United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR IAN ROGERS (of Counsel) Messrs Merriman White Solicitors 61 Fleet Street London EC4Y 1JU
For the Respondent	MR EDWARD JANKOWSKI (Solicitor) London Borough of Lewisham Legal Dept Room 307 Lewisham Town Hall Catford London SE6 4RU


 


MRS RECORDER COX QC:

1. This is an appeal from the Decision of an Employment Tribunal at London South, promulgated on the 5^th August 1999, that the Appellant had not been unfairly dismissed.
2. The Appellant was a senior surveyor who had worked for the Respondent for some 17 years. It was not in dispute before the Tribunal that the Appellant had been summarily dismissed by the Respondent for gross misconduct on the 3^rd November 1997. His dismissal followed an investigation by the Internal Auditor into events relating to works carried out by the Respondent to rectify problems of rainwater penetration and condensation in flats on the Dacres Estate. Serious difficulties developed in relation to these works which meant, eventually that costly remedial works were required. The Internal Auditor reported in July 1997 that responsibility for the satisfactory outcome of the works on the Estate lay with the Appellant as the Contract Administrator.
3. The Appellant was then suspended and a full inquiry carried out into the conduct of these works and the Appellant's role by the Head of Property Services with the Respondent, Ken Platt. An extensive report was submitted by Mr Platt on the 5^th August 1997, following which the Appellant was required to attend a disciplinary hearing on the 14^th August. Four charges were made against him, set out in a letter dated the 30^th July 1997, which were alleged to constitute gross misconduct. These charges were subsequently supplemented by further factual detail. The hearing, in accordance with the disciplinary procedure, was conducted by Brian Hayes, Assistant Director (Systems and Resources), on the 15^th and 17^th October 1997. On the 3^rd November Mr Hayes wrote to the Appellant informing him that he had found the allegations proved and that they constituted gross misconduct. The Appellant was summarily dismissed from the Respondent's service with effect from the 5^th November 1997.
4. The Appellant appealed against this decision and had the assistance of Solicitors at the appeal hearing, which was conducted by three elected Council members. Full documentation was provided for the appeal, which was conducted as a re-hearing of the charges and took place over 2 days. On the 12^th January 1999 the Appellant was informed that his appeal had been rejected.
5. The Appellant complained to the Employment Tribunal. In his Originating Application he denied the allegations which had been found proved by his employers and attached a lengthy witness statement, prepared for use at the disciplinary hearing, which contained his detailed defences to the various allegations made. The Respondents, in their Defence, relied on their full investigation into the allegations in question and the decision of Brian Hayes on what they submitted were reasonable grounds that the allegations were substantiated and merited summary dismissal.
6. Both parties were legally represented in the Employment Tribunal, with Mr Jankowski appearing for the Respondents both below and before us. The Employment Tribunal heard the case over 3 days. As they indicated in Paragraph 1 of their Extended Reasons documentary evidence of the facts was very extensive. The approach they adopted was therefore a legitimate one namely that they proposed not to refer to every detail of the documents but to give a general view of the facts which would clearly identify the basis for their decision.
7. The Tribunal identified the central issue in the case as being:

"….whether the activities of the Applicant in supervising work at the site in question amounted to more than professional negligence and could reasonably be classified as gross misconduct."

They went on to recognise that the issue in particular was whether a reasonable employer could come to the conclusion that the Appellant had been guilty of gross misconduct. After analysing the evidence the Employment Tribunal determined this issue in favour of the Respondent and dismissed the complaint of unfair dismissal. The Appellant appeals from this decision. Before the Tribunal the Appellant also alleged that there were various procedural defects, in relation to the disciplinary process, which had denied him a fair hearing. The Tribunal found against him on these allegations in addition but no appeal is pursued against their findings on these matters.

THE ISSUE

8. The key issue before us is whether the Employment Tribunal could properly conclude, on the evidence before them, that the Respondent had satisfied what is known as the Burchell test. This requires the Tribunal to consider whether the employer who dismissed the employee believed that he was guilty of gross misconduct, whether he had reasonable grounds for that belief and whether, when he formed that belief, he had carried out as much investigation into the matter as was reasonable in the circumstances (British Home Stores Limited v. Burchell [1980] ICR 303). The Court of Appeal in Post Office v. Foley [2000] IRLR 827 confirmed that this test was correct. They also emphasised that an Employment Tribunal should not substitute its decision as to what was the appropriate course to adopt for that of the employer, its proper function being to determine whether the decision to dismiss fell within the band of reasonable responses which a reasonable employer might have adopted.

The issue in this case is whether the Employment Tribunal could properly conclude that the Respondent, by the 3^rd November 1997, had reasonable grounds for a belief in the deliberateness, wilfulness or recklessness of the various failings alleged against the Appellant, such grounds being substantiated by or still subsisting after a reasonable investigation by the Respondent.

9. Mr Rogers, Counsel appearing for the Appellant before us, relied upon the Skeleton Argument settled by Counsel previously instructed, which had been before this Appeal Tribunal at the preliminary hearing. There are essentially two grounds of appeal pursued:

(1) It is submitted that there was insufficient or inconclusive evidence to support the Respondent's contention that the conduct of the Appellant was deliberate and to support the Employment Tribunal's finding that the Respondent had reasonable grounds so to find.

(2) The Tribunal proceeded under a misapprehension or misconstruction of the evidence before it such as to render its findings perverse. They failed in particular to grasp the technical complexities of the evidence and of the dispute between the parties. This failure coloured their approach to the central issues in the case and rendered their conclusions unsustainable.

10. In order to determine these issues it was necessary for us to consider a great deal of the evidence which was before the Employment Tribunal. In addition to our main bundle (referred to below as "EAT"), which included the Chairman's Notes of Evidence, we were provided with a large additional bundle of Appellant's documents ("A1"), together with a smaller supplemental bundle ("A2"). We are grateful to both Mr Rogers and Mr Jankowski, the parties' representatives, for the assistance they gave us in their submissions.

