United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MS A BROWN (of Counsel) Instructed by: Messrs Russell Jones & Walker Solicitors Landore Court 51 Charles Street Cardiff CF10 2GD
For the Respondent	MR J HOLL-ALLEN (of Counsel) Instructed by: Gwent Police Professional Standards Dept Block C Caerleon House Mamhilad Park Estate Pontypool NP4 0XF


 


SUMMARY

PRACTICE AND PROCEDURE

Amendment

The Employment Judge erred in failing to construe the Respondent's response as a blanket admission of the Claimant's claims. His secondary judgment that, if wrong, he would allow the response to be amended to withdraw most of the admissions was nevertheless correct. CPR PD14 applied since Employment Tribunal Rules are silent on withdrawal of admissions. It would be exceptional to remove a dispute about discrimination or, effectively, to strike out a response, by forming a view as to its merits at an interim stage.


 


HIS HONOUR JUDGE McMULLEN QC

1. This appeal is about case management of an application by a Respondent to amend a response, effectively to withdraw admissions. I will refer to the parties as the Claimant and the Respondent.

Introduction

2. Since this case is not near a hearing, as will become clear, I need say little about the circumstances. The appeal is against a judgment of Employment Judge Cadney sitting alone at a PHR at Cardiff with written reasons sent on 2 April 2009 (the Cadney judgment). Prior to the Cadney judgment, there had been three interventions by procedural judges to manage the Claimant's case.
3. The Respondent is represented today by Mr Holl-Allen but by different counsel below; the Claimant by Ms Althea Brown. The Claimant makes a substantial number of claims under the Sex Discrimination Act 1975, taking various forms: direct, indirect, harassment and victimisation. The response of the Respondent requires further attention.
4. The essential issue for the Cadney hearing was to decide whether an amendment could be made by the Respondent of some 16 pages of additional contentions to combat the Claimant's claim. Employment Judge Cadney allowed the Respondent to do that. The Claimant appeals. Directions sending this to a full hearing were given by HHJ Peter Clark, expedited because he was told that a substantive hearing of the case was due from 5-15 October at Cardiff. He did not, in his sift notes, give any opinion as to the strength of the case on appeal, and it seems to me that he was focusing upon the importance of resolving the procedural issue whilst hanging onto the trial date.

The legislation

5. The substantive legislation is not of concern today. The power to conduct a PHR is provided for by rule 18 of the 2004 rules. The approach to be taken is likely to be assisted by the approach to the withdrawal of admissions under the CPR part 14 and practice directions thereunder. It is also clear that an Employment Tribunal has power to make an order revoking a previous order but that usually require a significant change of circumstances, see Goldman Sachs Services Limited v Montali [2001] UKEAT/1203/01.

The facts

6. The Claimant had been engaged as a police officer by the Chief Constable in 1997, and in 2004 had lodged claims of sex discrimination, by both a grievance and Tribunal proceedings. In 2006, following a posting to Blackwood Police Station, there is in her allegations a recrudescence of her complaints of sex discrimination and the complaint of victimisation for having made the earlier complaint.
7. Broadly speaking, she complains of six specific instances, each of which constitutes direct and indirect sex discrimination and instances of victimisation and of harassment on the grounds of her sex or having made a protected act, that is the making of complaints against the Chief Constable. The Claimant also pulls together a number of the events, saying that the environment in which she worked cast her as a troublemaker. All of the matters constituted less favourable treatment and, if not individually, they were instances of a regime or state of affairs in which she was required to work. This is a continuing act or a continuing series of acts so that the Tribunal has jurisdiction long after the normal three-month limitation period to deal with her claim. She seeks a declaration, compensation for her injured feelings and the right to request the Tribunal to make recommendations that the Respondent take action to obviate discriminatory acts in the future. In numerous places in her claim, she uses the word "treatment" as does the response.
8. The claim was submitted on 29 August 2006. More than a year later, on 5 October 2007, the Respondent filed his response. It seems to me that the delay between the two has been caused by agreed extensions so that some form of mediation and medical examination could be conducted to resolve the dispute. When the response came, it was in this form.

"5.1 Do you resist the claim?

If 'No', please now go straight to section 6. Yes No ["No" is marked]

5.2 If 'Yes', please set out in full the grounds on which you resist the claim.

Gwent Police admit that the applicant has received inappropriate treatment, the detail of which is subject of an investigation by Gwent Police Professional Standards Dept. Managed by the Independent Police Complaints Commission. This investigation is sub-judice as both criminal and misconduct matters are being considered and we are awaiting the outcome."

