United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellants	MR J CAVANNAGH (of Counsel) Messrs Paisner & Co Solicitors Bouverie House 154 Fleet Street London EC4A 2DQ
For the Respondent	MISS L SEYMOUR (of Counsel) Messrs Goldkorn Davies & Matthias Solicitors 6 Coptic Street Bloomsbury London WC1A 1NW


 


JUDGE PETER CLARK: We have before us an appeal by the respondents (1) Air Canada and (2) Alpha Catering Services (ACS) before an Employment Tribunal sitting at London (South) under the chairmanship of Ms C E Taylor (the Taylor tribunal) on 9th December 1998 and a cross-appeal by the applicant, Mrs Basra, against that tribunal's decision, promulgated with extended reasons on 21st January 1999 (the Taylor Decision). In order to understand the issues raised in these appeals it is necessary first to set out the background.

History

1. Mrs Basra, an Asian woman of Indian national origin, commenced employment with Air Canada on 22nd April 1986. She worked as a lead hand in the Assembly Department of their Air Catering and Commissary section (ACC) based at London Heathrow Airport. The section carried out meals preparation and cleaning services. At the relevant time over 100 employees were engaged in that section.
2. In 1996 Mrs Basra brought a complaint of unlawful sex discrimination against Air Canada. It seems that the basis of that complaint (1996 complaint) was that Air Canada had unlawfully discriminated against her by requiring her to undergo a medical examination on applying for a job transfer when a male employee would not have been required so to do.
3. The 1996 complaint was heard by a tribunal sitting at London (South) in January 1997. Material to this appeal is that during the hearing of that complaint on 13th January 1997 the applicant gave evidence critical of her manager, Mr Green.
4. Its seems that contemporaneously, in January 1997, a decision was taken by Air Canada to sell the ACC part of their undertaking to ACS. Although that sale would involve a relevant transfer, to which the protection of the Transfer of Undertakings (Protection of Employment) Regulations 1981 would apply, many of those employed in ACC were anxious to remain with Air Canada. In short, they felt that they would be better off with Air Canada than ACS.
5. Conscious of those feelings Air Canada identified a number of vacancies within their United Kingdom operation and ring-fenced those posts for applicants from ACC. Mrs Basra was one of those who applied for a transfer. She was unsuccessful. Consequently she joined ACS on the transfer date, 1st June 1997.
6. She, together with six other transferred employees then brought complaints of race discrimination against both Air Canada and ACS (as transferee), in her case by an Originating Application dated 3rd July 1997 with the assistance of the Hounslow Law Centre (the 1997 complaint). The claims were resisted. By their Notice of Appearance to Mrs Basra's case Air Canada contended that she had not been appointed to the post of groomer for which she had applied because of her poor attendance record and her interview for the post showed that she had answered questions untruthfully and gained a good assessment accordingly.
7. Those complaints came before a tribunal sitting at London (South) under the chairmanship of Mr D M Booth (the Booth tribunal) on 26th-30th January 1998. The tribunal reserved their decision; met in Chambers to deliberate on 13th February 1998 and then promulgated their decision with extended reasons on 20th February 1998 (the Booth decision).
8. It is clear from the Booth decision that the tribunal were concerned with allegations of both direct and indirect racial discrimination in the seven complaints before them. Three of the applicants (not including Mrs Basra) succeeded on their complaints of indirect discrimination. All claims of direct discrimination failed and were dismissed.
9. So far as Mrs Basra was concerned, her complaint was one of direct racial discrimination only. The tribunal, at paragraph 44 of their reasons, were critical of Air Canada and Mr Green. A series of objective tests and interviews had been set up to ensure a fair selection process for transferees, but in Mrs Basra's case, having passed the relevant test for transfer to the job of groomer (aircraft cleaner) she was then marked down by Mr Green, who did not want her in the grooming department.
10. The tribunal quote from Mr Green's witness statement at paragraph 15 of their reasons. He did not believe that Mrs Basra was a straightforward and honest person because, he claimed, she had not told the truth at the tribunal hearing on 13th January 1997 of her 1996 complaint. That was a complaint of sex discrimination.
11. The Booth tribunal concluded that Mrs Basra had been treated unreasonably, but that treatment was not on racial grounds. It was because Mr Green found her to be a troublesome and unreliable person. Accordingly the 1997 complaint of direct racial discrimination failed.