THE LAW

11. There is no dispute that the Employment Tribunal correctly identified the legal test for determining the crucial issue in this case, namely whether a reasonable employer could properly conclude that the Appellant had been guilty of gross misconduct. In relation to the question whether the decision to dismiss fell within the range of reasonable responses, Mr Rogers accepted that, if we found against him on the central issue, he could not submit that the Appellant's dismissal was outside the range of reasonable responses for an employer who had, on reasonable grounds, found him guilty of gross misconduct.
12. There were two further authorities placed before us, which are relevant to the issues. Firstly the case of Neary v. The Dean of Westminster [1999] IRLR 288, in which the Special Commissioner, Lord Jauncey, made some general observations about gross misconduct which justifies summary dismissal. In particular he stated that

"The character of the institutional employer, the role played by the employee in that institution and the degree of trust required of the employee vis-à-vis the employer must all be considered in determining the extent of the duty and the seriousness of any breach thereof." (at Paragraph 19).

"….conduct amounting to gross misconduct justifying dismissal must so undermine the trust and confidence which is inherent in the particular contract of employment that the master should no longer be required to retain the servant in his employment."

13. Secondly, in London Borough of Hackney v. Jacqueline Benn (unreported) 31^st July 1996, BAILII: [1996] EWCA Civ 561, the Court of Appeal considered the role of an Employment Tribunal in assessing an employer's classification of conduct as gross misconduct, justifying summary dismissal. At page 13 of the Transcript Lord Justice Neil stated:

"….where an employer has an established disciplinary procedure and the employer follows that procedure both in the classification of the matters to be investigated and the method of investigation, an Industrial Tribunal has to be very careful before it makes a reclassification. A reclassification of the facts may make it difficult to see how a reasonable employer might reasonably respond to those facts."

Lord Justice Ward, at page 16 of the Transcript, held:

"The Tribunal in fact found that the reason for dismissal shown by the employer related to the capability of the employee, not to her conduct. In my judgment, it was entitled so to find. What it was not entitled to find was that the employer ought to have approached the question of dismissal on that basis. In treating this as a capability case where a warning to improve was appropriate before dismissal, the Tribunal was guilty of substituting its classification of the reason for dismissal for the employers and substituting its decision as to the right course to adopt for that of the Council. In so doing, it erred."

We have had regard to these authorities in considering the Employment Tribunal's approach in this case.

FACTUAL BACKGROUND

14. The Tribunal found that the Appellant was appointed by the Respondents to a PO2 (Principal Officer) grade in 1996 and that, in order to achieve that grading, he would have had to satisfy the Respondent that he had the experience and knowledge to act as a Project Leader, requiring supervision only on unusual or difficult problems. In Paragraph 3 of their Reasons, dealing with the facts found, they set out the background to the events with which the Tribunal was principally concerned and we repeat that paragraph fully here.

"The Council had received a number of complaints from tenants on the Dacres Estate. This estate consisted of 110 flats in 5 blocks, 11 storeys high. The complaints were of damp entering from the outside of the walls and of condensation. The Council paid the tenants compensation. It also resolved to attempt to rectify the situation. Unfortunately the process of rectification was severely restricted by financial considerations and it is common ground that the scheme which was adopted would not rectify the condensation problem. As a matter of fact it has proved successful in preventing rainwater coming through the walls. Condensation was mainly due to inadequate ventilation and heating and it was decided that if insulation were put on the inside of the cladding designed to keep out the rain this would prevent loss of heat through the wall. The wall, and particularly those parts of the wall with steer girders in their interiors, would then be warmer and less prone to condensation. In fact the financial stringency of the Council meant that only the South facing walls of each block could be dealt with. It was this shortcoming which prevented a successful solution to the condensation problem because, as is obvious, moisture would condense on the other three walls. The South-facing wall was, however, the one which caught the worst of the weather and the one which was letting in the majority of the rain from without."

15. The Respondent decided to use the product of specialist suppliers of rain screen cladding called Eternit UK Limited and subsequently they appointed fitters, William D Verry Limited (sub-contractors) to install the cladding. The Appellant, as the Contract Administrator, was responsible for supervising the works, in particular since no Clerk of Works had been appointed. The residents of the flats had formed an Association to pursue their grievance in relation to the damp and condensation. The Tribunal found, at Paragraph 10, that:

"That group had had discussions with representatives of the Council and had been given the details of the projected cladding and insulation. The matter had become political within the Council itself because members of the Council had taken up the case of the residents. It was very important, therefore, if modifications were to be made to the proposals that the residents should have a full explanation."

16. In their findings of fact from Paragraph 4 onwards the Tribunal describe that problems had developed from an early stage in relation to the insulation of the balcony return walls, which meant that it was impossible to fit the Eternit system and the Appellant was aware of this. The Tribunal found that the problems were not resolved and yet works continued under the Appellant's supervision and the insulation was omitted. The Appellant always alleged that this omission was the fault of Lewisham Direct, principal contractors, and that he neither knew about or approved it. Lewisham Direct maintained that the omission had been discussed and verbally agreed with the Appellant on the 22^nd April 1996 and they refused to carry out remedial works.
17. Once the matter had come to light there was a lengthy dispute as to who was responsible for rectifying the omission. The residents had discovered the missing insulation late in the day and were dissatisfied. The Tribunal found at Paragraph 13 that:

"The answer probably was that nothing effective could be done but, as we have noted, the Council had to take account of dissatisfied tenants who had, because of the late discovery of the missing insulation, clearly formed the opinion that an unsatisfactory job had been done. In the end it was estimated that rectification would cost a further £130,000."