9. I was not referred in detail to box 6.1 but in this there is an indication of the legal representatives working together and that the parties had agreed that the Tribunal would be asked to stay the proceedings pending agreement and quantification of compensation. There is a further reference to the Professional Standards Department under the supervision of the IPCC.
10. The Claimant agreed to be examined by Dr Vivian for the purposes of possible early retirement or some other solution. It was Dr Vivian's opinion that, although the Claimant was not eligible for medical retirement, there should be some way in which the parties should separate.
11. On 9 April 2008, the Respondent raised for the first time the possibility of an amendment to the response so as to fully articulate the nature of the allegations and the defence. The Claimant objected. By this time, Dr Vivian had made his report known to the parties, and they had discussed this with their legal advisers. It was plain that there was a causal connection in the minds of the Claimant and Dr Vivian between the delay in addressing significant issues in the Claimant's claim and her history, and there were allegations of breach of the duty of care.

The Williams Order

12. The first intervention by the Tribunal formally occurred on 22 May 2008 when Employment Judge Williams at a CMD where the Claimant and the Respondent were represented recorded the following by letter of 27 May 2008.

"2. There have been protracted discussions between the parties which, however, have not resulted in a complete resolution of all matters. It is admitted by the Respondent that the Claimant was subjected to sex discrimination for which the Respondent is liable to pay compensation to her. It is agreed that the appropriate course is to list the matter for a remedy hearing."

13. The significant event that occurred between that date and the hearing listed for 28 July 2008 was that the Claimant resigned by letter of 2 July 2008. In the light of that, the Respondent sought some further directions, which were refused by the Employment Tribunal. The Respondent indicated that a number of factual matters would require to be addressed by the Claimant in the light of the new situation caused by her resignation. The Claimant was unwilling to allow the hearing to be postponed, and a refusal was sent on 10 July.

The first Lloyd Order

14. That opened the way for the hearing before Employment Judge Lloyd, the first of two. Directions were given in which he summarised the position in this way:

"(a) The Respondent has liberty to further particularise the admission of liability set out in the ET3, but not to retract from such admission. The Respondent will serve such particulars within 35 days and will give relevant associated disclosure."

15. The 16-page amended ET3 was served by the Respondent on 1 September 2008. Immediately it was suggested by the Claimant that this was going beyond the scope of the order made by Employment Judge Williams and the reservation made by Employment Judge Lloyd.

The second Lloyd Order

16. This matter could not be resolved, and it was indicated that there would be a further CMD so that Employment Judge Lloyd again descended upon the matter on 15 January 2009. Following submissions by both the parties represented he said this:

"(d) The Respondent's application for leave will be the sole issue for determination by Judge sitting alone at the PHR/CMD directed at (b) above and the corollary of that determination will be the nature and the duration of the full hearing; that is whether the hearing will be as to remedy alone or whether liability issues will fall to be determined, subject to evidence. Employment Judges S Williams and B Lloyd will not be allocated to the PHR/CMD or to any further hearing of these proceedings. It is considered that the application for leave should be heard by a Judge who has not had to consider the issue of the Respondents alleged admission and alleged retraction of any such admission. The Respondent's application to consolidate cases 1601976/2006 and 1606351/2008 shall be determined only if appropriate in the light of the determination of the request for leave to amend the ET3."

17. He recused himself and Employment Judge Williams so the matter fell to Employment Judge Cadney to determine.

The Cadney Judgment

18. Employment Judge Cadney had to decide two principal submissions at the instance of the Respondent. Evidence was called (as is permitted by the rules at a PHR). Unusually, evidence was called as to what each party intended by what they had written. Further, it was unusual because the application was made by the Respondent for declarations as to his right to make the amendments. The first declaration sought was that the amended response was served in accordance with the orders of Employment Judge Lloyd made on 28 July, and that the Respondent was not required to obtain permission. The second declaration was that, if it was outside the scope of earlier rulings, discretion should be exercised effectively to allow the amendment and withdraw the admission. The Judge decided in favour of the Respondent's application on both points, the second in order that, if he were wrong on the first, his reasons would be clear.
19. The Judge approached the first ground by considering that there was not a blanket acceptance by the Respondent of liability for all of the acts claimed by the Claimant in her claim form. The Judge was taken to issues relating to the power of a judge to vary the order of a previous judge. See Goldman Sachs (above). He held that there had been a change of circumstances such as to allow Employment Judge Lloyd to make the order he did. In other words, the first Lloyd order was "valid" as it was put. The second application for the purposes of deciding this issue if the Judge were wrong was also in favour of the Respondent for the Judge addressed what he described as the legal authorities on principles put to him by both Counsel.
20. Very serious criticisms were made of the Respondent for its delay. The principal excuse advanced was that, as had been foreshadowed in the original response, matters were being investigated by the regulators, and it was not sufficiently clear to the Respondent until the ET1 was amended that he was free to make the admission. The Judge held that, by at least February 2008, the investigation by the regulators had been completed and there was no link between the allegations made by the Claimant, including those against certain officers, and the subject of the investigation, also in part against certain of these officers. Although there is actually a link between the investigation and one of the Claimant's claims in respect of one officer, that is the subject of the unchanged formal admission made by the Respondent in respect of that claim. So, it is true to say that there is no practical link.
21. Nevertheless, the Judge upheld the Respondent's position that he did believe when the response was put in on 5 October 2007 that the regulators' investigation may have had some effect on the documents in this case. Dealing with the alternative application, the Judge looked at various matters including the respective prejudice to the Claimant and the Respondent of making any amendment, and held as follows:

"48. To be set against that is the prejudice to the Respondent if the amendment is not allowed. That prejudice is very significant in my judgement. Firstly, the Respondent is a public body and has an interest in securing its reputation with the public. If it has genuinely discriminated against Officers, then that is a matter which it obviously in the public interest should be known. If however, there is dispute as to whether it has discriminated or the extent of any such discrimination, that is a matter in my view, in which for the same reason there is a considerable public interest in being resolved by the Tribunal. Secondly, the claim is a very substantial one financially. There is no prospect of making any claim in negligence against its employed legal advisors, and so irrespective of whose fault it was the loss will be borne by the Force itself.

49. Accordingly, in my judgement, sympathetic as I am to [the] Claimant, it does appear to me that the balance of prejudice in this case comes down heavily in favour of the Respondent and I would have allowed the amendment, had I not come to the earlier decision."

The Claimant's case

22. On behalf of the Claimant, it is submitted that the first Lloyd order was ultra vires, that is he had no power to make it. There had been an unequivocal admission of liability, which the Respondent should not be allowed to be released from. Secondly, in respect of the auxiliary ground, the Judge was also wrong for he failed correctly to analyse the respective prejudice and, in any event, failed to take account of what may be described as the merits of the case.

The Respondent's case

23. On behalf of the Respondent, it is contended that the issue as to the vires of the Lloyd order is not a live issue on appeal. In any event, the Respondent had not made a blanket but only a qualified admission, leaving further particularisation open to him. The Judge was correct in his analysis of the language of the response and in the exercise of discretion.

The legal principles

24. The legal principles to be applied in this case arise, first, from my approach endorsed by the Court of Appeal in the CIBC v Beck [2009] IRLR 740, which indicates that the exercise of discretion by an employment judge on case management is not likely to be overturned on appeal provided the judge has considered the relevant factors and no irrelevant factors. A judge in an Employment Tribunal may vary the order of a previous judge if circumstances have changed (see Goldman Sachs). On interim applications, there is no dispute that the approach of the Employment Tribunals should be assisted where the ET rules are silent, as they are on admissions, by CPR14 and in particular by the judgment of Sumner J in Braybrook v Basildon & Thurrock University NHS Trust [2004] EWHC 3436 (QB). There the judge said the following:

"From these cases and the CPR I draw the following principles.

(1) In exercising its discretion the court will consider all the circumstances of the case and seek to give effect to the overriding objective;

(2) Amongst the matters to be considered will be:

(a) the reasons and justification for the application which must be made in good faith;

(b) the balance of prejudice to the parties;

(c) whether any party has been the author of any prejudice they may suffer;

(d) the prospects of success of any issue arising from the withdrawal of any admission;

(e) the public interest, in avoiding where possible satellite litigation, disproportionate use of court resources and the impact of any strategic manoeuvring;

(3) The nearer any application is to a final hearing the less chance of success it will have even if the party making the application can establish clear prejudice. This may be decisive if the application is shortly before the hearing."

25. That is a direct application of CPR14 Practice Direction par 7.2, which is as follows:

"In deciding whether to give permission for an admission to be withdrawn, the court will have regard to all the circumstances of the case, including:

(a) the grounds upon which the applicant seeks to withdraw the admission including whether or not new evidence has come to light which was not available at the time that the admission was made;

(b) the conduct of the parties, including any conduct which led the party making the admission to do so;

(c) the prejudice which may be caused to any person if the admission is withdrawn;

(d) the prejudice which may be caused to any person if the application is refused;

(e) the stage in proceedings at which the application to withdraw is made, in particular in relation to the date or period fixed for trial;

(f) the prospects of success (if the admission is withdrawn) of the claim or part of the claim in relation to which the offer was made; and

(g) the interests of the administration of justice."

