United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellants	MISS A HEWITT (of Counsel) The Treasury Solicitor Queen Anne's Chambers 28 The Broadway London SW1H 9JS
For the Respondent	MS N AMIN (Representative)


 


MR JUSTICE MORISON (PRESIDENT): This is an urgent interlocutory appeal which comes before us whilst a case to which it relates is still within the Industrial Tribunal's jurisdiction.

The background to these proceedings is somewhat lengthy. The Applicant before the Employment Tribunal with which this appeal is concerned is Mrs Bamieh. She is, and has been for some time, employed by the Crown Prosecution Service. She is a qualified lawyer. She is currently a senior Crown Prosecutor. She brought proceedings against the Crown Prosecution Service (CPS) in 1995 and in 1997. Those proceedings contain allegations under the Sex Discrimination Act and the Race Relations Act in relation to the alleged unfavourable treatment accorded to her by the Crown Prosecution Service during the course of her employment.

Those two sets of proceedings have been consolidated and they have already had, I think, a three-week hearing with more to come in July of this year in front of an Employment Tribunal at London (South).

It had been thought that a settlement agreement had been arrived at between the parties in relation to the 1995 proceedings, but it transpired that that agreement was not legally effective as it did not comply with the statutory restrictions on the making of compromise agreements. It is the policy of Parliament to ensure that in principle people do not contract out of their rights to bring complaints under the two Acts, to which I have referred, unless certain safeguards have been built into the agreement.

It transpired in an Industrial Tribunal in London (South) that the alleged compromise agreement of the 1995 proceedings was not compliant with the statute and accordingly, directions were given for those proceedings to be consolidated with the 1997 proceedings, which by then had been issued.

Although the parties had entered into an agreement in relation to the 1995 proceedings, which were not legally effective to compromise the claim, it was the position of the CPS that by entering into an agreement and then taking the point that it was non-compliant with the legislation, Mrs Bamieh had acted vexatiously. It was also thought that she had behaved vexatiously as a result of the length of time it took for the agreement to be brought to fruition, and that she had been giving instructions to her Solicitors not to co-operate with the Treasury Solicitor, who was seeking to reduce to writing and complete the agreement which had been orally arrived at. Accordingly, I am told, and accept, that a learned Chairman of an Industrial Tribunal concluded that the conduct of the Applicant in those proceedings had been vexatious, but that he was not prepared to strike the proceedings out

In relation to the 1998 proceedings they are currently within the jurisdiction of the Bedford Industrial Tribunal and, indeed, they were set for hearing on 1 March 1999. On the previous Thursday negotiations opened between the parties which came to fruition. An agreement was made, the terms of which do not matter, which involved Mrs Bamieh leaving her employment on payment of money and that the compromise agreement was not just in relation to the 1998 proceedings, but in relation to the 1995 and 1997 proceedings as well.

However, over the weekend Mrs Bamieh had second thoughts based partly, she says, on a letter which she had seen in relation to an application for a promotion which she had made and accordingly, when the case was about to begin she informed the Crown Prosecution Service that she was no longer prepared to continue with the compromise agreement. That agreement had not been reduced to writing in a way which complied with the requirements of the legislation before an agreement can become effective. In particular, it did not state, as it is required, that the conditions regulating compromise contracts under the statute are satisfied.

There is some confusion at this time as to what the position of the CPS was in relation to Mrs Bamieh's contention that she was not bound by the agreement, which had been concluded in writing on the Friday afternoon. It is her belief, as represented to us, that at the hearing on 1 March Miss Hewitt of Counsel, on behalf of the Crown Prosecution Service, was not prepared to concede that the agreement was of no legal effect and accordingly, Mrs Bamieh had to seek the Tribunal's ruling on that issue before the case proceeded.

It is common ground between the parties that Mrs Bamieh then produced to the Employment Tribunal the written agreement in order that the Industrial Tribunal could determine whether it was compliant with sections 72 and 77 of the Race Relations Act and the Sex Discrimination Act respectively.

We are told by Miss Hewitt, and accept, that once the document had been put before the Tribunal the Tribunal Chairman indicated that there should be a short break so that some further legal research could be done. It is Miss Hewitt's position that she recognised that the written document did not comply with the statutory requirements and so informed the Tribunal. The Industrial Tribunal said this:

"5. Miss Hewitt has submitted that in the light of that agreement, Mrs Bamieh is barred from further proceeding with this claim. ...

6. Section 72(4) provides an exception for 'compromise contracts' which is similar to that in the 1975 Act. ... Subsection (f) requires that:

'The contract must state that the conditions regulating compromise contracts under this Act are satisfied.'

There is no such formula in this document and whilst Miss Hewitt has reserved her position on this point she has accepted that there is little further argument that she can pursue to persuade this Tribunal that in the absence of that provision this document is not a Compromise Agreement within the terms of either the 1976 Race Relations Act or the 1975 Sex Discrimination Act.

7. It therefore follows that the agreement on which the Respondents seek to rely is not a compromise agreement within the terms of either the 1976 or the 1976 Act. The purported agreement is unenforceable, and cannot form a bar to the continuance of Mrs Bamieh's application."

As the Tribunal decision reads, it was apparently their perception of Miss Hewitt's position that the CPS were contending that the agreement operated as a bar to any further proceedings in relation to the 1998 proceedings, and it is clear that the second position taken up by Miss Hewitt was that, in any event, Mrs Bamieh had behaved unreasonably and vexatiously and that her claim should be struck out under rule 13 (2) (d) of the Industrial Tribunals (Constitution and Rules of Procedure) Regulations 1993. The Tribunal said this:

"8. The second submission that Miss Hewitt makes is that nonetheless Mrs Bamieh has behaved unreasonably and that her claim should be struck out. Miss Hewitt points to the history of the negotiations which took place over several days last week and concluded in an agreement being reached on Friday 26th February. She points to the fact that not only is Mrs Bamieh seeking to get out of this agreement but that she had been found [or she had been found] to have behaved unreasonably in similar circumstances on an earlier occasion in another application in London South."

We take it that that last sentence is a reference to the outcome of the proceedings in relation to the 1995 application to which we have referred.

It is clear, and we accept from Miss Hewitt, that what she anticipated would then happen was that the Industrial Tribunal would entertain an application, which she was not in a position to advance on that day, to the effect that the case should be struck out under rule 13 (2) (d) for which purpose there would need to be a collection together of documents and of oral evidence which would then need to be presented to the Industrial Tribunal at some kind of a hearing. In fact what happened was that the Industrial Tribunal was prepared to hear Mrs Bamieh's explanation as to why she had changed her mind over the weekend and accordingly, she gave evidence about it.

The Tribunal then sought Miss Hewitt's help as to the basis on which the Tribunal could find that it was unreasonable for an Applicant to seek not to be bound by a document which was not legally enforceable and they note this:

"10. ... Miss Hewitt pointed to the fact that it is a matter of discretion for the Tribunal and that of course is quite right. We have looked at all the facts here. We have considered first of all whether we are in a position to make a decision today or not. As Miss Hewitt has pointed out, if the matter were fully explored it may well be that Miss Hewitt herself would have to give evidence of the negotiations. [I interpolate. She had been present on the Thursday when the negotiations had commenced] and that the matter would have to be deferred today to be heard before another tribunal."

They went on to conclude that, weighing the balance of prejudice, if they were to take one course or another, the balance was clearly against deferring the decision on the application to strike out if they felt able properly to make a decision that day and that it was right, as they put it, to "grasp this issue and resolve it". They noted that Miss Hewitt's principal objection was that Mrs Bamieh's unreasonable conduct had caused prejudice to the CPS both in the fact that they were not ready with the necessary documents for this hearing to proceed and that the Tribunal had become privy to negotiations, which of course would normally be privileged. So far as the documents are concerned, they noted that Mrs Bamieh's position was that she had her documents ready and they could be paginated for the following day. As to the position of the Tribunal, it was Mrs Bamieh's submission that they were, of course, well aware that negotiations of this sort do take place between parties and that it was not without note that the new Civil Procedure Rules require the judiciary actively to encourage such negotiations. They went on to say:

"13. ... We do not think that there is anything that we have heard today which inhibits us in making a decision today on this matter. Our decision is that we find that Mrs Bamieh has not behaved unreasonably and therefore that aspect of this application fails. We do not strike out Mrs Bamieh's application in whole or in part."

As to the suggestion that the Tribunal, having heard what they had heard, were no longer capable of giving a fair adjudication on the issues which then fell for them, they said this:

"14. It is implicit in Miss Hewitt's application that there is a further issue for us to address and that is whether, even though we have found that Mrs Bamieh is entitled to proceed with her claim, it is proper for this particular Tribunal to hear the claim in the light of what we have been told. We are satisfied that as members of the tribunal we can put to one side the information that we have received today. We are conscious that the difficulty lies not with us, but with Mrs Bamieh because it is Mrs Bamieh who has elected to take the risk of rejecting the agreement offered by the Respondents and to rely on the outcome of this Tribunal which of course no one can predict. It is our job to act judicially and to make our findings at the end of the day when we have heard all the evidence. It is for Mrs Bamieh to satisfy us on the balance of probabilities not only that there has been discrimination but also, if that were found to be the case, that her losses amount to such and such an amount. Nothing we have heard today is going to affect our judicial conduct of the hearing. We have therefore concluded that it is quite clearly in the interests of justice and indeed for that matter of all of the parties for this matter to proceed."

In her appeal Miss Hewitt effectively raises two points. She says that the Industrial Tribunal were wrong to reject her application to strike out the complaint without giving her an opportunity to marshall her evidence in support of it. She says that there were two bases for the application to strike out. The first was because of the similarity between the previous facts and what had happened in relation to the 1995 proceedings. The second was that the Applicant was vexatious and unreasonable in resiling from the agreement which had been reached after negotiations at which her Union, the First Division Association, had been present and after she had had the opportunity of taking legal and accountancy advice.

Secondly, she submits, that as a result of what the Tribunal now know about the negotiations they should recuse themselves because an objective observer looking at the proceedings would be of the view that justice was not being done between the parties. She drew attention in connection with the second submission, to the size of the amount which had been offered as part of the consideration for the overall settlement package. She was inclined to the view that had that amount been much smaller, she probably would not have been instructed to have made objection to the Tribunal continuing with the case.

It seems to us, with great respect to Miss Hewitt, that it was simply not open to the Industrial Tribunal to conclude that reneging on an unlegally enforceable agreement was capable of being vexation conduct entitling the CPS to apply to strike out her complaint. If it were the position that it was unreasonable for a party to renege on a document which did not bind her, then rule 13 (2) (d) would be a way of subverting the plain intention of Parliament that compromise agreements had to be made in such a way that the parties rights and interests were fully protected, by the use in the agreements of proper formulae in accordance with the express statutory provisions.

It was, as it seems to us, plain therefore that the application which she wished to make that the case should be struck out, was to put it bluntly "hopeless". As the Tribunal noted in paragraph 10 of their Decision, they sought Miss Hewitt's help on what basis the Tribunal could find that it was unreasonable for an Applicant to seek not to be bound by a document which was unenforceable. They obviously were of the same view as us, on this appeal, that an attempt to strike out because she had reneged on an unenforceable agreement, was doomed to failure. That being so, it would not have been appropriate to have adjourned the proceedings to enable the Tribunal to consider evidence as to what had happened in the past and matters of that kind.

Furthermore, it seems to us in principle, undesirable that before the Tribunal exercises its jurisdiction under section 13 (2) (d) it should have to have a trial within a trial. It seems to us that the power to strike out under section 13 (2) (d) is akin to the power to strike out which there used to be in Order 18, rule 19, of the Rules of the Supreme Court where the use of evidence on any such application is essentially frowned upon. It should only be in a cases where it is manifestly obvious from matters before the Tribunal, that an order for striking out should be made. If it is necessary in order to make the application for there to be a trial within a trial, then in our judgment the power should not be exercised.

As to the question whether this Tribunal is now competent to continue to hear this case, that has been given careful consideration by the three of us. It seems to us, in the circumstances of this case, that justice can properly be done between the parties by this particular Tribunal, subject to the Chairman giving careful directions which he has already indicated he is going to give his lay colleagues.

This was a case where the Industrial Tribunal had first to examine the compromise agreement in order to rule on its validity because of the submission which had been made to it. The fact that it has seen a document, which normally it would not have seen in the course of proceedings, does not of itself then lead to the conclusion that they should recuse themselves. Much will depend on all the particular circumstances.

Here, there were three sets of proceedings of which this Tribunal is only seized of one. They will not be involved in assessing the prospects of success which Mrs Bamieh may have in relation to the two earlier sets of proceedings, nor will they be able to assess for themselves whether Mrs Bamieh is going to succeed at all, and if so, to what extent. They do not know enough of the negotiations between the parties to form any view that the CPS were only willing to compromise the latest proceedings, the 1998 proceedings, because they entertained some fear that they were going to be found liable.

The explanation for the compromise agreement may well lie in relation to other proceedings with which this Tribunal is not concerned. But even if they had begun to think that the offer that was made reflected some kind of disquiet by the CPS in relation to these proceedings, they would of course be perfectly well aware of the desirability of parties arriving at a compromise which will have the effect of bringing disagreeable proceedings to an end and avoid considerable legal costs, which are going to have to be incurred, if the 1995 and 1997 and 1998 proceedings are to continue.

Accordingly, it seems to us fanciful to suggest that the only proper inference which could be drawn from the terms of the compromise agreement was that the CPS were obviously concerned about their conduct towards Mrs Bamieh in the course of her employment. In any event, it seems to us perfectly clear that the learned Chairman already has indicated that nothing that they have heard about the compromise agreement, will play any part at all in their consideration of the issues which they have to determine in these proceedings. That would be a correct direction for him to give to his lay colleagues. We have every confidence that this Tribunal, constituted as it is, will be able to continue to do justice between the parties.

We are not unmindful of the fact that there has already, yesterday, been a day of evidence; that the only reason why the case has not continued today is because the parties have been given a release to come to the Employment Appeal Tribunal for this appeal and that the case is going to resume tomorrow and for much of the foreseeable future (in judicial eyes). It seems to us therefore that the balancing exercise which the Tribunal had to undertake, as to whether they should recuse themselves or not, was sensibly carried out by this Tribunal and that we ought not to interfere with their judgment on this difficult issue.

Accordingly, we have not been persuaded that this is a case where the appeal on that ground should be allowed. It follows therefore that both grounds of appeal will be dismissed and obviously this case will now resume at the Industrial Tribunal tomorrow and for so long as is required until it is completed.

If, of course, at the end of the case it were to transpire that Mrs Bamieh did not succeed in her application, or alternatively succeeded in only a limited fashion, it would be open to the Industrial Tribunal to consider whether, in the light of any offer that may have been made to her, she has been vexatious or unreasonable in pursuing these proceedings and to form a view as to whether costs should be ordered, having regard to any offers that have been made.