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United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> APA International Ltd v Beechey & Ors [1996] UKEAT 1014_95_1402 (14 February 1996)
URL: http://www.bailii.org/uk/cases/UKEAT/1996/1014_95_1402.html
Cite as: [1996] UKEAT 1014_95_1402
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At the Tribunal
THE HONOURABLE MR JUSTICE MUMMERY (P)
MRS M T PROSSER
MISS S M WILSON
2) MISS S J ENGLAND 3) MR N C SANDFORD 4) BENSON MORGAN PLC (In Liquidation)
JUDGMENT
Revised
APPEARANCES
For the Respondents MRS L BEECHEY
(1st Respondent in person)
MISS S J ENGLAND
(2nd Respondent in person)
MISS S MOOR
(Of Counsel)
Messrs Winter-Taylors
Park House, London Road
High Wycombe
Bucks. HP11 1BZ
(On behalf of 3rd Respondent)
NO APPEARANCE BY OR ON BEHALF OF 4TH RESPONDENTS
MR JUSTICE MUMMERY (PRESIDENT): This is appeal is against the decision of the Industrial Tribunal held at Reading on 27 July 1995. The reserved extended reasons were sent to the parties on 9 August. For the reasons set out in the decision document, the Tribunal found, on a preliminary point, that there was a transfer of an undertaking within the meaning of the Transfer of Undertakings (Protection of Employment) Regulations 1981. That transfer was from the Applicants' employer, Benson Morgan Plc formerly APA Consultancy Ltd, to the second Respondents APA International Ltd.
The Applicants were Mrs Beechey, who had been employed by Benson Morgan as a receptionist, Miss England, who had been employed as a secretary, and Mr Sandford, who had been employed as a management consultant. They had brought claims for unfair dismissal against the Respondents. In a subsequent decision sent to the parties on 13 October 1995, it was found that each of those Applicants had been unfairly dismissed by APA International Ltd and awards of compensation were made to each of them.
The ruling in favour of a transfer of an undertaking led to this appeal. On 18 September, APA International Ltd gave Notice of Appeal. The grounds of the appeal are set out in an attached letter. There has been no attendance by APA International at the hearing to pursue their appeal. No-one has turned up to represent them. A telephone call was made before we started the hearing. The information was supplied that they would not be attending. We have therefore heard the appeal in their absence. As for representation, Miss Moor represents Mr Sandford. We are grateful to her for her helpful submissions. Mrs Beechey and Miss England have attended in person. They adopt the arguments advanced on behalf of Mr Sandford.
The question we have to decide, in considering the grounds of appeal, is whether they raise any error of law in this decision. There is no appeal against questions of fact. In deciding whether there is an error of law, we must examine the facts found in the decision and then consider whether the Tribunal applied the correct legal principles to the facts and reached a correct legal conclusion in applying those principles.
For the purposes of this appeal, it is sufficient to summarise the facts as follows: APA Consultancy Ltd, which later changed its name to Benson Morgan, is in a group of companies, the APA Group Plc. It carried on the business of consultants through the motor industry, providing training for dealers in certain makes of car. Mr Sandford was employed as a management consultant from March 1990 until 11 July 1994. He, along with the other Applicants, worked at Gerrards Cross. Mr Sandford was particularly involved in dealing with the Vauxhall training contract. APA International Ltd is the company alleged to be the transferee. The Applicants were dismissed on 11 July 1994.
Their case is that the activities previously carried on by APA Consultancy Ltd were in fact carried on in the same or similar form by APA International. Any claim that may have been available against APA Consultancy Ltd is worthless, because that company, re-named Benson Morgan Plc, is being wound up, pursuant to an order of the Court on 26 April 1995.
The crucial question is, therefore, what was the position before the alleged transfer in July 1994, and what was the position after? The correct legal principle is, that if the activities after the alleged transfer date are the same as, or substantially the same as, the activities which were, before that date, carried on by the alleged transferor, then that is a strong indication that there has been a transfer of an undertaking, within the meaning of the 1981 Regulations. It is not necessary to have a formal transfer document. It is not necessary for there to be a sale. It is not necessary for assets to change hands, directly or indirectly. The emphasis is on whether there is a change in the identity of the person who carries on the activities.
