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United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Burns v Ship- Link (UK) Ltd [1995] UKEAT 260_95_2209 (22 September 1995)
URL: http://www.bailii.org/uk/cases/UKEAT/1995/260_95_2209.html
Cite as: [1995] UKEAT 260_95_2209
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At the Tribunal
HIS HONOUR JUDGE J HICKS Q.C.
MR D A C LAMBERT
MR T C THOMAS CBE
JUDGMENT
Revised
APPEARANCES
For the Appellant MR I BURNS
(The Appellant in person)
For the Respondents MR A HOGARTH
(of Counsel)
Messrs Trowers & Hamlins
10 Maltravers Street
London
WC2R 3EF
JUDGE HICKS Q.C.: The appellant Mr Burns was employed by the respondent Ship - Link (UK) Ltd as company secretary from July 1989 until 25th September 1991. The employment came to an end when Mr Burns resigned from his employment, in the sense that he submitted a letter of resignation, but it is his claim that that was not a voluntary resignation but was in legal terms the acceptance of a repudiatory breach of contract by the employers and therefore a constructive dismissal. That claim, so far as concerns the way it is put in his notice of application to the Industrial Tribunal, rests on two matters and a consequential conversation.
The two matters were that, as he alleges, the Managing Director had required that the personal assistant to the Managing Director should open mail, notwithstanding that it was addressed to Mr Burns as company secretary and marked `Strictly Private & Confidential', and secondly that the Managing Director had directed him, in effect, to falsify the accounts. He protested about both of those matters and it is his case that the Managing Director told him that he must comply with both of those instructions, and that if he failed to do so he would be dismissed unless he resigned.
The respondent company, the employers, following that departure of Mr Burns, on 4th November 1991 issued County Court proceedings against Mr Burns in the Medway County Court, claiming the return of a motor car and certain equipment and also the proceeds of a cheque which Mr Burns had drawn on their account in October 1990 in the sum of £7,367.53, their allegation being that although Mr Burns was an authorised signatory he knowingly had no authority to draw that particular cheque.
In the County Court action Mr Burns lodged a defence and counterclaim, and the counterclaim included a claim for damages on the basis that he had been constructively dismissed by the actions of the Managing Director, and the terms in which that was pleaded in his counterclaim are that "On 25th day of September 1991 the Plaintiff submitted his resignation as Company Secretary of [inter alia], the Respondents having been instructed by the Managing Director to submit his resignation from the said positions or be dismissed". He averred that no good reason existed for either demanding his resignation or dismissing him, and that in the premises his resignation amounted to wrongful dismissal by the Respondent. It is clear, therefore, that that allegation in the counterclaim was founded on precisely the same facts as the application to the Industrial Tribunal, although it does not include the detail about the particular directions that had been given with in regard to opening the post and falsifying the accounts.
While those County Court proceedings were pursuing their interlocutory course and shortly after their commencement, Mr Burns presented his application in the present proceedings, the remedy he was claiming at that stage being reinstatement, but on 16th March 1993 he wrote to the Tribunal:
"... I would confirm that the only relief which I now seek is a declaration that I was indeed unfairly dismissed."
In the Industrial Tribunal proceedings the respondents twice applied for a stay pending the outcome of the County Court action. That was initially refused by the Chairman of the Industrial Tribunal, but on 27th April 1993 he granted a second application for a stay. He gave reasons for that decision which show that he was impressed by the likelihood that in whichever proceedings the matter was first fought out there would be a decision about constructive dismissal which would raise an issue estoppel in the other proceedings.
The County Court action was tried, or at least certain issues in it were tried, in December 1994, and on 14th December 1994 Judge Gerald Coombe gave judgment for the Plaintiffs, who are the respondent employers in these proceedings, against Mr Burns for a sum of money which included the proceeds of the cheque, and dismissed his counterclaim, including his allegation that he had been dismissed by the respondents on 25th September 1991.
On the face of that history it might appear that the question whether Mr Burns had been constructively dismissed on 25th September 1991 had been decided in the County Court action and that an issue estoppel would therefore arise, as had been contemplated in the stay application, so far as the Industrial Tribunal proceedings are concerned, because in the Industrial Tribunal proceedings, although the question of unfairness, were it reached, would plainly be a matter not comparable with or the same as anything in issue in the County Court action, the question of dismissal itself, which would be a prior requirement, might appear to be common to both and therefore covered by the County Court judgment.
However, that way of looking at matters was not relied upon by the Industrial Tribunal Chairman in dealing with the application which gave rise to the present appeal, nor is it relied upon by the respondent employers, and we therefore disregard it.
