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United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Arriva London North Ltd v Maseya (Practice and Procedure: Striking-out/dismissal) [2016] UKEAT 0096_16_1207 (12 July 2016)
URL: http://www.bailii.org/uk/cases/UKEAT/2016/0096_16_1207.html
Cite as: [2016] UKEAT 96_16_1207, [2016] UKEAT 0096_16_1207
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EMPLOYMENT APPEAL TRIBUNAL
FLEETBANK HOUSE, 2-6 SALISBURY SQUARE, LONDON EC4Y 8AE
At the Tribunal
Before
THE HONOURABLE MRS JUSTICE SIMLER DBE (PRESIDENT)
(SITTING ALONE)
ARRIVA LONDON NORTH LIMITED APPELLANT
Transcript of Proceedings
JUDGMENT
APPEARANCES
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(of Counsel) Instructed by: Hewitson Moorhead Kildare House 3 Dorset Rise London EC4Y 8EN
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(of Counsel) Instructed by: Ashfords LLP Tower Wharf Cheese Lane Bristol BS2 0JJ
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SUMMARY
PRACTICE AND PROCEDURE - Striking-out/dismissal
1. The Employment Tribunal found that the manner in which the proceedings were conducted by the Respondent was scandalous and unreasonable on the basis that the Respondent pursued a “false defence” to the unlawful disability discrimination claim and failed to comply with its duty of disclosure, despite being represented throughout. The Tribunal struck out the Respondent’s defence and gave judgment in favour of the Claimant.
2. The Tribunal’s conclusion that the Respondent put forward a false defence was based on a fundamental misunderstanding of the case and was reached without any consideration of the Claimant’s pleaded case. In fact, the clarification or amendment sought by the Respondent to its case was to bring it in line with the case advanced throughout by the Claimant. Moreover, there was no basis for a conclusion that there had been any deliberate non-disclosure of relevant documents.
3. To the extent that the Tribunal addressed the question whether a fair trial remained possible, its conclusion that a fair trial was no longer possible was based on the fundamental misunderstanding of the case. The clarification of the response considered necessary by the Respondent and/or the Tribunal was not capable of being viewed as significantly different. Nor was an adjournment inevitable. Had the Tribunal understood and identified the PCP relied on by the Claimant, it would inevitably have concluded that the amendment, whilst obviously relevant, was capable of being dealt with by the Claimant given that it coincided exactly with the Claimant’s own case. Further, there was no reason why disclosure could not be dealt with there and then; and in the absence of exploring this avenue as an alternative to the draconian sanction of a strike out the Tribunal was not entitled to conclude that a fair trial was no longer possible.
4. The Tribunal did not address the proportionality of the sanction of strike out in any event. This was an error of law. The deficiency in the pleading was capable of being rectified and the missing document capable of prompt reduction. This was not a case where the consequences of the Respondent’s failings were not capable of being remedied. Strike out was a disproportionate sanction in this case.
5. The appeal was accordingly allowed and the Tribunal’s decision on liability, remedy and the costs awarded against the Respondent all set aside.
THE HONOURABLE MRS JUSTICE SIMLER DBE (PRESIDENT)
1. This is an appeal from a Judgment of Employment Judge Mahoney sitting with members Mrs Cheetham and Mrs Sood with Reasons promulgated on 9 November 2015. The Employment Tribunal struck out the response, the ET3 in this case, under Rule 37 of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013, on the express grounds that it was scandalous, vexatious and had no reasonable prospect of success; in other words, in reliance on Rule 37(1)(a). Having done so, the Tribunal proceeded to deal with remedy in relation to complaints of unlawful indirect discrimination on the grounds of disability and failure to make reasonable adjustments, treated as made out in the absence of any defence, and awarding compensation in the total sum of a little over £11,000 together with costs in the total sum of a little over £12,000.
2. After permission to appeal was granted in the Appeal Tribunal and in response to correspondence from the parties by letter dated 19 May 2016 the Employment Judge directed that paragraph 1 of the Judgment be corrected to read:
“The response was struck out because the manner in which these proceedings have been conducted by the respondent has been scandalous and unreasonable.”
