United Kingdom Employment Appeal Tribunal

 APPEARANCES

For the Appellants MR C SAUNBY

Solicitor

Toller Hales & Collcutt

Castilian Chambers

2 Castilian Street

Northampton NN1 1JX

For the Respondent MR R SYMONDS

Free Representation Unit

Room 140

49-51 Bedford Row

LONDON WC1R 4LR


 


MR JUSTICE MUMMERY (PRESIDENT) This appeal from the Interlocutory Order of a Chairman sitting alone at London (South) on 6th February 1996 raises general points on the procedure and practice of Industrial Tribunals on applications for leave to amend. The opposing arguments on this appeal indicate that it may be helpful to clarify, for the benefit of practitioners, certain aspects of Industrial Tribunal procedure and practice.

The Appeal

This case comes on appeal to the Appeal Tribunal in the following circumstances:

(1) On 1st December 1995 Mr Michael Moore presented an Originating Application to the Central Office of the Industrial Tribunals stating that the type of complaint that he wanted the Tribunal to decide was "unfair dismissal". The details of the complaint were that Mr Moore had been employed as a bus mechanic from February 1973 until 20th October 1995 when he was dismissed by the Respondent company (Stagecoach Selkent). In Box 12 of the IT1 he stated the brief details of his complaint as follows:

"The Company Selkent created a situation of unnecessary distrust amongst the workforce by not utilising the recognised overtime procedure used within the Company. This resulted in the Company unfairly accusing me of coercing and intimidating behaviour.

I have been employed by the Company for 22 years with a good record - no previous disciplinaries. The Company has not listened to my explanation in the circumstances of the events and have unfairly dismissed me."

Nothing was said in those details about trade union membership or trade union activities. Notes to Box 12 advise applicants that -

"You will be given the opportunity to provide more detail later."

(2) In the Notice of Appearance dated 8th January 1996 Stagecoach Selkent admitted the dismissal of Mr Moore and contended that it was for a "conduct" reason. The attached statement, supplying details of resistance of the application under Box 8 of the IT3, alleged that Stagecoach Selkent had received a complaint from two bus mechanics on about 6th October 1995 that they were being intimidated by Mr Moore by putting unreasonable pressure upon them, so as to dissuade them from working voluntary overtime allocated by Stagecoach Selkent. The complaint was investigated in accordance with disciplinary procedures on 19th and 20th October. As a result Mr Moore was dismissed, without prior warning and without notice, for serious misconduct. His appeal against that decision took the form of a rehearing on 3rd November 1995, but the original decision to dismiss him was unchanged. He brought a second appeal to the Managing Director on 24th November 1995. That took the form of a meeting between the Managing Director and the TGWU Regional Passenger Secretary. The Managing Director decided that the dismissal would remain, but with notice and a payment in lieu of notice was made to him. In those circumstances Stagecoach Selkent denied unfair dismissal and pleaded, in the alternative, that, if there was unfair dismissal, Mr Moore had caused or contributed to that dismissal to a substantial extent by reason of his conduct.

(3) The hearing of the application was fixed for 14th February 1996.

(4) On 30th January 1996 Mr Moore's legal representative wrote two letters to the Regional Secretary to Industrial Tribunals at London (South). The first letter requested

"...an amendment to the application to an Industrial Tribunal by way of providing full particulars of the claim."

The letter then set out the amendment requested in the following form:

"That Box 1 of the application to an Industrial Tribunal read -

"Unfair dismissal by reason of S.57 Employment Protection (Consolidation) Act 1978 and/or S.152 Trade Union and Labour Relations (Consolidation) Act 1992."

The second letter set out the proposed amendment to Box 12 of the Originating Application as follows:

"The Company dismissed me following and due to my involvement in the ongoing pay negotiations between the Union and the Company and/or because they believed that I was involved in the preparation for, implementation of or the enforcement of a ban on voluntary overtime."

Copies of both letters were sent to the solicitors for Stagecoach Selkent.

