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BAILII case number: [1992] UKEAT 599_89_1606

Appeal No. EAT/599/89, EAT/27/90

EMPOLYMENT APPEAL TRIBUNAL

4 ST. JAMES'S SQUARE, LONDON, SW1 4JU

At the Tribunal

On 17 March 1992

Judgment delivered 16 June 1992

Before

THE HONOURABLE MR JUSTICE WOOD MC (PRESIDENT)

MRS M L BOYLE

MR J A SCOULLER

EAST BERKSHIRE HEALTH AUTHORITY APPELLANTS

MR A MATADEEN RESPONDENT

Transcript of Proceedings

JUDGMENT

Revised

APPEARANCES

For the Appellants Mr P Elias QC

Messrs J Tickle & Co

Solicitors

Victoria House

Vernon Place

LONDON WC1B 4DP

For the Respondent Mrs L Cox

(of Counsel)

Messrs Robin Thompson & Partners

Solicitors

Bainbridge House

Bainbridge Street

LONDON WC1A 1HT

MR JUSTICE WOOD ...PRESIDENT) In an Originating Application received on 28th March 1989 Mr Matadeen alleged that he had been unfairly dismissed by his employers the East Berkshire Health Authority. By a decision promulgated on 19th October 1989 an Industrial Tribunal sitting at Reading under the Chairmanship of Mr Jenkinson found that his dismissal was unfair but that he had contributed to his dismissal, that contribution was assessed at 50 per cent. The hearing on remedies took place on 2nd November 1989 and by a decision promulgated on 9th November 1989 the Tribunal unanimously decided that Mr Matadeen should be re-engaged. The terms of re-engagement were set out in that order. On 13th December 1989 the same Tribunal rejected the Health Authority's submissions that such re-engagement was not practicable and awarded Mr Matadeen £4,264 by way of compensation for failure to comply with that order. The calculation of the basic and compensatory awards was left for negotiation.

The Health Authority has appealed. By agreement with counsel on both sides we have heard the appeal on the issue of liability first. Our decision was that that appeal be allowed and we now give our reasons.

The facts are as follows. Mr Matadeen was born on 12th May 1938 and at the time of his dismissal, on 11th January 1989 was a charge-nurse - the male equivalent of a sister - at Churc Hill House Hospital, Bracknell in Berkshire. He had been employed by the Respondents since 1st July 1978. At all material times Mr Matadeen worked on night duty, which starts at 8 p.m. The Hospital provides full time residential care for patients who are mentally ill, and also for some who are physically handicapped. There are a number of wards and some are locked wards. We saw the detailed job description of a charge-nurse, which showed that the duties included that of management and supervision of nursing staff.

On Thursday 3rd November 1988 a disciplinary interview took place as a result of which Mr Matadeen received a final formal admonition which was to remain on his file for six months. He was so notified in a letter of 7th November. Prior to that incident Mr Matadeen had been a night co-ordinator but as from that date he was demoted to the position of night charge-nurse. The basis for that disciplinary action was that the Health Authority believed that he was asleep on duty in the early hours of Wednesday 2nd November 1988. His behaviour was said to be unacceptable and if repeated could result in his dismissal. He was told of his right to appeal, but he did not do so.

The Disciplinary and Grievance Procedure of the Berkshire Area Health Authority was before the Industrial Tribunal and it is before us. Under the heading "Misconduct" there is provision for "minor misconduct" and "serious misconduct". The latter is described as

"... in certain circumstances where the employee's conduct is of such a degree that it seriously interferes with the smooth running of the service or affects the health or safety of other staff or patients it should be considered to be a matter of serious misconduct, for example

(i) serious dishonesty

(ii) dangerous or wilful breaches of safety rules

(iii) aggravated or repeated misconduct of a minor nature

(iv) breaches of confidence relating to patients"

Provision is made under the heading "Levels of disciplining" for oral warnings, formal admonition, suspension and dismissal. Under the heading "Formal admonition" at 9(b)(iii) the following words appear -

"The length of time which the admonition remains on the personal file depends on the degree of seriousness which management attaches to the breach up to a maximum of 6 months."

As we read paragraphs 13 and 14 of those procedures a formal admonition is considered to be more serious than an admonition or an oral warning.

