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Industrial Tribunals Northern Ireland Decisions
You are here: BAILII >> Databases >> Industrial Tribunals Northern Ireland Decisions >> Herron v BE Aerospace (UK) Limited [2010] NIIT 503_10IT (20 December 2010
URL: http://www.bailii.org/nie/cases/NIIT/2010/503_10IT.html
Cite as: [2010] NIIT 503_10IT
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THE INDUSTRIAL TRIBUNALS
CASE REF: 503/10
CLAIMANT: Suzanne Herron
RESPONDENT: BE Aerospace (UK) Limited
DECISION ON A REVIEW
The decision of the tribunal is that the decision to dismiss the claim, following notification of a consolidated settlement entered into between the parties with the assistance of the Labour Relations Agency, is confirmed on review.
Constitution of Tribunal:
Vice President (sitting alone): Mr Noel Kelly
Appearances:
The claimant was represented by Mr G Daly, Solicitor, of Francis Hanna, Solicitors.
The respondent was represented by Mr P Bloch, of Engineering Employers Federation Northern Ireland.
Issue
1. The issue for the tribunal to determine was:-
“Whether the decision of the tribunal, dated 25 October 2010 and registered and issued to the parties on 26 October 2010, which dismissed the claim following notification of a conciliated settlement entered into between the parties with the assistance of the Labour Relations Agency, should be reviewed in the interests of justice under Rule 34(b) of the Industrial Tribunals (Constitution and Rules of Procedure) Regulations (Northern Ireland) 2005, and set aside.”
Facts not in dispute
2. In a claim lodged on 9 March 2010, the claimant alleged that she had been unfairly dismissed by the respondent and alleged that the respondent had been in breach of contract in relation to a bonus payment which she stated had been due in 2009.
3. The claimant had been employed as a Production Operative by the respondent in their Kilkeel Factory.
4. The claimant was represented by Francis Hanna & Company, Solicitors. Ms M Gavin, a solicitor in that practice, did much of the work on her claim but Mr Gerry Daly, a partner in that firm, was the solicitor with carriage of the case at all times which are relevant to this application for review.
5. The respondent was represented in the course of the tribunal proceedings by Ms Kathryn McCormick, a solicitor employed by the Engineering Employers Federation, at all times relevant to this review application.
6. In addition to the tribunal claim, there was a separate dispute between the respondent and a trade union about the payment of bonuses in the years 2005, 2006 and 2007. The trade union alleged that bonuses for those years were due to a group of staff working in the Kilkeel Factory. That group of staff included the claimant. A ‘lead’ case had been identified (not the claimant) by Francis Hanna & Company and High Court proceedings had been issued and were ongoing at all times relevant to this review application. The respondent was represented in that High Court litigation by Carson McDowell, Solicitors, and not by the EEF.
7. Discussions took place between Mr Daly and Ms McCormick, to resolve the tribunal claim, during working hours on 21 October 2010. Ms McCormick told Mr Daly that she had to get instructions from her client before the discussions could proceed further. At that point, Ms McCormick had been anxious to obtain replies to Notices which had been served on the claimant and, to that end, had already sought and had been granted a Case Management Discussion which had been listed for the next day; ie Friday 22 October 2010. Mr Daly was due to go on holiday in Spain throughout the following week. The full hearing of the tribunal claim was listed for 1 – 3 November 2010, immediately, or almost immediately, on Mr Daly’s return to Northern Ireland from Spain. Both parties, therefore, felt a degree of urgency in resolving the matter, if it could be resolved.
8. Ms McCormick telephoned Mr Daly later on the evening of 21 October 2010, at approximately 7.45 pm, but was unable to speak to him. She left a voicemail on his mobile telephone number. At approximately 8.20 pm, Mr Daly returned that call. The content of the call is the subject of a bitter dispute between Mr Daly and Ms McCormick and I will turn to that dispute shortly. However, it is clear that, during that call, Ms McCormick offered a sum of £2,750.00, on behalf of the respondent, in settlement. Mr Daly said he had to take his client’s instructions and stated that he would get back to Ms McCormick before the Case Management Discussion which was due to take place at 9.30 am on the following morning.
