United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR MICHAEL FOSTER Solicitor Instructed by Messrs Fynmores Solicitors 10-12 Parkhurst Road Bexhill on Sea TW40 1DF
For the Respondent	MS JENNY WIGLEY (Of Counsel) Instructed by Messrs Holden & Co Solicitors Liberty Building 32-33 Robertson Street The America Ground Hastings East Sussex TN34 1HT


 


MR JUSTICE LINDSAY (PRESIDENT)

1. This appeal, against a decision of a Chairman alone sitting at the Employment Tribunal at Brighton, gives rise to the question of whether the Employment Tribunal has jurisdiction at the hearing of an IT1 to entertain a second or subsequent application for an extension of time for a respondent's notice of appearance despite one or more previous refusals of such an extension, by way of a Chairman's letter, refusing earlier written ex parte applications.
2. The appellant, Skinners Hastings Ltd ("Skinners") appears by Mr Foster; the respondent before us, the applicant below, Mrs J.V. Wilkin, by Miss Wigley.
3. On 17th January 2000 Mrs Wilkin presented an IT1 against Skinners claiming unfair dismissal. She had been employed, she said, from August 1988 to January 2000. On the 17^th January 2000 a notice of the IT1 in standard form was sent to Skinners. It said, inter alia:-

"2. Under the Rules of Procedure you are required to enter an appearance within 21 days of receiving the application. This may be done by completing and returning the enclosed form IT3. A late Notice of Appearance may not be accepted and even if accepted may render you liable for costs - see Rule 3 (3) and (4). If you do present a late Notice of Appearance you should set out the reasons why the Notice was not presented in time."

An explanatory booklet "What to do if taken to an Employment Tribunal - England and Wales" was also sent. It said, inter alia:-

"The tribunal must receive your "appearance" within 21 days of the day you receive the [IT1]. The tribunal will assume that the copy of the [IT1] arrived on the second working day after it was sent. If you do not "enter an appearance" you will not be allowed to defend the applicant's claim. If you are late, you should write explaining why. The tribunal will decide whether to allow you to enter a late defence of the claim and if any costs are involved."

17th January 2000 was a Monday; the 21 days therefore began on 20th January and expired on the 9th February.

4. On 2nd February 2000 (so far as its date suggests) a letter to the Employment Tribunal was typed for Mr Nigel Cavey, Group Managing Director of Skinners, that said that Mrs Wilkin, a part-time worker, had been made redundant on being replaced by existing employee, a full-time one, on a "Last in, first out" basis. There had been no other suitable position available for her. The redundancy was regretted but the company believed the right course of action had been taken. The creation of this letter at 2nd February 2000 has not in terms been doubted by the Employment Tribunal. However, it was not then sent, nor was the Form IT3 on Skinners' behalf, also dated 2nd February 2000, which the letter referred to by the words "See attached". They were sent later.
5. In his affidavit Mr Cavey says:-

"A few days after the 15th February 2000 I received a Notice from the Employment Tribunal dated the 15th February stating that the matter was to be listed for hearing on Wednesday 15th March but alongside my Company's name were the words "Respondent's Appearance not entered". I knew that I had sent off the Notice of Appearance and I, therefore, telephoned the Tribunal Office.

I was then informed that the Notice of Appearance had been received but not until the 16th 2000 February and that the envelope in which it was contained was postmarked the 15^th February 2000. It had, therefore, crossed in the post with the Notice from the Tribunal dated the 15th February."

Skinners' IT3 and the attached letter had thus not been posted to the Tribunal till the 15^th February but had been posted before Skinners had received notice of the hearing having been fixed for 15th March on a "Respondent's appearance not entered" basis. The Tribunal received the IT3 on 16th February. The booklet earlier sent does not explain the import of that basis and it is not said that it was explained in the telephone call referred to by Mr Cavey. By sending in a late IT3 Skinners were deemed to be applying for an extension of time on such grounds as were then given, but none then were - see 1993 ET Rule 3 (3).

