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Cite as: [1992] UKEAT 711_91_2007

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BAILII case number: [1992] UKEAT 711_91_2007

Appeal No. EAT/711/91

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 20 July 1992

Before

THE HONOURABLE MR JUSTICE HUTCHISON

MR K GRAHAM CBE

MRS M E SUNDERLAND JP

I S S MEDICLEAN APPELLANTS

(1) MRS M M SEARLE (2) MRS K J WILSON RESPONDENTS

Transcript of Proceedings

JUDGMENT

Revised

APPEARANCES

For the Appellants MR J SWIFT

(Of Counsel)

Messrs Pinsent & Co

Solicitors

Post & Mail House

26 Colmore Circus

Birmingham

B4 6BH

For the Respondents MR T LINDEN

Free Representation Unit

13 Gray's Inn Square

LONDON WC1R 5JP

MR JUSTICE HUTCHISON: In this case the Respondent employers Mediclean Ltd appeal against a finding by an Industrial Tribunal at Bedford on a preliminary issue as to jurisdiction when they held that the two Respondents who were Applicants before them, had sufficient continuous employment to entitle them to maintain claims for unfair dismissal.

There was little or no dispute on the facts (and it may be that therein lies part of the difficulty of this case) and it is unnecessary to rehearse precise dates. The following brief outline will suffice to permit the point at issue before the Tribunal and on this Appeal to be understood.

Mrs Searle and Mrs Wilson had for more than 2 years prior to May 1990, been employed by the Hertfordshire Health Authority as assistant housekeeper and housekeeper at the Lister Hospital in Stevenage. They were concerned with cleaning the hospital. There were others employed in the same capacity. The authority, having taken a decision to have the cleaning work done by outside contractors, sought tenders in March 1990. The Appellants' tender was successful. A contract was in due course entered into.

On Friday 10 May 1990 Mrs Searle and Mrs Wilson were made redundant by the Health Authority and received appropriate redundancy payments. The following week each of them began employment with the Appellants, again as assistant housekeeper and housekeeper. It seems (see the Chairman's Notes of the agreed facts outlined to him by Mr Parrott for the employers) that the Appellants had in March invited applications for jobs and had in April interviewed and agreed terms with among others, these two Respondents. It is clear that the arrangements with the authority involved that all those currently employed in cleaning work at the hospital would receive an offer of a job interview and, if they were not employed, some explanation would be tendered. In the event not all of those previously employed were taken on by the Appellants.

In January 1991, though on different dates in January, both Mrs Searle and Mrs Wilson were dismissed in circumstances which they contend were such as to give rise to a claim under the Employment Protection (Consolidation) Act 1978 for unfair dismissal. Plainly their claims, the merits of which have not yet been investigated, could only succeed if they could show continuity of employment as between the Health Authority and the Appellants. The claim that they could was advanced both under paragraph 17(2) of Schedule 13 of the 1978 Act and under the Transfer of Undertakings Protection of Employees Regulations 1981. The Industrial Tribunal held that the regulations did not apply, and there is no challenge to that decision. The sole question to which this Appeal gives rise therefore is whether, on the virtually agreed facts found by the Industrial Tribunal, they were right in law in saying that there was here established continuity of employment by virtue of the provisions of the Act.

Those provisions are contained, so far as they are material, in Schedule 13, paragraph 17(2) which provides:

"If a trade or business or an undertaking ....is transferred from one person to another, the period of employment of an employee in the trade or business or undertaking at the time of the transfer shall count as a period of employment with the transferee, and the transfer shall not break the continuity of the period of employment."

It seems that no point was taken by the employers, or if it was no point is taken before us, as to actual continuity of employment. The sole issue was and is whether cleaning formed one of the Health Authority's activities and as such was a trade or business or an undertaking capable of transfer within paragraph 17(2).

In section 153(1) of the Act, the Interpretation section, one finds this:

"In this Act, except so far as the extent otherwise requires -

.....