18. The Housing (Investment and Property) Sub-Committee of the Council resolved in June 1997 to refer the matter to the Internal Auditor for investigation. The Tribunal found at Paragraph 14:

"The Auditor reported in July that responsibility for the satisfactory outcome of the works on the estate lay with the Contract Administrator (i.e. the Applicant). His primary conclusion is contained in paragraph 2.2 of his report as follows:

'This report will show that such responsibility was not discharged in the manner expected under the terms of the Fee Agreement for Architectural Services established between Housing and LEED, or the job description for the post. There is no conclusive evidence that this was deliberate and therefore LEED may wish to pursue a review of competency rather than discipline'."

19. Following this report the Appellant was notified on the 15^th July 1997 that he was suspended, the notification referred to the Auditor's report as indicating that

"You have been negligent, unprofessional and irresponsible in your role as Contract Administrator in the Dacres Estate Project, which may have serious financial implications for the Council". (Paragraph 15).

Ken Platt, Head of Property Services in the Respondent's Leisure Economy and Environment Directorate (LEED) was appointed to carry out a fact-finding investigation. The Tribunal found that he had interviewed a number of officers, made detailed notes and submitted an extensive report dated the 5^th August 1997. The Tribunal found (see Paragraph 18) that his conclusion was that the Appellant had committed misconduct and that disciplinary action should be taken against him.

20. On the 30^th July the Appellant was informed that he was required to attend a disciplinary hearing on the 14^th August. The charges against him at that stage were as set out at Paragraph 16 of the Reasons. The hearing was postponed and these charges were subsequently amplified, with further particulars being provided in respect of each of the four charges. These amplified charges appear fully in the document attached to the Appellant's Originating Application and, because of their importance, we set them out in full here:

"Allegation 1

That you have been negligent, unprofessional and irresponsible in carrying out your duties as Contract Administrator of the Dacres Estate project. Specifically:

(a) Mr Lo Sterzo issued a Schedule of Works when the project was re-tendered which required insulation to be installed on the balcony return walls as part of the Eternit rain cladding system ("the insulation works") despite his being aware through having been previously advised by Eternit that the insulation were not possible.

(b) Mr Lo Sterzo refused to hold prior to 22 April 1996 design team meetings involving the sub-contractors, William Verry Limited, despite being requested to do so.

(c) Mr Lo Sterzo deliberately failed to inspect work in progress on the balcony walls.

Allegation 2

You withheld information from senior management, which frustrated proper management of the contract.

Specifically during June 1997, Mr Lo Sterzo deliberately failed when asked to brief senior management (Ken Platt and Ralph Harris) on the project.

(a) To inform them that he had been advised by Eternit at the initial design state that the insulation works were not possible.

(b) To draw their attention to documentation issued by Eternit which was relevant to the issues of whether the insulation works were possible and of what Eternit had advised him on this point.

Allegation 3

You withheld information which affected a satisfactory resolution of the dispute.

Specifically throughout Mr Lo Sterzo's discussions concerning the project with his team leader, Ken Bryan, he deliberately failed to inform him that he (Mr Lo Sterzo) had been advised by Eternit at the initial design stage that the insulation works were not possible.

Allegation 4

You actions have led to unnecessary expenditure for the Council. Specifically, offices in LEED, Housing and DIRECTeam have had to spend time and LEED had to incur a consultant's fees in dealing with the dispute which arose over the insulation works not having been carried out. That time and fees would not have been spent and incurred at all, or to a lesser extent has in fact been the case, had you not committed the acts of misconduct set out under 1 – 3 above."

The Respondent's case and the evidence of Mr Hayes was that the most important allegations were Allegation 1(b), (c) and Allegation 4. Allegation 1(c) in itself was considered by Mr Hayes to constitute gross misconduct (see his witness statement at page 110 EAT).

21. The disciplinary hearing took place on the 15^th and 17^th October and was conducted by Brian Hayes, whose report is described by the Tribunal as "extensive and exceptionally detailed" (Paragraph 18). The Tribunal set out what they describe as the most significant points from his report at Paragraphs 18 to 21 of their Reasons. At Paragraph 21 they stated:

"In summing up, the report states that the Applicant failed to address a number of matters including a proper resolution of the situation in respect of the balcony return walls, the holding of a design meeting which would have prevented the dispute occurring, the inspection of the work at crucial states, the provision of crucial information to his Line Manager which would have prevented the dispute developing, and the failure to provide crucial information to senior management to bring the dispute to an end. The report concludes that all those actions were considered to have been deliberate. The ultimate conclusion is in these terms:

(v) [The Applicant] is therefore considered to have been negligent, unprofessional and irresponsible in carrying out his duties and to have further committed acts, all of which constitute gross misconduct which is a serious breach of Lewisham Council's code of conduct and it is recommended that appropriate action is taken in accordance with the Council's disciplinary code."

22. The letter to the Appellant from Mr Hayes of the 3^rd November (page 44 EAT) set out the findings and concluded with these words:

"It is my view that your actions throughout the whole of this contract were wilful and reckless of the financial and other consequences for the Council and its tenants and that your actions were deliberate, unprofessional and negligent. Accordingly I find that the allegations constitute gross misconduct and it is my decision that you should be summarily dismissed from the Council's service, with effect from the 5 November 1997."

23. An appeal by way of re-hearing before three elected members subsequently took place but the appeal was dismissed, the Appeal Panel writing to the Appellant as follows:

"The panel considered the arguments presented by both sides, together with the evidence from the witnesses. Having done so, the decision of the Panel was that the findings reached by Brian Hayes, the Hearing Officer were correct and that the decision to summarily dismiss you from the Council's service should stand. Your appeal is therefore rejected."

