England and Wales High Court (Queen's Bench Division) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION

		Royal Courts of Justice Strand, London, WC2A 2LL
		19/06/2007

The Hon. Mr Justice Eady :

1. On 8 June 2007 I heard an appeal from a decision of Master Foster given on 11 May 2006 (incorporated in an order dated a week later), whereby the Appellants' claim was struck out on the ground of abuse of process in accordance with the well known principle identified in Henderson v Henderson (1843) 3 Hare 100 (and as explained and redefined in Johnson v Gore Wood [2002] 2 AC 1). They were granted permission to appeal by Tugendhat J in a reserved judgment handed down on 25 January of this year. No order having been made to the contrary, and there being no need to do otherwise, the appeal was approached by way of reviewing the Master's decision and not by way of re-hearing.
2. Mr Mohammad Nazmul Hossain became the lead applicant in 1999 in proceedings before the Employment Tribunal in Stratford. Eventually, the matter was disposed of by way of a hearing which took place on various dates between April and June 2001. The object of the proceedings was expressed in paragraph 1 of the Tribunal's decision as being to obviate the need for further proceedings in respect of the 25 other applicants. It is submitted by the Respondent Bank (formerly Sonali Trade and Finance UK Ltd) that it was thus especially incumbent upon the Appellants to set out the whole of their claim before the Employment Tribunal.
3. Each of the Appellants had been made redundant in June 1999 when the Bank decided to cease its trading activities in this jurisdiction. They each brought claims relating to payments which they had received in respect of their pension entitlements. These had been calculated using a multiplier relating to the length of service and a multiplicand relating to the pay or "emoluments" that they had received.
4. Some of the Appellants conceded that the sums which had been paid to them had been correctly calculated, whereas others (including Mr Hossain) contended that the sums paid in respect of their pension entitlements were wrong since the figure representing the multiplicand should have included, in addition to basic pay, elements representing what has been described as the "protected" or "personal" pay. The details are included in the evidence before the Court, but it is unnecessary to set them out for present purposes.
5. In the original pleading of their claim none of the Appellants had alleged that the multiplicand should have included sums representing housing and foreign allowances. It is apparent that at some stage the question arose as to whether the claims should be amended to include these items. There was certainly reference to this in the written closing submissions of counsel, Mr Gavin Millar QC, who represented the Applicants before the Tribunal. It was also addressed briefly in his oral submissions. According to a note I have seen, it would seem that Mr Millar was asked by the Chairman whether he was seeking at that late stage to make an amendment in that regard, and he responded that he was not.
6. The Tribunal was nevertheless invited to have regard to the argument about housing and foreign allowances, in an unspecified general way, although it is clear that had there been an amendment it could have made a significant difference to the quantification of the monetary claims. Nevertheless, there having been no application to amend, the Tribunal declined to take those matters into account. That decision was subsequently held to have been entirely proper by the Employment Appeal Tribunal (EAT). A point which has been touched upon in the course of submissions is whether such an application would have stood any chance, by that stage, or even have been entertained. That may have some significance because it appears to be part of the Appellants' case that certain remarks of the Chairman would have made it clear that an application to amend would not have been entertained so late in the day.
7. Before the EAT it was part of the Appellants' case that the question of housing and foreign allowances had been one of which the Tribunal was seized and, moreover, that it had erred in not determining it. That appeal was dismissed by the EAT (the judgment being that of Cox J), who decided that, since there had been no amendment, the Tribunal's consideration of the multiplicand had not extended to addressing housing and foreign allowances. That, incidentally, is why subsequently Master Foster held that the issue could not be regarded as res judicata in the conventional sense of issue estoppel.
8. The proceedings now before me were issued on 28 June 2005 and sought to either re-open or raise for the first time the contention that the multiplicand should have taken account of the housing and foreign allowances. It is said that the claim therefore constitutes an abuse of process in accordance with the Henderson v Henderson principles. As a matter of fact, although the Master rejected the submission, the Respondent bank also relied upon issue estoppel for reasons which I shall briefly explain in due course.
9. Before the Master, and indeed on appeal before me, it was submitted that the relatively late disclosure of a particular document, described conveniently as "the 1989 memo", explained how it was that the Appellants had not hitherto been able to identify or to rely upon the housing and foreign allowances argument. It is, therefore, necessary to have regard to certain findings made by the Master in that context. There is no appeal against his findings of fact, and Mr Jones for the Respondent bank submits, accordingly, that his finding concludes this aspect of the case. There is, on the other hand, a dispute as to whether or not the Master's conclusion in this respect had the status of a "finding" at all.
10. It was suggested by Mr Reade QC, for the Appellants, that the Master was not making a finding of fact but merely expressing an opinion. He submitted that the findings of fact were listed numerically just above the relevant passage, but I do not understand the Master to have been listing these as the only findings of fact he was proposing to make. The actual words of the Master, as recorded, were as follows:

