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United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Deane v London Borough Of Ealing & Anor [1992] UKEAT 33_91_2411 (24 November 1992)
URL: http://www.bailii.org/uk/cases/UKEAT/1992/33_91_2411.html
Cite as: [1992] UKEAT 33_91_2411
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At the Tribunal
Judgment delivered on 20 January 1993
Before
THE HONOURABLE MR JUSTICE WOOD MC (PRESIDENT)
MR D G DAVIES
MR K M HACK JP
(2) MR B CROFTON - THE LONDON BOROUGH OF HACKNEY
Transcript of Proceedings
JUDGMENT
Revised
APPEARANCES
For the Appellant Mr T Nicholls
(Solicitors
Messrs Dibb Lupton Broomhead
London Wall
LONDON EC2Y 5AE
For the Respondents (First) Mr B Cotter
(of Counsel)
London Borough of Ealing
Percival House
14-16 Uxbridge Road
LONDON W5 2HL
(Second) London Borough of Hackney
Mr B A Crofton
(In Person)
Director of Housing
287 Mare Street
LONDON E8 1ER
MR JUSTICE WOOD (PRESIDENT) Mr Deane, who was the Applicant before and Industrial Tribunal sitting at London (North) on 30th and 31st October 1990 under the Chairmanship of Mr D B Williams, appeals against the amount of damages awarded to him under the provisions of the Race Relations Act 1976. The first Respondents, London Borough of Ealing were Mr Deane's employers and Mr Bernard Crofton, the second Respondent, was at the relevant time Director of Housing. The award of £950 was made as to £500 for injury to feelings, £250 for aggravated damages and £200 for loss of opportunity arising out of the act or acts of discrimination.
It was not until the hearing before the Industrial Tribunal that the claims for aggravated or for exemplary damages were clearly indicated, and without criticism of anybody in particular, it was agreed before us, by both advocates, that it would in the future be sound practice for an indication to be given as early as possible that such damages were to be claimed. We endorse that view.
Mr Deane is still employed by the Borough and has been appointed to the position of Principal Housing Officer (Policy and Resource). By his originating application which was dated 15th December 1989, he alleged that the Borough, through the actions of Mr Crofton, had refused to establish him in that post and had done so because he had been directly discriminated on the grounds of his race. He is white and has taken up the muslim religion. The notice of appearance was dated 15th January 1990 and was filed on behalf of both Respondents.
Subsequently, Mr Crofton left the employ of Ealing and moved to Hackney. As a result a letter was sent from the Legal Department of Ealing indicating that the Head of Legal Services, Mr Polson, was no longer instructed to act on behalf of Mr Crofton. Notification of this was sent to the Industrial Tribunal with copies to Mr Dean's solicitor and to Mr Crofton himself.
Although initially discrimination had been denied by Ealing, in a letter of 17th October 1990 an admission was made, so that thereafter the only issue was damages. An offer was made with the admission, but this was not accepted by Mr Deane or his advisers. The offer was to restore him to the post to which he was appointed, to pay him £500 compensation for injury to his feelings and to pay for any financial loss and compensation directly attributable to the issue. Ealing clearly wished to rectify the position and to pay reasonable compensation.
On the first day of the hearing Mr Crofton did not appear. The Tribunal was told by Mr Deane's solicitor that no appearance had been entered by him and it was submitted that as a result he should be debarred from defending the proceedings. This would have been an order under Rule 3(2) of the Industrial Tribunal Rules. Unsuccessful attempts were made to trace Mr Crofton who did not appear until the second day.
At the sitting of the Tribunal on the second day the Chairman gave a ruling as follows - "I do not give leave to second respondent to enter a notice of appearance out of time and do not validate the document as a notice of appearance."
The Chairman's Note continues a little later indicating that Mr Crofton arrived. He was told that he was discourteous and that the decision had already been made. He left. Some documents had apparently been sent in by Mr Crofton.
The hearing then proceeded and no award of damages was made against Mr Crofton personally.
At the hearing of this appeal, Mr Deane was most anxious that a finding of discrimination and also an award of damages should be made against Mr Crofton personally.