THE GROUNDS OF APPEAL

24. Clearly Mr Hayes believed that the Appellant was guilty of gross misconduct. Further we consider and Mr Rogers did not submit to the contrary that the Employment Tribunal found there to have been a very thorough and careful investigation by the Respondent into the serious allegations made against the Appellant. It is common ground that the essential question therefore is the extent to which it was reasonable for Mr Hayes to conclude that the Appellant's conduct, in relation to the different allegations, was deliberate and accordingly amounted to gross misconduct, rather than merely negligent; and whether the Employment Tribunal could properly conclude that it was reasonable for Mr Hayes so to find.
25. The Appellant's criticisms of the Tribunal's approach are of general application. We have approached the matter by considering each allegation separately and examining the evidence which was before Mr Hayes and before the Employment Tribunal in determining the answer to the essential question referred to above. We then deal with the general criticisms made by the Appellant in order to decide whether they demonstrate an error of law by the Tribunal.
26. We begin with Allegation 1(c), which Mr Hayes considered itself constituted gross misconduct by the Appellant, namely that he deliberately failed to inspect work in progress on the balcony walls.
27. The problems which existed in relation to these works all concerned the balconies, as the Tribunal found in Paragraph 29. At Paragraph 11 the Tribunal found as a fact that:

"Despite the failure to resolve the problem work went on under the Applicant's supervision and there is no dispute that in 300 hours which he committed to this site he never once inspected work being done on any of the 110 balconies. In either consequence he never became aware of the fact that no insulation was being inserted between the cladding and the balcony walls or he chose to shut his eyes to that fact. The inference is that once the cladding was fixed to the batons and sealed in there would be no way of discovering what was behind it."

28. Mr Hayes' evidence at the Tribunal was that, on his own admission, the Appellant

"had never seen any work in progress on the balcony return walls despite visiting the site once a week on average. He claimed that whenever he went on site, DIRECTeam were never working specifically on a balcony. In his evidence, Terry Gamble said that Mr Lo Sterzo had had every opportunity to witness the ongoing work on the balcony return walls and he had never been denied access….Mr Lo Sterzo did not deny this." (See Paragraph 19 of his witness statement at page 113 EAT).

Our examination of the Chairman's Notes of Evidence indicates that this evidence was not challenged by the Appellant in the Tribunal.

29. Mr Hayes' witness statement continued:

"The only excuse he offered for his failure to inspect the work on the balcony return walls was that the design for those works involved a very simple construction, which he did not perceive as a problem….I did not believe him."

His reasons for disbelieving the Appellant appear in detail in his witness statement at Paragraphs 20 to 27. In cross-examination the Chairman has noted Mr Hayes' evidence on this point. At page 63 EAT we see at the reference to R471-473:

"I took into account the evidence and came to the conclusion there was evidence that he deliberately failed to inspect. Inspection is a milestone event. Capability has not been in issue. He could not have missed this as a milestone event."

Later on at the reference R473 the Chairman has noted:

"The Applicant was aware of a significant problem on the balcony. He probably did not agree to omission of the insulation. He knew he had to inspect. I can say it was deliberate. ….I had sufficient evidence to say that he deliberately failed to inspect."

30. In oral submissions Mr Jankowski took us through the documentary evidence to which Mr Hayes had regard when deciding whether he accepted the Appellant's explanation, all of which were documents before the Tribunal and are referred to by Mr Hayes in his witness statement at Paragraphs 20 to 27. We looked in particular at pages 352, 337 and 341, 330 and 347 of Bundle A2. All these documents demonstrated that the nature of the works to be done to the balcony walls was evolving and problematical and continued to be so up to the time that work on the balconies started. We take the view that there was evidence from which Mr Hayes could reasonably reject the Appellant's contention that it was straightforward.
31. Mr Hayes also gave unchallenged evidence about the Appellant's competence, in rejecting negligence as a possible explanation for the failure to inspect. In Paragraph 28 of his witness statement he referred to the fact that:

"There was never any question of Mr Lo Sterzo being incompetent. His ability was accepted and agreed by Tom Livingstone and Ken Bryan".

At page 61 EAT the Chairman has noted Mr Hayes' evidence in-chief at the reference WS para. 28

"It was never part of the Applicant's case at the disciplinary hearing that what happened was due to incompetence. He never expressed regret or apology."

Again on page 66 EAT at the reference R506 the Chairman has noted

"The core of [the Applicant's] case was that there was no reason to inspect. ….incompetence not credible on 17 years' experience. Oversight on such a scale was not credible.".

On page 67 the Chairman notes at the reference WS para. 39

"Not once did he inspect. ….but Bryan and Livingstone was sure he was competent."

32. Mr Hayes concluded, on the evidence before him, that the Appellant had deliberately failed to inspect the balconies knowing that this task was required of him. Mr Hayes' overall conclusions, which appear at Paragraphs 9 and 10 of his witness statement (see page 110 EAT) were as follows:

"9. A clear overall pattern emerged from the evidence I heard. Marcia Mitchell, who came across as honest and genuinely distressed by what had happened, said that it had been a very difficult project with political involvement, high profile and lots of involvement with residents (see page 492 of R2). One of the tenants' main concerns was that condensation problem. I was satisfied that the project was not going to meet tenants' expectations concerning this problem. Ken Platt, who is an energy expert, indicated that the condensation problem could only really be tackled through heating and mechanical ventilation. The insulation was principally intended to increase the energy efficiency of the buildings to reduce heating costs, although it might also assist in reducing the risk of condensation resulting from cold bridging. Moreover, only one elevation was being done, no work being carried out on the other three.

10. In this context, it appeared to me that Mr Lo Sterzo's actions were due to his having been determined above all else that when problems arose, someone other than himself would be to blame, and this determination overrode his duty of care and common sense in the administration of the contract. In her evidence, which was not challenged in any way, Marcia Mitchell said that she had found him to be very defensive, writing lengthy memos (see page 492 of R2)."

33. The Tribunal accepted Mr Hayes' evidence. At Paragraph 29 of their Reasons they stated:

"In our view the Respondent took account of the fact that the Applicant was a competent and experienced surveyor and that the work in question was not particularly complex. In consequence the Respondent sees no reason why the Applicant should not have inspected work on the balconies at some stage whilst that work was actually proceeding; unless it was the Applicant's intention to shut his eyes to what was being done. At the very least the Applicant must have taken a decision not to inspect since he had both time and opportunity to do so and, indeed, the balconies were really the only part of the project which was likely to cause any problem at all."

