United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR R PIRANI (of Counsel) Instructed by: Messrs Michelmores Solicitors Woodwater House Pynes Hill Exeter Devon EX2 5WR
For the Respondent	MR R HARPER (of Counsel) Instructed by: Devon County Council Legal Services County Hall Topsham Road Exeter Devon EX2 4QD


 


SUMMARY

Practice and Procedure – Striking-out/dismissal

A issued proceedings in the ET before she resigned or (as the case may be) was constructively dismissed. She withdrew those proceedings which were then dismissed under rule 25(4). She issued fresh proceedings alleging constructive unfair dismissal relying largely – but not entirely – on matters raised in her first proceedings. The ET held the second proceedings should be dismissed on the basis of issue estoppel. The basis of her first claim was never made clear but it certainly was no unfairly dismissed. Held: the rule in Henderson v Henderson was a broad equitable rule to be applied with a view to fairness and A was not estopped from pursuing her claim for unfair dismissal.


 


HIS HONOUR JUDGE REID QC

1. This is an appeal from a decision of Mr Hollow sitting alone at Exeter on 5 June 2007. By his decision he determined that the Claimant's claim should be dismissed. The basis on which he did that was that the claim was, as he put it, subject to the doctrine of res judicata, using the expression res judicata it seems to me in the extended sense in which it is sometimes used referring to the case of Henderson v Henderson. The matter had come before him as a preliminary point following a pleading in the Respondent's ET3 "the Respondents contend the Claimant was estopped in pursuing the second claim either by way of res judicata and/or issue estoppel and/or the rule in Henderson v Henderson [1843] 3 Hare 100". That had led to a direction for a pre-hearing review to determine that issue.
2. The background to the case is that the Claimant had been employed for a considerable number of years by Devon County Council. All was not well and on 27 June 2006 she raised a grievance. There had been four meetings following her raising a grievance, both informally and formally, but on 25 September she lodged an ET1 making a variety of complaints. On 28 September she attended the fifth meeting and on the same day a letter was written giving the outcome of her stage 1 grievance. The following day she resigned with immediate effect, saying that she was constructively dismissed because of a breakdown in trust and confidence. She also, on 3 October, appealed the findings of the grievance and on 24 October she received advice from solicitors who, via her Trade Union, were advising her. The nub of that advice as contained in the redacted letter a copy of which was before the Tribunal was:

"On the basis of the above advice I recommend your current Employment Tribunal claim is withdrawn, the letter withdrawn must be worded carefully so as to minimising negative impact on any future claims. Please therefore confirm by return I have the authority to withdraw that claim."

3. On 1 November the Respondents put in an ET3 to that first claim in which they said as follows:

"5.2 The claim as drafted is cited at box 9.1 as a claim under the Health and Safety Act 1974 and management of health and safety regulations 1999. The tribunal does not have jurisdiction to consider such claims.

The Respondents understanding is that the claim has been admitted by the tribunal as a health and safety detriment claim. However the claim as drafted discloses no such claim as the circumstances do not fall within the ambit of s.44 Employment Rights Act 1996.

The Respondents have written to the Claimants union representatives by email dated 23 October 2006 seeking clarification on this point and ask that in the event of such clarification illustrating any such claim they be permitted the opportunity to amend the response accordingly.

The claim as drafted does not plead constructive dismissal (and could not, being submitted prior to the Claimant's resignation).

In the circumstances the claim discloses no cause of action for which the tribunal has jurisdiction."

4. The following paragraph 6.1 was in these terms:

"The Respondents request that the tribunal call a case management discussion/pre-hearing review to consider whether the tribunal has jurisdiction to consider the claim as drafted/clarify what is being claimed.

Should the Claimant bring a further claim for constructive dismissal this claim will be resisted in full and the Respondents will be seeking the opportunity to respond in detail to any such claim."

5. On Friday 3 November the Employment Tribunal sent out a notice of a case management discussion calling a case management discussion to be conducted by telephone on Thursday 16 November. That was received in the council's offices on Monday 6 November according to the date stamp, but meanwhile on 5 November the Claimant had written to the Employment Tribunal with copies both to county council and to her union officer in these terms:

"I wish to notify the Tribunal of my intention to withdraw the above claim against Devon County Council. For the record, this is done without prejudice to any claims which I may pursue in the future at an Employment Tribunal, County Court or High Court.