(5) By a letter dated 6th February 1996 Mr Moore's legal representative was informed by the Regional Secretary that the application to amend had been referred to a Chairman of Tribunals who granted the request. It is common ground that the Order for amendment was made without prior consideration of representations from Stagecoach Selkent, which were not received until after that letter was sent.

(6) The objections to the amendment by Stagecoach Selkent solicitors are contained in a letter sent on 5th February. The grounds of opposition were that -

(a) the application under S.152 of the 1992 Act would be a completely new claim;

(b) that claim arose out of additional facts, not out of any facts or allegations contained in the Originating Application; and

(c) the claim was advanced outside the 3 months' time limit for unfair dismissal claims.

The letter stated that, if the amendment were allowed, Stagecoach Selkent would ask for an adjournment to give them time to deal with the new matters. They would also need further particulars to clarify details of the negotiations referred to, details of the alleged belief of Stagecoach Selkent about Mr Moore's involvement and details about the alleged implementation of a ban on voluntary overtime. Those details have been provided.

(7) In a further letter written on 7th February 1996, after Stagecoach Selkent's solicitors had been informed of the grant of the leave to amend without consideration of their objections, it was pointed out that it was unfortunate that the decision was made without the matter being referred to their clients. The understanding of the writer of the letter was that, as the grant of leave was an interlocutory decision, it could not be rectified by the review procedure and that

"...the only recourse for our client is to pursue the matter by way of appeal."

They asked the Industrial Tribunal to consider granting an adjournment of the hearing fixed for 14th February 1996, so that they could consider with their clients whether they wished to appeal. I n any event, further particulars would needed to be supplied and time would be needed to take instructions to prepare for the amended claim.

(8) By letter dated 13th February 1996 the Industrial Tribunal informed Stagecoach Selkent's solicitors that they should raise their objections at the start of the hearing. They did. The result was that an Order was made adjourning the hearing on the basis that Stagecoach Selkent wished to lodge an appeal against the grant of leave to amend. It had been indicated to the Tribunal that the grounds of appeal would be, inter alia, that the Tribunal was wrong in law to grant such a request and had failed to give Stagecoach Selkent any opportunity to be heard in opposing the request to amend. The reasons for the adjournment, granted at a hearing attended by the legal representative of Mr Moore, as well as by the solicitor for Stagecoach Selkent, were notified to the parties on 6th March 1996.

The Appeal Hearing

The hearing of the appeal was expedited. At the opening of the appeal Mr Symonds, on behalf of Mr Moore, took a preliminary objection to the appeal. He submitted that the proper course for Stagecoach Selkent was to apply to the Industrial Tribunal for the ex parte order granting leave to amend to be set aside, not to appeal against it. As the order was made ex parte, the Industrial Tribunal had power to reconsider it and to confirm, discharge or vary it after hearing the objections of Stagecoach Selkent. Mr Symonds relied on the observations of this Tribunal on ex parte orders by Industrial Tribunals in Reddington v. S Straker & Sons Ltd [1994] ICR 172 at 176, D-E. He relied particularly on the statement that -

"It is unnecessary for a party, adversely affected by such an order [an ex parte order] to appeal to the Appeal Tribunal without first seeking an Order of the Industrial Tribunal to set it aside."

We do not accept this submission. The position in this case is that Stagecoach Selkent made their objections to the application for leave to amend in writing, both before the Order was made and after the Order was made, and orally at the hearing on 14th February. The response of the Tribunal (and also of the legal representative of Mr Moore, until this morning) was that the appropriate course was for Stagecoach Selkent to appeal to this Tribunal. The adjournment of 14th February was granted so that such an appeal could be pursued before the substantive hearing took place. Neither the Industrial Tribunal nor Mr Moore's legal representative insisted or suggested that the matter be dealt with as an application to discharge or vary the Order. In those circumstances we are of the view that it is not open to Mr Moore's legal representative to object to the appeal, particularly when he submits that the consequence of our accepting his submission is that the appeal would be dismissed and that it would be too late for the Industrial Tribunal to entertain an objection to the amended pleading. That would be unjust. It would also mean that delay had occurred and time and money have been wasted.