What were included, undoubtedly, in the County Court Judge's reasoned judgment were findings, as summarised in the Chairman's reasons for his decision, that:
"... Mr Burns had no authority to draw the cheque for £7,367.53 on the account of the Respondents; that it must have been patently obvious to Mr Burns that he was acting dishonestly in so doing, and that, had his employers known of his action in drawing that cheque while he was still employed, that action would have justified his instant dismissal. Judge Coombe went on to find in terms, and to state that he was satisfied beyond reasonable doubt, that Mr Burns had stolen the money from the Respondents."
Following that County Court judgment, the respondent applied to strike out the application to the Industrial Tribunal on the basis that it was frivolous and vexatious as being an abuse of the process of the Tribunal, and Mr Burns cross-applied for leave to amend his application to claim compensation. The Chairman dealt with the latter application first and rejected it, and then granted the respondent's application to strike out. Both decisions are appealed but only the latter has been argued, and as to the refusal of leave to amend we need say only that we find no error of law in the Chairman's decision and therefore dismiss that appeal.
As to the application to strike out the Chairman was referred, as we were, to the case of Ashmore v British Coal Corporation [1990] IRLR 283 and ICR 485 and in that report to the passage in the judgment of Stuart-Smith, LJ, at page 494 letter E, that being effectively the judgment of Court of Appeal because Farquharson, LJ, and Lord Donaldson, MR, simply agreed with it. In that passage the learned Lord Justice, referring to the relevant rule concerning "frivolous or vexatious" applications, said this:
" The expression "frivolous or vexatious" in rule 12(2)(e) includes applications which are an abuse of process: E.T. Marler v. Robertson [1974] I.C.R. 72, 76 per Sir Hugh Griffiths. Whether or not an application should be struck out on this ground is a matter for the discretion of the tribunal, which can only be challenged on the basis that the tribunal has misdirected itself in law or reached a decision to which no reasonable tribunal could come: see Medallion Holidays Ltd v. Birch [1985] I.C.R. 578."
We accept that as a statement of the law governing the way in which this Tribunal should approach an appeal from the Industrial Tribunal Chairman's decision in the present case, and we apply that test.
The Chairman's decision was expressed in this way in paragraph 8 of his reasons:
"8 I have not found this an easy decision to reach, but, at the end of the day, I am persuaded by the arguments of Mr Hogarth that it would be an abuse of process if Mr Burns' application were allowed to continue. ..."
I shall return to what he further said in that paragraph but clearly it is necessary to see, in view of the way that sentence is put, what were in summary the arguments which had been put before him. It appears that Mr Hogarth for the respondents had argued that:
"... the facts on which Mr Burns would have to rely to establish constructive dismissal had already been litigated in the proceedings in the Medway County Court even if that had been in the context of a claim for wrongful, rather than unfair, dismissal. [He further submitted that it would:] ... be an abuse of process to allow the issues to be re-litigated before the Tribunal when the most that Mr Burns could achieve would be a bare declaration that he had been unfairly dismissed. [Also] ... that the purpose of obtaining a declaration of unfair dismissal was usually to assist the Application in obtaining further employment. In the case of someone who had been found to be a liar and a thief, the Tribunal should not lend him that assistance."
Then there is in the reasons a reference to the case of Telephone Information Services v Wilkinson [1991] IRLR 148, and in relation to that Mr Hogarth as reported in the Chairman's reasons argued that:
"5 ... here Mr Burns was claiming solely for declaratory relief for what would be a technical and, in view of Judge Coombe's judgment, [in the County Court] a misleading declaration of unfair dismissal (assuming that he succeeded). This was not something that the Tribunal should assist him to do. He had been found guilty of conduct which would have disentitled him to any compensation whether by way or a compensatory award. ..."
Then in the course of Mr Burns' application for leave to re-amend his Originating Application, the Chairman's reasons show Mr Burns as arguing that:
"4.. Judge Coombe's judgment could still be appealed against, and that criminal proceedings, in which Mr Burns had been charged with theft and false accounting, had gone in his favour.[And it is not in dispute that there had been such a prosecution arising out of the same matter of the cheque for £7,367.53 and that he had indeed been acquitted at that trial. He also pointed to the fact, again not in dispute, as we understand it, that:] A Social Security Appeal Tribunal found that he was dismissed. [He also submitted to the Chairman:] The precise issue of unfair dismissal had not been canvassed in the County Court. ..."