Further, in relation to the appeal hearing, the Chairman noted the evidence of Laurence Crossan (Senior Personnel Adviser) that

"On the issue of inspection the Applicant changed his answer to each question. The Panel therefore found him inconsistent and not credible."

34. We take the view, having examined all the evidence, that it was open to the Tribunal to conclude that the Respondent had reasonable grounds, as at the date of dismissal, for believing that the Appellant's conduct was deliberate or wilful in relation to this particular allegation.
35. We turn then to Allegation 1(b), namely the refusal to hold design team meetings involving the sub-contractors, William Verry Limited, despite being requested to do so.
36. Before the Tribunal the Respondent's case was that, prior to the 22^nd April 1996, the Appellant had refused to hold design team meetings involving Verrys, despite being asked to do so. The Chairman noted Mr Hayes' evidence about this allegation at page 63 EAT at the reference R468-474K as follows:

"Refusal to hold meetings was contractually correct but such meetings would have been sensible."

37. In his witness statement Mr Hayes referred at Paragraphs 15 to 18 (page 111 EAT) to the evidence which was before him on this issue. Referring to the evidence of Tom Livingstone he stated that he had

"confirmed that the only successful way forward in resolving design issues was to get everyone together….the responsibility was on the contract administrator to take the lead on this, which clearly had not happened. There was ample evidence that Mr Lo Sterzo had deliberately refused to deal with Verrys directly and sufficiently both before and after the meeting on the 22^nd April 1996. Mr Lo Sterzo had chosen only to deal through DIRECTeam, with the exception of a pre-contract meeting in which Verrys were involved. The meeting on the 22^nd April had proved to be abortive and subsequent meetings were not held by Mr Lo Sterzo with Verrys, nor was there any other form of direct communication with them to resolve issues."

In Paragraph 16 Mr Hayes stated that

"Terry Gamble, who presented well and honestly, and who I found a very credible witness, said in his evidence that William Verrys had been denied access to the design meetings, being required to go through DIRECTeam. They had requested a design team meeting but had been told that they were not needed. He said that Mr Lo Sterzo had never made an attempt to get himself, DIRECTeam and William Verrys together on-site to discuss the design….".

In Paragraphs 17 and 18 Mr Hayes referred to further corroboration as to this matter being provided by Doug McInnes and Ken Bryan. We were taken to the documents before Mr Hayes in relation to this matter and in particular pages 335 to 6, 329 and 342 of Bundle A2. It would appear from the Chairman's Notes of Evidence that the Appellant did not challenge the evidence on this point.

38. Mr Hayes concluded that the reason the Appellant alleged that he could not deal directly with Verrys under the contract was in order deliberately to avoid having to find a solution to the problem with the balconies (see page 63 EAT and the Chairman's Notes at reference R468-474K).
39. The Tribunal accepted this as a reasonable deduction for Mr Hayes to make. At Paragraph 29 they stated:

"In our view the Respondent also took account of the fact that the failure of the Applicant to hold one or more meetings with the specialist sub-contractor, Verry, was also a deliberate avoidance of a solution to the difficulties. In our view this is a reasonable deduction. Our view is that the deduction is actually strengthened by the explanation the Applicant sought to give which was that Verrys were not parties to the contract between the Respondent and its main contractor. In our view this would be a technicality, which no reasonable person would rely on in view of the fact that the sub-contractor was effectively carrying out all the work on the site."

40. We do not consider that this finding discloses any error of law on the Tribunal's part. At this point they were considering whether a reasonable employer could properly conclude that the Appellant's failure to hold design team meetings with the sub-contractors was a deliberate failure. They held that it was open to an employer so to find. We agree with the Respondent's submissions that, in the circumstances of this case, a deliberate failure to hold meetings was effectively the same as a refusal to hold meetings and the Tribunal's conclusion did not in our view go to a different charge from that which the Appellant was facing in Allegation 1(b).
41. The next allegation to be considered is that at 1(a) namely that the Appellant issued a Schedule of Works requiring insulation to be installed on the balcony return walls as part of the Eternit Rain Cladding System, despite being aware that insulation was not possible.
42. Mr Hayes' evidence (Witness Statement, paragraph 12 at page 110 EAT), was that he accepted Mr Platt's finding that the final version of the specification did require insulation to be installed on the balcony return walls as part of the Eternit Rain Cladding System. He goes on to explain why. In Paragraph 13 he stated that:

"Mr Lo Sterzo accepted that even at the conceptual stage he had been aware that the Eternit system could not be continued into the balcony returns – see his statement at page 511….".

The Tribunal found as a fact in Paragraph 5 that the specifications put out (twice) for tender required that the Eternit system should be taken into the balconies. In Paragraph 14 of his witness statement Mr Hayes stated that

"I disagreed with Ken Platt concerning whether Mr Lo Sterzo had been negligent, unprofessional or irresponsible in issuing the final specification in these circumstances. I considered that the specification could have been amended and clarified subsequently, although Mr Lo Sterzo failed to do this."

His letter of dismissal of the 3^rd November (page 44 EAT) to the Appellant shows that Mr Hayes informed the Appellant that he concluded that by itself this matter was neither negligent nor unprofessional.

43. The Appellant, in his own statement, admitted knowing that it was impossible to take the Eternit system into the balcony return walls (see page 77 EAT). While the Employment Tribunal did not, in Paragraph 29 of their Reasons, state whether they had found that the Appellant knew of the impossibility, they expressed this as a finding of fact at Paragraph 5:

"The Respondent asserts, and the Applicant appears to admit, that the Applicant knew of this impossibility when he issued the specifications."

Again in Paragraph 7 the Tribunal found as a fact:

"As we have noted, complaint might be made that he should from the beginning have indicated the balcony difficulty and that, by not doing so, he ran the risk that an appointed contractor would claim extra payment for overcoming the difficulty."

