England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL
His Honour Judge Peter Clark, Mr. C. Edwards &
Mr. I. Ezekiel
UKEAT/0171/13/RN

		Royal Courts of Justice Strand, London, WC2A 2LL
		15 April 2016

Lord Justice Moore-Bick :

1. The appellant, Gainford Care Homes Ltd, is a family company owned and managed by Mr. Mohammed Kaliq, his wife, Mrs. Susan McAleer, and their son, Mr. Imran Kaliq. As its name suggests, it owns and operates a number of care homes in the North East. The respondents to this appeal, Ms. Gemma Tipple and Mrs. Margaret Roe, were both employed by the appellant, Ms. Tipple as a care assistant and Mrs. Roe as an area manager. Mrs. Roe was responsible for the area in which the care home at which Ms. Tipple worked was situated.
2. In November 2011 Ms. Tipple was dismissed. It is unnecessary for present purposes to describe the circumstances in which that came about, but shortly after her dismissal she brought a claim against the appellant in the Employment Tribunal ("ET") for unfair dismissal and direct discrimination. In the period leading up to Ms. Tipple's dismissal Mrs. Roe had supported her and had made it clear to the appellant's owners that she considered their conduct towards Ms. Tipple to be unjustified and unlawful. In response they did their best to persuade her to abandon her support for Ms. Tipple and to withdraw a statement that she had made in support of Ms. Tipple's claim. Mrs. Roe refused to do so and her relationship with the appellant declined to the point at which she left their employment in January 2012. As a result, Mrs. Roe brought a claim against the appellant for constructive unfair dismissal and victimisation.
3. The hearing of Miss Tipple's claim against the appellant was fixed to begin before the ET under the chairmanship of Employment Judge Hesselberth at North Shields on 5^th November 2012. The hearing of Mrs. Roe's claim was due to follow immediately after, having been adjourned from a previous occasion. Mrs. Roe was present for the hearing of Ms. Tipple's claim and was prepared to give evidence in support of it, having provided a statement for that purpose. The tribunal decided to use the morning of 5^th November to read the various documents that had been prepared for the hearing. When the hearing resumed that afternoon counsel for Ms. Tipple, Mr. Legard, complained that Mr. Mohammed Kaliq had threatened Mrs. Roe in order to induce her to withdraw her support for Ms. Tipple. The part of the building in which all this was said to have taken place was covered by CCTV cameras and the tribunal decided to view the recording in order to judge for itself the demeanour of Mr. Kaliq and Mrs. Roe at the time in question. In the event, the tribunal decided to use the rest of the day for reading and to defer until the next morning the task of making findings about what had occurred.
4. At the end of the day, however, a second event occurred, this time involving Mr. Imran Kaliq, who was alleged to have driven his car at speed close to Mrs. Roe and another lady, Ms. Mason, as they were using a zebra crossing in the car park outside the building. The incident had been captured on video and had also been witnessed by a security guard and a magistrate who had been leaving the building at the time.
5. The next morning Mr. Legard drew this second incident to the attention of the tribunal and asked it to strike out the appellant's response to each of the claims and debar it from taking any further part in any of the proceedings. The tribunal proceeded to view the video recording and hear oral evidence before making its findings. Mrs. Roe and Ms. Mason gave evidence together with the security guard and the magistrate, but neither Mr. Mohammed Kaliq nor Mr. Imran Kaliq was called.
6. The tribunal produced a written decision setting out in some detail its analysis of the evidence, its findings of fact and the reasons for its eventual decision on the application to strike out the appellant's responses. It is an excellent example of how a tribunal's decision should be presented. It is unnecessary for present purposes to repeat the tribunal's findings in full; suffice it to say that in relation to what had become known as "the morning event", the tribunal was satisfied that Mr. Mohammed Kaliq had threatened to expose various matters of a personal nature affecting Mrs. Roe to the Press if she continued with the proceedings and thereby attempted to intimidate her into abandoning her own claim and her support for Ms. Tipple. The tribunal found that Mrs. Roe felt very threatened to the point at which she would have found it very difficult to continue to give evidence and in particular to be cross-examined.
7. In relation to what had become known as "the afternoon event" the tribunal found that the car park of the building where the hearing was taking place had been laid out with a 'one way' system with zebra crossings for the use of pedestrians. Mr. Imran Kaliq had reversed his car out of a parking bay and had then driven the wrong way round the car park at speed ignoring a 'No Right Turn' and other signs. He had accelerated heavily, causing the car's tyres to squeal, and had continued to drive at greatly excessive speed, passing over the zebra crossing very close to Mrs. Roe, who had still been on it. She had been forced to move quickly to avoid being struck by the car. The tribunal found that she feared for her safety and would continue to do so because she feared that she would be subjected to a physical assault on another occasion.
8. The application to strike out the appellant's responses and to debar it from taking any further part in the proceedings was made under rule 18(7)(c) of the Employment Tribunals Rules of Procedure contained in Schedule 1 to the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2004 ("the Rules"). Rule 18(7) provides in its material part as follows:

" . . . a chairman or tribunal may make a judgment or order: —

. . .

