United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	NO APPEARANCE OR REPRESENTATION BY OR ON BEHALF OF THE APPELLANT


 


HIS HONOUR JUDGE CLARK: This Appeal has an unfortunate history. It was originally listed for a Preliminary Hearing on 16^th October 1998 before a Tribunal on which I sat. On that day, the Appellant telephoned to say that he had broken down on the motorway and would not be able to attend the Hearing. He sought an adjournment and that was granted. On 27^th October 1998 the Registrar wrote to him informing that a new hearing date would be fixed. The next hearing was listed for 10^th February 1999. On that day, the Appellant again failed to attend. He was contacted by a member of staff at this Tribunal to be told that he had not received the listing notice which was sent out on 4^th November 1998. Again, with great reluctance, we adjourned the hearing. In a judgment which I gave on that occasion, I made it abundantly clear to the Appellant that he would not be granted any further adjournment in any circumstances. Nevertheless, the case having been listed for a third time today, he has still not appeared before us. In these circumstances we shall consider the case on the papers.

1. The Appellant commenced employment with the Respondent company on 11^th March 1996. In February 1997 he found another job and handed in his notice of resignation on 24^th February. In that letter, he indicated that he was prepared to come to an agreement as to his finishing date with the Respondent. By letter of the same date, the Company accepted his resignation and recorded the parties' agreement that the employment would end on 28^th February. An Employment Tribunal sitting at Carmarthen found, in para 5 of their Extended Reasons dated 26^th November 1997, that the Respondent's letter accurately reflected the agreement reached. Following termination of the employment the Appellant presented an Originating Application to the Employment Tribunal on 27^th March 1997.
2. The material complaint with which we are concerned was a claim for breach of contract and was put in this way. It was an express term of the Contract of Employment that the Appellant in common with other staff would be paid by credit transfer one calendar month in arrears on the last business day of the month. That provision appears in para 5 of the Staff Handbook which, although withdrawn in 1996, the Tribunal found, continued throughout the Appellant's employment. The Appellant did not receive his final payment of salary and other outstanding amounts, such as holiday pay, until 6^th March 1997, when a cheque arrived at his home. During the intervening week it seems that due to insufficient funds in his account with his Bankers, Barclays Bank, certain cheques which he drew on that account were returned unpaid. As a result, he incurred bank charges and interest totalling some £175.00. He claimed that sum by way of damages for breach of contract.
3. The Tribunal dealt with that claim at para 10 of their Reasons in this way.

"The Tribunal accepts that the Applicant's salary had, during his employment, been paid by credit transfer to his bank on the last business day of each month. This was provided for at para 5 of the Staff Handbook and had continued following the withdrawal of the handbook at the end of 1996. The Tribunal finds that the late payment by cheque following the Applicant's resignation arose because of the time taken by the Respondent to calculate all final payments due to the Applicant in the light of his resignation. The Applicant submits that his claim in this respect falls within the Tribunal's extended jurisdiction in contract under the Industrial Tribunal's extension of jurisdiction, England & Wales Order 1994. Under Article 3 of the Order and Section 3(2) of the Industrial Tribunals Act 1996, a claim may be brought before the Tribunal where it is a claim for damages for breach of a contract of employment or other contract connected with employment and is a claim arising or outstanding on the termination of employment.

The Tribunal finds that the loss which the Applicant now seeks to recover in respect of bank charges is not one which would reasonably have been in the contemplation of the parties to the contract. Further, the loss was too remote in the context of the Applicant's contract of employment. The Tribunal therefore, makes no award to the Applicant under its contractual jurisdiction. This claim in this respect therefore, fails."

4. In his Notice of Appeal dated 22^nd October 1997 the Appellant contends that the Chairman erred in law by stating that the consequential loss which he suffered as a result of the late payment was too remote and not within the contemplation of the parties when the contract was made. He then refers to a booklet issued by the Department of Trade and Industry in submitting that the loss claimed fell within the jurisdiction of the Tribunal. It seems to us that the Tribunal applied the classic Hadley –v- Baxendale test, later restated in Victoria Laundry –v- Newman [1949] 2KB 528 and later qualified in Czarnikow –v- Koufos [1969] 1 AC 359.
5. The test of remoteness in a claim for damages for breach of contract is this: the aggrieved party is only entitled to recover such part of the loss actually resulting as was at the time of the contract reasonably foreseeable as liable to result from the breach. That will depend upon what was in the contemplation of the parties and the knowledge, actual or imputed, of the contract-breaker. Here, there is no suggestion that the Respondent was aware that the Appellant had no arrangement with his bank to cover payments during that one week period, assuming that failure to make final payment on 28^th February amounted to a breach of the contract of employment. Further, the Employment Tribunal held that such knowledge could not properly be imputed to the Respondent. We see no grounds in law for interfering with that finding.
6. In these circumstances we have concluded that the Appeal raises no arguable point of law to proceed to a Full Appeal Hearing and the Appeal must be dismissed.