44. We are unable therefore to identify any error on the part of the Tribunal in relation to this allegation, given their findings of fact, the Appellant's own admission and the fact that Mr Hayes had not in any event found this conduct itself to be deliberate. Indeed he did not consider that this conduct by itself was negligent as is made clear in the letter of dismissal.
45. Allegations 2 and 3 concerned the withholding of information from senior management which it was alleged frustrated proper management of the contract and affected a satisfactory resolution of the dispute. Specifically it was alleged that during June 1997 the Appellant deliberately failed when asked to brief senior management Ken Platt and Ralph Harris on the project and to inform them that he had been advised by Eternit at the initial design stage that the insulation works were not possible and also to draw their attention to documentation issued by Eternit which was relevant to this issue and to their advice to him. Further it was alleged that throughout the Appellant's discussions concerning the project with his team leader, Ken Bryan, he deliberately failed to inform him about the initial advice from Eternit at the design stage that the insulation works were not possible.
46. The Appellant's case throughout was that, since there had been an alternative design solution, which Eternit approved, there was no reason why he should have disclosed this information to management.
47. However Mr Hayes found these allegations proved and gave his reasons for so finding in his witness statement at paragraphs 31 to 35 (page 118 EAT). In cross-examination he is noted to have said (page 64 EAT at reference R448) that

"Withholding information is an omission but he should have known the importance of this and he did not bring it to attention.

(ii) I did not find this of great significance

(iii) It is more significant to say reasoning [Chairman's note: this relates solely to K Bryan]. It is not malice. It is the avoidance of investigation. It is setting out to protect himself."

Mr Hayes was making it plain at this point that he regarded Allegation 3 as the more significant. We examined the evidence of Mr Platt on this matter (see in particular Paragraph 43 of his witness statement (page 138 EAT), where he deals with the Appellant's dealings with Ken Bryan over the dispute. He refers in that paragraph to a number of documents, all of which we had regard to and all of which were before the Employment Tribunal.

48. In Paragraph 29 of their Reasons the Tribunal stated:

"….we believe the Respondent was influenced by the fact that the Applicant had not supplied his superiors with information on the difficulties in respect of work on the balconies. We accept the submission of Mr Jankowski that it is no answer to say that the Applicant's superiors could have inspected the files. It was reasonable for them to assume that the Applicant was in charge of the job and therefore was properly resolving the difficulties unless they heard to the contrary. The fact that he did not bring the matter to their attention strengthens their deduction that he was deliberately concealing it. The Applicant's explanation that the information was not relevant because the specialist cladding system was not being applied to the balconies lacks credibility. The Applicant was well aware of the "political" situation that existed in relation to the Tenant Association in the property. He had dealt extensively with that Association before this project was conceived. In the light of these considerations we believe that the disciplinary hearing came to the conclusion that the Applicant had decided to cover up the problem with the balconies. It is, in our view, reasonable for the Respondent to conclude that the Applicant had suppressed evidence of that problem and had deliberately turned his back on any opportunity to see it being worked out in action and to face the apparent difficulty of resolving it."

In the light of the evidence which was before Mr Hayes and his conclusions upon it, we are not persuaded by the Appellant's submission that it was not open to the Tribunal to have arrived at this conclusion.

49. In relation to Allegation 4 and the unnecessary expenditure which the Appellant's actions caused, it was common ground that this did not in fact amount to a separate allegation of misconduct (and the Tribunal do not deal with it as such) but related rather to the serious consequences which were caused by the conduct of the Appellant as alleged in the other charges. Mr Rogers did not submit that there was any error on the part of the Tribunal in their findings of fact as to the expenditure and inconvenience incurred by the Respondent as a result of the problems with these works. The issue was rather whether it was deliberate conduct on the part of the Appellant which had caused it. It is not necessary therefore for us to deal further with the evidence upon this point.

APPELLANT'S GENERAL CRITICISMS

50. We turn then to deal with the Appellant's submissions in support of his contention that there was insufficient or inconclusive evidence to support the Respondent's contention that the conduct of the Appellant was deliberate and, further, that the Employment Tribunal misconstrued or misunderstood the evidence to such an extent that it rendered their decision perverse.

THE INTERNAL AUDIT REPORT

51. The Appellant submits that the Tribunal should have considered in detail the findings and the conclusions arrived at in this report, having regard to the fact that there was no suggestion by the auditor that the Appellant had been guilty of gross misconduct.
52. It is correct that, at Paragraph 2.2, the report stated:

"This report will show that such responsibility was not discharged in the manner expected under the terms of the Fee Agreement for Architectural Services established between Housing and LEED, or the job description for the post. There is no conclusive evidence that this was deliberate and therefore LEED may wish to pursue a review of competency rather than discipline."

(See Paragraph 14 of Tribunal's Reasons.) The Tribunal refer to this conclusion but, it is submitted, do not go on to take into account the detailed findings and reasoning in considering the reasonableness of the employer's belief that the Appellant's conduct was deliberate.

53. We are not persuaded however that the Tribunal erred in failing to examine closely the reasoning and specific findings of the Auditor. Firstly it is clear from the Chairman's Notes of Evidence that the Tribunal did consider the Report and its conclusions. On page 53 EAT the Chairman has noted Mr Platt's answers to questions in cross-examination about the Auditor's Report and role, for example:

"I don't believe the Auditor carried out a fact-finding in the same way as I did. ….The Report went so far….The conclusion I came to was that there were grave questions which had caused unnecessary [expense]."

Further evidence about this from Mr Platt, in answer to questions from the Tribunal, was set out on page 54 EAT and on page 55 the Chairman noted

"I probably did not reflect back on the fact that I was differing from the internal audit. That had merely identified a problem. I took this into account. The charges arose at the end of the fact-finding."

There are, in addition notes of Mr Hayes being asked questions about the Auditor's Report on page 62 and again on page 67 where the Chairman has noted

"When I saw "irresponsible" and "negligent" in the Auditor's Report they were very strong indications that something was seriously wrong. I know him."