After submissions, it seemed common ground that Mr Crofton had in fact entered an appearance at the Industrial Tribunal and therefore Rule 3(2) was not applicable. The only other possible Rules under which he could have been prevented from being heard were Rule 8(3) and Rule 7(3). In the circumstances which occurred, it did not seem to us that they were applicable and we therefore decided, without real objection, to allow him to make representations before us. We did not allow him to adduce further evidence.
For the purposes of compensation an act of discrimination under Part 2 of the Act is treated as a statutory tort and the remedy is by way of damages, such damages as could have been ordered by a County Court, but by S.57(4) they can include compensation for injury to feelings. Damages are compensatory. The view taken by this Industrial Tribunal was that Mr Crofton was acting in the course of his employment by Ealing Borough Council and therefore that any award of damages should be made against the Borough. It seems to us that that was a proper approach for them to take, and we can see no reason in law why they should not have done so. In order to do so they found that Mr Crofton had committed an act of direct racial discrimination and therefore the submissions made for and against Mr Crofton did not seem to us to be relevant to the issue on the appeal before us.
Before the Industrial Tribunal Mr Deane gave evidence and was supported by Mr Krishna Sarda, the Chief Racial Equality Officer. The Industrial Tribunal saw and heard the witnesses and it is perhaps in cases such as the present, where the ability so to do is of an enormous advantage.
The background to this whole issue is important. The Housing Department of the Borough was being reorganised. There were four areas: Acton, Southall, Northolt and Ealing. There were two Assistant Directors who were each responsible for two areas and in charge of each area was a Principal Housing Officer. These were equal posts and new posts. In addition to the responsibility for the area they each had an advisory role, one of which was "policy and resources". Mr Crofton told us that this reorganisation was very much something which he had originated and supported.
There was clear evidence before the Industrial Tribunal indicating that there had been earlier problems in filling the four Principal Housing Officer posts and that allegations had been made of "canvassing" and "fixing". The Equal Opportunities Unit had recommended that no one involved in earlier rounds should be involved at the next attempt to make appointments. Mr Sarda had been involved in the earlier applications and panels. Before going on leave, Mr Crofton had made it clear that no actual appointments were to be made until his return from leave, as he wished to allocate the individuals selected between the four posts.
Mr Deane applied for one of the four posts and in particular, whichever one it was, to have the advisory role on policy and resources. He was selected, he was appointed and there was some correspondence about the details of his appointment and his remuneration because of the salary attached to the posts. Although the Tribunal found that there was a contractually binding appointment, it seems to the members of this Tribunal that there might well be some doubt about that, as the correspondence indicates counter offers. However, for the purposes of this appeal we proceed on the finding that it was a contractually binding appointment. This appointment was made during Mr Crofton's absence.
Upon his return Mr Crofton found that Mr Deane had been appointed to Southall. This meant that the Assistant Director and Mr Deane were both white. Mr Crofton felt that that was undesirable. He therefore decided and announced that he was not going to have two white men in Southall. He was therefore not prepared to confirm the appointment as Principal Housing Officer of Mr Deane to Southall. This was clearly a decision reached on the grounds of Mr Deane's race. He was white and Mr Crofton wanted an Asian or Black in that particular post. The other Principal Housing Officers were Asians.
The reason which Mr Crofton had for this decision was that he wished to make arrangements to afford people of the Asian racial group access to services to meet their special needs in regard to their welfare and ancillary benefits, and he believed that they could be most effectively provided if the Principal Housing Officer to the Southall area was of Asian origin and with Asian language skills. He and the Chairman of his committee both took that view. Mr Crofton was clearly incensed by what had happened in his absence and in the light of the reorganisation which he had planned.
From the documentation which is before us, and which is voluminous, it is clear that there was personal antagonism between Mr Crofton and Mr Sarda, and Mr Crofton and Mr Deane. This was to some extent corroborated by the desire of Mr Deane to obtain an award of damages against Mr Crofton personally.