12. Mr Green gave evidence before the Booth tribunal on 29th January 1998. Following the close of the evidence Counsel then appearing for the applicants, Mr Fenwick, made application to the tribunal, it is recorded at paragraph 46 of their reasons, to add to the 1997 complaint a claim of victimisation contrary to the Sex Discrimination Act 1975 (sex victimisation). The basis for that application was that, in evidence, Mr Green had, for the first time, given as one of his reasons for not appointing Mrs Basra to the post of groomer, that she had lied when giving evidence in support of her 1996 sex discrimination complaint on 13th January 1997. Thus it was said a significant reason for refusing her application for that post was her doing a protected act, namely bringing and pursuing a complaint of sex discrimination against Air Canada and its employee Mr Green.
13. We pause to observe that in their reasons the Booth tribunal make no mention of any application made on behalf of Mrs Basra to add a further complaint of victimisation contrary to the Race Relations Act 1976 (race victimisation). However it is common ground between Counsel before us, based on a note taken by an Air Canada manager, Mr Neil Hopkins, who was present at the tribunal on 30th January 1998, that Mr Fenwick also applied for leave to add a claim of race victimisation.
14. No amendment was permitted by the Booth tribunal. Their reasons for refusing the application were that the evidence had been finished; they did not think it appropriate to re-open the evidence to deal with the new complaint. It was open to Mrs Basra to bring a fresh complaint (which she had done, by an Originating Application dated 2nd February 1998 (the 1998 complaint) by the time the tribunal met in Chambers on 13th February) and ask the next tribunal to allow the case to proceed on the grounds that she had only just acquired the relevant knowledge to bring a victimisation complaint.
15. In the 1998 complaint Mrs Basra raised complaints of both sex and race victimisation. The basis of both complaints was the refusal to appoint her to the post of groomer, a decision communicated to her on 2nd May 1997. The protected act under the Sex Discrimination Act was said to be Mr Green's reaction to the evidence she gave in support of her 1996 complaint at the tribunal on 13th January 1997: under the Race Relations Act it was said to be her complaint during the early part of the 1997 recruitment procedure that Mr Green had only assisted white persons applying for jobs with Air Canada. It was further said that the applicant only became aware of Mr Green's true reasons for not appointing her to the post of groomer, as opposed to the reasons advanced in Air Canada's Notice of Appearance to the 1997 complaint, when he gave evidence before the Booth tribunal on 29th January 1998.
16. The Booth decision was not appealed by Mrs Basra to the EAT within time. On 14th May 1998 the Court of Appeal handed down judgment in the case of Divine-Bortey v Brent Council. It was reported in the Times newspaper on 20th May (see now [1998] ICR 886). That decision alarmed those advising Mrs Basra. With alacrity they lodged a Notice of Appeal against the Booth decision, out of time, on 22nd May 1998. In an accompanying letter her solicitors referred to the Times' report of Divine-Bortey. They sought leave to appeal out of time, fearing that in the light of Divine-Bortey their client might be estopped from pursuing the 1998 complaint.
17. That application for an extension of time was considered by the Registrar, having received representations from the respondents' solicitors opposing the grant of an extension of time, and on 15th July 1998 she refused that application.
18. Mrs Basra then appealed against the Registrar's order. That appeal was dismissed by Morison J, sitting in Chambers, on 3rd December 1998.
19. The 1998 complaint came before the Taylor Tribunal on 9th December 1998 for consideration of the following preliminary issues, whether, having regard to the relevant time limits the tribunal had jurisdiction to consider the complaints under both the Sex Discrimination Act and Race Relations Act.
20. Although both complaints were made outside the ordinary three month time limits under the respective Acts of 1975 and 1976, the tribunal was prepared to extend time on the basis that Mrs Basra had only become aware of the potential victimisation claims as a result of hearing Mr Green's evidence on 29th January 1998. She then acted promptly in lodging the 1998 complaint on 2nd February.
21. No point is taken in the appeal about that exercise of discretion to extend time by the Taylor tribunal.
22. However, the Taylor tribunal was faced with a more fundamental objection taken by the respondents below to the 1998 complaint proceeding. Relying on the rule in Henderson v Henderson [1843] 3 Hare 100, considered by the Court of Appeal in Divine-Bortey, it was submitted that, having heard Mr Green's evidence on 29th January, it was the duty of the applicant's advisers to bring forward all matters at the hearing before the Booth tribunal. It was not now open to her to raise the victimisation claims in subsequent fresh proceedings. Her remedy lay in an appeal against the Booth decision to the EAT. That she did not bring that appeal in time cannot justify her being permitted to launch separate proceedings.
23. Accordingly it was the respondents' submission that the 1998 complaint should be struck out under Rule 13(2)(d) of the Employment Tribunal Rules of Procedure on the basis that it was an abuse of process, thus raising the plea of res judicata.

