Judge wrong to deny insured claimaint his costs

Case 6: The facts

Mr Mardner brought successful tribunal proceedings against each member of the management committee of an unincorporated charity. He applied for his costs against the individual members on the basis that they had engaged in unreasonable behaviour.

An employment judge agreed that their defence of the claim had been unreasonable, but ruled out a costs order for two reasons: because they were all volunteers; and because Mardner’s litigation was funded by insurance meaning that he wasn’t personally out of pocket. Mardner appealed.

The ruling

The Employment Appeal Tribunal agreed that the judge was entitled to take the respondents’ voluntary status into account when deciding not to make a costs award against them, although it is not the law that volunteers will never have to pay costs.

However, the judge was wrong in the approach to Mardner’s employment litigation insurance, which should not have been taken into account. The fact that a party is not in need of the money can never justify a decision to award them their costs.

In other words, nobody should escape costs incurred due to their unreasonable behaviour just because the receiving party is wealthy or has put in place insurance cover.

Mardner v Gardner and Others UKEAT/0483/13/DA

www.bailii.org/uk/cases/UKEAT/2014/0483_13_2507.html