Thus, although the phrase used in the letter of 7th November 1988 was 'unacceptable behaviour' it seems to us quite clear on reading the procedures and looking at the circumstances together with the maximum period of time during which the formal admonition was to remain on the file, that this was considered, and properly considered, to be serious misconduct.

In November 1988 members of staff were engaged in industrial action because of discontent at the new national system of staff grading. The result was that management had to make ad hoc decisions at the beginning of shifts as to who was to staff the wards. Mr Matadeen was not involved in that action, although he was participating in an overtime ban. There was a picket line outside the Hospital and anxieties ran high. It would also seem clear that the difficulties facing the Hospital Authorities were substantial.

During this period two senior nursing officers and other staff received what were described as nuisance calls on the internal house telephone. They would pick up the telephone in answer to a call and find that there was no one at the other end; staff received a "bleep" call to a ward and then found on arrival that they had not been summoned there and were not wanted. The staff became angry and worried about the calls. They were asked to record the timing of the calls and to make notes whether anything was said. Coincidentally, a "call logger" apparatus was installed and it was possible to collate information from that.

When tabulated, the figures showed reported nuisance calls on five nights between 22nd and 27th November 1988. This was during the period of industrial action. On 22nd November there were 26 calls from a ward where Mr Matadeen was on duty. There were no recorded calls on 23rd or 24th November and on those days Mr Matadeen was not on duty. On 25th November there were 12 reported calls all coming from a ward where Mr Matadeen was working. On 26th November there were 10 nuisance calls from a different ward on which Mr Matadeen was working that night. On 27th November there was one reported nuisance call from a ward where Mr Matadeen was on duty and thereafter there were no reported calls. On occasions another member of staff was working on a ward with Mr Matadeen.

The Tribunal make a specific finding that

"Mr McCallum the respondents' Care Services Manager in their Mental Handicap Services Unit formed the view that whoever had made the calls was guilty of gross misconduct ..."

As a result of investigation suspicions fell on Mr Matadeen and on 7th December 1988, Mr McCallum wrote to Mr Matadeen as follows -

"I must inform you that you are required to answer an allegation of gross misconduct, the principal details of which are as follows:-

That on the following night shifts you abused the Hospital telephone system by making nuisance calls and on occasions misused the bleep system.

Tuesday 22 November 1988

Friday 25 November 1988

Saturday 26 November 1988

Sunday 27 November 1988

That these nuisance calls were made while night staff were in dispute about their conditions of work and there was discontent amongst staff at the hospital"

The letter continued by requiring the attendance of Mr Matadeen at a disciplinary hearing and warning him, "I must advise you that following this hearing, convened to consider whether gross misconduct has taken place, you may be dismissed."

Miss Williams, the Unit General Manager, opened the disciplinary hearing on 12th December, when documentation was made available to Mr Matadeen and his representative and the matter adjourned to 21st December.

On that occasion Mr Matadeen agreed that he had made some nuisance calls but denied being responsible for all of them.

At the end of the meeting on 21st December, Miss Williams felt it impossible to decide what action to take. Mr Matadeen had given no reason or justification for his actions and Miss Williams felt it would be right to give him a further opportunity to do so. She was satisfied that his action constituted serious misconduct but considered that the issues required further thought. A query had been raised on Mr Matadeen's behalf about the operation of the "logger" and this needed investigation.

By the time this had been done, the Christmas period passed and with the difficulty in re-assembling all those involved, the further meeting was delayed until 9th January 1989. On this occasion Mr Matadeen was represented by Miss Lambert and Mr Philby of COHSE.

He admitted that he was making the calls in order to be a nuisance.

Miss Williams told him that he was to be dismissed for what she described as unacceptable behaviour. On 11th January Miss Williams wrote confirming the decision to terminate Mr Matadeen's employment. An appeal duly took place but the decision to dismiss was upheld.

In answer to a request from the Trade Union Mrs Toy, Director of Personnel, wrote on 26th June.

"Mr Matadeen was dismissed because the Unit General Manager concluded that he has misused the Hospital's telephone system ... and this amounted to serious misconduct and conduct which was not commensurate with his continuing to work for the Authority as a Charge Nurse. The Unit General Manager thought that this matter alone warranted his dismissal. She then considered the final warning given to him in her letter of 7th November 1988 and concluded that he should be dismissed. ..."