Res judicata

24. Simon Brown LJ commenced his judgment in Divine-Bortey by identifying the three categories of estoppel encompassed by the doctrine of res judicata; cause of action estoppel, the rule in Henderson v Henderson and issue estoppel.
25. The distinction between those three categories is explained in the speech of Lord Keith of Kinkel in Arnold v National Westminster Bank Plc [1991] 2AC 93 as follows:

(1) "Cause of action estoppel arises where the cause of action in the later proceedings is identical to that in the earlier proceedings, the latter having been between the same parties … and having involved the same subject matter. In such a case the bar is absolute in relation to all points decided…" [P.104D]

(2) "Cause of action estoppel extends also to points which might have been but were not raised and decided in the earlier proceedings for the purpose of establishing or negativing the existence of a cause of action." Henderson v Henderson [P.104F-G]

(3) "Issue estoppel may arise where a particular issue forming a necessary ingredient in the cause of action has been litigated and decided and in subsequent proceedings between the same parties involving a different cause of action to which the same issue is relevant one of the parties seeks to re-open that issue." [P.105D-E]

The Taylor decision

26. Having decided the question of limitation in favour of Mrs Basra the Taylor tribunal proceeded to deal with the claims of sex and race victimisation separately in respect of the question of abuse of process and reached different conclusions on the two causes of action. Their reasoning may be summarised as follows:

Sex victimisation

So far as the rule in Henderson v Henderson was concerned, the applicant did bring forward her whole case before the Booth tribunal. Whilst agreeing with the respondents that she could have brought a timeous appeal against the Booth decision to the EAT, failure to do so did not amount to negligence on the part of her advisers. They acted reasonably when they attempted to present the 1998 complaint as soon as they were aware of Mr Green's evidence, given on 29th January 1998. Further, the Booth tribunal's response to her application for leave to amend constituted a "special circumstance", a reference to the judgment of Sir James Wigram V-C in Henderson v Henderson, cited in Divine-Bortey which they were asked to consider. No question of issue estoppel arose on this claim of sex victimisation in the context of the direct race discrimination complaint before the Booth tribunal. There was no abuse of process. The sex victimisation claim could proceed.

Race victimisation

An issue estoppel arose here. The Booth decision to dismiss her complaint of (direct) race discrimination precluded her from raising a claim of race victimisation in subsequent proceedings. The applicant was estopped from bringing that claim and accordingly that part of the 1998 complaint was struck out.

The complaint was allowed to proceed on the sex victimisation claim only.

27. Against the Taylor decision on sex victimisation claim the respondents now appeal; against the finding on the race victimisation claim Mrs Basra cross-appeals.

The appeals

28. Looking at the way in which the respondents' case on abuse of process was put before the Taylor tribunal, it is not immediately clear to us that a plea of cause of action estoppel, as opposed to reliance on the rule in Henderson v Henderson and issue estoppel as classified above, was advanced. However, Mr Cavanagh has submitted to us that true cause of action estoppel arises in this case, without objection by Ms Seymour, who was able to take time during the hearing to consider the points made by Mr Cavanagh. In these circumstances we have considered that submission as well as those made under the second and third categories of res judicata. It is convenient to consider the application of each of the three categories in turn.

Cause of action estoppel

29. The first question we have asked ourselves is whether there is in truth any distinction to be drawn in law and fact between a claim of direct racial discrimination and one of victimisation, whether under the Race Relations Act or the Sex Discrimination Act. We do not understand Mr Cavanagh to submit that no distinction exists, but it is important, when considering both cause of action estoppel and issue estoppel (see below) to appreciate clearly the nature of the respective causes of action and the issue which they raise.
30. First, direct racial discrimination. The question posed by s.1(1)(a) of the Race Relations Act is; was the complainant treated less favourably than the employer treated or would treat another person of a different racial group in the same or relevantly similar circumstances and, if so, was that less favourable treatment on racial grounds. Martins v Marks & Spencer Plc [1998] IRLR 326, per Mummery LJ, paragraphs 49-50, applying the opinion of the House of Lords, given by Lord Browne-Wilkinson in Zafar v Glasgow City Council [1998] IRLR 36.
31. In the case of victimisation under s.2 of the Race Relations Act or s.4 of the Sex Discrimination Act the complainant must establish that the principal or an important cause of the less favourable treatment was the fact that the complainant had done a protected act, which includes bringing proceedings against the alleged discriminator under the relevant Act, or alleging he has committed an act which would amount to a contravention of the Act. Nagarajan v London Regional Transport [1999] IRLR 572 (HL).
32. Thus, the similarities between the claims of direct discrimination and victimisation are:

(1) that the respondent has treated the complainant less favourably that he would treat others.

