United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellants	MR D READE (of Counsel) Messrs Biddle & Co Solicitors 1 Gresham Street London EC2V 7BU
For the Respondent	MR L GERRARD (of Counsel) Messrs Rahman & Co Solicitors 33 West Green Road London N15 5BY


 


JUDGE PETER CLARK: The Applicant, Mr Gerrard was employed by the Respondent, Mags Express, as Regional Sales manager. He began his employment in 1989 and remained employed until his summary dismissal on the grounds of alleged misconduct on 20 April 1998. An internal appeal against his dismissal failed. On 17 July 1998, he presented a complaint of unfair dismissal to the Manchester Employment Tribunal.

It is his pleaded case that five heads of alleged misconduct raised by Respondent at the disciplinary hearing were spurious; that the Respondents adopted an unfair procedure and that the dismissal was unfair. He claims as his remedy compensation only.

By their Notice of Appearance dated 12 August 1998, the Respondents contend that the Applicant was guilty of six disciplinary offences amounting to misconduct.

The sixth allegation at paragraph 7.6 of the grounds for resistance reads:

"7.6 conspiring with a third party to damage the Respondent by the conversion of its customers to the benefit of the third party and attempting to recruit the respondent's sales staff to the third party or otherwise cause the Respondent's sales staff to leave the Respondent's employment."

On 9 November 1998, the Respondents' solicitor wrote to the Applicant's solicitors asking for discovery of the following documents within 7 days:

"1. The itemised call listing for the mobile telephone number 0802 747915 for the period 1st November 1997 to 30th April 1998;

2. The call listing for the Applicant's itemised home telephone line for the same period as 1 above."

They go on to state their case in support of the application for discovery in this way:

"It is the Respondents' belief that the Applicant was in regular telephone contact with [Mr A], his competing business and others involved in that business in the specified period. The evidence of the call listings is plainly relevant to the issues in question in these proceedings."

No reply having been received the Respondents' solicitors wrote to the Tribunal on 16 November 1998 applying for an order for discovery in respect of the documents requested.

By letter dated 18 November the Tribunal replied in these terms:

"The Chairman directs me to inform you that your request for an order for discovery is refused on the grounds that as the issue will be what evidence the Respondents had on which to enable decisions at the time of the dismissal, the documents cannot be relevant to the question of whether the dismissal was fair, and therefore, do not appear to be Chairman to be necessary."

On 4 December the Respondents' renewed their discovery application. They submitted:

"With respect to the Chairman, the Respondent's belief that the Applicant had been communicating confidential information to a competitor is one of the primary grounds on which the Respondent seeks to justify dismissal. The Respondent denies this. If, in fact, evidence in the form of the Applicant's telephone records confirm that the Applicant had, indeed, been communicating with the competitor, that evidence must not only go to establishing the reasonableness of the Respondent's belief (albeit it was evidence it did not have at the point of dismissal), but also to the credibility of the Applicant's evidence as a whole. We respectfully suggest on the latter grounds alone (ie. credibility) the telephone records are highly material.

Further, even if the telephone records (and presuming them to be substantiate the Respondent's belief) cannot be taken account of by the Tribunal in deciding on the fairness of the dismissal itself, there is ample authority, (see Devis Atkins 1977 IRLR 314 Tele-trading Limited v. Jenkins 1990 IRLR 430 and Chaplin v. Rawlinson 1991 ICR 553), that evidence discovered after the dismissal and which would (had it been available) have made the dismissal fair, can be taken account of when the Tribunal comes to decide on compensation."

By letter dated 14 December the Chairman refused the renewed application. His reasons for so doing were expressed as follows:

".....the reasonableness of the Respondents belief can only be judged on the evidence before the Respondents at the time and inspection of the documents cannot be necessary for the proper determination of whether the dismissal was unfair in the chairman's view. The applicant's credibility has not been shown to be in issue on the question of whether the dismissal was unfair. The document may be relevant to remedy and in that case the Tribunal will order inspection at the relevant time."

An amendment or correction was made to that letter by letter of 19 January which reads:

"The Chairman directs me to inform you that your request for an Order for Discovery is refused on the grounds that, as the issue will be what evidence the Respondents had on which to make decisions at the time of the dismissal, the documents cannot be relevant...."

Against the Chairman's Order of 14 December, the Respondent appealed by Notice dated 21 December.

In support of the appeal Mr Reade reminds us of the relevant procedural rule. Rule 4(1)(a) of the Employment Tribunal Constitutional Rules of Procedure Regulations Schedule 1 1993, provides that the Tribunal may grant such discovery or inspection of documents as might be ordered by a County Court. Under County Court Rule Order 14 Rule 1, discovery may be ordered of the documents in the possession custody or power of the party, giving discovery which are relevant to any matter in question in the proceedings. By Rule 8(1), the guiding principle for discovery is that it will be ordered if the documents are necessary for disposing fairly of the matter or for saving costs.

He accepts that at the internal disciplinary stage, the Respondent formulated the first five charges set out at paragraph 7.1-5 of the grounds for resistance contained in the Notice of Appearance. The matters raised in paragraph 7.6 did not form a specific disciplinary charge, although he tells us that the Respondents' evidence will be that at the disciplinary interview, it was put to the Applicant that contact had been taken place with Mr A, a former employee of the Respondent who had set up in a competing business.

Further, applying the principle in Devis v Atkins [1977] ICR 662, information not before the Respondent at the time of dismissal cannot be relevant to the issue of the reasonableness of the reason for dismissal, applying the well-known three-fold Burchell test. Accordingly, the documents sought on discovery are not strictly relevant to the issue of fairness.

However, and this in turn is accepted by Mr Gerrard and by the Chairman below, the documents are prima facie relevant to the issue of remedies, if the dismissal is held to be unfair in this sense. After-acquired knowledge by the employer of the employee's pre-dismissal misconduct may go to the question of what if any compensation should be ordered under the just and equitable principle contained in section 123 sub-section 1 of the Employment Rights Act 1996. See Devis.

Thus, returning to the guiding principles in County Court Rule Order 14 Rule 8(1), is discovery at this stage necessary for the fair disposal of the matter? Mr Reade argues that it is; first, so that he may cross-examine the Applicant at the liability hearing as to the credibility. We accept Mr Gerrard's submission that that is not a proper basis, of itself, for ordering discovery. Secondly, so that he can assess the overall strength of his case. In our view that is not a sufficient reason to overturn the Chairman's exercise of his undoubted discretion. If the Respondent fails on fairness, it will then have discovery prior to the remedies hearing, at which the just and equitable principle may be applied. It is, we acknowledge, common practice at Employment Tribunals for unfair dismissal complaints to be heard in two stages.

Saving of costs. We prefer Mr Gerrard's submission that no costs will be saved by discovery at this stage. If the documents are irrelevant to the question of fairness, their discovery now will not affect the length of the liability hearing. Nor will the subsequent remedies hearing be materially extended by the admission of that evidence if, in the event, it is to form part of the Respondent's case.

Finally, our powers to interfere with Tribunal decisions. Mr Reade has referred us to the relevant principles, set out in the judgment of Wood J in Adams and Raynor v West Sussex County Council [1990] IRLR 211 at paragraph 16, where he said:

"It seems to us desirable, and indeed we would have expected, that the same principle would apply to interlocutory appeals as for final appeals even though the former will in the main be the result of the exercise of a discretion. Thus, in examining an interlocutory order of an industrial tribunal or of a chairman sitting along we would define three issues:

(a) Is the order made one within the powers given to the Tribunal?

(b) Has the discretion been exercised within guiding legal principles? eg as to confidential documents in discovery issues.

(c) Can the exercise of the discretion be attached on Wednesbury principles?"

Woods J then goes on to quote the well-known passage from the judgment of Arnold J in Bastick v James Lane (Turf Accountants) Ltd [1979] ICR 778 at 782A.

Looking at those three issues identified by Wood J:

(a) it is accepted by the Respondent that the Chairman's order was one made within his powers under the rules;

(b) we are satisfied that here the Chairman has exercised his discretion within guiding legal principles as we have outlined above;

(c) we cannot say that the decision is perverse in any of the senses identified by Arnold J in that passage in the Bastick case to which we have referred.

In these circumstances, we have concluded that there are no grounds in law for interfering with this Chairman's exercise of his discretion in refusing the order for discovery at this stage in the proceedings. Accordingly, the appeal is dismissed.