The Tribunal found that the reason for the dismissal was conduct.

The only possible criticism of procedure is contained in paragraph 9 of the Decision wherein the Tribunal comment that no enquiries had been made to ascertain whether any other person had been responsible for making calls because Mr Matadeen had only admitted responsibility for some of then but then continue,

"... We do not suggest that any other person had been involved but enquiries should have been made to ascertain whether or not anyone else was involved".

It seems to us that that enquiry was entirely superfluous, if the view taken was that it was immaterial. It is not suggested that this Health Authority did not have sufficient evidence before it on which to reach a conclusion that Mr Matadeen was responsible, in any event, for a substantial number of calls and that he had admitted that he did this in order to be a nuisance.

The Tribunal found that the dismissal was unfair on two grounds. First it considered that the decision to dismiss was not within the band of reasonable response for this employer in these circumstances. Secondly, it took the view that the Respondents were not entitled to take into account the earlier warning which had been given less than a month before the conduct complained of, because the allegation of misconduct which was the basis that earlier warning was of different behaviour from that for which he was dismissed.

It is conceded by Mrs Laura Cox for Mr Matadeen that the second ground is wrong in law in the light of a subsequent decision of this Court in Auguste Noel Ltd v. Curtis[1990] IRLR 326. In that case we followed an earlier decision of Lord McDonald in Stein v. Associated Dairies Ltd [1982] IRLR 447, paragraphs 5 - 8.

How then should we summarise the facts found by the Industrial Tribunal and the reasonable inferences to be drawn from them and upon which the decision to dismiss was taken? Mr Matadeen was an experienced nurse in a post with managerial responsibility. In November 1988, less than a month before the incidents of which complaint is made, he was demoted from night coordinator to night charge nurse on the grounds which, on a true understanding of the situation, must have amounted to gross misconduct. If not, it was at least to be considered a very serious matter. Whilst industrial action was taking place and at a time when the Hospital management were clearly having severe problems with staffing the wards efficiently during nights, he, as one of the senior charge nurses with a managerial responsibility, was using the telephone or the bleep system in order to disrupt the workings of the Hospital. This he admitted. There was no reason or justification for his action.. Although Mr Matadeen did not accept that he was responsible for all the nuisance calls the Tribunal did not think it necessary to suggest that any other person had been involved. The disruption took two forms. First, that staff who might have been attending to a patient were called to the telephone and then found it going dead, and secondly, that staff were called to a ward and then found on arrival that they were not wanted and it was a false call. It is also apparent that the staff were angry and worried about the calls and it was causing anxiety. In considering contribution of 50% the Tribunal found, "His activities hampered the smooth running of the service."

The Tribunal directed itself that it should not substitute its own decision for that of management but did not specifically mention the band of reasonable response based upon the decision of Iceland Frozen Foods Ltd v. Jones [1983] ICR 17.

The Tribunal did not consider that this employer was entitled to regard this as gross misconduct and therefore grounds for a dismissal. It gave three grounds for this view. First, that the behaviour did not fall within the examples given in the Grievance and Disciplinary Procedure. Secondly, it relied upon the fact that Mr Matadeen had not been suspended from his post during the investigation and thirdly, that if his behaviour had truly constituted serious misconduct it would have merited action between 21st December 1988 and 9th January 1989.

For the reasons which we have already indicated on the findings of fact, it seems to us that it was clearly open to the employers to take the view that this was serious misconduct. Upon the findings of fact made by the Industrial Tribunal it is difficult to see how any other view can be held.

Secondly, in its decision the Tribunal find that the reasons given by Miss Williams for not suspending the Applicant were sound reasons but were not compatible with the management's argument that the conduct constituted serious misconduct justifying dismissal. If this were to be sound reasoning in industrial relations, it would follow, as was pointed out during submissions by the industrial members of this Court, that employers would be minded to suspend at every juncture even though full investigation had not taken place. Suspension is undoubtedly a stigma, an indication that the employee is under suspicion and it seems to them that good industrial practice does not require suspension in every case. It would be extremely unwise, save in obvious cases, to draw any inference or conclusion from the suspension or a lack of suspension. It would discourage management from treating employees with compassion and acting in a way which they thought was reasonable in the circumstances. It could be argued that the more serious the misconduct the more detailed should be the enquiry before reaching a final conclusion. The Authority's disciplinary procedure indicates that suspension is a matter for discretion of management where serious misconduct is involved, consequently Miss Williams was, in any event, complying with that procedure.