(2) in both cases, the alleged discriminators motives for the less favourable treatment are irrelevant. That has been the case, on the authorities, in respect of direct discrimination for some time. See James v Eastleigh Borough Council [1990] ICR 554 (HL). It was thought by the Court of Appeal that in the case of victimisation it was necessary for the complainant to show that in treating him less favourably than the respondent treated or would treat another the respondent was consciously motivated by the fact that the complainant had done a protected act. See Aziz v Trinity Street Taxis Limited [1988] IRLR 204; Nagarajan [1998] IRLR 73. That approach was rejected by the House of Lords in Nagarajan (Lord Browne-Wilkinson dissenting). Motive is irrelevant both to direct discrimination and victimisation claims.

33. However, the two causes of action differ, in that whereas in a claim of direct discrimination it is necessary for the complainant to establish that he was less favourably treated on grounds of his race, in a claim of victimisation the reason for the less favourable treatment is that he has done a protected act.
34. That such a distinction exists was recognised by Bingham LJ in Cornelius v University College of Swansea [1987] IRLR 141, to which Ms Seymour referred us. Further, we believe that a practical application of the distinction is to be found in the Court of Appeal decision in The Housing Corporation v Bryant [1999] ICR 123. There, the applicant presented an Originating Application to the Employment Tribunal complaining of unfair dismissal and sex discrimination. A tribunal dismissed the complaint of sex discrimination on the basis that it was time-barred. Thereafter, she applied for leave to amend her Originating Application to add a claim of sex victimisation. That application was refused by a tribunal chairman. Her appeal to the EAT against that refusal succeeded.
35. On appeal by the respondent to the Court of Appeal the Chairman's order was restored. It was held that the Originating Application as first presented demonstrated no causative link between the protected act relied upon and the act of less favourable treatment complained of, namely her dismissal. In these circumstances the victimisation claim was not foreshadowed in the original pleading and the Chairman was entitled not to grant leave to amend to add that claim out of time.
36. Returning to the question of cause of action estoppel, it is clear on the facts of the present case that had Mrs Basra sought, in the 1998 complaint, to raise a claim of direct racial discrimination in relation to her non-selection for the grooming post in May 1997, a true cause of action estoppel would arise. That cause of action had been finally determined against her by the Booth tribunal. To seek to raise precisely the same cause of action would amount to an abuse of process. It would have to be struck out under Rule 13(2)(d).
37. However, she has not done that. She seeks to raise claims of sex and race victimisation. These are different causes of actions. How then can cause of action estoppel properly arise?
38. It is here that Mr Cavanagh has raised an argument which, so far as the diligent researches of Counsel show, is novel. He submits that the Booth tribunal's order refusing Mrs Basra leave to amend the 1997 complaint to add the claims of sex and race victimisation means that those claims were finally determined once the Booth tribunal had dismissed the 1997 complaint by their substantive decision of 20th February 1998.True cause of action estoppel then arose. She cannot now be permitted to litigate those claims by way of 1998 complaint.
39. Although we describe the point as novel we have derived some assistance in deciding it from the cases and the principles cited to us.
40. It is clear that a decision by a tribunal that it does not have jurisdiction to entertain a claim will not support a plea of res judicata on the merits of that claim if it is then brought in the appropriate forum. Spencer Bower on Res Judicata (1996 Edition) paragraph 37.
41. Thus, to take an example from our jurisdiction, if an applicant, still in employment, brings a complaint of race discrimination and breach of contract against his employer before the Employment Tribunal, that tribunal will not have jurisdiction to entertain the breach of contract claim (there having been no termination of the employment for the purposes of Article 3(c) of the Employment Tribunals Extension of Jurisdiction, etc Order 1994) but a finding to that effect will not prevent the claimant from bringing identical proceedings for breach of contract in the County Court.
42. However, it is not necessary for there to have been a determination of the complainant's case on its merits before the first tribunal for the doctrine of cause of action estoppel to arise. In Staffordshire County Council v Barber [1996] ICR 379 the applicant, a part-time teacher, was dismissed by her employer, the respondent Council, on 31st August 1992. She then presented an Originating Application to an Employment Tribunal claiming a redundancy payment only within time. On the day of the hearing of her complaint, 5th May 1993, she withdrew that claim. She was advised, based on the principle in Surrey County Council v Lewis [1987] ICR 982 (HL) that under United Kingdom legislation she had not completed the necessary period of qualifying service to allow her to bring a claim for a redundancy payment. Consequent upon that withdrawal the tribunal, without hearing evidence, promulgated a decision dismissing the complaint under what is now Rule 13(2)(a) of the Employment Tribunal Rules of Procedure 1993.
