A ‘Bum Deal’ for Huddersfield GiantsAndrew MacDonald
An indemnity costs award made against Huddersfield Giants by Leeds High Court on 21 August 2013, following a successful claim before the same court the previous month by the Club's former prop, Keith Mason, is a salutary lesson to employers contemplating a gross misconduct dismissal – and in particular how to conduct internal disciplinary proceedings and associated litigation.
In a sporting world increasingly dominated by social media, the case also serves as an interesting recent insight into how the Courts view the relationship between an individual’s social media account and their employer.
Mason was sacked in October 2012 after a picture of his then teammate Scott Moore’s posterior found its way onto Mason’s Twitter account. The picture had been taken during the Club’s regular end-of-season drinking session known as ‘Mad Monday’.
It had been posted on Twitter by Mason’s then girlfriend without his knowledge, a fact the Giants accepted prior to Mason’s dismissal. The image, which had prompted a small number of complaints, had remained on Mason’s Twitter account for 48 hours before it was deleted by him.
The Club considered a gross misconduct dismissal was appropriate on the basis that Mason had brought the Club into disrepute by not deleting the image sooner.
The player was only a year into a £95,000 per year, four year contract at the time the Club terminated his employment. After an unsuccessful internal appeal against the Club’s decision to summarily dismiss him, Mason sued the club for wrongful dismissal.
Mason’s contract pushed the Giants close to the salary cap. Evidence before the Court at the July hearing included that the Club had wanted Mason to move to Wakefield Wildcats to free up space for new players Craig Kopczak and Stuart Fielden.
The Judge said that he had “no difficulty” in finding that Mason had established he was wrongfully dismissed – even without considering the background issue of the Club signing other players. The Club knew that ‘Mad Monday’ happened each year but did not stop this or issue any formal warnings to players about their conduct.
Furthermore, the Judge did not accept that Mason was deliberately flouting the terms of his contract, instead finding that once the error of his ways was pointed out, Mason set out to correct it.
As far as Mason’s Twitter account was concerned, this was considered personal and not “inextricably linked” to the Giants. The Judge commented that “When all is said and done, the claimant was employed as a rugby player” and that “the offensive tweet took place outside of the workplace.”
Whilst players would be well advised to consider carefully what they say on Twitter and other social networking sites – one only has to think of Ashley Cole’s comments about the FA and Ryan Babel’s posting of a mocked up picture of referee Howard Webb in a Manchester United shirt accompanied by comments on his credentials as a referee to name but two examples – the Judge’s comments in this case appear to depart somewhat from the hard line that has been taken by the authorities.
The Judge recognised the Club’s desire to retain family values, and clubs and sporting organisations should ensure that they have Codes of Conduct and Social Networking policies to guard against these issues arising in the first place and proscribing the consequences if they do still ensue.
But as a major blow to the Giants in this case, it became apparent during the proceedings that the Club had failed to disclose key relevant documents and that it had been investigated by the RFL over the signing of Kopczak, paying £20,000 as compensation to the Bradford Bulls on the recommendation of the RFL.
Kopczak had previously been a Bulls player and there had been an agreement amongst the other teams in Super League not to take advantage of the Bulls’ perilous financial position and poach their players.
Kopczak had quit the Bulls in September 2012 and signed for the Giants the following month but the hearing was told that he had agreed to join the Giants in August 2012.
The Club’s failings in respect of its disclosure obligations included documents relating to complaints over the picture posted on Twitter, as well as details of the signings of Messrs Kopczak and Fielden, which the Judge said it was “blindingly obvious” should have been disclosed but which he was entitled to assume were deliberately not.
It was largely on this basis that Mason’s legal team sought “indemnity costs”.
If costs are ordered to be assessed on the indemnity basis, on assessment, the costs judge will only allow costs to be recovered which are both:
- reasonably incurred; and
- reasonable in amount1.
Unlike with costs assessed on the “standard basis”, consideration of proportionality does not arise if costs are assessed on the indemnity basis. Instead, there is a presumption of proportionality in favour of the receiving party.
This has the effect of shifting the onus onto the paying party to demonstrate that the costs claimed are unreasonable. The consequence usually means that the receiving party is more likely to obtain a higher recovery than on the standard basis. It is, therefore, advantageous to be awarded costs on an indemnity basis.
The costs Judge stressed that indemnity costs were only ordered in exceptional circumstances when there were concerns about the conduct of a case. That was the case here.
The total costs that the Club is going to have to meet from this sorry tale is likely to be around £400,000. The Judge ordered the Giants to pay Mason’s £146,510 damages within seven days.
The Club had previously been told to make a down-payment of £35,000 towards legal fees but this was paid late, which resulted in the Judge ordering a further £5,000 be paid.
Mason’s legal fees alone total approximately £200,000, which includes a ‘win bonus’ of between £75,000 and £100,000 for his legal representatives on top of the £98,000 legal fees.
The Club will have to pay most of its former player’s legal costs as well as its own, estimated to be at least £50,000.
And just when the Club thought things couldn’t get any worse – Mason had offered to withdraw his claim before the Club’s 11th hour disclosure of documents for £100,000. The Giants had counter-offered a mere £5,000.
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About the Author
Andrew is a Senior Solicitor in the Employment Team at Mills & Reeve LLP. Much of Andrew’s work focuses on the sports sector. He advises professional football clubs, players and agents on contractual and employment matters, including players’ contracts and disciplinary proceedings.