I look forward to confirmation the case has been withdrawn from the list."

That document was received by the Employment Tribunal on 7 November. On the same day the Employment Tribunal wrote to both parties with a copy to ACAS. It sent the Claimant's copy to her union representative, the union being on the claim form as her representative, in these terms:

"Thank you for your letter informing the Tribunal that you are withdrawing your claim against the respondent(s), namely Devon County Council.

The case management discussion listed for 16^th November 2006 has been cancelled.

Your file has been closed and will be retained in archive until 1 year when it will be destroyed."

That must have been sent out by fax because on the same day the County Council wrote to the Tribunal and sent also a copy to the union representative. The letter, dispatched respectively by fax and by email, was in these terms:

"I am writing further to the Notice of Withdrawal of Claim in the above matter to apply for the proceedings to be dismissed pursuant to Rule 25(4) of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2004.

I make this Application on behalf of the Respondents, bearing in mind in particular that the Claimant has withdrawn her Claim rather than sought to amend or add to it in the light of the points raised by the Respondents in their Response, despite the fact that there was shortly to be a Case Management Discussion in the matter.

I confirm that the Respondents have complied with Rule 11(4) in making this request."

6. On 14 November the Claimant raised a statutory grievance.
7. By 16 November no communication had been received from the Claimant or from her representatives. The Chairman made an order "upon application by the respondent, the proceedings are dismissed following the withdrawal of the claim by the claimant." There was then something of a lull while presumably the grievance was being pursued and on 26 March 2007 the Claimant issued a claim for constructive dismissal.
8. On 10 April 2007 the Respondents, the County Council, put in their ET3 which contained the following passage. "The Claimant submitted an earlier claim "[then details the history]". The Respondents contend the Claimant is estopped from pursuing the second claim and then refers to res judicata/issue estoppel and Henderson v Henderson". It was that that led to the hearing. The pre-hearing review considered the point having been, as I have already said, called on 30 April for hearing on 5 June.
9. At the hearing before Mr Hollow there was no evidence from the County Council. There was evidence from the Claimant. She produced a witness statement and the language of the Chairman's judgment tends to indicate that she gave some oral evidence even though it may only have been to verify the witness statement. Neither advocate before me today was present below and neither can confirm whether or not she in fact gave oral evidence but I think nothing turns on that.
10. The Chairman's decision, in my judgment, clearly proceeded on the basis that he was dealing with the matter under the rule in Henderson v Henderson. There are, as he observed, three types of what is sometimes called res judicata and this was the third of them i.e. Henderson v Henderson as opposed to cause of action estoppel or issue estoppel. A complaint was made that his decision is not Meek compliant in the sense that the Claimant could not understand how she lost. It may be that another Chairman would have spelt out more fully the way in which he reached his conclusion and dealt perhaps more fully with the other two forms of estoppel but it seems to me that its perfectly clear that he was proceeding on the basis that this was a Henderson v Henderson type case and that it cannot reasonably be complained that his decision does not give adequate reasons or is in any way obscure.
11. The law that he had to deal with has been most recently dealt with by the Court of Appeal in Aldi Stores Ltd v WSP Group Plc and various others [2007] EWCA Civ 1260. The Chairman of course did not have the advantage of having that decision before him. The general principles of a strike-out such as this (that is effectively what the Tribunal has done) were set out in that case by Thomas LJ at paragraphs 5 and 6 of his judgment by reference in part to Johnson v Gore Wood [2002] 2 AC 1 and in part by reference to a summary of the principles in that case by Clark LJ in Dexter v Vlieland-Boddy [2003] EWCA Civ 14 at paragraphs 49-53. I note that Thomas LJ said this:

"It is, in my view, generally neither necessary nor helpful to refer to the accretion of authority before that decision [i.e. Johnson v Gore Wood] as the decision clearly sets up principles the Court set to apply."