(c) striking out any claim or response (or part of one) on the grounds that the manner in which the proceedings have been conducted by or on behalf of the claimant or the respondent (as the case may be) has been scandalous, unreasonable or vexatious;"

9. The tribunal held that both the morning and afternoon events were so closely associated with the proceedings that they formed part of the manner in which they had been conducted by or on behalf of the appellant. It was also satisfied that the afternoon event, set in the context of the morning event, amounted to scandalous and unreasonable conduct. Neither of those conclusions is challenged. It then proceeded to consider whether that conduct had made it impossible to hold a fair hearing and whether there was some response short of barring the appellant from taking any further part in the proceedings that would be proportionate, those being questions which the authorities indicated it should consider. It expressed its conclusion in the following way:

"45 . . . The Tribunal refers to its findings about the effect on Mrs. Roe but in summary she was fearful for her safety and a very, very frightened lady. She expressed reservations about being able to give evidence and the Tribunal found that she would have the greatest difficulty in being cross-examined. The Tribunal has concluded that Mrs. Roe will be unable to manage her fear. This Tribunal recognises that it is an extreme step, a draconian step, to take in striking out the respondent's response but it is a consequence brought upon the respondent by itself. The Tribunal has very carefully considered whether there is some response short of barring the respondent. It has been suggested by Mr. Tinnion that we might invite Mr. Imran Kaliq not to attend and not to give evidence. We do not think that this would address the ability to have a fair trial in all the circumstances and such a step is not proportionate to deal with the prejudice to the wronged party."

10. On that basis the tribunal decided that the appellant should be debarred from taking any further part in the proceedings, whether in relation to liability or remedies, in both claims. It then proceeded to hear both claims in the absence of the appellant. Both claimants succeeded and were awarded damages. An application to the tribunal to review the decision to strike out the appellant's responses was dismissed in July 2013. It is of some significance that the appellant did not appeal against the tribunal's decisions on the merits, either in relation to liability or remedies, but it did appeal against the decision to strike out its responses. Seven grounds of appeal were advanced, which may be summarised as follows:

(1) that the tribunal failed to make adequate findings of fact about what Mr. Mohammed Kaliq said to Mrs. Roe in the course of the morning event;

(2) that the tribunal applied the wrong legal test in determining whether the conduct of Mr. Imran Kaliq constituted conduct falling within rule 18(7)(c);

(3) that the tribunal was wrong to hold that Mr. Imran Kaliq's conduct constituted conduct by or on behalf of the appellant;

(4) that the tribunal was therefore wrong to take into account the afternoon event when deciding whether the case fell within rule 18(7)(c);

(5) that the tribunal's decision to strike out the appellant's responses and debar it from taking any further part in the proceedings was Wednesbury unreasonable and fell outside the ambit of its discretion;

(6) that the tribunal failed to deal with the question whether it was reasonable or proportionate to allow the appellant to take part in the remedies stage of the claims, thereby failing to give proper reasons for its decision;

(7) that the tribunal failed to explain why no response short of striking out the responses was not sufficient, thereby failing to give proper reasons for its decision.

11. In the event the EAT refused permission to appeal on grounds (1) to (5), but granted permission to appeal on grounds (6) and (7). Quite why it took that course is unclear, but, as will become apparent in due course, its refusal to grant permission to appeal on grounds (1) to (5) assumes some importance in view of the way in which the case has subsequently developed.
12. The EAT dismissed the appeal. It proceeded on the basis that grounds (6) and (7) both involved an allegation that the ET had failed to comply with the duty to give reasons recognised in Meek v City of Birmingham District Council [1987] EWCA Civ 9 and with the obligations set out in rule 30(6) of the Rules, which in substance are to a similar effect. It rejected a submission by counsel for the appellant, Mr. Tinnion, that the tribunal had failed to distinguish between the cases of Ms. Tipple and Mrs. Rose or to explain why it was necessary and proportionate to debar the appellant from taking part in the remedies hearing in Ms. Tipple's case. It also rejected his submission that the tribunal had failed to consider whether any order short of striking out the responses would ensure fairness to both parties and held that the ET had sufficiently explained the reasoning for its decision. It is interesting to note that in the summary of its decision the appeal is described in the following way: " . . . limited to questions of Meek-compliance. ET Reasons sufficient."
13. There are two grounds of appeal to this court: the first is concerned with the appellant's right to participate in the remedies hearing relating to Ms. Tipple's claim; the second is more broadly based and seeks to raise the question whether debarring the appellant from taking any further part in the proceedings was a reasonable and proportionate response to the conduct of Mr. Mohammed and Mr. Imran Kaliq. In each case, however, the basis of the ground of appeal is that the tribunal failed to give adequate reasons for its decision, as required by Meek v City of Birmingham District Council.
14. In my view the appellant has failed to keep firmly in mind the essential distinction between the decision itself and the reasons for it. Meek v City of Birmingham District Council is concerned with the tribunal's obligation to give sufficient reasons for its decision to enable the parties to know why they have won or lost. The reasons may disclose an error of law; indeed, one of the purposes of giving reasons is to enable the losing party to decide whether there is an arguable ground of appeal: see English v Emery Reimbold & Strick Ltd [2002] EWCA Civ 605, [2003] IRLR 710, at paragraph 15. However, whether a decision is correct in law or not, it will not be bad for want of reasons if the tribunal has made it clear how it reached its decision. To say, as the appellant does, that the ET has not directed its mind to the correct legal principles and has failed to explain why they do not lead to a different conclusion, is to challenge the substance of the tribunal's decision, not the sufficiency of its reasons.
15. It was because of this confusion that Mr. Tinnion drew our attention to cases such as Abegaze v Shrewsbury College of Arts & Technology [2009] EWCA Civ 96, Bolch v Chipman [2004] IRLR 140, and Force One Utilities Ltd v Hatfield [2009] IRLR 45, in which the courts have set out the approach that a tribunal should take when it finds that the proceedings have been conducted in a scandalous, unreasonable or vexatious manner. It was summarised by Elias L.J. in Abegaze v Shrewsbury College as follows:

"15. In the case of a strike out application brought under paragraph (c), it is well established that before a claim can be struck out, it is necessary to establish that the conduct complained of was scandalous, unreasonable or vexatious conduct in the proceedings; that the result of that conduct was that there could not be a fair trial; and that the imposition of the strike out sanction was proportionate. If some lesser sanction is appropriate and consistent with a fair trial, then the strike out should not be employed."

16. Mr. Tinnion submitted that in the present case the ET had not asked itself whether it was proportionate to debar the appellant from taking part in the remedies hearing relating to Ms. Tipple's claim, much less whether it was necessary or proportionate to strike out both its responses and debar it from taking any further part in either of the proceedings. He drew our attention to the judgment of Pitchford L.J. in Duffy v George [2013] EWCA Civ 908 and argued that there were other, more limited, orders that could have been made which would have ensured a fair trial without altogether depriving the appellant of its right to participate.
17. If this were an appeal on the merits of the ET's decision, these arguments might have had some force. Mrs. Roe was a relevant witness both in relation to her own claim and that of Ms. Tipple, including in relation to the question of remedies. She had clearly been badly shaken by both attempts at intimidation, particularly the afternoon event, and feared for her personal safety. If, as the ET found, she was not fit to be cross-examined, it might have been possible for other measures to have been taken to ensure a fair trial without entirely depriving the appellant of its right to participate. Some were suggested by Mr. Tinnion and others which come to mind include allowing Mrs. Roe to give her evidence in writing without cross-examination. The appropriate response was a matter for the tribunal to determine in the exercise of its discretion but its decision could be challenged on established grounds, one of which is that it was Wednesbury unreasonable and so fell outside the ambit of its discretion. That, of course, was precisely the point raised in ground (5) of the appeal to the EAT.
18. However, the EAT did not give permission to appeal on ground (5) or on any of the other substantive grounds and it follows that it is not open to the appellant on this appeal to challenge the substance of the ET's decision. It can appeal only on a point of law arising from the decision of the EAT, which was itself limited to the question whether the ET had given sufficient reasons for its decision. At one stage in the argument I was unsure whether, by granting permission to appeal on grounds (6) and (7), the EAT had left it open to the appellant to argue that the decision of the ET should be set aside because it had failed to apply the correct principles in reaching its decision. However, if the grounds of appeal are read as whole, I think it is clear that the grant of permission was limited to the question whether the ET had given adequate reasons. That is certainly how the EAT itself understood it and it was not suggested that it was wrong to do so. In those circumstances I think we are bound to proceed on the same basis.
19. The issue for decision on this appeal, therefore, is a very narrow one, namely, whether the ET gave sufficient reasons for its decision to enable the parties, in particular the appellant, to know why they had won or lost. In my view the EAT was right to hold that it had. It found that those conducting the proceedings on behalf of the appellant had acted in a scandalous and unreasonable manner so that it had become impossible to hold a fair trial. The conduct of Mr. Mohammed Kaliq and Mr. Imran Kaliq was extremely serious and spoke for itself, but the tribunal was alive to the need for its response to be proportionate and it considered other options before making its order. It rejected the proposals put forward by Mr. Tinnion, because it did not think that they would meet the needs of the case. It was also conscious that Ms. Tipple and Mrs. Roe would still have to establish their cases. The EAT refused permission to appeal on the merits, so the court is not concerned with whether the decision was sustainable in law. Whether, if there had been an appeal on the merits, the tribunal's decision might have been open to criticism or not, I do not think that there can be any real doubt about the reasons for its decision.
20. I would therefore dismiss the appeal.

Lord Justice McCombe :

21. I agree that this appeal should be dismissed for the reasons given by the Vice-President.

Lord Justice Beatson :

22. I also agree that the appeal should be dismissed for the reasons given by the Vice-President.