9. Mr Daly telephoned Ms McCormick at approximately 8.30 am on Friday 22 October 2010 and stated that his client was willing to accept the offer. Mr Daly said he would contact the tribunal to cancel the Case Management Discussion and asked Ms McCormick to contact the Labour Relations Agency to process a conciliated settlement.
10. Ms McCormick contacted Mr Damien Rushe of the Labour Relations Agency and told him the terms of the settlement as she understood them to be. She asked him to put those terms in the form of a CO3 (Conciliated Settlement) and to forward a draft’ CO3 to both herself and to Mr Daly.
11. Mr Rushe forwarded the draft CO3 by e-mail to both Ms McCormick and Mr Daly at 10.47 am on the same morning. Those terms read:-
“(1) The respondent shall offer and the claimant shall accept the sum of £2,750.00 in full and final settlement of these proceedings and of all other claims, if any, within the jurisdiction of the conciliation officer, which the claimant could have brought against the respondent arising out of the terms of her contract of employment or out of the termination of that contract. This settlement does not affect any rights the claimant may have in relation to personal injury claims or accrued pension rights.
(2) The respondent makes no admission of liability.
(3) It is agreed between the parties that this settlement and the terms thereof shall remain confidential and shall not be publicised by either party or their representatives.
(4) The respondent agrees to pay the above sum within 21 days of receipt of this agreement, duly signed by the claimant.
(5) The claimant agrees to refrain from continuing these proceedings.”
12. Ms McCormick responded to the Labour Relations Agency 19 minutes later at 11.06 am with “fine at this end”.
13. Mr Daly responded to the Labour Relations Agency almost an hour later at 11.55 am with “fine by me as well!”.
14. Mr Rushe e-mailed both Ms McCormick, Mr Daly and copied to Mary Gavin in the following terms:-
“I shall now e-mail OITFET that settlement has been reached. Please find attached the finalised agreement which Gerry can print off for his client to sign and return to LRA (FAO Sylvia Pedlow).”
15. The agreement was never signed.
16. Mr Daly e-mailed Ms McCormick at 12.08 pm in the following terms:-
“Kathryn, just one point that occurs to me and we touched on this last night. It relates to the claims for unpaid bonus which is being prosecuted in the High Court and subject to outcome of the lead case my client may be entitled to compensation. I need you to confirm that it is understood that this claim is not being compromised by way of this settlement agreement. Please confirm by return.”
17. Ms McCormick responded at 12.13 pm in the following terms:-
“It was never discussed with me and I took it that it was all claims therefore this is an issue for us. I have never been advised about the High Court proceedings and we most certainly did not touch on it last night (can you please confirm what you actually perceived our conversation to have been because I have an [sic] noted our conversation down which lasted three minutes and this did not feature at all).”
18. Ms McCormick e-mailed the LRA, copied to Mr Daly, at 12.44 pm to state:-
“Please inform tribunal as per the case law this matter is now settled on the agreed terms (accepted by both parties via e-mail).”
19. The Labour Relations Agency faxed the tribunal at 1305 hours to state:-
“A settlement has been concluded between the parties as a result of conciliation action by the Labour Relations Agency. The settlement includes an agreement by the claimant to refrain from continuing these proceedings.”
20. Mr Daly e-mailed Ms McCormick, copied to the Labour Relations Agency, at 1305 hours to state:-
“This case is not settled unless it is accepted by the respondent that the annual bonus claim which is the subject of proceedings in the High Court is excluded from the agreement as stipulated by me when I spoke to Ms McCormick yesterday evening and specifically mentioned this.”
21. Mr Daly e-mailed the tribunal at 1529 hours to state:-
“Damien Rushe of the LRA has confirmed to me that you have been advised of settlement in this case. Please note that I wish the case to be heard on 1 November 2010 as listed as I do not accept that there has been a valid settlement. Please pass this correspondence to the President for her urgent attention and if my attendance is required at the tribunal, I will be available to attend later this afternoon.”
22. Ms McCormick faxed the tribunal later on 22 October 2010 to state:-
“This matter has been conciliated through the Labour Relations earlier today. The draft terms were forwarded to both representatives and accepted by e-mail correspondence. Mr Damien Rushe, in his capacity as LRA conciliation contacted the tribunal to advise an agreement had been reached and the case should be dismissed. A valid agreement has been reached between the parties and we would respectfully request that this matter is taken out of the list for substantive hearing on the 1st to 3rd November 2010.”