6. Having received the IT3 and its accompanying letter, the Tribunal wrote on 23^rd February pointing out that it was out of time, but that no reason for delay had been put forward and that an explanation for the delay should be provided to the Tribunal by 2nd March.
7. Mr Cavey's affidavit says:-

"Although I made enquiries in my office as to why the document I had completed and put out for posting on the 2nd February had not apparently been posted until the 15th February I was unable to discover an answer. I, therefore, on the 29th February wrote a letter to the Employment Tribunal explaining that I had completed the Notice of Appearance on the 2nd February and left it for posting. I gave an explanation as to why I had not followed the matter up personally and asked that in those circumstances I be allowed to represent the Company on the 15th March."

His letter of 29th February said:-

"It appears that you did not receive our response to the notice of appearance in the above case within the 21 days allowed. I am unsure of why this was, as I had completed the forms by 2 February 00 and left these at our Hastings office to be forwarded to yourselves. As you will no doubt appreciate, I am continually travelling between our four branches and have just received the notice stating that our response was late.

As we do not keep a daily record of individual letters posted for each day, I must assume there was a delay between the file being left at Hastings and it being posted to you, perhaps you will have a record of when you received it.

I must therefore apologise for any delay and ask that you do admit our response, as there was no intention not to comply with your timescale. Clearly we would wish to be allowed to make our case on 15 March 00."

On receipt of that letter the Tribunal had before it a deemed application for the extension of time on the grounds given in the letter. On 3rd March 2000 the Employment Tribunal wrote to Skinners noting the letter of the 29th and continuing:-

"The Chairman does not consider your explanation for entering a late Notice of Appearance to be adequate and so the case will proceed on 15/03/00 on an 'appearance not entered' basis."

The letter did not explain what the "Appearance not entered" basis was, nor why the explanation was inadequate, nor whether the decision on the point was appealable, nor whether Skinners would be either permitted or denied the opportunity to amplify the reasons given or to seek a fresh determination. The booklet, without giving any technical or limited meaning to the word "decision", had said:-

"The tribunal will always send a written decision - and its reason for making that decision - to the parties or to their representatives. There are limited rights to apply for a review of the decision, or to lodge an appeal against it to the Employment Appeal Tribunal within set time limits."

Of the Tribunal's letter of 3rd March, Mr Cavey's affidavit, unchallenged, says:-

"There was absolutely no prejudice to the Applicant employee whatsoever in that there was still almost two weeks before the date fixed for hearing and even if there was any possible potential prejudice the same could have been dealt with by an Order for Costs. No explanation was given as to why the Tribunal Chairman regarded the explanation I had given as insufficient."

8. Undeterred by the Tribunal's letter of 3rd March, Mr Cavey wrote again to the Tribunal, saying:-

"Thank you for your [letter] of 3 March 00; naturally I am disappointed that The Chairman has rejected our explanation.

I fail to see how justice can be achieved in this matter should we not be allowed to represent ourselves and answer any questions, which undoubtedly will arise during the hearing. We are a respectable Company who have been in business under the current ownership, for over thirty years. We are a respecter of the employment rights of all employees and of the Employment Tribunal systems' aims and achievements; however we fail to see the rationale behind his decision.

I should also like it noted, due to staff changes within our Group, we have today, through ACAS been able to offer Mrs Wilkin a new job with our Company, at the same branch in the same role as she worked previously. Regrettably this offer has been rejected. I shall keep this position open, pending next week's outcome.

As I indicated in my original defence, we have no desire to make people redundant and our offer of re-employment clearly demonstrates there were no other issues in our original decision.

I therefore respectfully request that the Chairman reconsider his decision."

9. The Tribunal wrote on 9th March 2000 in answer. Their letter said:-

"The file has again been referred to a Chairman, who directs I reply as follows. The Respondents advance no further explanation. Whilst he is aware of his powers under Rules 3 and 15, he does not validate the Notice of Appearance. The case remains listed as "Appearance not entered by Respondent" at Brighton on Wednesday 15th March 2000 at 9.45 am."