"business" includes a trade or profession and includes any activity carried on by a body of persons, whether corporate or unincorporate;"

We come now to the decision of the Tribunal and their reasons. Their unanimous decision was as we have indicated, that the Applicants had sufficient continuous employment to come within the Employment Protection Act. They recorded that there was little dispute about the facts. Insofar as they deal with them at all, or indeed insofar as they had facts before them, they rehearse facts in paragraphs 3, 4 and 5. It is material to note that what they set out there is that the Respondents were employed by the Health Authority; they recite the history of the decision to change the method of cleaning; the dismissal of the Respondents by reason of redundancy and the payment of redundancy payments; the relevant dates and so on. In paragraph 5 they say:

"When carrying out the cleaning operation, the respondents [that is to say the present Appellants] are required to have a manager of their own on duty there but there is an officer of the Health Authority who monitors the standards and they have to work to a specified standard".

They say really nothing about the structure of or arrangements for the carrying out of the cleaning operations under the auspices of the Health Authority before the change in the early summer of 1990.

Then in paragraphs 9 and 10 they recite various preliminary matters recording Mr Lambe on behalf of the two Applicants submitting that there was sufficient continuity; and recording ("several points which must be borne in mind") that no goods and materials were transferred, that the Respondents had to work to the standards of the Health Authority and that the Applicants received redundancy payments; and that the contracts into which they entered with the present Appellants looked as though they were new contracts. These they described without elaboration as matters of some difficulty and they say:

"Nevertheless, our approach has been as follows.

11. We have to consider whether or not the cleaning activities were part of an undertaking. It appears that the whole of the cleaning activities were run by the respondents after this. We accept that it is a sufficiently self-contained part of the undertaking carried out by the hospital so as to count as a part of an undertaking.

12. We have borne in mind that the hospital is not a commercial activity; this would be relevant under the Transfer of Undertakings Regulations, but is not a bar to it being an undertaking under paragraph 17 of Schedule 13.

13. We have considered the point that the applicants have received a redundancy payment. On the face of it, it perhaps seems odd that they can claim continuity when they have received redundancy payment. However, paragraph 12 of Schedule 13 deals with receipt of a redundancy payment, and this would be operative if the applicants had been dismissed by reason of redundancy by the respondents:- it would have an effect of the earlier redundancy payment in effect stopping the earlier period of employment. It does not prevent the earlier period of employment counting as continuous in a case such as this.

14. We have considered the point that part only of an undertaking was transferred. Paragraph 17(2) does not refer to part of an undertaking. However this point was decided in G D Ault (Isle of Wight) Ltd v Gregory [1967] ITR 301, so that undertaking includes part of an undertaking provided it is a separate and self-contained operation.

15. We have borne in mind that the contracts with the respondents put May 1990 as the date of the commencement of the employment. Can the previous employment be continuous in such circumstances? We are satisfied it can. Continuous is a statutory scheme and whether or not employment is continuous depends on whether the applicant comes within the various statutory provisions. To hold otherwise would have the effect of permitting parties to contract out of the unfair dismissal provisions.

16. The reality is that the applicants were employed in part of the activities carried on at the hospital, namely the cleaning. All of that was transferred as a result of the agreement so that it was carried out by a different employer. Although no equipment was transferred to the respondents under the agreement with the Health Authority, the respondents could carry on the cleaning activities after the agreement. They had their manager on site. Although their standards were monitored, they had control over the cleaning operation and it was their business. We are satisfied that the cleaning operation was a sufficiently self-contained part of the activities of the Health Authority so that it amounted to a transfer of an undertaking.

It will be observed from that citation that the Tribunal refer to only one case having been cited to them GD AULT (ISLE OF WIGHT) LTD v GREGORY, though they do in a different context (that of the application of the transfer regulations) refer also to EXPRO SERVICES LIMITED v SMITH. There are a number of cases bearing on this issue and the principal contentions advanced by Mr Swift on behalf of the Appellants is that it is plain that the Tribunal did not really apply the right tests. They did not give themselves correct directions and as the passages we have cited show, they did not pose the two vital questions which authorities establish are material in cases of this sort. It is unnecessary at this juncture to refer further to his submissions helpfully contained in a Skeleton Argument. Mr Linden, on behalf of the Respondents, while not making any express concessions, was constrained almost to accept that the decision was on the face of it difficult to support, and he concentrated the main force of his submissions before us upon inviting us to give assistance of a particular sort to any tribunal which has to consider this matter if it is sent back for reconsideration.

