player except as permitted by either Rule K.1.2 or Rule K.2 shall be in breach of these Rules and may be dealt with under the provisions of Section R."

Given the firm prohibition on approaches to contracted players, it is perhaps surprising how infrequently clubs, players or agents are pursued for breach of the rules. When action has been taken, the punishments metered out have been severe. Two recent cases have involved Chelsea FC. As was widely publicised in 2005, Ashley Cole and Jose Mourinho were both fined £75,000 and Chelsea fined £300,000 for their roles in the eventual transfer of Cole from Arsenal to Chelsea. More recently, in 2009, Chelsea was initially punished very severely by FIFA following the move of a youth team player, Gael Kakuta, from RC Lens to Chelsea in 2007. Chelsea were banned from signing any further players for the duration of two transfer windows and given a significant fine, before both punishments were eventually overturned by the Court of Arbitration for Sport on the basis that Kakuta’s contract with RC Lens had not been a valid one.

Whilst implicated players, clubs and agents have tried and failed to argue that the rules on approaches amount to an unreasonable restraint of trade, the generally accepted reality appears to be that tapping up continues to be a necessary evil. Whilst the 24 hour news reporting of sport now means that avid football fans are likely to know far more of possible transfers and approaches to players than before, it is clear that approaching contracted players in contravention of the rules is by no means a recent phenomenon. Brian Clough famously said of his time as manager of Nottingham Forest, "we tapped up more players than Severn-Trent Water Board". Gary Lineker (famous crisp eater and striker) made clear in a much publicised article in 2006, that he had been approached by numerous clubs whilst he had been contracted to Barcelona (including Fiorentina, then managed by Sven-Goran Eriksson). Lineker’s view was that few deals could ever be done without approaching a player first, as no club wanted to be left embarrassed by trying to sign a player who had no interest. Similarly, a club that wants to sell may be reluctant to dilute its bargaining position by openly stating, from the outset, that it is looking to transfer a player. In the circumstances, there does at least seem an argument for the removal or refinement of these rules. For as long as the restrictions remain in place, approaching a contracted player will not be without risk for any football club.

Should any Southampton FC scouts be reading, it is perhaps worth remembering that there are no risks associated with approaching those players who are out of contract and currently plying their trade at College Chambers whilst waiting for their call up...

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