The basis of the appeal was that the award for injury to feelings and the award for aggravated damages were so low as to amount to perverse decisions, and that it was wrong to refuse exemplary damages in the light of the fact that the decision of this Court in Bradford v. Arora [1989] ICR 442 was erroneous as the decision had been reversed in the Court of Appeal. We do not understand that the award of £200 by way of compensation for loss of opportunity to be challenged.
Before turning to the submissions in detail, it is material, in our judgement, to refer to the attitude and appreciation of the situation by the Industrial Tribunal that when dealing at the end with the possibility of costs they said this -
"9 It may well be that the parties will wish to come back to the Tribunal on another occasion to deal with the question of costs. Our view at the moment - and we may well be persuaded to a different view when we hear further argument - is that the first Respondent should be ordered to pay the Applicant's costs up to the date of their admission in October and that the Applicant be ordered to pay the Respondent's costs thereafter, to include the costs of hearing of the case. That we feel at the moment would do justice between the parties. However, we are willing to listen further argument and to amend our view, if that is appropriate, at a further hearing. We would request the parties to notify the Tribunal within 28 days either that they have disposed by agreement of all outstanding aspects or that they wish us to reconvene to hear further argument."
The indication there given was that the offer made in October 1990 was clearly reasonable.
We turn to the various headings.
Exemplary damages
The claim so far as compensation is concerned is based on the statutory tort created by the Act 1976. This is clear from the reasoning of May LJ in Alexander v. Home Office [1989] ICR 685 at p.692E. Arora was considered very recently by the Court of Appeal, Sir Thomas Bingham M.R., Stuart Smith and Simon Brown LJJ, in a decision handed down on 16th November 1992, Gibbons v. South West Water. The ratio of Arora was held not to be binding upon the decision of the Court of Appeal in the Gibbons case where it decided that examplary damages were only to be awarded in respect of damages for torts, statutory or common law, which existed prior to the decision in Rookes v. Barnard [1964] AC 1129. It was therefore decided that exemplary damages could not be made by a court or a tribunal for a tort which came into existence after 1964. This decision is clearly binding and the appeal on exemplary damages therefore fails.
On the issue of damages for injury to feelings and aggravated damages the Tribunal had cited to them all the relevant authorities.
Aggravated damages
The finding of the Industrial Tribunal was as follows:-
"6. Going on to the issue of aggravated damages, it is conceded by the Respondent that this is separate from the injury to feelings, that the Notice of Appearance did not contain any admission and should have done so. Any damages to be awarded, over and above any award of costs, should be restricted to £250. We take into account the motive of Mr Crofton. We regard his behaviour as reprehensible to some extent but we do not accept that he was malicious or oppressive in his behaviour. As he did not give evidence, we are not in a position to assess his motives. Again doing the best we can, he seems to have been motivated by an impression he had formed of the object of the legislation which we all agree is to reduce and, if possible to eliminate discrimination on racial grounds. We accept that Mr Crofton uttered the infelicitous phrase about having "two white faces". We cannot accept that he was anything other than misguided and had misunderstood the law. He is not in bad company in misunderstanding it or in finding difficulty in applying it. Many engaged in the field of race relations feel themselves torn between positive discrimination favouring ethnic minority groups and actively discouraging all acts which discriminate against ethnic groups, whichever those ethnic groups may be, wether minority or majority, black or white. In those circumstances, we accept the first Respondent's suggestion that we should not award more than £250 in respect of aggravated damages. Again it is possible that we would have been persuaded to award less."
Mr Nicholls for the Appellant takes the point that no one who knew anything about the law and indeed no one who was aware of the decision in London Borough of Lambeth v. Commission for Racial Equality [1990] ICR 768 could have thought that a valid defence could be made under S.5(2)(d) of the 1976 Act. We were also referred in this connection to Tottenham Green Under Five's Centre v. Marshall (No.2) [1991] ICR 320.
The submissions before the Industrial Tribunal were comprehensive and detailed as is indicated from the Notes of Evidence and Mr Nicholls who has appeared before us has repeated those submissions to us. It seems to us quite clear that the Tribunal did take into account the submissions which had been made to us on the basis of motive and of the way in which Mr Crofton dealt with the matter; they were essentially in the mind of the Tribunal when it reached the decision which it did.
It is important for us to bear in mind the guidance given by Lawton LJ in Skyrail Oceanic Ltd v. Coleman [1981] ICR 864 at p.872A where he says -
"In my judgment, appellate courts when reviewing the assessment of compensation by industrial Tribunals should act as they do when reviewing awards of damages by judges sitting alone. Mr Lester submitted that they should deal with awards made by industrial tribunals in the same way as they dealt with awards made by juries. I do not agree. Industrial Tribunals are presided over by chairmen who have legal qualifications. Reasoned decisions are given, including reasons for making awards. The giving of reasons distinguishes their decisions from the verdicts of juries. If they have acted on a wrong principle of law or have misapprehended the facts or for other reasons have made a wholly erroneous estimate of the damage suffered, an appellate court can interfere: see Davies v. Powell Duffryn Associated Collieries Ltd [1942] A.C. 601, 617, per Lord Wright."
Bearing that principle in mind we are not satisfied that the figure of £250 for aggravated damages is, in the circumstances, wholly outside the bracket which was open to the Industrial Tribunal.
That leaves the question of damages for injuries to feelings.
Damages for injuries to feelings
The most recent case in which damages for injuries to feelings has been considered is Sharifi v. Strathclyde Regional Council [1992] IRLR 259. That is a decision of this Appeal Tribunal sitting in Edinburgh presided over by Lord Coulsfield. In that case the award of compensation was £750 in respect of loss of opportunity, disadvantage in the job market and injury to his feelings. There was no sub-division under each heading. The learned Judge considered the principles to be applied and cited the judgments of May LJ in Alexander and Lawton LJ in Skyrail Oceanic Ltd.
In that decision the Appeal Tribunal took the view that an award of £500 for injury to feelings could be regarded as at or near the minimum. With this we would entirely agree. The total award of £750 was increased to a total award of £1,500. Giving its reason the learned Judge said - "We would not, of course, be inclined to interfere with the award of the industrial tribunal unless it was substantially out of line with what we consider to be appropriate. In the present case, however, we have come to the view that the appropriate award of compensation would have been £1,500. We shall, therefore, allow the appeal and substitute the award of £1.500 for the sum awarded by the industrial Tribunal."
This industrial tribunal saw and heard the witnesses as we have pointed out and took into account the documentation and the background to this matter. We therefore ask ourselves whether the award of £500 which was offered in October is "substantially out of line with what we consider to be appropriate" or a wholly erroneous estimate of the damage suffered. To seek to apply the latter test of Lawton LJ is to indicate that in only very rare cases would it be right for this Tribunal to interfere.
As might well be expected in a difficult problem such as the present, the initial approach of the members of this Appeal Tribunal has varied. Mr Garfield Davies took the view that the Tribunal had seen and heard the witness and were entitled to indicate that they were not over-impressed by the sense of injury of the Applicant. Mr Kenneth Hack took the view that a man with significant service and seniority in a responsible position such as the Applicant, and bearing in mind the level of the new appointment in relation to that which he already held he should have received a greater sum and the award was substantially out of line. He would therefore treble the figure to £1,500 for this item of damage.
My own approach is that we are dealing with injury to feelings and to no other head of damage, and that the evidence of injury to feelings of the Applicant supported by Mr Khrisna Sarda was detailed and of very considerable weight. There was no evidence to the contrary. Although the Tribunal had the inestimable advantage of seeing and hearing the witnesses and assessing their reactions, it clearly had considerable doubts in its mind as to the effect on the Applicant, but they did not specifically disbelieve his evidence or deal with it in detail. In the circumstances therefore, I take the view within the principle enunciated by Lawton LJ that this Tribunal must have misapprehended the facts and I would have doubled the figure of £500 for injury to feelings to £1000.
Having discussed this matter between us we have reached the unanimous conclusion that the fair adjustment of the damages to injury to feelings in the present case is to alter the award of £500 to £1000 and therefore the total award would be correspondingly increased. The appeal is allowed to this extent.