23. The tribunal claim was dismissed on 25 October 2010 by me following notification of a conciliated settlement entered into between the parties with the assistance of the Labour Relations Agency and containing an agreement by the claimant to refrain from continuing the proceedings.
24. Mr Daly wrote to Ms McCormick on 25 October 2010 and in that letter stated:-
“I fully accept that I sent an e-mail to the LRA at 11.28 am and indicated that the terms as drafted were fine by me. That was sloppy on my part and I fully accept that. I would in my defence say that although I did not consider the past bonus claim at the time of reading the draft agreement, in my mind this had been excluded for the settlement.”
25. Mr Daly gave evidence on oath to the tribunal. In his evidence-in-chief he stated:-
“I admitted immediately on that day (25th October) it was sloppiness on my part – embarrassing but that is what it was – I did not read the document – did not take the time and care to read the document.”
Relevant law
26. Article 20 of the Industrial Tribunals (Northern Ireland) Order 1996 (‘the 1996 Order’) provides for conciliation in industrial tribunal proceedings and in claims which could be the subject of industrial tribunal proceedings. The scope of conciliation is defined in that Article and that scope includes under Article 20(1)(d) proceedings in respect of which an industrial tribunal has jurisdiction by virtue of Article 5 of the 1996 Order. That would include breach of contract claims.
Article 20 of the Industrial Tribunals (Northern Ireland) Order 1996 replicates Section 18(2) of the Employment Tribunals Order 1996 and provides:-
“(1) This Article applies in the case of industrial tribunal proceedings and claims which could be the subject of industrial tribunal proceedings –
(d) which are proceedings in respect of which an industrial tribunal has jurisdiction by virtue of Article 5.
(2) Where an application has been presented to an industrial tribunal, and a copy of it has been sent to the Agency (the Labour Relations Agency) it is the duty of the Agency –
(a) if it is requested to do so by the person by whom and the person against whom the proceedings are brought –
to endeavour to promote a settlement of the complaint without it being determined by an industrial tribunal.”
27. The law in relation to conciliated settlements by ACAS (the LRA’s GB equivalent) has been most recently discussed by the Employment Appeal Tribunal in the case of Allma Construction Ltd v Bonner [UKEATS/0060/09] on 12 May 2010. In that case an unfair dismissal claim was the subject of settlement discussions. A settlement offer of £1,000.00 was made and accepted. The ACAS officer was involved in drafting the terms of the settlement. One day later, the claimant changed his mind about accepting the offer of £1,000.00 and advised the ACAS officer that the claimant had changed his mind and no longer wished to accept the £1,000.00 settlement. The employment tribunal at first instance found that there had been no binding settlement in that the initial offer had been simply an invitation to treat rather than a formal offer. The EAT referred to an earlier decision of the EAT in Duru v Granada Retail Catering Ltd [EAT 281/00] which held:-
“An offer in the contractual sense is an expression of willingness to contract made with the intention that it is to become binding on the person making it as soon as it is accepted by the person to whom it is addressed – a communication not made with the intention that it shall be immediately binding as soon as the person to whom it is addressed signifies his unconditional assent may be better analysed as an ‘invitation to treat’ rather than an offer in the contractual sense.”
28. The EAT held that:-
“Where one party makes an offer to another that is sufficiently definitive to indicate an intention to be bound which covers the essential of the contract in question and it is accepted, a contract is concluded.”
It further held that:-
“As to the effect, if any, of a change of mind by one party, it can only alter the contract or prevent it being concluded, if it is communicated to the other party before offer and acceptance have taken place (Thompson v James [1885] 1 8 D 1).”
29. The EAT further referred to the case of Gilbert v Kembridge Fibres Ltd [1984] ICR 188. In that case an ACAS officer dealt with an offer by the claimant to settle a claim for a specified sum. The employer’s solicitor indicated to ACAS that the employers were agreeable to settling on that basis. The relevant conciliation form was then sent to the employee to complete. The employee initially signed the document but subsequently changed his mind and deleted his signature and returned the form with the signature deleted to ACAS. The EAT upheld the finding by the Employment Tribunal that an enforceable agreement to settle had been reached before the processing of the conciliation form; the agreement did not require to be in writing and offers and acceptances could be communicated through ACAS. The EAT in the Allma case held:-
“Thus, if parties agree to settle a claim in circumstances where an ACAS officer has ‘taken action’, the jurisdiction of the Employment Tribunal is ousted.”