Mr Swift, in his response, invited us to take the somewhat unusual though by no means unprecedented course of deciding this case finally for ourselves. The basis of his submission was that had any tribunal applied the correct tests, it is inevitable that they would have concluded that there was here no transfer and therefore no sufficient continuity. Again, anticipating what we have to say, we can state at this stage that we have concluded that while there is much force in the submissions that Mr Swift makes, nevertheless this is a case in which for reasons which we shall explain, we ought not to take that rather unusual course of simply reversing the Tribunal and deciding the matter for ourselves. We shall, allowing this Appeal as we propose to do, direct that the matter be reheard before a differently constituted tribunal.

The problem which as it seems to us has bedevilled this case, is that whereas the parties with the best intentions believed that the facts were all agreed and so informed the Tribunal, and indeed there was no dispute about the facts that one can discern, the consequence of that was that the Tribunal were quite inadequately informed about that part of the case which had to do with the arrangements that had subsisted between the Health Authority and those employed as cleaners, prior to the contracting out of the cleaning work to the present Appellants.

We venture to add a general observation in that context. Parties who consider that the facts of a particular case are not disputed and therefore can be dealt with without evidence should pause and address their minds always to the question: "What material are we going to place before the Industrial Tribunal who have to rule on these matters, which very often involve quite difficult questions of law?" If evidence is not to be called, the parties should take very careful steps to ensure that some agreed statement of the facts is placed before the Tribunal so that the sort of difficulties to which this case has given rise are obviated. We feel confident that had that been done in this case it would have concentrated everybody's minds on the particular legal niceties of the case and would, perhaps, have prevented the Tribunal from going astray as we are persuaded that they did.

There is, as we indicated, a good deal of authority which bears on how this matter should have been approached and we can do no better than begin by citing perhaps the most recent of the authorities to which we have been referred which has the advantage not only of being recent, but of being a decision of this Court presided over by the President Mr Justice Wood. That is the case of GIBSON v MOTORTUNE LTD [1990] ICR 740. The facts of the case need not be rehearsed and it is unimportant for present purposes that the members of this Court were not in agreement as to the outcome of the Appeal, Mr Justice Wood finding himself in a minority in favour of allowing the Appeal on the issue of continuity. What is important is that the decision contains a very useful summary of the relevant provisions to which an Industrial Tribunal should have regard when seeking to resolve the sometimes quite difficult questions of transfer of employment. The passage in question is a long one in which he cites what he describes as the four principal cases from which guidance is to be obtained and it reads as follows:

" How should this issue have been approached by the industrial tribunal? There are four principal cases in which guidance is given. The first is Kenmir Ltd v Frizzell [1986] 1 WLR 329, a decision of the Divisional Court of the Queen's Bench Division under the Redundancy Payments Act 1965. The judgment of the court is given by Widgery J. He refers to two earlier cases. The first was H A Rencoule (Joiners and Shopfitters) Ltd v Hunt (1967) 2 ITR 475, in which case the lessee of a factory sold the stock in trade of his business with the fixtures and fittings of the factory to a purchaser who obtained a new lease of the premises. The purchasers took over the former employees and the work in progress and the vendor agreed to introduce the purchaser to former customers of the business. However the agreement expressly provided that the purchaser was not purchasing the business and should have no right to use the old firm name. The court, nevertheless, held that it was a transfer of the vendor's business. The second case was G D Ault (Isle of Wight) Ltd v Gregory (1967) 3 KIR 590, in which case a written agreement provided for the sale by a firm of all its stock in trade and materials as a builder and contractor; secondly, all the plant and equipment; thirdly, the business premises together with the fixtures and fittings and lastly, the benefits of contracts relating to work to be performed in the Isle of Wight in connection with the business. There was no express assignment of goodwill but the vendors agreed thereafter not to be concerned or interested in the business in the relevant districts of Sandown and Shanklin in the Isle of Wight. Here again the court held that it was clearly a transfer of the business. Having considered those two cases, Widgery J. went on to say, at p. 335:

"We think that the principles applied in these two cases govern the present case also. In deciding whether a transaction amounted to the transfer of a business regard must be had to its substance rather than its form, and consideration must be given to the whole of the circumstances, weighing the factors which point in one direction against those which point in another. In the end the vital consideration is whether the effect of the transaction was to put the transferee in possession of a going concern the activities of which he could carry on without interruption. Many factors may be relevant to this decision though few will be conclusive in themselves. Thus, if the new employer carries on business in the same manner as before this will point to the existence of a transfer, but the converse is not necessarily true because a transfer may be complete even though the transferee does not choose to avail himself of all the rights which he acquires thereunder. Similarly, an express assignment of goodwill is strong evidence of a transfer of the business but the absence of such an assignment is not conclusive if the transferee has effectively deprived himself of the power to complete. The absence of an assignment of premises, stock-in-trade or outstanding contracts will likewise not be conclusive if the particular circumstances of the transferee nevertheless enable him to carry on substantially the same business as before."