54. Whilst the Auditor's Report was clearly relevant and the Tribunal refer to it in their Findings of Fact we take the view that they were required to focus on the more detailed fact-finding investigation carried out by the Appellant's employers and on the findings and conclusions of the ultimate decision-maker, Mr Hayes. The Tribunal's duty, ultimately, was to analyse the facts and reasoning of Mr Hayes who decided to dismiss the Appellant summarily for gross misconduct.
55. It seems clear to us that the Employment Tribunal were mindful of the Report and noted or explored the issues raised by it with both Mr Platt and Mr Hayes. It was ultimately however necessary for them to consider the conclusions of Mr Hayes. This they did and we can identify no error on the part of the Tribunal in the approach they took to this matter.

THE QUALITY OF THE EVIDENCE AT THE DISCIPLINARY HEARING

56. The Appellant submits that the Tribunal failed to have any or adequate regard to the quality and nature of the evidence which was relied upon by the Respondent at the disciplinary hearing. He further submits that the evidence adduced in support of the allegations against the Appellant raised no more than issues of incompetence, negligence or the mishandling of a politically delicate situation. In the Skeleton Argument and in oral submissions before us Mr Rogers developed the submission by taking us through passages in the witnesses' evidence and documentation which demonstrated in his submission that the allegations involved only negligence on the part of the Appellant. Mr Rogers' principal difficulty with this submission is that there was, as we have indicated above when dealing with each separate allegation, other evidence from which the Tribunal considered that Mr Hayes' conclusion that the Appellant had acted deliberately was a reasonable one for him to reach. For the reasons we have already given we consider that it was open to the Tribunal to make this finding and are not persuaded that there was any error in so finding on the Tribunal's part.

FAILURE TO APPRECIATE THE SIGNIFICANCE OF THE APPELLANT'S ROLE AS CONTRACT ADMINISTRATOR

57. The Appellant submits that the Tribunal failed to understand that the Appellant's role as Contract Administrator had clearly defined duties and responsibilities and that the contract was governed by the JCT IFC Form 84. He submits that the Tribunal referred in their Decision to the Appellant as "Contract Manager" (see Paragraph 8), which was an incorrect description and ignored the contractual requirement for the principal contractors to carry out all surveys of the properties and to provide a full detailed design of the over-cladding system, with any final design needing to be approved by Eternit and the Contract Administrator.
58. We do not accept that the Tribunal misunderstood the Appellant's job title or his role or that they ignored the contractual requirements. They clearly recognised that the Contract Administrator was the Appellant in Paragraph 14, where they refer to the Internal Auditor's Report. And in Paragraph 18, where dealing with Mr Hayes' Report, they refer to him again as the Contract Administrator. It is clear from their extensive Findings of Fact in our view that they correctly identified and understood the role of the Contract Administrator in relation to these works. The fact that the Tribunal used the words "contract manager" in Paragraph 8 appearing as they do in lower case appear to us to be simply a shorthand description for the work that the Applicant was actually doing.
59. Further, whilst they do not refer expressly to the contractual requirements they clearly had before them Mr Platt's evidence (see Paragraph 19 of his witness statement at 129 EAT), where he dealt with the responsibility for the carrying out of surveys. In Paragraph 6 of their Decision the Tribunal referred expressly to the modifications of the Eternit system referred to in the letter from the contractors to the Appellant of 15^th March 1996. They proceeded on the basis that the two specifications were an outline design to be clarified further by the contractor and we see no error on the part of the Tribunal in this respect.

THE GIVING OF AUTHORITY TO OMIT INSULATION FROM THE BALCONY

60. The Appellant submitted that it was essential to the Respondent's case that authority had been given by the Appellant to omit insulation from the balcony. He contends that the Tribunal totally disregarded the requirements set out in the JCT IFC Form 84 that any such variations that were to be authorised by the Contract Administrator were required to be in writing in order to be effective.
61. It seems clear to us however that this was not the Respondent's case either in the disciplinary hearing or before the Employment Tribunal. This seems clear from Paragraph 30 of the witness statement of Mr Hayes (page 117 EAT), where he stated as follows:

"Although it was not directly relevant to the issues which I had to decide, I did consider whether Mr Lo Sterzo had ever agreed to the omission of insulation from the balcony return walls. I accepted the evidence of Terry Gamble and Doug McInnes that he removal of insulation was discussed at the meeting on 22 April 1996. I found it highly suspicious that Mr Lo Sterzo had not kept any record of the meeting. However, I believed Mr Lo Sterzo avoided explicitly approving the omission of the insulation although aware that it was practically impossible to install the balcony returns with any meaningful amount of insulation. Had he approved the omission then he might have been exposed to criticism as questions could then have been asked about why Lewisham Housing and tenants had been led to believe that insulation was going to be installed and as to why a specification had been produced which was not achievable in this area. If the omission of the insulation had not been noticed by a tenant, it is likely that the panels would have been sealed (as was in fact eventually the case), Mr Lo Sterzo would have approved the works, the contract would have been finished and the omission of the insulation might not have come to light for years. Unfortunately for Mr Lo Sterzo, he had been forced to act at the end of the contract when the omission had been publicised by a tenant."

62. Mr Hayes' evidence was that he was considering generally whether the balcony return works were problematical and he did not regard it as relevant to the issues with which he was dealing to decide whether or not there had been an agreed variation. We do not consider therefore that this point assists the Appellant's case.