30. The EAT in the Allma case held that the Employment Tribunal had erred in law in holding that there had not been a binding settlement. Once the Employment Tribunal have found that the employer’s agent had offered to settle the claim at £1,000.00 and that that offer had been accepted by the claimant’s solicitor, a binding settlement had been reached.
Dispute between the parties
Mr Daly’s evidence
31. Mr Daly stated that during the telephone conversation at 8.45 pm on 21 October 2010, Ms McCormick said that the £2,750.00 would be in full and final settlement of all claims with a confidentiality clause. He stated that he then, in response to that assertion, stated that settlement did not include the potential claim in the High Court for bonus for 2005, 2006 and 2007 in which the EEF were not involved. He stated that he told Ms McCormick during that conversation that the High Court proceedings were underway and were relevant to everyone in the factory.
32. He stated that he had received the draft settlement terms from the LRA. He did not read the document. That was sloppiness on his part. He did not take the time and care to read the document. He was alerted to the absence of any exclusion of the High Court claim from the terms of the settlement by Ms Gavin another solicitor in his practice.
Ms McCormick’s evidence
33. Ms McCormick stated that the settlement negotiated during the telephone call on the evening of 21 October 2010 was a payment of £2,750.00 in settlement of all claims, other than claims in respect of pension or personal injury.
34. She stated Mr Daly had not said anything about the High Court bonus litigation. That litigation had not been mentioned at all.
35. At that time she had been unaware of the existence of that litigation in which EEF were not involved.
36. If it had been mentioned, she would have had to get further instructions from her client before agreeing to a settlement on those terms.
37. She took a contemporaneous note of the telephone conversation on 21 October 2010. The original of that contemporaneous note was shown to the tribunal and formed part of her examination-in-chief and her cross-examination. That note did not mention the High Court bonus litigation.
38. She stated that she was ‘completely astounded’ by the e-mail received from Mr Daly at 12.08 pm on 22 October 2010 and had responded promptly to that e-mail.
Findings of fact and decision
39. There is a irreconcilable conflict between the evidence of Mr Daly and the evidence of Ms McCormick. Mr Daly said he specifically and clearly excluded the potential High Court claim from the scope of the settlement in the evening telephone conversation on 21 October 2010. Ms McCormick said he did not do so and that he did not even mention that potential High Court claim. Further, she states that she was not, at that time, aware of the existence of the High Court litigation or of a potential claim by the claimant in respect of bonuses for 2005, 2006 and 2007.
40. Mr Daly accepted that he accepted the terms of the draft prepared by the LRA and e-mailed to him on 22 October 2010. That draft clearly did not contain the exclusion that he contends should have been in the agreement.
41. Happily, I do not have to attempt to decide whose evidence to accept. The law is clear. A conciliated settlement does not have to be signed. It does not even need to be in writing. In the present case the terms of the conciliated settlement were not just in writing. They were in writing in a draft on the accepted conciliated settlement form (CO3) prepared by the LRA and the terms were then accepted by both the respondent’s solicitor and the claimant’s solicitor, again in writing, by e-mail on 22 October 2010.
42. On that basis the LRA notified the tribunal that there had been a conciliated settlement and the claim was dismissed by me, on that basis.
43. The draft terms of settlement can only be interpreted in one way. It is a full and final settlement of all claims within the jurisdiction of the conciliation officer. That jurisdiction includes breach of contract claims.
44. Mr Daly does not seek to deny that his intention was to settle the tribunal case for £2,750.00. He argues solely that the potential High Court litigation which might be brought by the claimant was not included in that settlement. Whether the conciliated settlement, as accepted in writing by both parties, and as notified to the tribunal by the LRA, includes any potential High Court claim following the ‘lead’ case in the High Court, and whether the claimant is estopped from pursuing such a claim, is not a matter for me or this tribunal. Should that potential High Court claim ever crystallise, the effect of the conciliated settlement in this jurisdiction will be a matter for the High Court to determine.
45. The decision to dismiss the claim is confirmed.
Vice President:
Date and place of hearing: 10 December 2010, Belfast
Date decision recorded in register and issued to parties: