United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MISS JESSICA CONNORS (of Counsel) 39 Essex Street Instructed by: Bar Pro Bono Unit
For the Respondent	MISS DIYA SEN GUPTA (of Counsel) Instructed by: Messrs Lewis Silkin Solicitors Employment Department 12 Gough Square London EC4A 3DW

SUMMARY

Practice and Procedure

Chairman struck out IT1 for failure to comply with an Order to serve a Schedule of Damages and give disclosure. He later refused a renewal. Appeal allowed on refusal of review and case remitted to a full fresh Tribunal to hear evidence on whether or not the Appellant had received notice of proposal to strike out. Failure to take account of a relevant consideration, namely the issue of credibility. There was a subsidiary issue of whether 'sent' in Rule 4 (8) means 'received'. EAT did not decide this.


 


HIS HONOUR JUDGE BIRTLES

1. This is an appeal from two decisions of a Chairman, Mr V J Adamson, sitting alone at Watford Employment Tribunal. The first decision appeal was an order made on 22 December 2003 which struck out the Applicant's Originating Application for a failure to comply with the Tribunal's directions dated 26 August 2003 to provide a schedule and to disclose documents. The second decision was promulgated on 23 January 2004 and was a decision which refused to review the first decision, the strike out order.
2. The history can be put very shortly. Miss Beecroft was employed until the date of her dismissal by World Dutyfree Europe Ltd based at Terminal 3, Heathrow Airport. She was dismissed because it was alleged that she had eaten sweets from a packet which had been damaged or opened and which in accordance with the Respondent's procedures should have been destroyed and not consumed by staff. It is not necessary to go into any further detail in this judgment.
3. Miss Beecroft's application alleged that she had been unfairly dismissed for a variety of reasons. The Respondent's Notice of Appearance alleged that she had been fairly dismissed. Those issues have not been ventilated yet before an Employment Tribunal.
4. On 26 August 2003 a Chairman of Tribunals at Watford, Mr Metcalf, gave directions to both parties so that this case could come to a hearing. Among the directions he gave were that a time allocation of 2 days was given and that this was sufficient for the Tribunal to deliberate, give its decision and to determine if necessary the issue of remedy. In due course the date fixed for hearing was 5 January 2004. The directions included directions for the exchange of witness statements and in paragraph 4 a direction that:

"The Applicant shall within 21 days of the date of these directions prepare a schedule setting out all the losses which were claimed in the proceedings… A copy should be sent to both the Respondent and the Tribunal."

and in paragraph 5 that:

"Both parties shall within 21 days of this letter disclose to the other all documents…"

which were material to the claim.

5. There was correspondence between the solicitors acting for the Respondent and the Tribunal and it is also apparent from a set of attendance notes that between 8 September 2003 and 28 November 2003 the Appellant, Ms Beecroft, had a number of telephone conversations with different solicitors at Lewis Silkin, who was the Respondent's solicitor, about different matters relating to the presentation of the case.
6. Miss Beecroft did not comply with paragraphs 4 and 5 of the Order of 26 August 2003 and in due course the Respondent's solicitors made an application that she should provide a schedule and disclose documents. The matter came before Mr Adamson on 22 December 2003 and he made an order striking out the Applicant's Originating Application. It is a short decision and I will read it:

"In exercise of powers conferred on me under Rule 4 (8) of the Employment Tribunals Rules of Procedure 2001, I order that the Originating Application be struck out for the Applicant's failure to comply with the Tribunal's Directions dated 26 August 2003 to provide a schedule and to disclose documents.

EXTENDED REASONS

1. On 22 July 2003 the Applicant presented an Originating Application to the Tribunal.

2. By Directions dated 26 August 2003 the Applicant was DIRECTED to send to the Respondent and to the Tribunal Office a schedule of loss and to disclose documents, but failed to do so.

3. On 21 November 2003 the Applicant was warned that unless written reasons be given within 14 days as to why an Order should not be made a Chairman would consider striking out the Originating Application for non-compliance with the directions.

4. No reasons having been provided in answer to that letter I order that the Originating Application be struck out."

7. The next thing that happened was that by a letter dated 6 January 2004 Miss Beecroft wrote to the Tribunal Office in the following terms:

"I am led to believe that I should have received a letter in November relating to my case number [which she then gives] which required an urgent response from my solicitor or myself; unfortunately I did not received any such letter. This has only come to light when I received your letter dated the 22^nd of December which I received on the 24^th December stating that this was now a Striking Out Order, I immediately contacted my solicitor stating that I had not received any previous letter from yourselves, I was told that she would send a fax to yourselves explaining this [ we have not been shown any such fax].

I have been experiencing problem with my post for sometime i.e. not receiving letters and receiving letters for other neighbours on the estate where I live. For instance just before Christmas I received a letter from Runnymede Council stating that I was in arrears with my Rent and Council Tax and that I had not responded to their earlier letter sent in November which I had also not received.

My house number is 1 Flanders Court, Mullens Road but on several occasions my mail has been delivered to other neighbours including 1 Mullens road, to the amount of post this resident receives or post received by this resident in no longer [I think it should be is no longer] passed on but returned to the Post Office. I have spoken to the Post Office previously and also to the Postman regarding this problem, which has proved to be ineffective.

I have spoken to my solicitor who will be sending a copy of this letter along with the requested information required to yourselves.

I hope this is satisfactory and apologies for any inconvenience caused by my not receiving your letter sent in November due to no fault of mine."

8. That letter was placed before Mr Adamson and, as I say, on 23 January. He treated as an application for a review and refused it. The Extended Reasons are as follows:

"1. By letters dated 6^th and 7^th January 2004 from the Applicant and Wills Walker, solicitors, respectively, application was made for a review of the order dated 22 December 2003 striking out the Applicant's Originating Application. In a letter dated 24 December from Wills Walker referring to the order application was made for the Originating Application to be reinstated. The particulars of the application were that the Applicant had not received a letter from the Tribunal in November 2003 and thus that was the reason why she had not responded to it. The only letter written to the Tribunal to the Applicant during November 2003 was the 'show cause' letter written pursuant to Rule 4(8) Employment Tribunals Rules of Procedure 2001.

2. The Applicant is considered pursuant to rule 13 and in particular rule 13(1)(e) of the rules.

3. Prior to the correspondence referred to in paragraph 1 of these reasons the Tribunal had not received any correspondence from any solicitor acting on the Applicant's behalf.

4. All correspondence from the Tribunal to the Applicant has been sent to the Applicant's address as provided on her Originating Application. The Applicant had not offered or requested that correspondence be sent to a different address. All documents sent by the Tribunal are pre-paid.

5. Pursuant to section 7 Interpretation Act 1978 service is deemed to be effected … by properly addressing, pre-paying and posting … and, unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post.

6. The Applicant states that she has been experiencing problems with her post for some time, yet at no time did she ask the Tribunal to correspond with her at a different address.

7. The Applicant states that her post is sometimes wrongly delivered to other neighbours, including one neighbour who returns post to the Post Office, but that the Post Office and postman have been unable to help her. The Applicant does not state however that she has raised the issue of non delivery of Tribunal correspondence with the Post Office, Royal Mail or anyone else.

8. I recognise the potential difficulty the Applicant may have in proving that the Tribunal's "show cause" letter was not received. The Applicant did, however, provide the address to which the correspondence was sent and has not provided any corroborating evidence to support her assertion that she did not receive it. Having regard to rule 23 (notices etc), section 7 Interpretation Act 1978, and rule 13 (5) I shall refuse the Application as having no reasonable prospect of success."

9. The only additional material facts seem to us to be the fact that we were told and accept that for an unspecified period that beginning on or about 25 November 2003 Miss Beecroft was represented by a firm of solicitors called Wills Walker. Wills Walker never put themselves on the record at the Employment Tribunal. It follows they never took themselves off the record and at all times as the Chairman makes clear in his Extended Reasons on the application for a review the Tribunal corresponded directly with Miss Beecroft at the address 1 Flanders Court, Mullens Road, Egham, Surrey. Of course it is self evident that if the solicitors had put themselves on the record as they presumably should have done then correspondence would have gone from the Tribunal to them on this problem that is before us today would have arisen.
10. The Employment Tribunal's powers are contained in the Employment Tribunals (Constitution etc) Regulations 2001. Those regulations giving two separate powers to the Tribunal to strike out a case. We are concerned only with the powers of the Tribunal under Rule 4 (8) and not with the powers under Rule 15. It is quite clear from the Chairman's first decision that he exercised his powers under Rule 4 (8).
11. The directions in August 2003 were quite clearly given under Rule 4 (1) which give the Tribunal the power to give such directions as it deems to be appropriate. Rule 4 (5) gives the Tribunal the power to order disclosure and produce such documents of witnesses as it deems relevant. Rule 4 (8) says this:

"If a requirement under paragraph 1 or 5 is not complied with the Tribunal –

(a) may make an order in respect of costs under Rule 14(1)(a) or

(b) before or at the hearing may strike out the whole or part of the Originating Application or if the case may be the Notice of Appearance where appropriate direct that the Respondent be debarred from defending altogether but a tribunal shall not exercise its powers under this paragraphs unless it has sent notice to the party who has not complied with a requirement giving him an opportunity to show cause while the Tribunal should not do so or the party has been given an opportunity to show cause already while the power conferred by this paragraph should not be exercised."