Thirdly, the comment on the delay in action between 21st December and 9th January as a ground for finding that the conduct was not misconduct meriting dismissal seems to us unsustainable in the light of the specific finding of the Tribunal at paragraph 6(j) -

"At the end of the meeting on 21 December Miss Williams felt it was impossible to decide on what action to take. Mr Matadeen had given no reason or justification for his actions and Miss Williams felt that it would be right to give him a further opportunity to do so. She was satisfied that his action constituted serious misconduct but considered that the issue required further thought. A query had been raised upon Mr Matadeen's behalf about the operation of the logger and this had to be investigated."

There were two reasons for the adjournment. First, that Miss Williams wanted time to think about it and was looking for some further explanation and secondly, that the operation of the logger needed to be checked and investigated. To criticise the employers for either of those courses seems to all of us to be wholly unreasonable in the context of industrial relations.

However, lastly, we take the view that on an overall reading of paragraphs 11 to 13 of the Tribunal's Decision, the Tribunal, although having warned itself not so to do, had in fact substituted its own view for that of the employers. This is evident from the use of a phrase in paragraph 11 where they start their reasoning.

It follows that in our judgment the Industrial Tribunal on the facts which it had found erred in law in reaching the decision that to dismiss for misconduct was outside the band of reasonable response by this employer in these circumstances.

The addition of the ingredient of the earlier warning will simply emphasise the correctness of the decision of the Respondents.

Mr Patrick Elias only relies on the plea of perversity as a last resort. He submits that there are clear indications that this Industrial Tribunal otherwise erred in law.

Mrs Laura Cox in her helpful submissions has argued every point which could properly be put forward and did so persuasively. Her main contention was that this whole decision of the Industrial Tribunal was based on findings of fact and that it was therefore unassailable. She stressed that the Tribunal had seen and heard the witnesses and that this Court should not fall into the trap of reaching its own conclusions upon those facts. Reasonableness was an issue of fact provided that the Tribunal had correctly directed itself on the matters which should or should not be taken into account.

We were first referred to UCATT v. Brain [1981] ICR 542 and in particular to the passage in the judgment of Donaldson LJ at p550A-D where he said

"... Whether someone acted reasonably is always a pure question of fact, so long as the tribunal deciding the issue correctly directs itself on the matters which should and should not be taken into account. But where Parliament has directed a tribunal to have regard to equity - and that, of course, means common fairness and not a particular branch of the law - and to the substantial merits of the case, the tribunal's duty is really very plain. It has to look at the question in the round and without regard to the lawyers's technicalities. It has to look at it in an employment and industrial relations context and not in the context of the Temple and Chancery Lane. It should, therefore, be very rare for any decision of an industrial tribunal under this section to give rise to any question of law. And this is quite plainly what Parliament intended.

Of course, a tribunal can approach this simple question in a way which is other than that which Parliament intended. However, where Parliament has given to the tribunal so wide a discretion, in my judgment, appellate courts should be very slow indeed to find that the tribunal has erred in law. When I refer to appellate courts I do not mean only the Court of Appeal, because, although the Employment Appeal Tribunal calls itself a tribunal, it, like its predecessor, is declared by statute to be a superior court of record."

She also referred us to British Telecommunications Plc v. Sheridan [1990] IRLR 27 and the judgment of the learned Master of the Rolls at paragraphs 34 and 35 where he said -

"... Any court with the experience of the members of the Employment Appeal Tribunal, and in particular that of the industrial members, will in the nature of things from time to time find themselves disagreeing with or having grave doubts about the decisions of Industrial Tribunals. When that happens, they should proceed with great care. To start with, they do not have the benefit of seeing and hearing the witnesses, but, quite apart from that, Parliament has given the Employment Appeal Tribunal only a limited role. Its jurisdiction is limited to a consideration of questions of law.