10. The Tribunal had not said that it had no jurisdiction to allow an extension of time, one having earlier been refused, nor that it had been opposed by Mrs Wilkin, nor that granting an extension might jeopardise the hearing fixed for 15th March, nor that Skinners could challenge the decision in any way.
11. Mr Cavey attended the hearing on 15th March to represent Skinners. He believed he had a strong case on the Company's behalf. His affidavit says that he was informed quite categorically by the Chairman, who was sitting alone, that he could take no part in the proceedings. The Chairman said that he, the Chairman, was bound by the earlier decision to refuse an extension of time. Mr Cavey believed that his turning up at the hearing was as clear an indication as there could be that he wished to take part. He says that he made no application for an extension of time but only because he was denied the opportunity to do so. Mr Cavey's affidavit says, of the Chairman:-

"He said that I could, however, appeal against any decision and I gained the impression that he was encouraging me to do so but I may be wrong about that."

12. By the 15th March an appeal (either against earlier refusals to extend time or against the ruling at the hearing on 15th March) would not have served Skinners' purpose unless accompanied by a stay, which, to judge from the Chairman's responses, would in any event not have been entertained.
13. The hearing of Mrs Wilkin's IT1 proceeded before the Chairman alone, with Skinners taking no part. On 5th July 2000, 10 days short of 4 months after the hearing, the decision was sent to the parties. Mrs Wilkin was held to have been unfairly dismissed and was awarded £3428. Of Mr Cavey's attendance on 15th March the Chairman said:-

"Mr Cavey, the Managing Director of the Respondents, attended the hearing on the 15 March. The Tribunal explained in particular the provisions of Rules 3 and 11 of the Employment Tribunals (Constitution) Regulations 1993 to him. No application was made by or on behalf of the Respondent for any extension of time pursuant to Rule 15, and the hearing proceeded on an "appearance not entered basis"."

If the Chairman had informed Mr Cavey "quite categorically that [he] could not take part in the proceedings", as Mr Cavey's unchallenged affidavit says, the Chairman's comment that no application had been made for an extension of time, whilst true, hardly gave him a fair picture of what had occurred. In the event, Mrs Wilkin's evidence given on 15th March (which was, of course, not tested by way of cross-examination) was accepted by the Chairman. The Chairman found her to have been unfairly dismissed. There is no indication in the extended reasons that her redundancy within section 98 (2) (c) was at all explored, nor, in the computation of her loss, that any consideration was given to her being offered a new job by Skinners on 9th March 2000. In the award her loss of wages was calculated on the basis that there would be a continuing loss from 14th January 2000 to 29 May 2000.

14. There is reason to doubt Mr Cavey's view that the Chairman told him he could appeal against any decision, given that the Chairman's particular explanation was about 1993 ET Rule 3 (as to the lodging of an IT3 and the deemed application for an extension) and Rule 11 (Review). Mr Cavey may have confused review with appeal. However, on 8th August 2000, by then represented by Solicitors, Skinners lodged a Notice of Appeal against the decision of 5th July. It has not been said that 1993 ET Rule 3 (2) precludes an appeal. The Notice of Appeal is also directed to the refusal of an extension of time on 3rd March 2000. So far as that ruling was concerned, the Notice of Appeal was out of time. By an order of the Registrar on 10th October 2000 an extension of time for that part of the appeal was refused and there was no appeal against that refusal. What we have before us, therefore, is only an appeal against the decision of 5th July 2000. Although, as a Tribunal decision, that of 5th July did not formally so rule, the Notice of Appeal treats it as if, in effect, it contained tacit rulings that Skinners could not that day renew the application to be granted an extension of time for the IT3 and could not be heard to take part in the proceedings on that day. In consequence of those tacit rulings, Skinners appeals also against the conclusions in Mrs Wilkin's favour. It seems to us sensible to approach the matter in that way and so the principal question before us is this: did the Chairman err in law on 15th March 2000 when he told Mr Cavey, as is unchallenged:-

(i) that he, the Chairman, was bound by the earlier decision that an extension of time for a Notice of Appearance was refused

and (ii) that accordingly Skinners could take no part in the proceedings that day.

Rule 3 of the Employment Tribunal Rules 1993 provides:-

"3. Appearance by respondent

(1) A respondent shall, within [21 days] of receiving the copy of the originating application, enter an appearance to the proceedings by presenting to the Secretary a written notice of appearance -

(a) setting out his full name and address and, if different, an address within the United Kingdom to which he requires notices and documents relating to the proceedings to be sent;

(b) stating whether or not he intends to resist the application; and

(c) if he does intend to resist it, setting out sufficient particulars to show on what grounds.

Upon receipt of a notice of appearance the Secretary shall send a copy of it to each other party.

(2) A respondent who has not entered an appearance shall not be entitled to take any part in the proceedings except -

(a) to apply under rule 15 for an extension of the time appointed by this rule for entering an appearance;

(b) to make an application under rule 4 (1) (a);

(c) to make an application under rule 11 (4) in respect of rule 11 (1) (b);

(d) to be called as a witness by another person;

(e) to be sent a copy of a document or corrected entry in pursuance of rule 10 (5), 10 (10) or 10 (11);

and in the rules which follow, the word "party" only includes such a respondent in relation to his entitlement to take such a part in the proceedings, and in relation to any such part which he takes.

(3) A notice of appearance which -

(a) is presented to the Secretary of State after the time appointed by this rule for entering appearances, and

(b) sets out the reasons why the notice has been presented after that timeshall be deemed to include an application under rule 15 for an extension of the time so appointed on the grounds disclosed by those reasons.

(4) Where a chairman grants an application under rule 15 for an extension of the time so appointed (including an application deemed to be made by virtue of paragraph (3) he shall determine whether, having regard to the grounds of his application, it would have been reasonably practicable for the respondent to present his notice of appearance within the time so appointed. If the chairman determines that it would have been so practicable, the respondent shall be treated as having acted unreasonably for the purposes of rule 12 (1) and the chairman shall make an order under that rule if he considers it appropriate.

(5) ....."

Thus if, in answer to our question (i) above, the answer is that there was no error and that the Chairman was so bound, it seems inevitable that (ii) could only be answered that there was no error of law in (ii). Save as is provided for in the express cases described in section 3 (2) (a) to (e), which Skinners do not fall into, Rule 3 (2) allows no escape from its provision that a respondent who has not entered an appearance is not entitled to take any part in the proceedings. We thus concentrate on question (i), which first requires us to see whether the Chairman, as a matter of jurisdiction, had to decline to hear Mr Cavey to ask for an extension of time on 15th March because of the earlier ruling or rulings.

15. As for that jurisdiction question, Miss Wigley has done well to find RAM Office Supplies Ltd. -v- O'Brien, EAT 14th June 1994. It is not only unreported but has escaped the keen eyes of Harvey's editors. There is no suggestion that the Chairman below relied upon it. In RAM the EAT had before it an appeal where the applicant below, Mr O'Brien, had presented his IT1 on 19th March 1992. His respondent, RAM, put in no notice of appearance. A hearing of the IT1 was fixed for 23rd October 1992. At the hearing a director of RAM sought to appear for it. On being told there had been no notice of appearance entered, he applied for an extension of time. None had been applied for earlier. It seems that he then told the Tribunal that it was RAM's Solicitors's fault that no notice of appearance had been entered. The Tribunal nonetheless refused the application and heard Mr O'Brien's case, awarding him over £10,000. No appeal was made by RAM as to the refusal to extend time but RAM sought a review of the Tribunal's whole decision. That was heard on 18th November 1992. In support of that a director of RAM swore an affidavit saying that he had no recollection of receiving the IT1 though he had received the notice of hearing for the 23rd October. He had passed what he had received on to RAM's Solicitors. He had at the hearing assumed that they had failed to deal with the papers but now acknowledged that, though he had genuinely believed that, he had since found it was not their fault. It was common ground, on the hearing of the review application (presumably by reason of ET Rule 3 (2)'s predecessor in the then applicable 1985 Rules) that the review could not proceed unless and until an extension of time to enter an appearance had been granted. The Tribunal then considered the submission made by RAM's Counsel as to that. The Employment Tribunal held it had no jurisdiction to hear the application to extend time. RAM appealed and the EAT said:-

"This appeal is against the ruling that the Tribunal had no power to grant the subsequent application to extend the time after the refusal of the first application on 23rd October 1992."

