Background
Dr. C M Day was a specialist registrar in medical training employed by Lewisham and Greenwich NHS Trust. He made protected disclosures about patient safety and brought whistleblowing claims under the Employment Rights Act 1996 against both his employer and Health Education England (HEE), arguing he was a “worker” of HEE under section 43K. HEE’s solicitors, Hill Dickinson LLP, opposed jurisdiction. The case progressed through the Employment Tribunal, Employment Appeal Tribunal, and Court of Appeal over more than a decade. The Court of Appeal ultimately remitted the matter to the Employment Tribunal for fact-finding on whether HEE substantially determined Dr. Day’s terms of employment.
In advance of the remitted hearing, the Employment Tribunal issued the Hildebrand Order requiring standard disclosure of documents. Dr. Day’s solicitors discovered in 2019 that HEE’s solicitors had failed to disclose Learning and Development Agreements (LDAs)—contractual documents between HEE and NHS trusts governing junior doctors’ training placements. Dr. Day applied for a wasted costs order against Hill Dickinson LLP, contending the non-disclosure was improper, unreasonable or negligent and had forced him to incur unnecessary costs defending the strike-out application.
The Employment Tribunal refused the wasted costs application, holding that Hill Dickinson LLP had not acted improperly, unreasonably or negligently and that Dr. Day had not incurred additional costs as a result of the non-disclosure. Dr. Day appealed to the Employment Appeal Tribunal.
The Court’s Holding
The Employment Appeal Tribunal dismissed the appeal. The Court upheld the Employment Tribunal’s careful application of the three-stage Ridehalgh v Horsfield test for wasted costs orders. The Tribunal found that Hill Dickinson LLP’s litigation team was genuinely unaware of the existence of the specific LDAs until June 2016—despite the firm’s commercial colleagues having drafted them—a factual finding the appellate court could not disturb. Critically, the information contained in the undisclosed LDAs was substantially consistent with information already available to Dr. Day in the Gold Guide, a document he was familiar with and had relied upon throughout the proceedings.
The Court held that before the Hildebrand Order imposed a disclosure obligation in July 2017, no legal duty to disclose existed. Any voluntary disclosure made during that period was not misleadingly selective because the undisclosed documents did not convey a false impression of the relationship between the parties. After the Hildebrand Order, while it was unclear why certain LDAs were not disclosed, the conduct was not “quite plainly unjustifiable” under the Ridehalgh standard, particularly given that Hill Dickinson LLP could not fully explain its position due to legal professional privilege, which the claimant had not challenged HEE to waive. The Court found reasonable explanations for the failure to disclose—for example, that the agreements were not a focus of attention when the Gold Guide adequately summarized the relationship.
The Court also noted that even if the LDAs had been disclosed at any earlier stage, it was fanciful to suggest the Court of Appeal would not have remitted the case back to the Tribunal for fact-finding. Thus, Dr. Day had not demonstrated that the non-disclosure caused him to incur unnecessary costs.
Key Takeaways
- Wasted costs orders are a serious sanction requiring proof on the rigorous three-stage Ridehalgh test: (1) improper, unreasonable or negligent conduct; (2) causation of unnecessary costs; and (3) justice of ordering compensation.
- A solicitor’s lack of awareness of documents held by colleagues in a different department, absent evidence of negligent failure to enquire, does not automatically constitute improper, unreasonable or negligent conduct.
- Disclosure of information substantially similar to information already known to the opposing party—particularly where the claimant was familiar with and relied upon an alternative source—may defeat a claim that non-disclosure was improper or misleading.
- Legal professional privilege, while not a shield against findings of abuse when conduct admits of no reasonable explanation, may be relevant to assessing whether conduct was unjustifiable where the solicitor cannot present the full factual picture.
Why It Matters
This decision is important for employment practitioners and in-house counsel because it reinforces the exceptionally high threshold for wasted costs orders—arguably higher than in other civil proceedings. The court’s emphasis that conduct must be “quite plainly unjustifiable” to warrant such a serious sanction provides guidance for solicitors managing complex, multi-year litigation. The decision also clarifies that disclosure obligations in employment tribunal proceedings must be assessed against the actual prejudice caused; if a claimant had access to substantially equivalent information through other means and relied upon it, the non-disclosure of a source document may not ground a wasted costs application.
The case illustrates the practical complexities of disclosure in large firms handling interconnected matters across departments and the limited extent to which a party’s failure to waive privilege can be held against solicitors unable to explain their full reasoning. It demonstrates that appellate courts will be slow to interfere with an employment tribunal’s careful factual findings and application of the Ridehalgh test absent clear legal error, reinforcing the deferential standard of review in this sensitive area.