On all questions of fact, the Industrial Tribunal is the final and only judge, and to that extent it is like an industrial jury. The Employment Appeal Tribunal can indeed interfere if it is satisfied that the Tribunal has misdirected itself as to the applicable law, or if there is no evidence to support a particular finding of fact, since the absence of evidence to support a finding of fact has always been regarded as a pure question of law. It can also interfere if the decision is perverse, in the sense explained by Lord Justice May in Neale v. Hereford & Worcester County Council [1986] ICR 471 at 483."

However she particularly relies upon a passage in the judgment of the learned Master of the Rolls, Lord Donaldson of Lymington, in the recent case of Piggott Bros v. Jackson [1992] ICR 85 where in commenting on a reference by this Court to the judgment of May

LJ in Neale v. Hereford and Worcester CC [1986] ICR 471/483 he says -

"This last is an allusion to the now very familiar sentence:

"Deciding these cases is the job of industrial tribunals and when they have not erred in law neither the appeal tribunal nor this court should disturb their decision unless one can say in effect: 'My goodness, that was certainly wrong.' "

I accept, as I must, the exposition of May LJ in Neale's case. Indeed it has the added authority of, I think, being derived, albeit expressed in more homely terms, from the speech of Lord Diplock in Council of Civil Service Unions v. Minister for the Civil Service [1985] ICR 14, 37-38, where he said that a decision which was plainly wrong could found an application for judicial review and that it was no longer necessary to resort to Viscount Radcliffe's explanation in Edwards v. Bairstow [1956] AC 14 of irrationality as raising an inference of an unidentifiable mistake of law.

Nevertheless it is an approach which is not without its perils. A finding of fact which is unsupported by any evidence clearly involves an error of law. The tribunal cannot have directed itself, as it should, that findings of fact need some evidence to support them. The danger in the approach of May LJ is that an appellate court can very easily persuade itself that, as it would certainly not have reached the same conclusion, the tribunal which did so was "certainly wrong." Furthermore, the more dogmatic the temperament of the judges concerned, the more likely they are to take this view. However, this is a classic non sequitur. It does not matter whether, with whatever degree of certainty, the appellate court considers that it would have reached a different conclusion. What matters is whether the decision under appeal was a permissible option. To answer that question in the negative in the context of employment law, the appeal tribunal will almost always have to be able to identify a finding of fact which was unsupported by any evidence or a clear self-misdirection in law by the industrial tribunal. If it cannot do this, it should re-examine with the greatest care its preliminary conclusion that the decision under appeal was not a permissible option and has to be characterised as "perverse"."

Mrs Laura Cox argued her case on the basis that it would need to be a finding of perversity before the decision could be disturbed; all findings of fact were supported by evidence.

We ourselves are of the view that there were errors of law but in deference to the forceful submissions made to us by Mrs Laura Cox we have also considered the situation on the basis of perversity as we now understand the law to be.

The industrial members sitting with me take the view that this is an exceptional case, happily a rare case, where they are certain in their own minds that when examined from a background of sound industrial experience and practice this decision defies logic and ignores generally acceptable standards to be maintained in industrial relations, and that this decision must not be allowed to stand. When so viewed it is irrational. It is therefore erroneous in law. The findings of fact seem to be supported by evidence.

Whilst the industrial members sitting with me have readily understood the guidance of May LJ in Neale, they find it difficult to understand Piggott when placed beside Neale. Piggott is cited to us almost daily. It has outstripped Neale and runs second only to Polkey as the advocates favourite. The difficulty of the present lay members has been shared by other members in other appeals. It is therefore for me to seek to direct them on the law as I now understand it to be and to reconcile a number of cases which have caused them some difficulty. If my analysis is erroneous then we would all welcome assistance from superior courts.

