Tuesday 1 September 2009

Costs: Lying Litigants

[Thanks to Will Dobson of Cloisters for providing this case summary]

The EAT in Dunedin Canmore Housing Association v Donaldson has held that it was perverse for the Tribunal to have refused to award costs where the claimant's assertions that she had not disclosed details of her compromise agreement in breach of a confidentiality clause were false.

The Claimant brought proceedings for breach of a compromise agreement, claiming she had not been in breach of a confidentiality clause. The Tribunal rejected her evidence and found she had made disclosures to two people. Nonetheless, it declined to award costs against her as it took the view that it was necessary for her to bring proceedings as the employer had alleged that the claimant had breached the clause.

The EAT disagreed and observed:
  • there was no basis for the view that proceedings were 'necessary' or that the claimant had no other alternative but bring proceedings where she knew her assertions were false;

  • the fact that the claimant was a lay person was irrelevant - what mattered was whether she had or had not, in simple human terms, approached the essential factual matters that lay at the heart of her case honestly and reasonably
Because she had not approached the case honestly and reasonably, the EAT reversed the tribunal's decision on costs and ordered the Claimant to pay her ex-employer's legal costs.

This case follows the EAT's earlier judgment in Daleside Nursing Home Ltd v Mathew which held that it was perverse for a Tribunal not to award costs where the central allegation of racial abuse was a lie.

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