Discussion and conclusions

26. Although this case involved oral evidence about what the Chief Constable meant to say in his response, it appears to me that the first place to look to find the meaning and intention of the Respondent is the response signed on his behalf. This document, in my judgment, is an admission of all of the "treatment" the Claimant says in her claim she received. It is accepted by the Respondent that that is inappropriate conduct. In the context of her claims it must mean inappropriate sex discrimination. The problem arises in the construction of the response form. The Respondent here said he did not resist the claim and, therefore, should not have said anything else and gone straight to box 6. However, he said what is contained in box 5.2. I do not accept that the construction of this passage is anything other than an admission of the matters the Claimant put against the Respondent. The detail may be relevant to the compensation awarded, and that is clear because the answer to box 6.1 does deal with agreement and quantification of compensation.
27. The Respondent indicated that he knew about the power of a Tribunal to stay any proceedings. He might have asked for a stay in his answer to box 5 at the same time but he did not. What this paragraph does is to indicate that other matters are being considered which might have a bearing upon the Claimant's claim but, irrespective of that, the claim is admitted. That has substantial advantages for the Claimant for at once she could see that she was not in for a fight on a number of the controversial issues that she had raised as a matter of fact or law. That approach was accepted by Employment Judge Williams. He noted, as I have cited in paragraph 2 of his order, what the impact of it was, and the remedy hearing was set up. However, at that aborted remedy hearing, which became, effectively, a CMD with the remedy being adjourned, permission was further given to particularise the admission but not to retract it. There is no lack of power for the first Lloyd order. The remedy hearing had been adjourned; that is all. There would be no need for him to order further particularisation of the admission if it were not to deal with certain aspects of the admission.
28. The Respondent then submitted the 16-page document. I hold that this is a retraction from the blanket admission. Only two parts of the Claimant's claim are now admitted as being sex discrimination. A new point on limitation is taken against her and, as I analyse the Claimant's case, some 40 claims are running of which she is the beneficiary of an admission in respect of only two. This may seem rather a detailed analysis but each claim is on its own a claim of direct and indirect discrimination and an instance of victimisation and or harassment. Whether or not found as an act of discrimination under the Act or a contribution to the overall state of affairs, the Claimant is now facing a fight on almost the whole of her claim.
29. The question was plainly not beyond controversy for, once the amendment was set out for the first time and sent on 1 September 2008, it was decided that there should be a decision on this, and that was the subject of the second Lloyd order. It is clear that the Judge did not regard it as beyond his powers to order that this matter be the subject of a formal judgment. It has to be said that there was no appeal against any of the three orders. I think that the ambiguity that may have been left by the nature of the orders and the Respondent's approach to the admission was correctly diagnosed as fit for a PHR, which in due course occurred.

Ground 1

30. As a matter of construction, the Respondent did admit the Claimant's case. The Judge's approach to this is incorrect. He was much assisted by the evidence of the Chief Constable. I do not consider much assistance would be given by the officer giving oral evidence about what he thought he could admit. The Judge also focused upon the need to find a material change of circumstances under Goldman Sachs, and that was identified as being the resignation. But, since the further particularisation of the Respondent's answer is not a retraction in whole, the Judge approached this matter incorrectly. He set out three propositions (see paragraph 38), and he appeared to be much exercised by the correct interpretation of the order.
31. As I have indicated, the Respondent has, by his amendment, sought to be released from its blanket admission of sex discriminatory treatment of the Claimant. When it was put to the Judge, it was put in terms of procedure but, since I hold that there was no barrier to the Respondent responding in the way he did, there was no lack of power when Employment Judge Lloyd dealt with the matter. Employment Judge Cadney, in my opinion, was wrong in not recognising what the nature of the admission was and was wrong in considering that it was necessary for there to be a material change of circumstances. There was not. The resignation had been foreshadowed through the report of Dr Vivian, or at least the parting of the ways between the parties in this case, and, while it would have a significant effect on quantum, was not a necessary trigger for the purposes of revoking an order by a previous judge.

Ground 2

32. Fortunately, however, the Judge considered the secondary position, which is that, if he were wrong about the first, what should he do about a straightforward application to revoke an admission? On this, the language of Sumner J is important, and so is the holding by Peter Gibson LJ in Cobbold v London Borough of Greenwich [1999] EWCA Civ 2074, when he said this:

"The overriding objective (of the CPR) is that the court should deal with cases justly. That includes, so far as is practicable, ensuring that each case is dealt with not only expeditiously, but also fairly. Amendments in general ought to be allowed so that the real dispute between the parties can be adjudicated upon provided that the prejudice to any party caused by the amendment can be compensated for in costs, and the public interest in the administration of justice is not significantly harmed."