The members see their position thus. As was pointed out in Brain the EAT is a superior court of record, it is also unique as such. It has industrial members sitting not as assessors but as full members of the court. The presiding High Court judge can be, and on occasions has been, outvoted on a decision. Parliament has constituted an Appeal Tribunal on which laymen skilled and experienced in industrial relations and practices are in a majority. Comment has been made "That the Appeal Tribunal, by its constitution, is just as capable of acting as an industrial jury as an Industrial Tribunal". Their function is not only to give advice to the judge on numerous matters and aspects of industrial relations, but to bring their experience and industrial judgement to the application of the law and to the decision to be reached on each appeal. If the EAT is required to examine each appeal in the context of the Temple or Chancery Lane, then the industrial members can see little point in their sitting. As they understand the position it is because the strictest application of the law must at times be tempered, that Parliament ordained that they should be full members of this Court. It is against this background and their understanding of their position that industrial members have sought my help in understanding the present legal principles in what have been called the "perversity" cases. I have been reminded of a comment by Nolan J when sitting in the EAT in Payne v. Spook Erections Ltd [1984] IRLR 219 at paragraph 7 when he said:-

"In considering whether the decision of an industrial tribunal is perverse in this sense, there is one feature which has not occurred in other branches of the law and that is that matters of good industrial relations practice must be taken into account."

It seems to me that the simplest starting point is with the judgment of the learned Master of the Rolls in Sheridan at paragraph 35. The Court of Appeal in that case was considering the well known passage from the judgment of Phillips J in Watling v. William Bird & Sons Contractors Ltd [1976] 1 ITR 70.

We have already set that paragraph out above. The division which he makes is three-fold. First, a misdirection or mis-application of the law on the face of the decision. Secondly, a material finding of fact relied upon in the decision for which there was no supporting evidence or possibly evidence to the contrary.

To pause there, these are clearly and understandably errors of law.

The third heading is expressed as "It can also interfere if the decision is perverse in the sense explained by Lord Justice May in Neale v. Hereford and Worcester Council [1986] ICR 471 at 483". That is the sense in which the phrase "perversity" is used and it is the analysis of this third heading upon which the industrial members seek help.

In Piggott reference is made to Edwards v. Bairstow [1956] AC 14 and Council of Civil Service Unions v. Minister for the Civil Service [1985] ICR 14. (the GCHQ case).

In Edwards v. Bairstow the question to be decided by the General Commissioners was whether the transaction was an "adventure in the nature of trade". This was purely a question of fact. The Commissioners set out the facts and found that it was not. The House of Lords reversed a strong Court of Appeal (Evershed MR, Jenkins and Hodson LJJ) and held that the facts found had inevitably led to the conclusion that the transaction was an adventure in the nature of trade.

It must be emphasised that no misdirection of law appeared on the face of the decision nor was there any suggestion that there was lack of material upon which the facts which were found could have been based.

The two relevant passages from the speeches are first that of Viscount Simonds at p.29 where he says -

"Before, however, examining the authorities in any detail, I would make it clear that in my opinion, whatever test is adopted that is, whether the finding that the transaction was not an adventure in the nature of trade is to be regarded as a pure finding of fact or as the determination of a question of law or of mixed law and fact, the same result is reached in this case. The determination cannot stand: this appeal must be allowed and the assessments must be confirmed. For it is universally conceded that, though it is a pure finding of fact, it may be set aside on grounds which have been stated in various ways but are, I think, fairly summarised by saying that the court should take that course if it appears that the commissioners have acted without any evidence or upon a view of the facts which could not reasonably be entertained.

A little further on in his speech he says this -

"... The primary facts, as they are sometimes called, do not, in my opinion, justify the inference or conclusion which the commissioners have drawn: not only do they not justify it but they lead irresistibly to the opposite inference or conclusion. It is therefore a case in which, whether it be said of the commissioners that their finding is perverse or that they have misdirected themselves in law by a misunderstanding of the statutory language or otherwise, their determination cannot stand. ..."

Secondly, I would refer to the speech of Lord Radcliffe at p.36 -

"... When the case comes before the court it is its duty to examine the determination having regard to its knowledge of the relevant law. If the case contains anything ex facie which is bad law and which bears upon the determination, it is, obviously, erroneous in point of law. But, without any such misconception appearing ex facie, it may be that the facts found are such that no person acting judicially and properly instructed as to the relevant law could have come to the determination under appeal. In those circumstances, too, the court must intervene. It has no option but to assume that there has been some misconception of the law and that this has been responsible for the determination. So there, too, there has been error in point of law. I do not think that it much matters whether this state of affairs is described as one in which there is no evidence to support the determination or as one in which the evidence is inconsistent with and contradictory of the determination, or as one in which the true and only reasonable conclusion contradicts the determination. Rightly understood, each phrase propounds the same test. For my part, I prefer the last of the three, since I think that it is rather misleading to speak of there being no evidence to support a conclusion when in cases such as these many of the facts are likely to be neutral in themselves, and only to take their colour from the combination of circumstances in which they are found to occur.