The Employment Tribunal had also said in RAM that if it did have jurisdiction to extend time, which it held it had not, then (presumably then treating the matter as one of discretion) it would have refused the application as RAM had relied on nothing more than mere oversight in not entering a timely appearance and for its failure even to ask for an extension till the very day of the hearing. The Employment Appeal Tribunal in RAM ruled that the tribunal below had been right on jurisdiction saying:-

"Prima facie a person is entitled to only "one bite of the cherry" at each level. He makes an application. It is argued. It is decided. Once it is decided the tribunal which makes the decision in functus officio. The remedy of a person aggrieved by the decision is to bring an appeal to [the EAT] on a question of law under ..."

the then requirement of s. 21 of the Employment Tribunals Act and the EAT added that Counsel for RAM's argument

".... that there is a right to go back to the tribunal and make another such application runs counter to the scheme of the Rules and the legislation."

Apart from that suggested inconsistency with that scheme, the Employment Appeal Tribunal relied on a number of further considerations as follows:-

(i) it would be odd and unfair if the applicant for an extension could make repeated applications, heard as to both fact and law, whereas if an application were granted, the respondent to it could only appeal and could only do so on a point of law; related to that -

(ii) an applicant for an extension could even gain by not appealing its refusal (because of the difficulty on appeal in finding an error of law) and by instead applying afresh, and thus being heard again on the facts;

(iii) several applications could be made, putting the respondents to them and the tribunal to time and expense.

16. With respect to the decision in RAM, none of those three further reasons points to the absence of jurisdiction as opposed to there being a discretion to refuse second and subsequent applications. Firstly, it is not the case that a respondent to a second application for an extension of time, were it granted ex parte, could only appeal; in the way normal amongst persons suffering a decision against them without having had the opportunity to be heard, he would be able to require an inter partes hearing. Secondly, Tribunals have adequate weapons to avoid the waste of time and money; they can deter improper second applications or those contrived or delayed for tactical advantages. Such applications can be refused on the merits or as abusive of process (within new 2001 Rule 15 (1)) and, if inter partes, costs might be awarded under the new 2001 Rule 14 (1) or (2). Even if such an application were granted, if that led to an adjournment, again costs could be awarded - new 2001 Rule 14 (4).
17. As to there being only "one bite of the cherry" that is, as we see it, not a matter of jurisdiction in interlocutory matters but, again, rather one of discretion. Neither Rule 3 (2) (1993 Rules) nor Rule 3 (3) (2001 Rules) expressly provides that only one application may be made for an extension of time. Nor is it unknown for repeated applications to be made in interlocutory situations. Thus, for example, an interlocutory injunction, despite being refused, even inter partes, may be sought afresh although, as a matter of discretion, the Court on the second occasion will be likely to regard the application as abusive unless a material change in circumstances since the refusal of the first one can be shewn. There is, in our view, no need to import into the rule a "once and once only" restrictive jurisdictional rule when the Tribunal already has adequate weapons to counter abuse and waste. Nor is it the Employment Tribunal's invariable practice to insist on such applications being made "once and once only"; had that been the case the refusal of 3rd March would have been an end of the matter and the letter of 9th March would have had to be a refusal in point of jurisdiction rather than, as it was, because no further explanation had been advanced.
18. We would thus wish to differ from the decision in RAM but it can in any event be distinguished; there the Tribunal below (presumably, as it "unanimously" rejected the application, it was a full Tribunal of 3) had actually heard the first application for an extension and did so (as it was dealt with at the hearing itself) inter partes. The second application for an extension in RAM was only after the IT1 had been heard. The case for the Tribunal by then being functus officio was plainly stronger; the IT1 had been fully dealt with and an order had been made upon it. By contrast, in the case before us there had been no hearing in respect of Skinners's earlier applications, there was no "decision" made thereon within the description of the Employment Tribunals (Constitution & Rules of Procedure) Regulations reg 2 (2) and the application which Mr Cavey was effectively barred from making, on being told, as is unchallenged, that he could take no part on the 15th March, would have been one made before the hearing of the IT1 began.
19. In these circumstances, we hold that the Chairman erred in law in considering himself bound, as a matter of jurisdiction, to regard the earlier refusal of an extension of time as conclusive and such as to exclude further application.
20. Having taken that view, the Chairman had no need to, and did not, consider Skinners' position on its merits. If the surrounding facts were such that no tribunal properly addressing itself to them could have ruled in Skinners' favour upon its seeing Mr Cavey's presence, as he says, as a clear indication that he wished to take part - see Tull and others -v- Severin [1998] ICR 1037 EAT - then it would be wrong of us to allow the appeal. We should therefore look briefly at Skinners' position.
21. Skinners had, in our view, a case on the merits of the IT1 which was not obviously without substance; there were arguments possibly in their favour on whether there had been a true redundancy and whether, on a fair "LIFO" basis, it had been Mrs Wilkin who had to go. Even if she was unfairly dismissed, there was a possible issue as to whether there was an offer of a new job to her such as would have limited her compensation for loss of wages. On 15^th March the Tribunal could have adjourned the hearing (very probably at Skinners' expense) or have let Mr Cavey cross-examine Mrs Wilkin on those issues on the basis that if, in the course of the hearing, she found herself taken by surprise or that the proceedings otherwise became unfair to her, she could be protected by an adjournment (again, probably at Skinners' expense).
22. Nor can it be said that mere oversight, as the only reason for not lodging a Notice of Appearance in time, has necessarily to be met with a refusal of an extension of time - see e.g. Horsfield -v- Roberts, EAT 24th October 1981, EAT/240/81 and the judgment delivered by Browne-Wilkinson J. (as he then was). Where the procedural default is before any ruling on the merits the applicable principle is as described by Sir Thomas Bingham M.R. in Costellow -v- Somerset C.C. [1993] 1 All E.R. 952 C.A. at 959 where he said (albeit of the plaintiff) that he

