S Garrod v Riverstone Management Limited

The Employment Appeal Tribunal upheld the Employment Tribunals ruling that references in the claimants pleadings and evidence to settlement proposals made at an 8 November 2019 meeting were protected by without prejudice privilege and should be removed. The ET was entitled to find that an existing dispute arose from the grievance and that the meeting formed part of a genuine attempt to settle the same dispute. The court rejected the submission that an allegation of discriminatory motive meant the "unambiguous impropriety" exception to the without prejudice rule applied. The EAT also upheld the costs order against the claimant because she gave untruthful evidence which substantially increased the length and complexity of the preliminary hearing.

Background and parties: The claimant, Mrs Garrod, brought claims including breaches of the Maternity and Parental Leave etc Regulations 1999, section 47C of the Employment Rights Act 1996, pregnancy and maternity discrimination, harassment and constructive unfair dismissal. The meeting of 8 November 2019, convened after the claimants grievance, included an employer proposal to offer termination on terms. The claimants particulars of claim referred to that meeting and to an offer said to have been made there.

Procedural history: The claim was issued on 2 March 2020. The respondent applied to remove references to the without prejudice meeting; Employment Judge Harrington decided on 6 November 2021 that the without prejudice rule applied and ordered removal of those references. A costs hearing before Employment Judge Jones QC followed, resulting in an order that the claimant pay 3,400 for giving untruthful evidence which had materially complicated the preliminary issue. Reconsideration applications were dismissed. The claimant appealed to the Employment Appeal Tribunal.

Nature of the issues:

• Whether, on the facts, there was an existing dispute at the time of the 8 November 2019 meeting so as to engage without prejudice privilege.
• Whether the without prejudice communications fell within the very narrow exception for "unambiguous impropriety" so as to be admissible.
• Whether the costs order against the claimant was an unlawful exercise of discretion, having regard to findings of untruthful evidence and applicable authorities on costs.

Courts reasoning and outcome: The EAT held that the Employment Judge had correctly applied the principles in BNP Paribas v Mezzotero and related authorities. Having heard live evidence over three days, the EJ was entitled to find that the grievance, the meeting and the subsequent tribunal claim concerned the same dispute, that settlement discussions might reasonably be expected to lead to litigation if unsuccessful, and that the meeting was a genuine attempt at settlement. The tribunals rejection of claims that the employers conduct amounted to unambiguous impropriety was upheld: proposing consensual termination was not of the gravity required to displace the without prejudice rule. On costs, the EAT accepted that a finding of untruthful evidence does not automatically warrant costs but held that EJ Jones had properly exercised his discretion given that the claimants untruthful evidence had "very substantially complicated" the hearing.

Both appeals were dismissed. The Employment Tribunal did not err in finding an existing dispute and that the 8 November 2019 meeting was a genuine attempt to settle, thereby attracting without prejudice privilege; the exception for unambiguous impropriety was not made out. The costs order was within the tribunals discretion because the claimant gave untruthful evidence which materially complicated the proceedings.

Claim issued to the Employment Tribunal 2 March 2020; preliminary issue hearing before Employment Judge Harrington, decision dated 6 November 2021 removing references to without prejudice material; costs hearing before Employment Judge Jones QC (24-25 February 2022) awarding costs of 3,400 against the claimant; reconsideration applications dismissed by EJ Harrington (7 April 2022) and EJ Jones (10 May 2022); appeal to the Employment Appeal Tribunal decided 9 December 2022 ([2022] EAT 177) with both appeals dismissed.