FAILURE ON THE PART OF THE TRIBUNAL TO UNDERSTAND THE SPECIFICATION

63. The Appellant submits that it was always his case that there were two forms of construction contemplated in the specification. There was firstly a proprietary system, namely the Eternit system (a layer of insulation of 50 mm and an air gap of 30 mm) and secondly a non-proprietary system which was to be applied to the balconies. The Eternit system was not to be applied to the balcony returns and the Appellant submits that the Tribunal simply failed to understand this fact. In Paragraph 5 they state that the tender required that the Eternit system should be taken into the balconies and this is simply wrong. The Appellant goes on to submit that the Tribunal then noted in Paragraph 7 that complaint might be made that the Appellant should have indicated the balcony difficulty from the beginning and his failure to do so ran the risk that an appointed contractor would claim extra payment for overcoming the difficulty. This, the Appellant contends, is a fundamental error and one upon which the rest of the Tribunal's decision is predicated.
64. We have considered very carefully the Appellant's submissions on this point but we do not accept that the Tribunal misunderstood the technical issues or the evidence before them. The relevant findings of fact by the Tribunal are set out at Paragraph 5 of the Reasons. They are as follows.

"The specifications put out (twice) for tender required that the Eternit system should be taken into the balconies. On the face of it this would mean that the cladding inside the balconies should allow for an 80mm space between the cladding and the wall. In fact this was impossible. On the inside return wall such a projection would extend over the glazed part of the window. On the outside return wall the projection would prevent the balcony door from opening. The Respondent asserts, and the Applicant appears to admit, that the Applicant knew of this impossibility when he issued the specifications. The tendering contractors had, therefore, no warning of the difficulty of extending the system into the balconies. It would have been quite simple to give this warning by including in the specification an extra drawing indicating a proposed modification in the balconies. The Applicant claims that in both versions of the specification it was indicated that the cladding inside the balconies would be fixed onto soft wood batons instead of the standard metal supports. He has, throughout the disciplinary proceedings, claimed that the Eternit system was not going to be applied to the balcony return walls although the same cladding material was going to be used. He says that an alternative proposal had been submitted to him by William Verry which would involve timber batons less thick than the outside metal supports thus reducing the space between the cladding and the wall. This cladding would be filled completely with insulation and sealed with silicon. This is obviously an acceptance of the fact that the insulation would be of some use on the inside return wall but that there was not any serious problem of rain entering the balcony to any extent and certainly not of penetrating the outer cladding."

65. There was evidence before the Tribunal which, in our view, supports these findings. Ken Platt deals with the matter at Paragraphs 18, 21 and 22 in his witness statement (page 128 EAT) and we also had regard to the documents he referred to. Paragraph 8 of the document at page 157 of Bundle A1 makes no reference to a separate solution for the balconies. Documents at page 209 at B and at D and page 210 at B of Bundle A1 indicate that there is to be a full, detailed design which includes the balconies as part of the system.
66. Mr Platt took the view that these documents were not supportive of the Appellant's case and it is clear from Paragraph 12 of his witness statement (page 110 EAT) that Mr Hayes accepted Mr Platt's evidence on this matter. Similarly the letter on page 330 of Bundle A2 shows that the contractors considered that the specification would also apply to the balconies. We consider therefore that there was evidence which enabled the Tribunal to make the findings of fact it did concerning the Eternit system in Paragraph 5 and they did not in our view misunderstand that evidence.
67. The Appellant contends that the contract drawings 1-4 and 1-4A prepared by the sub-contractors, Verrys, cannot be reconciled with the Tribunal's finding at Paragraph 5 that the tender required that the Eternit system should be taken into the balconies. However these drawings on analysis were shown to postdate the tender and this point therefore does not assist the Appellant.
68. On our analysis of the evidence before Mr Hayes and before the Employment Tribunal there was no written variation of the Eternit system which would remove the requirement for the works to be done as specified. There was no clear written alternative solution or final set of drawings produced altering the specification and neither Housing Direct nor the Tenants Association were told about any other solution. It was Mr Hayes' view that the specification had been wrong from the start and that there was never a final version of the drawings produced, which provided the Appellant with the incentive to conceal the matter later. He considered, further, that the contractors did not do the work in accordance with the specification, the Appellant never came up with a final solution and the contractors then had to do the best that they could in the circumstances.
69. The Appellant spent some time addressing us on the drawing which appears at page 98 EAT but this drawing in our view does not show that the Appellant's alleged solution was in place at the time, namely the 3^rd March. In any event Mr Hayes did not decide as a matter of fact whether the Appellant's "solution" was feasible or not and we accepted the Respondent's submission that this was not relevant to Mr Hayes' conclusions. He looked not at the feasibility of the Appellant's alternative solution but whether there had been one at all. He concluded that there was not and he focused on what he regarded as a deliberate failure on the Appellant's part to inspect the work in progress on the balconies and his deliberate failure to hold meetings and the problems which resulted as a result of those failures. The Tribunal recognised this in their Decision and we cannot identify any error on their part in the way that they approached these issues.
70. It is of course not our role in this Appeal Tribunal to assess all the documentary evidence afresh and form an independent view. Rather we must examine critically the Employment Tribunal's conclusions as to the reasonableness of the employer's findings and decision. We see no basis for disturbing the Employment Tribunal's findings of fact or their conclusion about the reasonableness of Mr Hayes' determination in this case.
71. In conclusion therefore we see no material misunderstanding of the evidence by this Employment Tribunal. Rather it seems to us that the Appellant is seeking to persuade us to a different decision on the evidence when there was in fact evidence which would enable a reasonable employer to decide the matter as Mr Hayes did and determine that the Appellant acted deliberately or wilfully and was therefore guilty of gross misconduct. We take the view that this Employment Tribunal carefully analysed and considered the evidence adduced before them and that they were entitled to conclude that there was evidence which would permit a reasonable employer to form the view that Mr Hayes did that the Appellant's conduct in relation to the specified allegations had been deliberate and not merely negligent.
72. The Tribunal recognised in Paragraph 30 of their Reasons that there was no significant dispute between the parties as to the consequence. They stated:

"Once it is shown that the Applicant's failures were deliberate they pass out of the realm of incompetence and into that of misconduct. Although the project itself was relatively straightforward the Applicant was well aware of facts which gave it significance in the eyes of the local authority. That being so, his deliberate creation of a politically fraught situation can reasonably be regarded as gross misconduct.".

We see no basis to disturb the Tribunal's decision and we would dismiss this appeal.