United Kingdom Employment Appeal Tribunal

BAILII case number: [1995] UKEAT 861_93_1403

Appeal No. EAT/861/93

EMPOLYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 14th March 1995

Before

THE HONOURABLE MR JUSTICE MUMMERY (P)

MR R JACKSON

MR A D SCOTT

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MRS M KRUMINS          APPELLANT

LATVIAN NATIONAL COUNCIL          RESPONDENTS

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Transcript of Proceedings

JUDGMENT

Revised


 


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APPEARANCES

For the Appellant MR S WEBB

(of Counsel)

Messrs. Thompson, Smith & Puxton, Solicitors

4 & 5 North HIll

Colchester

Essex

CO1 1EB

For the Respondents MR P NICHOLLS

(of Counsel)

Messrs Owstons

Solicitors

23 Friar Lane

Leicester

LE1 5QQ


 


MR JUSTICE MUMMERY (PRESIDENT): This is an appeal against the decision of the Industrial Tribunal held at Hereford on 16th December 1992, 31st March and 26th July 1993.

The Tribunal heard a claim brought by Mrs Marite Krumins for unfair dismissal from her position as matron of a home at Nieuport House, Almeley in Herefordshire.

The Respondent to the claim was her employer, the Latvian National Council.

Mrs Krumins case was that in May 1992 she had been summarily dismissed by the Latvian National Council from her employment at the residential home. She denied that there was any good reason justifying her dismissal and complained that her dismissal was unfair.

The case was defended by the Latvian National Council, who said, in the circumstances set out in the Notice of Appearance dated 17th September 1992, that they were left with no alternative for the reasons which are detailed there, but to dismiss Mrs Krumins and they contended that they acted reasonably in doing so.

The Tribunal, after hearing a great deal of evidence and considering a substantial number of documents, unanimously decided that Mrs Krumins was unfairly dismissed. They went on to hold, however, that by reason of her contributory conduct the compensation should be reduced by 100%.

She was dissatisfied with the decision and appealed by Notice of Appeal served on 25th October 1993.

Her ground of appeal was that the Industrial Tribunal erred in law and acted perversely, in holding that her conduct was culpable conduct, meriting 100% reduction in compensation.

The matter was first brought before this Tribunal on 13th October 1994 on a Preliminary Hearing. Having heard arguments advanced on behalf of Mrs Krumins, the Tribunal directed that the Appeal should be allowed to proceed a Full Hearing.

This is the Full Hearing. As at the Preliminary Hearing Mr Webb has represented Mrs Krumins, Mr Nicholls appears today for the Latvian National Council.

As is observed by the editors of Harvey on Industrial Relations and Employment Law, 100% contributory conduct is a rare finding in an unfair dismissal case. They refer to the authorities on the question of 100% contributory conduct at paragraphs 2747 to 2760.

Mr Webb submitted that it was exceptional for there to be a finding of 100% contributory fault or for such a finding, if made, to be upheld.

The case presented by him on the Appeal turns on the proper interpretation and application to the facts of this case, of section 74(6) of Employment Protection (Consolidation) Act 1978 which provides:

"(6) Where the tribunal finds that the dismissal was to any extent caused or contributed to by any action of the complainant it shall reduce the amount of the compensatory award by such proportion as it considers just and equitable having regard to that finding."

The interpretation of that section came before the Court of Appeal in Parker Foundry Ltd - v Slack 1992 ICR 302 where, at page 307, Lord Justice Woolf pointed out:

" ... that there was no express indication in [section 74] subsection (6) that that the only matter to which the tribunal is to have regard. [to is the question of the] complainants own conduct caused or contributed to his dismissal. [He went on to add] " ... there was considerable force in ... this submission that that was the correct literal interpretation of the subsection (6) [provision]. ... The court's attention is focused on the matter and the extent to which the complainant's own conduct cause or contributed to his dismissal."