That last passage was approved by the Court of Appeal in Lloyd v Brassey [1969] 2 QB 98. That case has been said to be peculiar to its own facts - it was dealing with a farm - but some help can usefully be obtained from a passage at the end of the judgment of Salmon L.J., at p. 107:

"Of the many factors to be taken into account in considering whether or not a change in the ownership of a business has occurred, none by itself nor a combination of any of them together is necessarily conclusive. Everything depends on a broad view of all the circumstances of each particular case. In this case, having come to the conclusion that there was ample evidence to support the tribunal's finding, I would allow the appeal."

The next case in which guidance is given is Woodhouse v Peter Brotherhood Ltd [1972] ICR 186 Buckley L.J. said, at pp. 205-206:

The continuity of the environment in which the employees work and of the production unit of which they constitute part may very well be an incident of a transfer of the business and may be some evidence that a transfer has taken place, but it cannot in my judgment constitute a transfer of itself or be conclusive evidence that a transfer has taken place. The transaction in the present case resulted in Peter Brotherhood Ltd. acquiring a factory, acquiring that plant and machinery and taking on the existing labour force. They acquired the means of carrying on a business; they acquired, if you please, a production unit. In this sense only did they acquire a going concern, as perhaps a ship complete with a crew might be said to be in a sense a going concern. But this is not enough to satisfy the requirement of the statute. There must be a transfer of a trade or business or undertaking."

Later in his judgment he says, at p. 206:

In my judgment the court below erred in approaching the matter from the point of view from which the transaction might have appeared to an employee. This is not the criterion laid down by the statute, which is that the trade, business or undertaking must be transferred from one person to another. The test may, I think, be simply and accurately stated by asking whether B has become the proprietor of the trade, business or undertaking in succession to A."

The last case is Melon v Hector Powe Ltd [1981] ICR 43. This was an appeal from Scotland under the Redundancy Payments Act 1965. Lord Fraser of Tullybelton gave the leading speech in which he said, at p. 49:

"It seems to me that the essential distinction between the transfer of a business, or part of a business, and a transfer of physical assets, is that in the former case the business is transferred as a going concern "so that the business remains the same business but in different hands" - if I may quote from Lord Denning M.R. in Lloyd v Brassey [1969] 2 Q.B. 98, 103 in a passage quoted by the industrial tribunal -whereas in the latter case the assets are transferred to the new owner to be used in whatever business he chooses. Individual employees may continue to do the same work in the same environment and they may not appreciate that they are working in a different business, but that may be the true position on consideration of the whole circumstances. A change in the ownership of a part of a business will, I think, seldom occur, except when that part is to some extent separate and severable from the rest of the business, either geographically or by reference to the products, or in some other way."

From those cases it will be seen that there are essentially two questions which fall to be determined in cases of this sort. The first, and we say this subject to the submissions made by Mr Linden to which we shall refer in a moment, is that adumbrated by Lord Fraser in Melon's case where he concludes the passage cited with these words:

"A change in the ownership of a part of a business will, I think, seldom occur, except when that part is to some extent separate and severable from the rest of the business, either geographically or by reference to the products, or in some other way."

The second is to be found in the much earlier decision of Mr Justice Widgery as he then was

in Kenmir Ltd v Frizzell where he says:

"In the end the vital consideration is whether the effect of the transaction was to put the transferee in possession of a going concern the activities of which he could carry on without interruption."

It will be seen that as they stand those two questions seem to address overlapping, but nevertheless distinct considerations. That formulated by Lord Fraser plainly concentrates on the status of the "transferred business" while still in the hands of the transferor; that formulated by Mr Justice Widgery on the position so far as the transferee of the business is concerned when he takes it over.