A little later the reasons record him as submitting that:
"... he had a right to apply for a finding of unfair dismissal, because that was one issue that had never been decided. He should be allowed to proceed despite Judge Coombe's findings. It would not mean going over the same matters again. Mr Burns asserted that he had told the truth and had been honest: he accepted that was not what Judge Coombe had found, but that it was nevertheless the case."
Finally, the Chairman's reasons record that:
"7 Mr Hogarth, in reply, submitted that Mr Burns was using litigation as part of a campaign against Ship-Link (UK) Ltd: that was not something of which the Tribunal should allow itself to be made part. In view of my decision not to permit Mr Burns to re-amend his Origination Application, the only purpose of these proceedings would be for Mr Burns to gain a bare and misleading declaration that he had been unfairly dismissed. That could only be an abuse of the process of the Tribunal."
So those seem to be the principal matters which the Chairman had in mind when referring to the arguments which had been before him, and to the fact that he had been persuaded by the arguments of Mr Hogarth that it would be an abuse of process if Mr Burns' application were to be allowed to continue. A little later in that paragraph he puts matters in his own words:
"8 ... It seems to me that the circumstances are entirely different from those in Wilkinson's case, [that, as I have said, being an analogy being canvassed] and that it would indeed be an abuse of process for Mr Burns to be allowed to argue that he should be awarded a declaration that he was unfairly dismissed, when to do so would involve revisiting the very facts on which Judge Coombe has based his decision."
In the light of those reasons, and asking ourselves whether there was any error of law on the part of the Chairman, any misdirection or perversity, we look at the arguments put forward before us by Mr Burns on this appeal.
He first submitted, and this is his general thesis, that the Chairman relied on the proposition that a hearing would be a re-visiting of the facts and re-litigation of the same issues, whereas Mr Burns submits that that would not be the case. For the reasons I have given it is clear that the Chairman did not treat this as a matter of issue estoppel and of re-litigation in that sense it is clear that what impressed the Chairman was that the findings as to Mr Burns' dishonesty in relation to the cheque would make it, in practical terms, impossible for him to overcome the difficulties which would face him in the application for unfair dismissal, because those matters would undoubtedly be put to him again and the findings of the County Court judge upon them.
Mr Burns submitted that reliance on after-acquired knowledge in support of a dismissal was peculiar to a common-law claim for damages, and not a matter which would be relevant to his claim for unfair dismissal. It is only fair to say he put that forward in response to some questions which I had raised and that for the reasons which I have already given that proposition is accepted by the respondents through Mr Hogarth, which is why issue estoppel is not relied upon by them, but since the Chairman, as I have indicated, did not rely on it himself either that shows no error of law on his part, and the same therefore is true of the matters to which Mr Burns drew our attention in citing the case of Green v Hampshire County Council, which was an issue estoppel case.
Mr Burns next referred us to the case of NRG Victory Re-Insurance v Alexander [1992] ICR 675. That was a case where it was held that an agreement between the employer and employee as to compensation for dismissal in return for an agreement by the employee to waive his rights to make any claim did not oust the jurisdiction of the Industrial Tribunal under the Employment Protection (Consolidation) Act 1978, because there are provisions in that Act which exclude such ouster unless agreement has been reached with the assistance of a conciliation officer. We take it that the reason why Mr Burns referred us to that case is to show that since the jurisdiction of the Industrial Tribunal is not ousted even by an express agreement to that effect, and even though that agreement, on the face of it, fully deals with the employee's claim for compensation, so here, I think his argument runs, it would not be right to oust the jurisdiction of the Industrial Tribunal to deal with the unfair dismissal application by a striking out order, but in our view that is not the right way in which to approach this question. We are not concerned with the question of ouster of jurisdiction in the sense which arose in NRG Victory Re-Insurance; we are concerned, as I indicated at the beginning, with the question whether on appeal against the exercise by the Chairman of an undoubted jurisdiction to strike out "vexatious and frivolous" applications should be allowed against a background of clear authority that this Tribunal has jurisdiction to allow such an appeal only if there is an error of law on the part of the Chairman.
The next point raised by Mr Burns was that the finding of the County Court judge at the foot of page 44 of the respondent's bundle of documents was perverse. In that passage the County Court judge said:
" As regards the ability of St Clair's Limited [that was an associated company] to stand a payment of 10,000 pounds, Mr Ellingsen [he was the effective controlling party] denied ever making the remark attributed to him, and he described this sum as "peanuts money", in the context of the company's overall operations. This would certainly appear to be the case when one examines the accounts of St Clair's Limited to 31st December 1990, showing its creditors at 496,000 pounds, and it capital commitments at 1.5 million pounds."