After we decided to reject the preliminary submission on the jurisdiction to entertain this appeal, the parties' representatives informed us that they had agreed that the appeal should now proceed on the basis that we should not remit the case if there was an error of law, but we would be asked to exercise the discretion normally exercised by the Tribunals on questions of leave to amend. We should do that after hearing the objections of Stagecoach Selkent to the grant of leave and Mr Symonds's submissions in support of the order of the Chairman. In our view, this is a permissible and sensible course for the parties and this Tribunal to follow.

The Submissions of Stagecoach Selkent

Mr Saunby, the solicitor for Stagecoach Selkent, made the following objections to the amendment:

(1) Natural justice point

He objected to the circumstances in which the amendment was granted. It was a fundamental principle that a party affected by a decision should be made aware of the nature of the application to the Tribunal and should have an opportunity to make representations to the Tribunal before the decision is made. This principle had been breached by the Tribunal in this case in making a decision without prior consideration of the objections raised by Stagecoach Selkent.

(2) The power to amend

The power to amend is no exception to the principle of natural justice. The power is part of the wide discretion conferred on Industrial Tribunals to regulate their own procedure. The exercise of that discretion should be judicial. In its exercise the Tribunal should have regard to whether the amendment raised a new cause of action and, if so, whether that cause of action was brought within the relevant time limit and, if not, whether the facts stated in the original application were apt to cover or anticipate claims of the nature proposed in the amendment and whether it was reasonably practicable to have brought those claims within the relevant time limit.

(3) The exercise of the discretion

The Tribunal had erred in principle in exercising the discretion to grant the amendment. The facts in the originating application gave no indication of a claim under S.152 of the 1992 Act. There was no allegation that Mr Moore was a member of a union or that his dismissal was in any way connected with his membership or with trade union activities. Further, the time limit for making the claim under S.152 expired at the end of three months from his dismissal ie, on 20th January 1996 and there was no evidence before the Tribunal as to why it was not reasonably practicable for Mr Moore to make his claim before that date.

The Submissions of Mr Moore

On behalf of Mr Moore, Mr Symonds made the following submissions:

(1) Natural justice

There was no obligation in the Industrial Tribunal's Rules of Procedure for the Tribunal (or a Chairman) to seek representations from any of the parties on an application for leave to amend. Where there was such an obligaation, it was expressly so stated in the Rules eg, Rule 6 and Rule 13(5), neither of which is concerned with applications to amend. The absence of the obligation to seek representations was consistent with the need for Industrial Tribunals to act expeditiously in dealing with claims.

(2) No new cause of action

The proposed amendment did not contain any new cause of action. The claim in the Originating Application was for "unfair dismissal". Mr Moore invoked the statutory right conferred on him by S.54 of the Employment Protection (Consolidation) Act 1978. He did so within the time prescribed by S.67 of the 1978 Act. It was therefore a valid application. The decision of this Tribunal in Dodd v. British Telecommunications Plc [1988] ICR 116 was authority for the proposition that it was not fatal to the validity of an originating application to fail to specify which Act was invoked. Thus, in a discrimination case, an effective complaint, which would stop time running, could be made without specifying whether the discrimination complained of was on the ground of race or sex. The nature of Mr Moore's complaint was sufficiently identified for the purposes of identifying a cause of action. Any deficiency in the details of the complaint could be cured by the provision of particulars at a later date. The more recent case of Quarcoopome v. Sock Shop Holdings Ltd [1995] IRLR 353 illustrated the same point in relation to complaints of direct and indirect discrimination. A complaint could be validly made to an Industrial Tribunal of race discrimination, without identifying initially the different ways in which it was alleged that the discrimination had occurred. An application to add a complaint of indirect race discrimination was not therefore out of time. The initial complaint of race discrimination covered any case in which discrimination on that ground was alleged, whether direct or indirect.