"The 1989 memo supported their [the Appellants'] case but made no reference to the allowances being included in emoluments. Therefore, even if the document was made available at a late stage, I am not satisfied that the claimants were adversely affected in the way they were able to put their case".

I would regard that as a finding of fact, albeit expressed in negative form, to the effect that the 1989 memo did not affect the relevant mind or minds.

11. In the skeleton argument put forward by the Appellants in support of their notice of appeal (at a time when they were acting in person) a different argument was advanced; namely, that the lawyers representing the Appellants in the period of April to June 2001 had acted negligently in not applying to amend the Tribunal proceedings. It is right to say that this argument has not been pursued before me, but it nevertheless remains of some significance because of the factual assumptions or assertions implicit in it. It is clearly recognised, in particular, that the argument about foreign housing and foreign allowances had been addressed and discussed with lawyers prior to the stage of closing arguments. (As to the merits of the argument itself, it was obviously not raised before the Master and therefore cannot be identified as in some way demonstrating an error on his part.)
12. As I understand the argument, as it was at that stage being advanced, it is simply that the consequence of the alleged negligence should not be visited upon the Appellants. It might equally be thought that it should not be visited upon the Respondent Bank, which is now being "vexed" with the same dispute some eight years later. If there were any validity in the point, the Appellants' remedy would have lain against their solicitors – subject to any limitation points.
13. Everyone recognised that the relevant principles are set out in Johnson v Gore-Wood, and especially at pp. 30-31 (Lord Bingham) and pp. 59-60 (Lord Millett).
14. Underlying both the strict issue estoppel doctrine and that of Henderson v Henderson are the important public policy considerations that there should be finality in litigation and, correspondingly, that nemo debet bis vexari pro una et eadem causa. One of the new developments to be found in Johnson v Gore Wood is that the abuse of process issues need to be judged in the light of the particular facts of the case, and without rigidity, as was explained at 31C-D:

"It is … wrong to hold that because a matter could have been raised in earlier proceedings it should have been, so as to render the raising of it in later proceedings necessarily abusive. That is to adopt too dogmatic an approach to what should in my opinion be a broad, merits-based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focusing attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before".

It is thus for the party alleging abuse to make out the case and to demonstrate that it is appropriate to characterise the later proceedings as an abuse, for which purpose it will not necessarily suffice to show merely that the issue could have been raised on an earlier occasion.