The Court of Appeal also made important observations in the case Hollier -v - Plysu Ltd 1983 IRLR 260 about the circumstances in which the Employment Appeal Tribunal may entertain an appeal against a finding of contributory fault. As was said by Lord Justice Stephenson in paragraph 5 of his judgment:

" ... an appeal lies to, and from, the Appeal Tribunal only on a question of law - s.136 of the Act - and the presence of lay members in the Appeal Tribunal does not alter that fact, which has been repeatedly stressed by this court. In approaching an appeal from the Appeal Tribunal, this court must have in mind that as long as the Industrial Tribunal, to whom Parliament has entrusted the decision in the ordinary way, have directed themselves properly and fairly on the facts and have not gone wrong in law, the Employment Appeal Tribunal should not interfere with their decision, even though they would themselves have come to a different conclusion" [he said in paragraph 6]

"The Industrial Tribunal's function in considering s.73(7) and s.74(6) is what it was in considering the statutory forerunners of those subsections: it is to take a broad commonsense view of the situation and to decide what, if any, part the employee's own conduct played in causing or contributing to his or her dismissal and then, in the light of that finding, decide what, if any, reduction should be made in assessment of his or her loss ...." [he said in the final paragraph, the main paragraph of his decision paragraph 19]:

[The question of reducing awards of compensation:"[is a question] ... which is so obviously a matter of impression, opinion, and discretion as is this kind of apportionment of responsibility, there must be either a plain error of law, or something like perversity, to entitle an appellate Tribunal to interfere with the decision of the Tribunal which is entrusted by Parliament with the difficult task of making the decision."

[Lord Justice Fox similarly stressed the limited circumstances in which the Appeal Tribunal is] "... entitled to interfere with that finding."[of contributory fault. He said that the Tribunal] "... was not so entitled unless one can conclude that no reasonable Tribunal could, on the evidence, have made such a finding."he said in paragraph 26]:

"The matter, I think, was essentially one for the Tribunal of fact, which was the Industrial Tribunal. They reached a very definite conclusion upon it, having heard her and observed her. There was, in my view, evidence on which they could do so, so far as we have the evidence before us at all, in the facts which I have mentioned. I must conclude, therefore, that there were no grounds upon which the Appeal Tribunal could interfere with the conclusion of the Industrial Tribunal on that matter"

It is against that background that Mr Webb sought to persuade us on the Appeal that this is an exceptional case, in which the Appeal Tribunal should interfere with the finding of contributory fault. He submits that we are entitled to do so, on the grounds that the Tribunal erred in law in failing to take a broad view of all the relevant circumstances, particularly the criticisms made in the Decision of the conduct of the Latvian National Council. He says the Tribunal also erred in law in coming to a perverse decision.

The background to those submissions is contained in the lengthy decision of the Tribunal. The Full Reasons, which were notified to the parties on 17th September 1993, run to thirty-nine paragraphs on thirteen pages. The Tribunals' conclusion on the crucial point is contained in paragraph 39. They held first that:

" ... the dismissal was unfair by reason of procedural defect."

The procedural defect was that the Latvian National Council had not given Mrs Krumins a formal opportunity to state a case in explanation or mitigation of the very serious allegations that had been raised against her and against her husband in the affairs of the home at Nieuport House.

They then went on to deal with the question of contributory conduct.:

" ... We have considered very carefully the question of contributory conduct; we are wholly satisfied that the dismissal was brought about by the collection of a petition for signatures by the applicant's husband which was an act of which she was fully aware and in approval. This followed within days of a meeting between the Social Services Department and the applicant and her husband in which a catalogue of very serious allegations were made. In relation to these allegations there had been no explanation whatsoever, save a blanket denial of their occurrence and conspiracy amongst aged individuals being put forward as the motivation behind their dissemination. The Tribunal have considered the matter very carefully as to the fact of contributory conduct and the degree of reduction in compensation that should be allowed. We are satisfied that it was the conduct of the applicant and/or her husband agent which was the direct cause of their dismissal. The conduct which we find was culpable conduct and in our view very, very serious conduct which merits a 100% reduction in compensation."

In order to put that conclusion in context, it is necessary to look at the outline of the history of the events which led up to Mrs Krumins' dismissal.

The Tribunal found that she had been employed, along with her husband, as care manager of the home, appointed on 1st January 1990 and remained in the employment until dismissed by letter of 23rd May 1992. The home was a residential home owned by the Latvian National Council for the care and settlement of Latvian Nationals, who found themselves as displaced persons in Great Britain following the end of the Second World War. There were approximately twenty-eight residents at the premises at the time of appointment, a great number of them were elderly and a number of them were extremely frail.

The Tribunal dealt with the difficulties which were encountered by Mrs Krumins almost from the inception of her appointment.