Edwards v. Bairstow was considered by Lord Diplock in the GCHQ case at p.37. He was considering whether judicial review was applicable to a particular decision. At p.37D he says this -

"Judicial review has, I think, developed to a stage today when without reiterating any analysis of the steps by which the development has come about, one can conveniently classify under three heads the grounds upon which administrative action is subject to control by judicial review. The first ground I would call "illegality", the second, "irrationality" and the third, "procedural "impropriety"."

Then after considering 'illegality' he continues at G -

"By "irrationality" I mean what can by now be succinctly referred to as "Wednesbury unreasonableness" (Associated provincial Picture Houses Ltd v. Wednesbury Corporation [1948] 1 KB 223). It applies to a decision which is so outrageous in its defiance of logic or of accepted moral standards that no sensible person who had applied his mind to the question to be decided could have arrived at it. Whether a decision falls within this category is a question that judges by their training and experience should be well equipped to answer, or else there would be something badly wrong with our judicial system. To justify the court's exercise of this role, resort I think is today no longer needed to Viscount Radcliffe's ingenious explanation in Edwards v. Bairstow [1956] AC 14 of irrationality as a ground for a court's reversal of a decision by ascribing it to an inferred though unidentifiable mistake of law by the decision-maker. "Irrationality" by now can stand upon its own feet as an accepted ground on which a decision may be attacked by judicial review"

Lastly I would refer to Neale at p.483 where, after analysing a number of cases, Lord Justice May says this -

"...An Industrial Tribunal has been described as an "industrial jury", and so in many ways it is. It knows its area; it comprises a lawyer, a representative of employees and a representative of employers within that district; each has substantial experience of industrial problems and they are hearing this type of case regularly. Their job is to find the facts, to apply the relevant law and to reach the conclusion to which their findings and their experience lead them. It will not, in my opinion, be often that when an industrial tribunal has done just that, and with the care, clarity and thoroughness which the industrial tribunal in the present case displayed, that one can legitimately say that their conclusion "offends reason," or that their conclusion was one to which no reasonable industrial tribunal could have come. Deciding these cases is the job of industrial tribunals and when they have not erred in law neither the appeal tribunal nor this court should disturb their decision unless one can say in effect: "My goodness, that was certainly wrong".

I have considerable sympathy with the applicant in this case. I am sure that the appeal tribunal had so too. I think that the employers need to take a hard look at their disciplinary procedures. I am sure that the appeal tribunal thought so too. But I cannot find it in myself to say of the industrial tribunal's decision, there being no demonstrable error of law: "My goodness, that must be wrong."

With personal regret, therefore, but in the sure knowledge that this court should uphold the decisions of domestic tribunals unless they are shown to have been arrived at by error of law, or are so very clearly wrong that they just cannot stand, I think that the appeal tribunal erred in this case. ..."

Although the phrases "My goodness, that was certainly wrong" and "My goodness, that must be wrong" have found favour with practitioners, in order to understand them it is important to lay emphasis on the phrase towards the end of that citation where the learned Lord Justice uses the phrase "unless they are shown to have been arrived at by error of law, or are so very clearly wrong that they just cannot stand," he is there maintaining the distinction taken by Lord Donaldson in Sheridan. I would also point to the earlier phraseology used by the learned Lord Justice, "One can legitimately say that their conclusion "offends reason", or that their conclusion was one to which no reasonable industrial tribunal could have come." This whole passage in the judgment must be taken into account in order to understand the final phrases.