There is no dispute between Counsel as to the formulation by Mr Justice Widgery being correct and as to that being the second stage of the enquiry. But it has been suggested by Mr Linden on behalf of the Respondents that Lord Fraser's words do not lay down an absolute test and that a different and somewhat less stringent test is appropriate. In making that submission he basis himself on remarks of Mr Justice Phillips in GREEN v WAVERTREE HEATING AND PLUMBING CO LTD [1978] ICR 928 to which we shall come in due course. There is however, as it seems to us, very respectable support for the approach of Lord Fraser (if indeed one needs to look for support for what is said in the House of Lords). I begin by mentioning the case of G D Ault (Isle of Wight) Ltd v Gregory [1967] Vol 2 ITR 301. Again, I do not pause to rehearse the facts but in a paragraph at the end of a judgment delivered by than Lord Justice Diplock one finds this statement on page 303:

"In my view, where the sub-paragraph refers to the transfer of a trade or business, that covers and includes the transfer of any trade business or undertaking which is run by the owner as a separate and self-contained part of his operations in which assets, stock in trade and the like are engaged. It may be an individual may carry on two different trades at different times and if he transferred one of them, then clearly in my view it would be within the sub-paragraph; or he may carry on the same trade at different places but if he maintains it as a separate and self contained part of his operations, as plainly this was maintained according to the agreement to which I have referred, then in my view the transfer of that separate part of his operations carried on in the particular trade is a transfer from one person to another of a trade or business within the meaning of paragraph 10(2) [I should interpolate the fact that he is referring to earlier legislation but it is in identical terms to that which we are considering]

Then again, one has a further decision, again a court in which Lord Justice Diplock delivered one of the judgments, DALLOW INDUSTRIAL PROPERTIES LIMITED v ELSE [1967] 2 Q.B. 449. There one finds at the end of Lord Justice Diplock's judgment this statement of the law:

"In order to come within section 13(1) of the Act of 1965, there must be a change of ownership, not merely in an asset of a business as in this case, but a change of ownership in the combination of operations carried on by the trader or by the non-trading body of persons, and there can only be a change of ownership in a business or part of a business, including business activity in the sense which I have construed it, if what is transferred is a separate and self-contained part of the operations of the transferor in which assets, stock-in-trade and the like are engaged, or the corresponding expression which would apply to a body of persons which was carrying on operations not for profit."

There he is reiterating what he had shortly before said in the case of Ault.

As against that there is a passage already mentioned in the judgment of Mr Justice Phillips in this court in Green & Wavertree Heating Co. where one finds at page 932(F) this statement:

"It seems plain to us, particularly having regard to some observations in Evenden v Guildford City Association Football Club Ltd [1975] ICR 367, that it is not really necessary to be able to show that the transferred part had prior to the transfer been carried on separately and in a self-contained manner. It is sufficient if it can be seen that the part transferred, which then is self-contained and separate, is a recognisable and identifiable part of the whole business out of which it has been separated. So understood, it seems to us clearly the case that this business was; it was recognisable part of the total business carried on by Prime which related to the execution of the Gas Board contracts. One thinks that anybody inquiring of Carroglen about such matters would be told in quite a colloquial manner, "Oh, well, we've handed over that part of the business to Wavertree"; and it seems to us that that would be perfectly sensible and perfectly understandable ".

I continued to cite the latter part of that extract because it directs one's mind to the facts which Mr Justice Phillips was there considering where a quite distinct part of a business of gas fitting and plumbing was transferred away. The interpretation that we place upon that statement is that it is not, as it were undermining, let alone replacing, the formulations of Lord Fraser which indeed succeeded it, or of Mr Justice Diplock which had preceded it. It is, it seems to us, to be taken as a sensible gloss on that approach, indicating that too rigid an application of tests of this sort may, in particular circumstances, lead one to an erroneous result. The correct approach, subject to that possible gloss, is we consider exemplified by the passages in Lord Fraser's and Lord Justice Diplock's speeches.

The only other authorities to which we need refer before stating our conclusions, are two to which our attention was drawn by Mr Linden. I am not suggesting he only drew out attention to two, I am saying that we need cite only two. The first is EXPRO SERVICES LTD v SMITH [1991] IRLR 156. That was a decision of this court presided over by Sir David Croom-Johnson in which the question at issue was whether in a case not dissimilar on its facts to the present, the Transfer of Undertakings Regulations applied? The transferor there had been the Ministry of Defence and Sir David Croom-Johnson giving the judgment of this court, indicated that the transfer regulations did not apply. He also criticised the Industrial Tribunal for having posed to themselves the question "what was the nature of the business in the hands of the transferee?" without considering the allied and extremely important question as to "what was the nature of the business in the hands of the transferor?".