43. On 3rd March 1994 the House of Lords promulgated their decision in Regina v Secretary of State for Employment ex parte EOC [1994] ICR 317. That case decided that the relevant domestic statutory provisions which had prevented her from qualifying for entitlement to claim a redundancy payment offended European equal treatment laws. As a result, she presented a fresh Originating Application, raising claims to a redundancy payment and/or unfair dismissal remedies on 3rd May 1994. The Court of Appeal held that it was unnecessary to show, for cause of action or issue estoppel to apply, that the tribunal had given a reasoned decision on the issues and facts in the first litigation. The order made by the tribunal on 5th May 1993 was a judicial not an administrative decision. The second claim for a redundancy payment was prevented by that decision under the res judicata doctrine.
44. We understand that claim to have barred as being a true cause of action estoppel. As to the additional claim of unfair dismissal brought in the second proceedings, the Court referred to the rule in Henderson v Henderson, and found that there were no special circumstances to permit that claim to proceed. It could have been raised in the first proceedings. Accordingly that claim was also dismissed.
45. In so holding the Court of Appeal upheld the reasoning of Mummery J in the EAT, which is set out at the beginning of the report.
46. However, in Dattani v Trio Supermarkets [1998] IRLR 420, Mummery LJ, giving the leading judgment in the Court of Appeal, drew a distinction between a tribunal decision which properly disposed of a cause of action raised in those proceedings, and one which ought to have been raised (Barber) and a tribunal order which did not.
47. In Dattani the applicant made a complaint of unfair dismissal against his former employers. In that complaint he gave details of wages allegedly owed to him during his employment. He said that he had been underpaid. In due course the Employment Tribunal issued a document headed "Decision of the Industrial Tribunal" which recorded that "this case has been settled on the basis that the Respondent pay the Applicant the sum of £5,000."
48. Thereafter the applicant commenced proceedings in the County Court claiming unpaid wages. That was a breach of contract claim. The County Court judge held that he was estopped by the Employment Tribunal decision from pursuing that claim under the rule in Henderson v Henderson. On appeal the Court of Appeal held that the doctrine of res judicata did not apply. Although headed "Decision" the document issued by the tribunal was not a "decision" within the meaning of the Regulations. It did not determine any issue between the parties. It merely recorded an agreement. That agreement did not compromise the claim for unpaid wages, only the unfair dismissal complaint. It was not an abuse of process to commence County Court proceedings for the unpaid wages.
49. The principle in Barber is also to be found in part in Mullen v Conoco Limited [1998] QB 382. Mr Mullen, who carried on a petrol station business, entered into a petrol supply agreement with Conoco. He then found that the price charged by Conoco under the agreement meant that he could not compete with other petrol stations in his area without reducing his profits. In November 1993 Conoco made two deliveries of petrol to him, but he refused to pay for it. Two sets of proceedings then followed .
50. In the first, Conoco began High Court proceedings for the price of the petrol delivered but unpaid for. Mr Mullen failed to enter a defence to those proceedings and Conoco entered judgment in default of defence (the default judgment).
51. Mr Mullen then applied to have the default judgment set aside on the grounds that the supply contract was so one-sided, unfair and unreasonable as to be unenforceable at Conoco's suit. That application failed before the deputy Master. The default judgment stood.
52. He then commenced separate proceedings against Conoco in the County Court, claiming trade losses arising out of the imposition and enforcement of an improper and unreasonable supply agreement. Conoco applied to have the claim struck out as an abuse of process. On appeal from a District Judge the judge struck out the whole of the claim.
53. On Mr Mullen's appeal against that order to the Court of Appeal it was accepted that the default judgment was decisive as to Mr Mullen's liability for the two invoices (see Barber). However, the Court was not prepared to hold that although Mr Mullen had raised the issue of the agreement being unconscionable in his application to set aside the default judgment, the deputy Master had determined that issue in the first proceedings. It was merely considered in the exercise of his discretion as to whether to grant the procedural remedy of setting aside judgment. The Master did not reach such a conclusion on the merits of Mr Mullen's case in those interlocutory proceedings so as to found an estoppel by reason of res judicata or abuse of process.
54. Those, then are the authorities which we have considered in deciding the point raised by Mr Cavanagh in this part of the appeal. In our judgment Mrs Basra's claims in the 1998 complaint are not barred by true cause of action estoppel for the following reasons:

(1) although the victimisation claims were raised before the Booth tribunal, that tribunal refused to grant permission for those claims to be added to the 1997 complaint by way of amendment.