That is the quotation from the County Court judge's judgment which Mr Burns says is perverse. But in our view that cannot possibly be an argument going to show an error of law on the part of the Industrial Tribunal Chairman. This Tribunal is not an Appeal Court to which appeals against County Court decisions can come; it simply is not for us to form or express any view as to the validity or soundness of the judgment of a County Court judge. It may be - indeed we accept for the purposes of this appeal it would be - a matter for consideration in dealing with an application to strike out that the judgment on which the respondent relied was one which might be successfully appealed or set aside, and the prospects of that would - we, as we say, accept for present purposes - be a matter to be taken into account. But that was indeed, as appears from the Chairman's reasons and Mr Burns accepts, fairly and squarely put by Mr Burns to the Chairman in the course of dealing with this application, and there is no ground for supposing that he did not take it into account. It apparently is the position that there has still been no appeal at this stage, now many months out of time, although Mr Burns says that he still has hopes of attacking the validity of that judgment in some way. But for the purposes of this appeal we see no error of law on the part of the Industrial Tribunal Chairman, or any ground for supposing that he did not take into account that point for whatever weight it had.
Mr Burns next referred us to the passage in the Chairman's reasons in paragraph 8 in which he commented upon Telephone Information Services v Wilkinson and said that:
"It was entirely in accord with the justice of the situation for Mr Wilkinson to be allowed to establish that he had indeed been unfairly dismissed."
As to that point, we need only say that each case must turn on its facts, and the fact that that was the conclusion in the Wilkinson case in no way requires that the same conclusion be reached by the Chairman in dealing with the different facts of this case. The Chairman clearly understood the difference between the facts of the two cases, and indeed he had himself drawn the attention of the parties to the Wilkinson decision and clearly put, in a sense on Mr Burns' behalf and in quite strong terms, to Mr Hogarth the question whether that case was similar or distinguishable, and came to the conclusion that it was distinguishable, and there is no possible basis on which we can say he was in any error of law in that conclusion.
Finally, Mr Burns drew to our attention the case in the House of Lords of Ridge v Baldwin [1964] AC 40, and to a passage at page 74 of the report in the speech of Lord Reid in which Lord Reid quoted a judgment of Lord Hewart in an earlier case to this effect:
"The question, therefore, which we have to ask ourselves in this case is whether it is true to say in this matter, either of the Church Assembly as a whole, or of the Legislative Committee of the Church Assembly, that it is a body of persons having legal authority to determine questions effecting the rights of subjects, and having the duty to act judicially. It is to be observed that in the last sentence which I have quoted from the judgment of Atkin L.J. the word is not `or' but `and'. In order that a body may satisfy the required test it is not enough that it should have legal authority to determine questions affecting the rights of subjects; there must be superadded to that characteristic the further characteristic that the body has the duty to act judicially. ..."
Ridge v Baldwin was a case about the extent of the power of the Courts to review decisions by other non-judicial bodies, non-judicial in the sense of not being part of the structure of courts such the High Court and the County Court, and not directly relevant to this case at all, but as we understand Mr Burns' point in referring it to us he wants us, I think, to have regard to the duty of the Industrial Tribunal to act judicially, and of course we accept that that is its duty; it is a fully judicial body. But in so far as Mr Burns wishes to proceed from that proposition to the proposition that to act judicially requires that the Industrial Tribunal must hear every application and that no application can ever be struck out as being frivolous or vexatious, that conclusion simply does not follow. There is express provision in the rules, authorised by the statute, for such a striking out, it is that jurisdiction which the Chairman was exercising here, and we return as we must always to the question: has it been shown that he fell into any error of law in exercising that jurisdiction, which is a discretionary one, as is pointed out in Ashmore v British Coal Corporation?
The Chairman expressly says that he found this not to be an easy decision. We might have also found it difficult had the application been made to us. As the Chairman recognised there is at least one point, the question of the Managing Director's instructions as to who should open the post, as to which it can be said that not only has that not been formally decided by the County Court, but also that the findings of dishonesty which the County Court judge made would not necessarily be a crippling handicap to the appellant in this Industrial Tribunal application.
The acknowledged difficulty of the decision, however, does not justify our substituting our own view for the Chairman's. Indeed, his expression of that difficulty indicates how carefully he weighed the considerations for and against the respondent's application. We have considered all the matters which Mr Burns has advanced in support of this appeal, but cannot find in any of them any error of law in the Chairman's approach, and we must therefore dismiss this appeal.