He then went on and quoted from Lord Bingham at page 31 where Lord Bingham said this:

"But Henderson v Henderson abuse of process as now understood although separate and distinct from the course of action estoppel and issue estoppel has much in common with them. The underlying public interest is the same that there should be finality and litigation and that a party should not be twice vexed in the same matter. This public interest is reinforced by the current emphasis on efficiency and economy in the conduct of litigation in the interest of the parties and the public of a whole. The bringing of a claim or the raising of the fence in later proceedings may without more amount to abuse if the court is satisfied the owness being on the party alleging abuse, the claim or defence should have been raised in the earlier proceedings if it was to be raised at all. I would not accept that it is necessary before abuse may be found to identify any additional elements such as a collateral attack on a previous decision or some dishonesty. But where those elements are present the later proceedings would be much more obvious than abusive and the more rarely the finding of abuse the less the later proceedings involves what the court regards as unjust harassment of a party. It is however wrong to hold that because a matter could have been raised in earlier proceedings it should have been so as to render the raising of it in later proceedings necessarily abusive. That is to adopt to of a masculine approach to what should in my opinion be a broad merits based judgment which takes into account of the public and private interests involved and also takes account of all the facts of the case focusing attention on the crucial question whether in all circumstances a party is misusing or abusing a process of the court by seeking to raise before it the issue which could have been raised before. As one count got hence of relistal possible forms of abuse serve on count formulate any hard and harsh rule to determine whether on the given facts the abuse is to be found or not. Thus while I would accept that lack of funds would not ordinarily excuse a failure to raise at earlier proceedings an issue which could and should have been raised then I would not regard it as necessarily irrelevant, particularly if it appears that the lack of funds is being caused by the party against whom it sought to claim. While the result may often be the same it is in my view preferable to ask whether in all circumstances a party's conduct is an abuse than to ask whether the conduct is an abuse and then, if it is, to ask whether the abuse is excused or justified by special circumstances. Properly applied, and to whatever the legitimacy of its descent, the rule has in my view has a valuable part to play in protecting the interests of justice."

12. Thomas LJ then went on and referred to the summary of the principles by Clark LJ in the Dexter case and I can read from paragraph 49 of Clark LJ's judgment where he summarises the principles as follows:

"i) Where A has brought an action against B, a later action against B or C may be struck out where the second action is an abuse of process.

ii) A later action against B is much more likely to be held to be an abuse of process than a later action against C.

iii) The burden of establishing abuse of process is on B or C or as the case may be.

iv) It is wrong to hold that because a matter could have been raised in earlier proceedings it should have been, so as to render the raising of it in later proceedings necessarily abusive.

v) The question in every case is whether, applying a broad merits based approach, A's conduct is in all, the circumstances an abuse of process.

vi) The court will rarely find that the later action is an abuse of process unless the later action involves unjust harassment or oppression of B or C."

The Chairman of course did not have the advantage of that authority before him and he, it seems to me, approached the case in a rather different way. He said this at paragraph 18 of his judgment:

"I bear in mind the underlying rule as I consider it to be in Henderson where by a party must bring before the Tribunal all the matters that he or she wishes to have litigated. I bear in mind that whilst the Claimant in the first application of the Tribunal was not entirely clear of its nature it may have been a claim under s.44 of the Employment Rights Act but that was something to be sorted out. One thing it could not have been would have been a claim of unfair dismissal where actual or constructive, that I said for emphasis was because of course the date of the first application the Claimant was still in employment."

At 19 the Chairman continued:

"The second application to the Tribunal is undoubtedly a claim for constructive dismissal and whatever the first one may have been is a clear difference between the remedy which would have been available to the second and whatever remedy might have been available in the first had they succeeded. Nevertheless it does seem to me the basic allegations the Claimant makes are all very much of the same tenor. The distinction between them of course is in the second case the Claimant brings allegations against other managers as well as her line manager. She alleges her grievance as being rejected as indeed it had and she had resigned, apart from those factors the basic date for the two claims is very much the same."

13. He then went on and considered two cases, Air Canada and Alpha Catering v Basra [2000] IRLR 683 and Divine-Bortey v London Borough of Brent [1998] IRLR 525. He summarised the Basra case and having done so concluded dealing with it:

"As has been submitted to me today, she had done everything she could have done at that stage to enable herself to bring the proceedings. She had sought to bring all matters before the Tribunal. That she was not permitted to do so and the first instance was not her fault."