(2) It follows that they did not adjudicate on those claims on their merits.

(3) The victimisation claims represent different causes of action from the claim of direct racial discrimination which the Booth tribunal heard and determined against Mrs Basra on its merits.

(4) Although a judicial decision may give rise to cause of action estoppel without a hearing on the merits, see Barber, Mullen, that decision must relate to the same cause of action which is sought to be raised in the second set of proceedings. That is not the case here.

(5) The Booth tribunal's refusal to grant leave to amend the 1997 complaint to add the victimisation claims was an interlocutory order which specifically did not involve consideration of the merits of the victimisation claims. Following Mullen, that order could not found true cause of action estoppel in relation to those causes of action which the Booth tribunal declined to entertain.

(6) The observation by the Booth tribunal, in refusing the application to amend, that it was open to Mrs Basra to issue fresh proceedings and seek an extension of time for bringing them, is more akin to a tribunal declining jurisdiction to entertain a claim which may then be brought in the appropriate forum.

In these circumstances we reject Mr Cavanagh's submission on cause of action estoppel.

The rule in Henderson v Henderson

55. This so-called rule is taken from the judgment of Sir James Wigram V-C in Henderson v Henderson. It has withstood the test of time and has been approved at the highest level. It remains good law today and is applicable to the decisions of Employment Tribunals.
56. The material passage from the judgment for our purposes reads as follows:

"…I believe I state the rule of the court correctly, when I say, that where a given matter becomes the subject of litigation in, and of adjudication by, a court of competent jurisdiction, the court requires the parties to that litigation to bring forward the whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only to points upon which the court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, in which the parties, exercising reasonable diligence, might have brought forward at the time."

57. Application of the rule to an employment case is to be found in Divine-Bortey. There, the applicant brought a complaint of unfair dismissal against his former employer, Brent. That complaint was dismissed following a full merits hearing held before an Employment Tribunal. During that hearing it became apparent from the evidence called by Brent that one of the reasons for the applicant's non-selection for a new post when his position was abolished, leading to his dismissal, was his African accent.
58. No application was made during the hearing, after that evidence was given, by his advocate, a trade union official, for leave to amend the complaint of unfair dismissal to add a claim of racial discrimination. Following the tribunal's decision rejecting the complaint of unfair dismissal the applicant presented a second complaint alleging racial discrimination. The second complaint was dismissed by a chairman sitting alone on the grounds that the applicant was estopped from bringing that complaint. It was res judicata by reason of the first tribunal's decision. An appeal against the Chairman's decision was allowed the EAT (Lindsay J presiding) on the grounds that there were special circumstances for not applying the rule in Henderson v Henderson. Five factors were mentioned in the judgment of Lindsay J which, it was said, amounted to special circumstances.
59. On appeal the Court of Appeal rejected the view expressed by the EAT that special circumstances existed. They considered and rejected each of the factors relied on by the EAT for reaching their conclusion. The applicant should have brought his claim of racial discrimination before the tribunal hearing his complaint of unfair dismissal. He did not do so.
60. It has been submitted to us by Ms Seymour that the approach of the division of the Court of Appeal sitting on Divine-Bortey to the question of special circumstances when applying the rule in Henderson v Henderson differs from the approach of a different division sitting in the later case of Bradford & Bingley Building Society v Seddon [1999] 1WLR 1482. The decision in Divine-Bortey does not appear to have been cited to the Court in Seddon. For reasons which appear later in this judgment it is not necessary for us to consider that submission.
61. In Barrow v Bankside Agency Limited [1996] 1WLR 257, a case arising in the Lloyd's Names litigation, the plaintiff was a member of an action group which brought a group action against certain defendants alleging breach of contract and negligence in the conduct of underwriting business. The action succeeded at trial, with damages to be assessed.
62. The plaintiff then began a fresh action against two defendants, one of whom had been a defendant to the original group action, raising a different type of claim. The defendants applied to strike out the second claim on the grounds of estoppel, alternatively abuse of process. The judge dismissed the application. An appeal against that order failed.
63. The Court of Appeal held that the rule in Henderson v Henderson that a party must bring the whole of his case at one time did not apply to a second claim which could not have been brought in the previous litigation. The reason it could not be brought was the special procedure adopted by the Commercial Court to deal with the Lloyds litigation. First, the action groups were gathered to deal with single issues, or issues common to the group. Secondly, the Court managed the actions on the basis of the generic class into which those actions fell. Mr Barrow fell into different groups. Hence his second action could not have been disposed with at the first trial. It was not an abuse of process. Further, the Court found in the alternative that even if the case fell within the mischief to which the rule in Henderson v Henderson was directed, there were special circumstances excusing him from the duty to bring forward his whole case at the outset.
64. Reverting to the rule propounded by Wigram V-C, we accept Ms Seymour's submissions that it raises three potential questions in this case:

(i) did Mrs Basra fail to bring forward her whole claim before the Court? If not, then the rule has no application.

(ii) if so, could she, exercising reasonable diligence, have brought it forward at the time?

(iii) if so, did special circumstances exist excusing her from the effect of the rule?

65. Mr Cavanagh submits that it was incumbent on Mrs Basra, once she was aware of Mr Green's evidence, to have her new claims of race and sex victimisation determined by the Booth tribunal. Although there is a distinction on the facts between this case and that of Divine-Bortey, in that here application was made for leave to amend to add the victimisation claims, once that application was refused by the Booth tribunal her remedy then was to appeal to the EAT within time, not to present a fresh complaint to the Employment Tribunal. That she failed to appeal in time was the fault of the applicant or her advisers. She had not exercised reasonable diligence. No special circumstances exist, contrary to the finding of the Taylor tribunal. The rule falls to be applied to both new heads of claim. The 1998 complaint should be struck out in its entirety. Further, he submits that the 1998 complaint is an impermissible collateral attack on the decision of the Booth tribunal.
66. We have carefully considered those submissions and we reject them.
67. It seems to us that the Taylor tribunal was correct to find, in paragraph 21 of their reasons, that the applicant did bring her whole case before the Booth tribunal. Unlike Divine-Bortey, application was made for leave to amend the 1997 complaint to add the victimisation claims. That application was refused by the Booth tribunal. There was nothing further that the applicant could do in that forum. She had sought a determination of her whole claim, including the new cause of action which arose, to her knowledge, for the first time during the hearing on 29th January. In the exercise of their discretion the Booth tribunal made an interlocutory procedural order which prevented her from having her victimisation claims determined on their merits by that tribunal.
68. In our judgment the possibility of a timeous appeal against that interlocutory order is nothing to the point. As we understand the rule propounded by Wigram V-C it is to the effect that a party must bring the whole of his claim before the court of first instance which is trying that claim on its merits, or otherwise disposes of the claim (see Barber). The question of subsequent appeal does not arise. The mischief at which the rule is aimed is the multiplicity of first instance actions.
69. Further, and in the alternative, we would hold that even if it could be said that the applicant failed to bring forward the whole of her claim in the sense that it was not raised and decided by the Booth tribunal (see Lord Keith in Arnold P.104F), then the applicant exercised reasonable diligence in making the unsuccessful application for leave to amend to the Booth tribunal.
70. Accordingly we do not find it necessary to consider the question of special circumstances, on which the Taylor tribunal expressed a view at paragraph 21 of their reasons. In our judgment the rule in Henderson v Henderson does not apply in this case. See Barrow.
71. Finally we can deal shortly with Mr Cavanagh's submission that the 1998 complaint constituted a collateral attack on the decision of the Booth tribunal. It did not. On the contrary, as Ms Seymour points out, by issuing the 1998 complaint the applicant was doing precisely that which the Booth tribunal envisaged her doing after they had refused leave to amend. We do not decide this case on the footing that the applicant was "misled" by the Booth tribunal into issuing fresh Employment Tribunal proceedings, rather than appealing the Booth decision to the EAT within time, although we can see that subjectively it might have appeared to the Taylor tribunal a harsh decision to strike out a claim which the applicant had been encouraged to make by the earlier tribunal.
72. In these circumstances we uphold the Taylor tribunal's decision to permit the sex victimisation claim contained in the 1998 complaint to proceed to a merits hearing.