The Tribunal said that:

" ... over the passing months there developed a ground swell of complaints in an atmosphere of tension and fear at the Home which was detected by Mr A Ozolins who at that time was the Vice-Chairman on the Council. He would receive complaints of the authoritative and confrontational attitude of the applicant in particular which resulted in an atmosphere of discomfort for the residents which was quite opposed to that should have been an atmosphere of calm in such circumstances. Mr Ozolins attempted to deal with such complaints internally by speaking directly with the applicant advising her as to what was required. Mr Ozolins failed in his attempts at diffusing the situation ..."

The Tribunal went on to criticise the members of the Latvian National Council, who made regular visits to the home. They said in paragraph 9:

"It is deplorable that it is admitted by Mr Ozolins that certainly in his case some of the observation recorded by himself in the report or day book were in fact inaccurate but done in a misguided attempt to provide support for the applicant and to hold the line, as it were, whilst attempts would be made to resolve the difficulties through discussion."

The Tribunal went on to criticise the Latvian National Council:

"... a number of poor judgements were made in the course of this episode largely as a result of that frame of mind amongst the Latvian National Council. That an attempt should be made to resolve the disagreements without fuss and keep the matter within the family."

Things got so bad that the Social Services Department made a report on the situation at the home. A report was made in June 1991 and a further report in April 1992. The report contained a number of serious comments, so serious that:

"the Tribunal find that Mr Ozolins and other members of the Latvian National Council would have been entitled to regard the way in which the report was compiled and the objectivity of the investigation, together with the accuracy of its findings, as grounds for demanding very serious disciplinary action."

A meeting was arranged with Mrs Krumins:

"... The reaction to the allegations was a blanket denial of the allegations of misconduct explained as a conspiracy against them organised by a small number of residents joined by all ..."

This was the matter referred to in paragraph 39. Mr and Mrs Krumins gave no explanation in relation to the serious allegations. They gave the blanket denial of their occurrence and alleged a conspiracy of aged residents.

Matters took a serious turn. There was a disastrous prospect facing the Latvian National Council. A decision was taken to dismiss. The trigger for the decision to dismiss summarily was the circulation of a petition among the residents. The petition was headed:

"Mr A and Mrs M Krumins - Would you like us to carry on as managers?" [The Tribunal found that that document] was drawn up by Mr Krumins with the knowledge and consent of Mrs Krumins allegedly on the advice of their solicitor. The petition was taken around the residents and they were asked for their views. Given the nature of the allegations which had been made against the applicant, Mrs Krumin, of fear and intimidation, allegations of which she and her husband were well aware, [the tribunal found] the action undertaken by Mr Krumins for an on behalf on his wife would only be described at best as undertaken with appalling insensitivity. The result of this action was a number of complaints made to Mrs Kirkham from residents who were distressed at what had gone on. [and that, as I have mentioned] was the trigger for the decision to dismiss immediately"

In the view of the Latvian National Council the collection of the petition was a case of misconduct. No formal meeting or enquiry was set up where there was an opportunity of Mr and Mrs Krumins to deal with the allegations made against them. The decision to dismiss was carried out. The Tribunal found later in the decision that, having heard evidence from a great number of witnesses, they rejected Mrs Krumins' evidence:

" ... that her husband would not be acting on her instruction when the petition was collected but we find that she was well aware of the plan and in full agreement and support. [The Tribunal commented that Mrs Krumins had] deliberately tried to mislead this Tribunal"

On the basis of that outline of the facts, the Tribunal found that the reason for dismissal was misconduct and in paragraph 37 said:

"... the immediate cause of dismissal was the collection of a petition against the background of a report which contained serious allegations, some of which were related directly to the kind of behaviour exhibited by the collecting of signatures for this petition."

The Tribunal concluded that the:

"... dismissal was the appropriate response to the misconduct complained of, ..."

and only found unfair dismissal by reason of the failure to provide Mr and Mrs Krumins with a formal opportunity to state a case in explanation or mitigation of the allegations against them.

The Tribunal went on to say that, on the evidence they had had, there were:

"adequate grounds for dismissal based upon their own evidence from the residents ... that there was cogent evidence of [what was described as] ... over-strict and confrontational style of management."[by Mrs Krumins].

I have been through the Decision in detail, because that was done by Mr Webb for the purposes of making out his argument that the Tribunal had erred in law in failing to have regard to the findings critical of the Latvian National Council. He said that the Tribunal had erred in law, in either finding that the criticisms of the Latvian National Council were irrelevant and/or in failing to take them into account.