15. As Lord Bingham made plain also, however, it is not essential to a finding of abuse that there should have been "… any additional element such as a collateral attack on a previous decision or some dishonesty".
16. Against that background, I would conclude on the present facts that if the relevant point (i.e. relating to housing and foreign allowances) could have been taken before the Employment Tribunal, then there is no good reason why it should not have been. Thus, although Lord Bingham emphasised that the one concept does not necessarily follow from the other, I can see no room for middle ground in this particular case. Moreover, it is to be noted that the Appellants do not put their case in this way either. They do not say that it was possible for the point to have been taken before the conclusion of the Tribunal proceedings but that there was some justifiable reason for postponing it to a later occasion. The critical question would, therefore, appear to be whether or not the Appellants could have taken the point.
17. I could understand a situation in which relevant information came to a litigant's attention so late that it was not possible to raise the issue before the conclusion of the relevant proceedings, or where it would have been perceived by the tribunal in question as coming too late, and it would thus be rejected for that reason. In such circumstances it is difficult to see how a court would be able to conclude that the point could have been taken, save theoretically, or for that matter that it should have been taken. I explored this hypothetical scenario in the course of argument, but it does not seem to correspond to the Appellants' case as it was advanced before me.
18. As I have already noted, the 1989 memo had been considered before the written closing submissions of Mr Millar QC were formulated. From a letter of 31 May 2001, in respect of which privilege was waived, reference was made to it by Mr Hossein and he appears to have been giving instructions that an application should be made to amend the proceedings accordingly. No such application was made (for whatever reason). If it was an arguable point, and the Appellants or their advisers wished to advance it, that was the time to put it forward.
19. It is necessary to focus a little further on the significance or otherwise of the 1989 memo. It is Mr Jones's submission that it said nothing about housing or foreign allowances and that the Master was, therefore, entirely correct in his conclusion that its late disclosure could not have accounted for the scales falling from the Appellants' eyes and their wishing to amend the proceedings or at least contemplating that possibility.
20. The memo in question is dated 21 September 1989, signed by the Deputy General Manager, and headed "Fixation of pension amount and rates of pension and payable gratuity for government officers/staff in various grades under general provident fund scheme & pension and death-cum-retirement benefit scheme". The document was entirely in Bengali except for one word, which was "Emoluments". It apparently deals with the specific concepts of raising "the highest ceiling for pension" and enhancing "the percentage rate from 70% to 80% of 'emoluments'". It certainly does not address either housing or foreign allowances. It is therefore to be assumed, submits Mr Jones, that the significance of it is supposed to be the word "emoluments". It might suggest to English lawyers a broad definition of "emoluments" corresponding to that adopted in English employment law and practice. On the other hand, it is important to note that this was not the first time that word "emoluments" appeared over the horizon – so as to cause the scales suddenly to fall from either the Appellants' eyes or those of their English lawyers. The word was appearing in their own case from the time of the further particulars in 2000.
21. Furthermore, in Mr Millar's written submissions he made reference to an earlier memorandum of 2 September 1966 (wrongly described as "1996") and submitted:

"It has long been established that the concept of final 'emoluments' in the public sector Bangladeshi scheme embraces full final pay received by the particular pensioner immediately before retirement".

It is thus difficult to see how the 1989 memo would have made any difference, especially since it does not appear on its face to include any new or broader definition of the concept of "emoluments".

22. In the course of the discussions before the Tribunal Mr Millar was arguing that more elements should have been taken into account in arriving at the correct multiplicand but, on that occasion, he did not cite the 1989 memo as a justification for this change of stance. He relied upon the concession made by a witness called Mr Latif. (That point is no longer pursued and, no doubt, rightly so in view of the way the matter was dealt with before the EAT.) It is accordingly difficult to understand why the 1989 memo should now assume such significance, for the purposes of the present appeal, when it found no place in Mr Millar's explanation before the Tribunal.
23. Accordingly, Mr Jones submits that the Master was entirely correct in his (unchallenged) factual conclusion about the 1989 memo (quoted above). In my judgment, it was certainly one that he was entitled to reach.
24. There were a number of other criticisms levelled by Mr Reade against the Master's decision. First, it is submitted that he erred in his interpretation of the concept of a "broad merits-based approach", in that he appeared to confine himself to considering the merits of the Respondents' abuse application – rather than taking into account also the merits of the underlying claim. No doubt Lord Bingham's phrase was deliberately chosen so that judges should adopt a flexible approach and take into account all the circumstances of the case. Thus I am sure that it was not intended to exclude altogether from consideration whatever might be the merits of the claim sought to be struck out. One could hardly ignore them, for example, when addressing the potential consequences for the parties of either allowing or disallowing the claim to proceed. Nevertheless, I am equally satisfied that the "merits" which are primarily to be considered are (as the Master concluded) those of the abuse application itself. In particular, it is necessary to decide whether or not the label "abuse of process" is justified, and whether or not the party applying to strike out is being or would be impermissibly harassed by the claim being allowed to continue. (As Mr Jones pointed out, it will frequently be the case that an application based on Henderson v Henderson will be directed at what would otherwise be a meritorious claim, since one without merit could be struck out for that reason or dispatched under CPR Part 24.)
25. If a judge decides that the particular claim could have been brought into consideration in earlier proceedings and, what is more, that it should have been so raised, then in my judgment it would be an unusual case in which the court went on to conclude that the merits of the underlying claim were so strong that, nevertheless, the second set of proceedings should not be characterised as abusive and should therefore be allowed to continue.
26. Accordingly, even if the Master gave the impression that he was excluding the merits of the underlying claim from his consideration altogether (which I doubt), I see no evidence that this led him into error in his conclusion on the particular facts of the case. Indeed, the Master was proceeding on the assumption that the Appellants' case on foreign and housing allowances had merit. He could hardly do otherwise, since for the question to be finally resolved it would presumably require investigation into aspects of Bangladesh law with the assistance of expert evidence.
27. Secondly, it is said that he impermissibly drew a conclusion which was not justified on the evidence before him. That relates to a passage in his judgment in which he recorded a finding that there had been a deliberate decision not to amend the Employment Tribunal proceedings to add reference to the housing and foreign allowances. (I leave aside the rather sterile debate as to whether "a deliberate decision" is materially different from a "decision".) What is said is that the Master impermissibly concluded that the purpose of not seeking permission to amend, whether on the part of the Appellants or their then lawyers, was the tactical one of leaving open the opportunity to make a later claim. I am by no means convinced that this is a fair interpretation of what the Master found. What he is recorded as having said is as follows:

"I therefore conclude that it was a deliberate decision of the claimants not to seek an amendment so as not to receive a decision on this issue".

The construction "so as not to receive" is ambiguous. It is not necessarily to be equated with "in order not to receive", and is equally consistent with pointing out a consequence rather than a purpose. Nevertheless, I readily accept that there was no evidence before the Master which would justify the conclusion that Mr Millar or his clients had in mind the purpose of postponing the issue for later determination in separate proceedings.

28. This again, in my judgment, makes no difference to the outcome. Questions of motive or purpose are not germane. The matter is to be judged objectively. Once the Master had decided (as he was entitled to) that there had been a decision not to apply for permission to amend, that would have entitled him, in the absence of any sufficient explanation, to conclude that the opportunity to raise the argument should have been taken at that time.
29. It is also said that the Master erred in principle by applying an old fashioned approach to the Henderson v Henderson jurisdiction, such as was stigmatised by Lord Bingham as "dogmatic". This is a curious submission in the light of the fact that the Master quoted from the speech of Lord Bingham (at pp. 30-31) in extenso and directed himself accordingly. In particular, I see no reason to suppose that the Master failed to distinguish between the question whether the Appellants' argument on the allowances could have been raised and that of whether it should have been raised. He quite clearly concluded that it should have been raised and, moreover, that is a conclusion he was entitled to reach. On a review, it would not be open to me to overturn such a decision. In any event, it is the view at which I should have arrived myself. In the light of the authorities, it seems to me appropriate to characterise the proceedings as involving "unjust harassment" in respect of what is now an old claim.
30. None of the criticisms of the Master's short judgment seems to me to have any validity. He did not misdirect himself in law or reach any conclusion on the facts to which he was not entitled. Strictly speaking, in these circumstances, it is unnecessary for me to address the argument based on issue estoppel. In any event, as Mr Reade points out, the Respondent bank has not cross-appealed. Nevertheless, out of deference to counsel's arguments it would be appropriate to consider them.
31. The Master concluded that issue estoppel could not have application to this case for the very simple reason that the Tribunal was not seized of the matter. That would, at first blush, appear to be a compelling argument. As so often in issue estoppel cases, however, it is necessary to focus closely on what is the res or issue which is said to have been determined. Mr Jones argues that one should look for this purpose to the relevant pleading, which is to be found in paragraph 29 of the further and better particulars served in 2000. The Employment Tribunal was required to rule on the Appellants' entitlement in respect of "the full amount of pension payment due". It is to that very same issue which the present argument now relates. The only difference, he submits, is that the Appellants wish to increase the quantum.
32. Mr Jones suggests that it would no more be appropriate here to permit the introduction of the claim based upon housing and foreign allowances than it would be to permit a claimant in (say) a clinical negligence case to return to court a few years after judgment on the basis that he had thought of a few more heads of claim. The quantification would already have been resolved and his entitlement would have become res judicata. So too here. Although it is surplus to requirements, in one sense, I am persuaded by Mr Jones that this would be the correct approach.
33. In the result, for the reasons I have given above I believe that the Master was correct in his approach to Henderson v Henderson and the appeal is accordingly dismissed.