Issue estoppel

73. But for their finding on issue estoppel it seems to us that the Taylor tribunal would have also permitted the race victimisation claim to proceed. For the reasons which we have given above that would, in our judgment, have been the proper course. The final question therefore, arising on the cross-appeal, is whether the Taylor tribunal was correct in law to strike out the race victimisation claim on the basis of issue estoppel.
74. It is first necessary to return to our earlier analysis of the difference in cause of action between a claim of direct discrimination on grounds of race or sex and one of victimisation. For the purpose of true cause of action estoppel the two causes of action are not co-terminous. However, the question when considering issue estoppel is whether a relevant finding has been made by a tribunal determining one cause of action in the first proceedings which then precludes a different finding being made in the second set of proceedings on which the second cause of action depends. That is why this category of res judicata is sometimes referred to as fact estoppel.
75. One illustration of the operation of issue estoppel taken from our jurisdiction will suffice. In Munir v Jang Publications Limited [1989] ICR 1 nine employees, including the two applicants, took part in a strike. The employers then prepared letters of dismissal to be sent to all the striking employees. Before posting those letters there was a telephone conversation between Mr Nissar, one of the strikers and a member of management in which Mr Nissar said that six of the men would be returning or were thinking of returning to work. Consequently letters of dismissal were sent only to the three remaining strikers, including the applicants.
76. On the applicants' complaints of unfair dismissal a preliminary issue was heard by an Employment Tribunal (the first tribunal). The question was whether all those on strike had been dismissed for the purposes of s.62 of the Employment Protection (Consolidation) Act 1978 (the victimisation provision). That tribunal found that the six employees were still on strike when the applicants were dismissed and consequently the tribunal had jurisdiction to consider their complaints of unfair dismissal. Those complaints were then heard on their merits by a second, differently constituted tribunal. The question for the Court of Appeal was whether, in dismissing those complaints, the second tribunal had made findings of fact which were contrary to certain findings made by the first tribunal.
77. Whilst accepting that the doctrine of issue estoppel did apply to successive decisions of tribunals, the Court drew a distinction between facts necessarily found by the first tribunal relating to the question under s.62 of the Act, which were binding on the second tribunal, and those which were not necessary for determination by the first tribunal of the s.62 issue, and which could not be binding on the second tribunal which was concerned with the fairness of the applicants' dismissals.
78. With that approach in mind we turn to the Taylor tribunal's reasons, expressed at paragraph 24, for deciding that issue estoppel barred Mrs Basra from pursuing her claim of race victimisation by way of the 1998 complaint.
79. On one view the tribunal has simply failed to appreciate the need for a careful analysis of the findings made by the Booth tribunal in determining the complaint of direct race discrimination and their relevance to the questions of fact and law which arise in the race victimisation claim. They appear to have assumed that a decision by the Booth tribunal on the applicant's race discrimination complaint (the 1997 complaint) of itself prevented her from pursuing the race victimisation claim. Plainly, in our view, that is not correct as a matter of cause of action estoppel; cannot it be right as a matter of issue estoppel?
80. Mr Cavanagh has sought to support the Taylor decision on this part of the case in this way. He submits that in determining the direct race discrimination claim it was necessary for the Booth tribunal to make a finding as to why Mrs Basra was not appointed to the groomer post in May 1997 in answering the question whether that less favourable treatment, when compared with white employees who were redeployed within Air Canada as opposed to being transferred to ACS, was on racial grounds. They found that it was not. Instead they concluded that the reason for the applicant's rejection for the post was that Mr Green found her a troublesome and unreliable person with whom he did not get on.
81. In these circumstances, submits Mr Cavanagh, the Booth tribunal has made a necessary finding which negatives any causative link between the treatment complained of and the protected act for the purposes of the race victimisation claim.
82. We reject that submission. It seems to us that the only relevant question for the Booth tribunal was whether the less favourable treatment, common to both causes of action, was on racial grounds, that is, because of Mrs Basra's race. They found that it was not, and in so finding held that the reason for the treatment was Mr Green's attitude towards Mrs Basra.
83. However that begs the question, not answered nor necessary for the Booth tribunal to answer, whether the protected acts done by the applicant had a significant influence on Mr Green's attitude which caused her not to be selected for the groomer post. Indeed the Booth tribunal pose the question, in paragraph 44 of their reasons, as to whether her rejection for the post was on racial grounds or because Mr Green had fallen out with her and did not trust her following the earlier case of sex discrimination. In opting for the second alternative the Booth tribunal negatived a finding of direct racial discrimination, but tantalisingly left open the question of victimisation which was not before them.
84. It follows, in our view, that there was no relevant and necessary finding made by the Booth tribunal which precludes the applicant from pursuing a claim of race victimisation. The Taylor tribunal fell into error in holding that issue estoppel arose in these circumstances.

Conclusion

85. It follows from our reasoning that the appeal is dismissed and the cross-appeal allowed. Accordingly we shall direct that the 1998 complaint proceed in its entirety to a full merits hearing before a fresh Employment Tribunal to be appointed by the London (South) Regional Chairman.