United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MS E LAING (of Counsel) Instructed by: Ms P Carne Messrs Mylles & Company Solicitors Keayne House 28 Thames Street Windsor Berkshire SL4 1PR


 


MR JUSTICE MORISON (PRESIDENT): This is an appeal against a decision of an Industrial Tribunal held at Reading which decided, following a two day hearing, that it should review a decision which it had made previously recording the fact that the application before it was withdrawn on settlement between the parties. The first decision was sent to the parties on 16th March 1998. There was then an immediate application for a review. The Industrial Tribunal concluded that the previous decision should be revoked and that the matter should proceed to a full hearing.

The background circumstances to this case can shortly stated. The applicant, Mr Gould, had been employed as a teacher at Lambrook Haileybury School. He was dismissed from his employment. The case was scheduled to be heard before an Industrial Tribunal in the first part of March 1998.

Immediately prior to it coming on for hearing the parties entered into negotiations. It was the desire of the School that if negotiations were successful it should lead to an agreement which would effectively preclude the applicant from pursuing his complaints in the Industrial Tribunal. Heads of agreement, in effect, were agreed on 9th March 1998. Included within them was provision for the payment of a specific sum gross and a provision that a reference in terms suitable to both parties would be agreed in due course. In order to ensure the enforceability of any such agreement Mr Gould went to legal advisers to give him the benefit of independent legal advice. In accordance with the heads of agreement that had been arrived at between the parties, a draft agreement dated 9th March 1998 was prepared for consideration by Mr Gould's solicitors and by the School. In its original form the agreement provided for the payment of the gross sum and recorded that it was accepted in full and final settlement of the complaints which he might have. In paragraph 4.6 there was a restriction on disclosure to third parties about the circumstances of the agreement and the dismissal and there was an exception to that, namely:

"... save in the form of the reference set out in the schedule hereto."

It was manifestly clear that the parties had intended to agree the precise terms of any reference which would be given to Mr Gould were the School to be asked for one in the future. That night, that is on 9th March 1998, the solicitors to Mr Gould confirmed that the date for the tribunal hearing had been vacated. It was vacated as a result of the applicant himself sending to the tribunal this statement:

"Hearing date: 10th-11th March

I confirm that the case has settled, as I informed a member of your staff today as the office was closing and as she later confirmed with me this evening."

The parties produced in due course a varied version of the original typewritten agreement to make provision for the payment to be made gross and so as to ensure that the Inland Revenue would not in due course seek to tax it. Thus in clause 1 of the agreement the payment of the sum was described as being compensation for the termination of his employment. In clause 2 there was provision which said that if at a later date the Inland Revenue or a Court or other authoritative body determines that income tax of National Insurance contributions should have been deducted, then the employee agrees to indemnify and keep the employer indemnified against any amounts so payable by the employer and would pay the employer within 14 days of demand what he had had to pay out. Again the document referred to the form of the reference "set out in schedule hereto". It is to be noted that no reference was actually finally agreed between the parties and therefore no schedule could be prepared. It appears that before the agreement was signed on behalf of the employee he was expressing concern about the tax implications of the payment to him and in addition was concerned about the terms of the reference which he believed was not satisfactory in the form in which it was being proposed.

Thus it would appear that although on 9th March, in good faith, it appeared to the parties that an agreement was in the bag, and the tribunal was so informed, what then happened made it plain that the parties had not concluded their agreement.

The issue before the Industrial Tribunal as it was defined for them was the question whether the parties had indeed made a binding contract. The School submitted that the agreement had been concluded either on 9th March, when the respondents' solicitors agreed to a settlement on the payment of the sum concerned; or, alternatively, as a result of the second draft agreement being signed by them. It was their case that the signing by the applicant was not a necessary step for the conclusion of a contractual bargain between the parties.

There was then an appeal against the tribunal's decision to revoke the earlier decision which had been entered on 16th March 1998 to this Court.

It has to be said that the point which was raised on this appeal is without any merit whatsoever. It was not a point which was raised before the Industrial Tribunal at the review hearing. It is said that since it is a jurisdiction point we can entertain it despite that fact.

It seems to us on the issue presented to the Industrial Tribunal that their decision was manifestly correct. It seems to us that there is no room for arguing that a concluded agreement was arrived at between the parties. Any agreement made on 9th March 1998 was plainly intended to be subject to the drawing up of a formal contract which would have the required effect. The agreement which was then drawn up was amended. The terms of the reference were never completed. It was plainly the intention of the parties that they should become bound by the agreement only when they had signed it. For those reasons, which are essentially those set out in tribunal decision, we would have dismissed the appeal on that issue.

The jurisdiction point that is taken relates to the nature of the order which was made by the Industrial Tribunal on 16th March 1998 when it entered it in the Register and recorded the fact that:

"This application is withdrawn on settlement between the parties."

The argument runs as follows. That was not a decision of a tribunal, even though it is headed a decision; and even though it had been entered in the Register in accordance with Rule 10 of the tribunal's Rules. It was said that this was an order and it was an interlocutory order rather than a decision; or, alternatively, it was a decision on an interlocutory matter. Rule 11 provides that a tribunal shall have power to review any decision that it has made. That was the Rule pursuant to which the tribunal had the review hearing, but it was submitted they had no power to carry out a review because the earlier decision was not a decision within the meaning of the Rules but was rather an interlocutory order. Accordingly, the tribunal acted without jurisdiction in carrying out the review.

In support of this ingenious but unmeritorious argument, Ms Laing for the School submitted that this was an interlocutory decision in the light of a decision of the Court of Appeal which held that the tribunal was not obliged to dismiss an application on withdrawal, that that was a judicial decision which involved the exercise of discretion. Accordingly, since the tribunal had discretion not to dismiss the application, it was not a final decision as such, it must fall into the category of an interlocutory decision. An interlocutory decision being distinguished from a final decision on the basis that the latter is a decision which whichever way it is decided finally disposes of the rights of the parties. It follows that if there was a discretion to dismiss appeal upon withdrawal, it was not a decision which inevitably was going to dispose finally of the parties rights.

It seems to us that like other unmeritorious and technical decisions there is an easy answer to it. It is in this way. The definition of the word 'decision' to be found in Regulation 2(2) is preceded by the words "unless the context otherwise requires". It seems to us that the context in which the decision was made by the Industrial Tribunal on 16th March 1998 was a decision falling within Rule 10. The context in which Rule 11 empowers the tribunal to review such a decision otherwise requires that such a decision should include a decision of the sort with which we are dealing. That is because the decision of the tribunal referred to was entered in the Register as a decision and was sent to the parties on that basis in accordance with Rule 10. But alternatively, if it was not a tribunal decision capable of a review under Rule 11, then it must have been an interlocutory order. It seems to us that in accordance with the decision in Nikitas v Solihull Metropolitan Borough Council [1986] ICR 291, it is open to a tribunal which has made an interlocutory order at any stage of the proceedings to unmake it, revoke it or make a different order. Accordingly, it seems to us, that this appeal is manifestly hopeless. It will therefore be dismissed.

MR JUSTICE MORISON (PRESIDENT): We were asked for leave to appeal. We refuse leave to appeal. As we have indicated this appeal has no factual merit at all and on analysis, in our judgment, has no legal merit either.