That case does not directly assist in the present case because for some reason no claim was advanced under paragraph 17(2) of Schedule 13 of the Act. However, Mr Linden, relying on that fact, invites us to reaffirm what was conceded by Mr Swift namely that the tests laid down by paragraph 17(2) are to an extent less restrictive than the tests laid down by the Transfer of Undertaking Regulations because of the requirement in the latter that there should be commercial activity.

A separate but allied point on which Mr Linden is anxious that we should be clear is this: in the course of the argument there was some discussion as to whether, in order to qualify at all, the business which is transferred must be a business at, as it were, the profit-making end of the employer's undertaking rather than at the support and services end and there was a question raised as to whether it was really essential if the business transferred was to qualify within the wording of section 153(1) there must be some profit-making element. Plainly, and Mr Swift did not really submit the contrary, that is not the case. There are a number of statements which give support to that proposition - one in a case to which Mr Linden drew our attention: RASTILL v AUTOMATIC REFRESHMENT SERVICES [1978] ICR 289 at page 296 where giving the judgment of this court Sir John Arnold said, among other things, this:

"It [that is to say the business activity carried on by the transferor] was a describable commercial enterprise. Nonetheless was it that, in our view, if the facts be, as they may well have been, that the object and intention of Dorman Diesels Ltd was not to carry on the canteen at a profit, but rather to provide, by means of carrying it on, the sort of attractive amenity as regards its workpeople which would enable the employment of those people to be the better facilitated.

In the course of his arguments before us, Mr Swift said about services "I don't say transfer of a service simpliciter could never fall within the definition, but one would have to look at it carefully to see whether it could be a trade or business." We think that that is right.

Those are all the authorities to which it is necessary to draw attention and one comes back to the two-stage approach which it was incumbent upon the Tribunal to adopt. Did they address the question as to whether there was here a separate and distinct undertaking such as Lord Fraser refers to? Did they even address, if that were the correct test, the rather more liberal test adumbrated by Mr Justice Phillips? Was this a recognizable and identifiable part of the whole business out of which it has been separated? The simple answer to those questions, as it seems to us, is that they certainly did not. They deserve sympathy, for they had little or no evidence which bore on those questions. Mr Linden has, with considerable ingenuity, drawn our attention to passages in the Chairman's Notes of evidence and in the contract with the Appellants which he suggests indicate the nature of the arrangements pertaining to cleaning under the auspices of the Health Authority and has suggested that those passages and references could justify the conclusion on the part of the Tribunal that this was a separate and self-contained business or a recognizable and identifiable part of the whole business out of which it had been separated.

We have to say that we cannot accept those submissions. There was really no evidence bearing on this matter at all. There certainly was no evidence upon which the Tribunal could properly have concluded that the test was satisfied and we accept the submissions made by Mr Swift. Indeed we venture to question whether, bereft as they seem to have been of citation of authority on this particular topic, the Industrial Tribunal ever really appreciated that they had to address the matter in that way.

So far as the second question is concerned - Did they correctly pose the question formulated by Mr Justice Widgery in the case of Kenmir Ltd v Frizzell? - Mr Linden suggests that they did, but we consider that the evidence is remarkably sparse if it exists at all. Beyond the fact it seems that they did take over without, as it were, a perceptible break, there is little or no evidence on the topic. Be that as it may, on the first point we have no hesitation in concluding that the Industrial Tribunal never addressed at all, or if they did address, had no evidence upon which to decide, the crucial question of the nature of the arrangements that pertained to cleaning within the organisation of the authority in this hospital, and whether those could be said to be capable of satisfying the first test.

It is perhaps helpful, or we hope it is helpful if we add, that in the course of the argument both Counsel were disposed to accept that there was a gradation of fact in cases of this sort, at one end of which one could clearly and without hesitation say that a particular activity could not possibly satisfy the first test, and at the other end of which one would be able without much difficulty to say that it did. But before one can do that there must be evidence on which a sensible factual conclusion can be reached and we refer again without repeating, to our expression of hope that in cases of this sort where facts are agreed, everyone will ensure that what has been agreed is adequate to meet the case and properly recorded so that there can be no doubt of the basis upon which the legal debate proceeds.

For those reasons, we have reached the clear conclusion that this Appeal must be allowed and the matter remitted to be reconsidered on proper evidence before a differently constituted Tribunal.