As the Chairman makes clear that he was exercising a Rule 4 (8) power to strike out the Originating Application on the grounds that there had been a failure to comply with paragraphs 4 and 5 of the directions of August 2003 made under Rule 4 (1) and/or Rule 4 (5).

12. The issue that is raised is whether that was a proper exercise of his power to strike out. At the time he made the original decision he did not know that Ms Beecroft would assert that she had not received the 'show cause' letter. The other rule that is relevant is in relation to the review. The powers of an Employment Tribunal to conduct a review are contained in Rule 13 and I will simply recite Rules 13 (1) and (5):

13 (1) "Subject to the provisions of this Rule a Tribunal shall have power on the application of a party on its own motion to review any decision on the grounds that:

(a) the decision was wrongly made as a result of an error on the part of the Tribunal's staff

(b) a party did not receive Notice of the Proceedings leading to the decision

(c) the decision was made in the absence of a party

(d) new evidence (not necessary to read that)

(e) the interests of justice require such a review.

…

(5) An application for the purposes of paragraph 1 may be refused by the President or by the Chairman of the Tribunal which decided the case or by a Regional Chairman if in his opinion it has no reasonable prospect of success."

13. The Notice of Appeal sets out a number of grounds attacking both decisions of the Chairman. We have granted leave today to Miss Connors to add a further ground of appeal which is set out in her very helpful skeleton argument. No objection is taken by Ms Sen Gupta to that amendment. We would particularly wish to pay tribute to Miss Connors who has come into this case very late in the day. The previous solicitors having been de-instructed and Miss Connors has acted on a Pro Bono basis without solicitors.
14. Miss Connors, I think, said everything that possibly could be said in support of this appeal. We remind ourselves before turning to the specific grounds of appeal that we have limited powers. The powers of the Employment Tribunal are not to re-hear evidence or to try to reach a different decision from that of the Employment Tribunal Chairman simply because we would have taken a different view. The EAT has no power to interfere with the Tribunal's decision unless it can be shown (a) that the Tribunal misdirected itself in law or misunderstood the law or misapplied the law or (b) there was no evidence to support a particular conclusion of finding of fact or (c) that the decision was either perverse in a sense that it was one which no reasonable Tribunal directing itself properly on the law could reach or alternatively one which was obviously wrong. The authorities are well known and do not need repeating for the purposes of this appeal. So far as the ground of perversity is concerned there is of course recent guidance in the decision of the Court of Appeal in Yeboah v Crofton [2002] IRLR 634 which makes it very clear how difficult it is for an Appellant to succeed in showing that the decision of an Employment Tribunal is perverse in law.
15. I turn then to the grounds of appeal. First, the decision of Mr Adamson dated 22 December 2003. The first ground of appeal is that the Chairman in exercising his Rule 4 (8) power had to consider whether there was a real risk that as a result of Ms Beecroft's failure to provide a schedule of loss and to serve evidence of mitigation a fair trial would no longer be possible. Reference is made to the decision of the Court of Appeal in Landauer Ltd v Comins & Co [1991] Times, 7 August and in particular the judgment of Lloyd LJ. The second matter the Chairman had to consider was whether striking out the whole of Ms Beecroft's Originating Application would be a proportionate response to her failure to provide a schedule of loss and to serve evidence of mitigation and reference was made to Carter & Hopson v Hi-way Express, a decision of this Tribunal (judgment delivered on 19 November 2003). That as far we are aware is unreported.
16. I should say also in support of those submissions which are made in paragraphs 9 and 10 of her skeleton Ms Connors also in paragraph 11 sets out a series of other options which the Chairman could have followed. We bear in mind that these decisions are made by the Chairman sitting alone. He will have access to the file. In this particular case we do not accept Ms Connors' submissions that the Chairman did not have these matters in mind. We do so for the following, amongst other, reasons. First, this order was made on 22 December 2003. That was just before Christmas. The 2 day hearing date had been set down for some time to begin on 5 January 2004. While we have no direct evidence about the matter it is a fair inference that this would have been the first working day for the Tribunal after the Christmas vacation.
17. The practical effect of Christmas is that solicitors' offices and the Tribunal offices are closed so the position as to some alternative course of action being taken would not have become apparent to the Respondent until the morning of the first day of the hearing on 5 January. Second, the Chairman would not have had access to the file which combined all of the correspondence he would have borne in mind that the application had been made by the Respondent who quite clearly from the correspondence considered themselves prejudiced by the failure to provide a schedule of loss and mitigation.
18. A schedule of loss and mitigation is relevant not just to a remedy hearing. It is also relevant to negotiations between the parties and a possibility of settlement between them thereby avoiding the considerable legal cost involved in a two day hearing. We have no material before us which enables us to say that the Chairman did not apply the correct legal test and did not consider the alternatives.
19. The second ground of appeal in relation to the Chairman's decision of December 2003 is a test of perversity. All that is necessary here is for us to refer to what Lady Justice Arden said in the case of Terry v Hoyer (UK) Ltd [2001] EWCA Civ 678 at paragraph 35 where she says this in respect of that case (which was also a striking out case):

"35. The essence of the appellant's case before this court is that the reaction of the tribunal in the present case was, and here I quote "too vigorously draconian" in proportion to the default before it. No challenge was or could be made to the existence of the power to strike-out. That power primarily exists to protect the other party in the case [our emphasis]. Therefore in order to succeed on this appeal the appellant must show that the Employment Appeal Tribunal's conclusion was one that no reasonable tribunal acting reasonably could make."