With that line of authority in mind the problems faced by the industrial members is in the paragraph in Piggott beginning at p.92D to G. After stating "What matters is whether the decision under appeal was a permissible option" the judgment continues,

"To answer that question in the negative in the context of employment law, the appeal tribunal will almost always have to be able to identify a finding of fact which is unsupported by any evidence or a clear self-misdirection in law by the industrial tribunal. If it cannot do this it should examine with the greatest case its preliminary conclusion that the decision under appeal was not a permissible option and has to be characterised as perverse."

It is the return to the first two parts of the phraseology in Sheridan that is confusing industrial members, namely the error of law ex facie and the absence of evidence to support an essential or at least important finding of fact.

The law as it stands seems to me to indicate that the EAT can only interfere with a decision of the "industrial jury" ie, the Industrial Tribunal, if first, there is ex facie an error of law, a misdirection or a mis-application of the law. Secondly, that there is a material finding of fact relied upon by the Tribunal in the decision, which was unsupported by any evidence or contrary to the evidence before them. Thirdly, and as a free-standing basis in law, there is a finding of perversity. It is likely to be a very rare occasion upon which the Employment Appeal Tribunal can interfere on this ground and it should caution itself against so doing and in particular to be careful not merely to substitute its own view for that of the Industrial Tribunal.

The fact that perversity, properly understood, is a free-standing basis in law is also supported by a passage in the speech of Lord Fraser of Tullybelton in Melon v. Hector Powe Ltd [1981] ICR 43 where at p.48B - C he says:-

"It is common ground that the appeal from the industrial tribunal to the Employment Appeal Tribunal and thence to the courts is open only on a question of law. The appellate tribunals are therefore only entitled to interfere with the decision of the industrial tribunal if the appellants can succeed in showing, as they seek to do, that it has either misdirected itself in law or reached a decision which no reasonable tribunal, directing itself properly on the law, could have reached (or it has gone fundamentally wrong in certain other respects none of which is here alleged). The fact that the appellate tribunal would have reached a different conclusion on the facts is not a sufficient ground for allowing an appeal."

Thus, even on factual findings of an Industrial Tribunal, the EAT can interfere if the members are completely satisfied in the light of their own experience and of the sound practices in the industrial field that the decision is "not a permissible option" per Lord Donaldson of Lymington M.R.: "a conclusion which offends reason or is one to which no reasonable industrial tribunal could come"or "so very clearly wrong that it just cannot stand" per May LJ, or to paraphrase Lord Diplock in the GCHQ, the decision was "so outrageous in its defiance of logic or of accepted standards of industrial relations that no sensible person who had applied his mind to the question and with the necessary experience could have arrived at it." It is also interesting to note that Lord Diplock continues at p.37G

"Whether a decision falls within this category is a question that judges by their training and experience should be well equipped to answer or else there would be something badly wrong with our judicial system."

I would respectfully add that there is something wrong with our system and with this Appeal Tribunal if those industrial members who are appointed to it, with their vast experience of industry, were not able to recognise a decision which fell within that category.

I have cautioned the members against interfering with decisions of industrial tribunals. They cannot interfere merely because they disagree. They cannot interfere even if they feel strongly that the result is unjust, though in this latter case it may be that on a careful analysis of the true reason lying behind such a view is that the decision flies in the face of properly informed logic.

In our view the Industrial Tribunal in this case erred in law in failing to find upon the facts that the conduct of the Applicant was gross misconduct. Secondly, in substituting its own view for that of the Respondents whose decision fell within the "band of reasonable response", and thirdly, in failing to take the earlier warning into account.

If Mrs Cox is right in her submission that this whole decision is one of fact and unappealable and that in the absence of a finding of perversity the appeal must fail, then the industrial members sitting with me are clearly of the view, and indeed certain that when viewed against appropriate industrial experience and practice this decision was "irrational" in the sense used by Lord Diplock and developed by May LJ and the learned Master of the Rolls. It therefore was erroneous in law. I agree with them.

The industrial members simplify their view thus. The decision to dismiss a senior nurse, holding managerial and supervisory responsibility in a mental hospital, for what is plainly calculated and gross misconduct and who has previously received a final warning, must fall within the band of reasonable response of this employer. A decision to the contrary would make absolutely no sense in an industrial relations context.

It is for these reasons that we allowed the appeal and substitute a finding that the dismissal was fair.

Leave to appeal.