" .... should not in the ordinary way be denied an adjudication of his claim on its merits because of procedural default, unless the default causes prejudice to his opponent for which an award of costs cannot compensate ...."

At least where a defendant has the possibility of a merits-based defence, that principle must equally apply to such a defendant. As the Chairman on 15th March saw the matter as one of jurisdiction he did not inquire into the nature of prejudice to Mrs Wilkin but there is no reason to suppose that an adjournment on 15th March would have caused any material prejudice to her not compensatable by an award of costs which Skinners would have been able to meet. In written argument Mrs Wilkin's advisers describe Skinners as "well-to-do". Still less material prejudice would have been caused to her had there been no immediate adjournment but had Mr Cavey been enabled to take part with Mrs Wilkin being protected as we have mentioned.

23. Accordingly, the Chairman having erred in law as to jurisdiction and having not considered the discretion which he had and which could have been examined to let Mr Cavey take part on the 15th March, to have told Mr Cavey that he could not take part was an error of law such that the decision of 5th July 2000 must be set aside.
24. It would be open to us to remit the matter to the Employment Tribunal for it to consider whether, in such circumstances as are then laid before it, it would be right to grant a late extension of time to Skinners and, if so, on what terms. However, more especially now that regard has to be paid to Article 6 under the Human Rights Act, it is a severe step to deny a party an initial hearing of its position on the merits. In order to diminish the risk of further hearings, delays, costs and appeals, we see the better course as being for us here and now to extend time for the lodging of a Notice of Appearance by Skinners to 14 days after service upon it of the Order drawn up to give effect to this judgment - consider Horsfield -v- Roberts supra. We do so on the basis that if no such notice of appearance is lodged within that time the matter is to be restored to us for us to consider costs but that if such notice of appearance is lodged in time, the Employment Tribunal will, at the end of the substantive hearing, be able to consider what, if any, prejudice (other than the costs of or incidental to the appeal to us), being compensatable in costs, has been suffered by Mrs Wilkin by reason of Skinners' failure to lodge a timely Notice of Appearance and to consider also whether to make an award in her favour in respect of all or part thereof.
25. We allow the appeal on that basis.