33. Employment Judge Cadney has plainly gone through a check list, as he was asked to do, of the matters canvassed by Sumner J. If a judge does that, it is most unlikely that there will be a reversal of the exercise of discretion on appeal. He certainly weighs up the balance of prejudice and makes condigne criticisms of the Respondent's conduct in delay. No suggestion is made by the Claimant as to any lack of cogency of the evidence she will bring as affecting a fair trial although it has to be said that there is bound to be some given it will now be tried some four years after the relevant events.
34. The justification for the application seems to me to be originally the resignation of the Claimant. But, since the Judge accepted that in the mind of the Respondent was the ongoing regulator's report, that too could be considered amongst the matters where the court will consider all the circumstances. There has been no relevant allegation of lack of good faith or manipulation for the purposes of strategic manoeuvring. The Judge paid attention to the prejudice to the Respondent in putting forward a case when the reputation of himself and officers is clearly at stake. He also considered the claim was very substantial, and there was no claim to be made against employed internal lawyers.
35. An important issue, in my judgment, has to be the prospects of success of any issue arising from the withdrawal of an admission. The Judge does not expressly enter upon that but, in a discrimination claim as is made clear by in Hendricks v Commissioner for the Police Metropolis [2003] IRLR 96 CA and in Anyanwu v South Bank University [2001] IRLR 305 HL, discrimination claims cry out for trial and are not readily to be decided on what is equivalent to a strikeout. The Judge could not assess the prospects of success of the Claimant's claim once the Respondent was released from its admission. I agree that the prospects of success envisaged by Sumner J involve a consideration of the Claimant's claim and the likely response. But these are pre-eminently fact-sensitive issues for trial, and ought not to weigh with overwhelming force in an application such as this. It is implicit in the first aspect of prejudice identified by Employment Judge Cadney that the Respondent has an interest in defending himself. I would not elevate it in terms of public interest for I accept Ms Brown's submission that the Respondent is simply a party to a sex discrimination claim. What the Judge was indicating was that there ought to be an opportunity for the ventilation of the Respondent's defence and, thus, trial of the Claimant's claim. if the Claimant is likely to win, that would weigh against release from the admission, but that cannot be said of the 40 claims here.
36. As to substantial financial effect, in Leicestershire County Council v Unison [2005] IRLR 920 EAT, the Court of Appeal, when considering the exercise of the EAT of discretion on whether to allow a new point to be raised, held that the financial value of the claim was irrelevant. Those guidelines were approved by the House of Lords in Celtec & Ors v Astley [2006] ICR 992. As to the claim in negligence not being exigible, that is possibly a reflection on Sumner J's imprecation against satellite litigation. It seems to me neutral, actually, because there would be no satellite litigation in this case and, although it is generally a feature that one cannot pray in aid a claim against the insurers (see Euro Hotels (Thornton Heath) Ltd v Alam UKEAT/0006/09/DM), the absence of a claim may be relevant. I take it no further than that since it is not an issue in this case.
37. The Judge regarded himself as very sympathetic to the Claimant but, on balance, came down in favour of allowing the amendment. As I have indicated, it would be unusual on appeal, unless we detected something wrong in principle, for us to overturn the exercise of discretion by the Judge. I have been able to disagree on legal grounds with the Judge on his first finding since that seemed to me to be a matter of construction. But it is in the public interest that discrimination claims are heard and not disposed of at a PHR. The application to amend puts in issue the Claimant's case on a very substantial number of grounds and, just as the cases that I have cited are primarily of strikeouts of claimants' cases, the rule should apply equally to respondents; that is, they have a case to make in response to a discrimination claim, and should not be shut out at an interim stage. I also bear in mind that, although the law on setting aside admissions as contained in my judgment in Secretary of State v Rance [2007] IRLR 665 makes clear that it is going to be exceptional, the stage at which an admission or concession is sought to be withdrawn is important. This is in advance of any hearing. There has been no hearing of the merits of this case.
38. I add these two further observations whilst upholding the Judge's judgment overall. By making this application, the Respondent has, effectively, put the bulk of the Claimant's case in issue. He has done so with his eyes wide open in the light of the medical evidence, which shows the effect on this police officer of these proceedings and the delays that have occurred. No doubt, that will be a matter to be considered by him and possibly by any Tribunal at some stage in the future.
39. The second is that, given that there are now further proceedings brought by the Claimant in respect of her resignation, and there will be an application to bolt those to this, there should be some conciliation. [Directions given].