The Tribunal came to the conclusion that there was a transfer. There were differences. APA International carried on its activities from Shirley Lodge, Slough. There were assets belonging to Benson Morgan, but there was no transfer of ownership of them to APA International. Certain assets were transferred to another company in the Group, Suntex Ltd, who then leased them to APA International. But, overall, the facts found by the Tribunal were that there was a transfer. There was ample evidence for the finding that the same staff, except the Applicants, were carrying out the same work for the same customers, using the same equipment. There was such a transfer, even if, for a short period, Suntex Ltd owned some of the assets.
The important point to emphasise, in our view, is that ownership is not conclusive. The question is, whether the undertaking has been transferred? The undertaking may simply consist of activities in the form of services. If similar services are provided to the same or similar customers, using some of the same staff and some of the same equipment, that may be sufficient to justify a Tribunal finding that there is a transfer of an undertaking.
In our view, the Tribunal having found the facts summarised, correctly identified the applicable legal principles as set out in the recent decision of this Tribunal in Council of the Isles of Scilly v Brintel Helicopters Ltd. The effect of that case and the principles stated in it are summarised in paragraph 24 onwards of the decision. In our view, the Tribunal correctly applied those principles to the facts of the case. In paragraph 28 they expressly stated they found that the personnel and the contracts upon which the Applicants were working and the materials which they were using in the course of their employment with APA Consultancy on or before 11 July 1994, were utilised by APA International, after that date.
There is no legal error in the Tribunal's statement of the principles, or the application of them to the facts, or in their conclusion. We should, however, examine the grounds of appeal to see if there is an error of law identified there. We are not able to find one in the decision. In our view, the errors alleged in the grounds of appeal are not legal errors. If there are errors, they are factual inaccuracies which cannot be the ground of an appeal to this Tribunal. Miss Moor has taken us paragraph by paragraph through the grounds of appeal, in paragraph 6 of the Notice of Appeal form. In our view, they show a lack of understanding on the part of APA International Ltd and its directors and advisers, as to the nature and effect of the 1981 Regulations.
The complaints in the grounds of appeal are these. There was a misunderstanding of Company Law and structure. That is not an error of law. We are unable to detect a misunderstanding of the correct corporate structure. It is not relevant to the question whether there has been a transfer of an undertaking. The corporate structure is that there are a number of companies within a group, and the company, which has gone into liquidation, has had its activities transferred to another company in the group. Some of the assets of the company in liquidation have been transferred to yet another company in the group, which has made them available for use by the company in fact carrying on the activities of the company in liquidation.
It is alleged that there are serious inaccuracies in the record. If they are inaccuracies of fact, they are not identified. It is therefore impossible to deal with them. Even if they are identified, if they are factual inaccuracies, they do not amount to a legal error. There is a reference to an admission by Miss Moor of certain documents, which form part of her case, but which had not been forwarded to APA International. We are not able to find that there is any error or even any truth in that allegation. Again, there is no attempt to identify what documents are being referred to, and how it is said that they are relevant to the case.