(3) The exercise of discretion

In determining Mr Moore's claim in its original form, the Industrial Tribunal would have to make a finding of fact, on the evidence, as to the reason for his dismissal. Even without the amendment, the Industrial Tribunal might still find that Mr Moore was dismissed for an inadmissible reason. For those reasons a claim for unfair dismissal in its nature includes any claim that the dismissal was by reason of an inadmissible reason. There was therefore no reason for refusing leave on the grounds that the application was out of time. The Tribunal Chairman had exercised the discretion in accordance with legal principle. This Tribunal should, therefore, confirm the exercise of discretion and dismiss the appeal.

Procedure and Practice for Amendments

The rival submissions of the parties state the position at opposite extremes. Before we state our conclusions on this appeal, it may he helpful to summarise our understanding of the procedure and practice governing amendments in the Industrial Tribunal.

(1) The discretion of a Tribunal to regulate its procedure includes a discretion to grant leave for the amendment of the originating application and/or notice of appearance: Regulation 13. See Cocking v. Sandhurst Ltd [1974] ICR 650 at 656G - 657D. That discretion is usually exercised on application to a Chairman alone prior to the substantive hearing by the Tribunal.

(2) There is no express obligation in the Industrial Tribunal Rules of Procedure requiring a Tribunal (or the Chairman of a Tribunal) to seek or consider written or oral representations from each side before deciding whether to grant or refuse an application for leave to amend. It is, however, common ground that the discretion to grant leave is a judicial discretion to be exercised in a judicial manner ie, in a manner which satisfies the requirements of relevance, reason, justice and fairness inherent in all judicial discretions.

(3) Consistently with those principles, a Chairman or a Tribunal may exercise the discretion on an application for leave to amend in a number of ways:

(a) It may be a proper exercise of discretion to refuse an application for leave to amend without seeking or considering representations from the other side. For example, it may be obvious on the face of the application and/or in the circumstances in which it is made that it is hopeless and should be refused. If the Tribunal forms that view that is the end of the matter, subject to any appeal. On an appeal from such a refusal, the appellant would have a heavy burden to discharge. He would have to convince the Appeal Tribunal that the Industrial Tribunal had erred in legal principle in the exercise of the discretion, or had failed to take into account relevant considerations or had taken irrelevant factors into account, or that no reasonable Tribunal, properly directing itself, could have refused the amendment. See Adams v. West Sussex County Council [1990] ICR 546.

(b) If, however, the amendment sought is arguable and is one of substance which the Tribunal considers could reasonably be opposed by the other side, the Tribunal may then ask the other party whether they consent to the amendment or whether they oppose it and, if they oppose it, to state the grounds of opposition. In those cases the Tribunal would make a decision on the question of amendment after hearing both sides. The party disappointed with the result might then appeal to this Tribunal on one or more of the limited grounds mentioned in (a) above.

(c) In other cases an Industrial Tribunal may reasonably take the view that the proposed amendment is not sufficiently substantial or controversial to justify seeking representations from the other side and may order the amendment ex parte without doing so. If that course is adopted and the other side then objects, the Industrial Tribunal should consider those objections and decide whether to affirm, rescind or vary the order which has been made. The disappointed party may then appeal to this Tribunal on one or more of the limited grounds mentioned in (b) above.

(4) Whenever the discretion to grant an amendment is invoked, the Tribunal should take into account all the circumstances and should balance the injustice and hardship of allowing the amendment against the injustice and hardship of refusing it.

(5) What are the relevant circumstances? It is impossible and undesirable to attempt to list them exhaustively, but the following are certainly relevant:

(a) The nature of the amendment

Applications to amend are of many different kinds, ranging, on the one hand, from the correction of clerical and typing errors, the additions of factual details to existing allegations and the addition or substitution of other labels for facts already pleaded to, on the other hand, the making of entirely new factual allegations which change the basis of the existing claim. The Tribunal have to decide whether the amendment sought is one of the minor matters or is a substantial alteration pleading a new cause of action.