He referred to the criticisms already quoted relating to the poor judgment of the Latvian National Council, to the well-intentioned but "deplorable false entries" in the Day or Report book. He pointed out specific criticisms made of the Latvian National Council in allowing the previous matron to live in a grace and favour arrangement, close to the residential home. He referred to the criticisms of the Council in not giving a opportunity to Mrs Krumins to answer these very serious allegations against her. He pointed out that Mrs Kirkham had recommended suspension, not dismissal. He said it was not fair to criticise Mr and Mrs Krumins for making "blanket denials", when all that were made against them were "blanket allegations".

There was no excuse for not having a proper disciplinary hearing, at which Mr and Mrs Krumins could present their side of the case.

In these circumstances, Mr Webb submitted that the finding of 100% contributory fault was perverse and in error of law. He made an analogy with the law of contributory negligence, and sought to distinguish the cases in which there have been findings of 100% contributory negligence, cases all concerned with criminal or quasi criminal conduct involving violence, theft or assault.

We have considered these submissions carefully, but we have reached the conclusion that there is no error of law in the decision of the Tribunal, which would entitle us to disturb the conclusion that there was 100% fault.

We accept the arguments advanced by Mr Nicholls on behalf of the Council. He pointed out, in an admirably concise oral argument based on his skeleton argument, that this was essentially a question of fact for the Tribunal. He pointed out that the Tribunal had reviewed all the evidence fully. Very serious allegations had been made against Mrs Krumins which gave rise to a case in which it was held that they were, but for the procedural aspect, justifiably dismissed. He pointed out that it was a permissible option for the Tribunal to find 100% contribution. He said that this was particularly so when one looked at the matters relevant to contributory fault.

On the authority of Parker Foundry - v - Slack he emphasised that this is not a case in which the Tribunal is engaged in the apportionment of fault, in relation to an overall work situation, it is more specific than that. What the Tribunal has to consider is the extent to which, if any, the employee has caused or contributed by his own action to his dismissal. It was right, therefore, for the Industrial Tribunal to concentrate on the immediate cause of the dismissal. The immediate cause of the dismissal were not the allegations made against Mrs Krumins by the residents of the home, or the allegations and findings contained in the Social Services Report. The immediate cause of the dismissal was the circulation of the petition, which the Tribunal found was done with Mrs Krumins' knowledge by her husband.

It was the circulation of the petition which caused them to be dismissed. The Tribunal found that the circulation of the petition was misconduct. The decision and the manner in which the petition was circulated was a matter divorced from the fault and criticism found by the Tribunal on the part of the Latvian National Council.

Quite separately from what had been going on in relation to those allegations there was an attempt by Mr and Mrs Krumins to defend their position by circulating a petition in a manner similar to the allegations made against them.

If one looks simply, as the section requires one to, at the contributory cause of dismissal, the Tribunal were entitled to find that the cause of the dismissal was 100% the conduct of Mr and Mrs Krumins in relation to the petition. In those circumstances there was no error of law.

As to Mr Webb's submission that the other cases concerning 100% contribution have all been of a criminal nature or quasi criminal nature, we do not accept that as a correct proposition about the cases. Even if those cases were only concerned with that kind of conduct, it does not mean that it is so limited in new cases as and when they arise. As Mr Nicholls pointed out Section 74(6) is in terms wide enough to allow a Tribunal to take into account conduct which is a matter of fault, without it being a matter of criminal liability. If they are entitled to do that, in deciding whether to make a finding of contributory fault, it follows that they are entitled to do that in deciding to what extent, even up to 100%.

In all those circumstances we have reached the conclusion that this appeal should be dismissed, because there is no error of law in the Industrial Tribunal's decision.

Following the decision, Mr Nicholls made an application on behalf of the Council that Mrs Krumins pays the costs of this Appeal.

He makes the application under Rule 34 on the grounds that the Appeal was an unreasonable one, since it was only on fact and was against a decision which contained very full and, in our view, correct reasons.

We do not think it is appropriate to make an order for costs in this case. The matter came before the Tribunal as a preliminary hearing. We directed a full hearing on the basis that cases of 100% contributory fault are rare and exceptional cases. It does require careful examination of the decision in order to see that the decision of unfair dismissal, but 100% contributory fault, is well-founded in law. We have found it to be well-founded in this case. But, in our view, it was not unreasonable to bring the appeal.

The application for costs is dismissed. No orders for costs.