They give a list from A-G of more specific inaccuracies. In our view, none of them amount to an error of law. They refer in `A' to evidence given by Mr Smirthwaithe, on behalf of Mr Sandford, about his employment in Churchgate Associates, to the effect that that was the same company as APA Consultancy. They repeat the point of the lack of understanding of the corporate structure. There is no any error there that could possibly be relevant to the question of the transfer of an undertaking. In `B' they say that the Applicants' Counsel argued that the matter was merely a case concerning the sale of shares in the same or similar companies. That does not appear from the extended reasons to have been the way the case was put. The ownership of the shares is not a matter relevant to the issue before the Tribunal. `C' refers to what is alleged to be another lack of understanding. That refers to Mr Crawford, a consultant who attended the hearing in the Industrial Tribunal in the place of Mr Hallett, the consultant familiar with the case. That refers to certain mistakes in the evidence that he had given. If the complaint is that Mr Crawford was not able to give as much help to the Tribunal as Mr Hallett would have been able to if he had attended, it is not a complaint that we can do anything about. As Miss Moor pointed out, if Mr Crawford was in difficulty in handling the case, in place of Mr Hallett who was indisposed, an application could have been made for an adjournment. No application was made. There is no error of law flowing from Mr Crawford's evidence, or the way that the Tribunal dealt with it. `D' refers to the fact that it is incorrectly represented in the record, (that is, the decision of the Tribunal), that APA were not sub- contractors of the APA Group. They say APA Group were sub-contractors of APA International in respect of certain car contracts. Again, this is not a matter relevant to the transfer of undertakings. The transfer of undertakings question is not concerned with what inter-company arrangements within the Group for the performance of contracts. The crucial point is, as already identified, whether APA International were continuing in their hands the activities previously conducted by APA Consultancy. The point in `E' is misconceived. The point seems to be that the Tribunal misunderstood Mr Crawford's evidence. He had not said that the ex-employees taken on by APA International were doing the same job as in previous employment. Mr Crawford had said simply that it could possibly be the case that at times this work was like or similar. Again, that is not a legal point. If it were, it is sufficient, for the purposes of transfer of undertakings, that work is like or similar. It does not have to be identical, to fall within the regulations. The point in `F', in relation to the purchase of assets by Suntex, is not relevant to the transfer of undertakings. If it is relevant to anything, it is to the making of a transaction which the liquidator and HM Customs & Excise may wish to examine to see whether there has been any prejudice to the creditors of the company resulting from the transfer to Suntex. It is not relevant to the claim in this case. The same point is made in `G'.
Those points, as do many other points in this letter, show that the Tribunal, far from lacking understanding of what had happened, had formed a sound understanding of what had happened and was relevant for the purposes of the issue they had to decide. We reject the criticism, in the last paragraph, that this decision was reached without a clear understanding of the facts. The Tribunal made findings of relevant facts. Those findings show, in our view, that the Tribunal were right in concluding that there was a transfer of an undertaking, with the result that the Applicants were successful.
We shall therefore dismiss this appeal. There is no error of law in it. The errors of law are in the grounds of appeal.
After we gave judgment dismissing the appeal, there was an application by Miss Moor on behalf of Mr Sandford and by Mrs Beechey and Miss England for costs and expenses. Under Rule 34 of The Employment Appeal Tribunal Rules 1993 an order for costs or expenses may be made in the following circumstances:
"34(1) Where it appears to the Appeal Tribunal that any proceedings were unnecessary, improper or vexatious or that there has been unreasonable delay or other unreasonable conduct in bringing or conducting the proceedings the Tribunal may order the party at fault to pay any other party the whole or such part as it thinks fit of the costs or expenses incurred by that other party in connection with the proceedings.
(2) Where an order is made under paragraph (1) of this rule, the Appeal Tribunal may assess the sum to be paid or may direct that it be assessed by the taxing officer,"...
Miss Moor submitted, and Mrs Beechey and Miss England concurred, that this was an unnecessary appeal. It was a case that was bound to fail on the grounds put forward in the Notice of Appeal. They revealed no arguable point of law. There has been in addition, unreasonable conduct in bringing and conducting these proceedings. The Appellants, having put in an appeal, have not turned up to argue the case and have not put forward any excuse for not turning up. We agree.
Rather than dismiss the case for want of prosecution, we have gone through each of the grounds stated in their appeal letter in order to make doubly sure that we were right in our provisional views that there was no error of law in this decision. We have received substantial help in this exercise from Miss Moor. In those circumstances we think that costs and expenses have been incurred by the Applicants, who were responding to this appeal, which the Appellants ought to be made to pay. On the basis of information we have been provided with, we make the following Orders, that APA International Ltd pay to Mr Sandford £750, in respect of his legal costs and £100 in respect of his loss of salary and travelling expenses for today; they pay to Mrs Beechey £60 in respect of loss of salary and travelling expenses; and they pay to Miss England £10.40 in respect of her travelling expenses.