(b) The applicability of time limits

If a new complaint or cause of action is proposed to be added by way of amendment, it is essential for the Tribunal to consider whether that complaint is out of time and, if so, whether the time limit should be extended under the applicable statutory provisions eg, in the case of unfair dismissal, S.67 of the 1978 Act.

(c) The timing and manner of the application

An application should not be refused solely because there has been a delay in making it. There are no time limits laid down in the Rules for the making of amendments. The amendments may be made at any time - before, at, even after the hearing of the case. Delay in making the application is, however, a discretionary factor. It is relevant to consider why the application was not made earlier and why it is now being made: for example, the discovery of new facts or new information appearing from documents disclosed on discovery. Whenever taking any factors into account, the paramount considerations are the relative injustice and hardship involved in refusing or granting an amendment. Questions of delay, as a result of adjournments, and additional costs, particularly if they are unlikely to be recovered by the successful party, are relevant in reaching a decision.

Conclusion

In the particular circumstances of this case, we have reached the conclusion that the appeal should be allowed and that Mr Moore should not be permitted to amend the Originating Application. We make it clear that we have dealt with the question of amendment on the basis of the circumstances existing at the date when the application was made. The relevant legal situation was not altered by anything that has happened since. In fact all that has happened since is that the Industrial Tribunal hearing was adjourned from 14th February to a new date. As that adjournment arose out of the application for leave to amend and the objections to it, it is not open to Mr Moore to say that Stagecoach Selkent have now had more time to deal with the amendment than they originally had. The question is whether the application for amendment, at the time when it was made, should have been granted or should have been refused. The reasons for our decision are as follows:

(1) There is no dispute that the amendment pleads facts, which have not previously been pleaded, in support of a new positive case of automatic unfair dismissal for trade union reasons within the meaning of S.152 of the 1992 Act. Fresh primary facts will have to be established by evidence and inferences made from them, if appropriate.

(2) Mr Symonds, on behalf of Mr Moore accepts that no explanation was provided to the Industrial Tribunal and no explanation has been provided to this Tribunal why these facts, which must have been within Mr Moore's knowledge, were not alleged in the original application. It was not said, for example, that Mr Moore had failed to plead these facts because he was ignorant of the right to make a complaint of dismissal on those grounds. In our view, an application for amendment made close to a hearing date usually calls for an explanation as to why it is being made then, and was not made earlier, particularly when the new facts alleged must have been within the knowledge of the Applicant at the time when he was dismissed and at the time when he presented his Originating Application.

(3) The refusal of leave to amend would not cause hardship to Mr Moore. As already explained, his Originating Application was presented in time. It is a valid application. It can proceed to a hearing on the issue identified in the unamended IT1 and the IT3. It is not disputed that Stagecoach Selkent dismissed Mr Moore. The burden will therefore be on them to prove that Mr Moore was dismissed for a potentially fair reason. If they fail to do that, Mr Moore will win his case. Even if they prove that the reason for dismissal was a potentially fair one, Mr Moore may still win his case, if the Tribunal conclude that it was not fair and reasonable to dismiss him for that reason. The refusal of leave does not prevent Mr Moore from pursuing his case for unfair dismissal. He may pursue it and he may win it.

(4) In our view, the risk of hardship is, on balance, greater if the amendment is granted than if it is refused. As the new allegations were made late, it must have been foreseeable by Mr Moore or those advising him that an adjournment would be requested and would probably have to be granted. That increases costs, which will probably not be recovered, even if ordered. Further costs are likely to be incurred if the amendment is made, because the nature of the allegation will add to the length of the hearing, even perhaps to the number of witnesses, without necessarily affecting the result or conferring any additional benefit on Mr Moore.

For those reasons the appeal is allowed and the amendment is refused.