20. In our case, we take the position of the Court of Appeal: is this decision a decision which no reasonable Chairman acting reasonably could make? Looking at the background facts as we have recited them, in our judgment this attack on this decision does not begin to reach the perversity test.
21. The third ground of appeal is what Miss Connors has called 'an error of precedent fact' and the argument is set out in paragraph 12 of her Skeleton Argument. I do not propose to repeat that. In essence the submission is that the Chairman had to be satisfied that Ms Beecroft had actually received the show cause notice when it made its decision to strike out on 22 December 2003.
22. Ms Connors submits that the word 'sent' in Rule 4 (8) means 'received' and she cites in support of that the decision of the Court of Appeal in a judicial review case R v Secretary of State for the Home Department ex parte Yeboah [1987] 1 WLR 1586. We are aware of a number of decisions of this Tribunal in relation to the proper construction of Regulation 4 (8) and 15 and indeed of other courts on other statutory provisions where the service of documents is relevant.
23. The point raised before us was not raised in the Notice of Appeal. That is no criticism of the Appellant or indeed Ms Connors. As I say we gave leave for the point to be argued and it was not opposed by Miss Sen Gupta. However, we are not persuaded by the limited argument which we have heard. In our judgment, for us to make a decision on whether the word 'sent' in Rule 4 (8) means 'received', and therefore something contrary to its meaning in Rule 15, would require full argument and full citation of authorities and we are not persuaded by what we have heard today.
24. It follows for those reasons the appeal in respect of the strike out order is refused. We turn to the second area of appeal which is in relation to the review decision.
25. In essence, Ms Connors submits that when one reads the Extended Reasons and in particular paragraphs 7 and 8 the Chairman clearly recognised that there was an arguable point and he should have resolved that by allowing the application for a review and remitting the matter to be tried before a full Employment Tribunal which was the best and indeed only available Tribunal to decide disputed issues of fact.
26. It is important to note that the principles on which the power to strike out are made in this case under Rule 4 (8) and 13 are not the same. The wording is not the same as that of Rule 13 (5). What the Chairman has to do under Rule 13 (5) is to consider the application under Rule 13 (1), and in this case the Chairman focused on Rule 13 (1) (e), that the interests of justice require such a review, and then consider his discretion under Rule 13 (5) - he may refuse the application for review if in his opinion it has no reasonable prospect of success.
27. The Chairman did consider the issue of whether the interests of justice required such a review and of course it is easy to see how he would form a view that it did not because the effect of the strike out order meant that Ms Beecroft was deprived of the right to bring her claim before the Employment Tribunal. Furthermore, the Respondent would be prejudiced if with the benefit of that strike out order it would be now required to conduct a two-day hearing.
28. We have carefully considered the submissions made to us by Ms Connors and Miss Sen Gupta and we have come to the conclusion that the Chairman here has made an error of law. When we carefully examine the reasons given by him in paragraphs 7 and 8 of his Extended Reasons we find that he recognises the potential difficulty that the Applicant may have, in proving that the Tribunal's show cause letter was not received. So the Chairman there recognises that there is a live issue to be resolved. However, he goes on to say that because the Applicant asked for correspondence to go to her address and that she did not provide any corroborating evidence to support her assertion that she did not receive it. He refused the application for a review as having no reasonable prospect of success.
29. We find it difficult to see how one can provide corroborating evidence that one did not actually receive something. It seems to us to be in logical terms a non sequitur. But in our judgment the Chairman erred in law for this reason, and this reason alone. He failed to take account of the relevant consideration which was the issue he had identified and shown to be arguable, i.e. whether the Appellant's assertion was credible. That required resolution by a full Employment Tribunal, and was not one which he could resolve himself. When he reached the decision that this application for review had no reasonable prospect of success he erred in law. If necessary, we would refer in support of our decision to the case of Hancock v Middleton [1982] ICR 416.
30. So far as disposal is concerned, there seems to us therefore to be only one way of dealing with this case. The application for review will have to be remitted to a full and fresh Employment Tribunal chaired by a Chairman who is not the Chairman in this case.