He then went on to consider Divine-Bortey and refer in particular to paragraphs 45-48 of the judgment. He said:

It seems the Court of Appeal was saying it would have been open to Mr Divine-Bortey to apply for leave to amend. That he could and should have done at that stage [i.e. before the Employment Tribunal]. In my judgment this is the same situation here."

In the Divine-Bortey case it was alleged that a racial motive for his selection for redundancy emerged in the course of other proceedings for unfair dismissal.

14. The Chairman continued:

"The date the Claimant's resignation took effect her first claim was still alive. It would have been open to her, in my judgment, to have added the Claimant constructive unfair dismissal. All matters relevant to the claim were within her knowledge. I had not really given a great deal of thought to the procedure by which she might have done so. I suspect the appropriate way would have been for her to have issued a fresh claim and sought to have the two consolidated or linked for hearing together. That was not done. Her claim was withdrawn. It seems that was done on the basis of legal advice. It is clear from the authorities and including the case of Yat Tung Investment Company Limited v Dao Heng Bank and Another [1975] AC 58 that in advertence a mistake or nature consists such a claim being is not a special circumstance to override the principal of res judicata."

15. He then goes straight on to his concluding paragraph:

"I have come to the conclusion sadly for the Claimant in this case that the course she should have followed is, as I have indicated, to have issued fresh proceedings. The matters are res judicata. The dismissal of the proceedings on 16 November was undoubtedly a judicial act albeit there was no determination of any of the issues on their merits after hearing evidence. In my judgment, however, that does not affect the situation and unfortunately for the Claimant I have come to the conclusion and claim it was res judicata and cannot proceed, it is therefore dismissed."

16. In coming to that conclusion it seems to me that the Chairman was in error. He appears to have taken the view that it was obligatory for the Claimant to have brought all matters before the Tribunal in one set of proceedings. He rightly, in my view, accepted that she could not amend the existing proceedings to include a claim arising after the issues of those proceedings or unfair dismissal. He then postulates that what she should have done was simply to have issued other proceedings rather than withdrawing the first proceedings and sought to have had the two tried together. He says that she could have done that and should have done that but because she did not, therefore, her first set of proceedings having been dismissed she is subject to the doctrine of res judicata.
17. That approach in my judgment does not accord with the approach required as the result of the Court of Appeal of the House of Lords decision in Johnson v Gore Wood or the subsequent Court of Appeal decision in Divine-Bortey. The exercise now is that one must ask whether in all circumstances a party's conduct is an abuse and one must approach the matter by making a broad merits based judgment, taking account of the public and private interest involved, with all the facts of the case, focusing "attention on the crucial question whether in all the circumstances a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before". In my judgment, had the Chairman had the benefit of those authorities cited to him, he would not have come to the conclusion to which he did come. It is clear that the first claim was withdrawn in circumstances where the second claim was contemplated. Furthermore it is clear that the County Council, was well aware that a claim such as the second claim was indeed contemplated. There has been no determination on the merits one way or the other. The difference between what the Chairman suggests should have been done and what was done is minimal. If instead of withdrawing it and not opposing dismissal of her first claim, she had written and said "I have issued my second claim", or "I am issuing my second claim, please allow me to put them together", there would have been no more hearings and there would have been minimally different paperwork.
18. In my judgment it cannot be said to be in accordance with the general merits of the case that because of what is at worst no more than a procedural slip-up the Claimant should be deprived of her opportunity of putting her substantive claim. There is no injustice, it seems to me, to the Respondent, who has anticipated this claim. There has been no evidence adduced as to any prejudice that would be suffered by the Respondent as a result of the course matters have taken rather than taken the marginally different course that, in the Chairman's view, they should have done. I can infer that there has been certain limited costs incurred but nothing beyond that.
19. In all circumstances I take the view that the appeal should be allowed and be remitted to the Employment Tribunal to be dealt with on its merits. I should make it clear that I have heard nothing about the merits. I am not for a moment suggesting that when the matter is returned to be dealt with on its merits the Claimant has any great prospect of success. I simply do not know. She may succeed but equally she may fail dismally before the Employment Tribunal when the matter is dealt with on the merits.