In other words, the Employment Tribunal relied on Rule 37(1)(b) as the basis for the strike out decision.
3. For ease of reference, I refer to the parties as they were before the Tribunal. The Respondent, whose appeal it is, is represented by Mr Russell Bailey of counsel. The Claimant resists the appeal and appears by Mr Thomas O’Donohoe of counsel. Mr O’Donohoe appeared below, but Mr Bailey did not.
4. The nature of the claim and its procedural history can be summarised as follows. The Claimant is a qualified engineer. He is disabled within the meaning of the Equality Act 2010 by virtue of the fact that he has monocular vision. In October 2014 he applied for the role of a PSV fitter with the Respondent through a recruitment agency. The agency refused to forward his application to the Respondent on the express basis that he did not have a PCV licence or the potential to obtain such a licence once employed. That was communicated to him in writing by an email dated 27 October 2014, timed at 3.20pm, by Mr Sam Birtwistle of the recruitment agency, and it was repeated to him in a telephone call.
5. The Claimant pursued unlawful disability discrimination proceedings in the Employment Tribunal. His claim form identified the criterion relied on by the Respondent as being “the ability to hold a PCV licence”, and he alleged that this criterion was relied on in rejecting his application (see paragraphs 7 and 8). At paragraph 11 he alleged that the requirement that all fitters have a PCV or HGV licence amounted to a PCP that indirectly discriminated against the Claimant, putting him and others with his disability at a substantial disadvantage because they were prevented from applying for this role. He challenged the treatment as unlawful disability discrimination and made clear subsequently that he was also relying on a failure to make reasonable adjustments.
6. The Respondent’s ET3 contended, among other things, that all employees carrying out the role for which the Claimant applied were required to hold a PCV licence as an intrinsic element of the role. The Respondent contended that his requirement was to enable fitters to undertake road testing of vehicles following repairs and to respond to breakdowns where engineers are often required to take a substitute bus from the garage, to meet a non-working bus on the bus route or to swap vehicles over and return non-working buses to the garage. The Respondent contended that the Claimant was treated in the same way as other non-disabled people without PCV licences were or would have been treated and argued that the PCP was in any event a proportionate means of achieving a legitimate aim.
7. The claim form having been presented on 12 February 2015 and the ET3 on 16 March 2015, there was a case management discussion held on 14 April 2015. That case management hearing led to the identification of the issues, and in particular the PCP was identified at that case management hearing as a PCP for all fitters to have a PCV or HGV licence. The Tribunal made a standard civil procedure based Order for mutual disclosure of documents relevant to the issues identified. The Tribunal also made the usual Orders in relation to bundles of documents for the hearing and to the exchange of witness statements. A Full Hearing was listed for two days on 30 and 31 July 2015.
8. It is common ground that both the Claimant’s witness statement and the contemporaneous correspondence between the Respondent’s recruitment agent and the Claimant made clear that the requirement or condition communicated to the Claimant as the reason for rejecting his application was a requirement to hold or to be able to hold a commercial vehicle driving licence; in other words, the wider rather than the narrower PCP. At paragraph 23 of his witness statement the Claimant said expressly that:
“23. … It was [a] requirement or condition to have [the] ability to hold or hold commercial vehicle driving entitlement. …”
9. At paragraph 27 he asserted that that wider PCP was applied to him by the Respondent, and at paragraph 34 he again referred to his understanding that the agent and the Respondent would not recruit anyone “without the ability to hold or holding a PCV licence”.
10. The matter came before the Employment Tribunal on 30 July, and the Tribunal recorded the fact that (having read the documents and evidence in the case before the hearing commenced) confirmation from the Respondent’s representative, Mr Huggett, a legal executive, was sought that all engineers employed by the Respondent on the date of the alleged discriminatory act were in fact holders of PCV licences. The Respondent was not able to give that confirmation and accepted that it employed some engineers who did not have a PCV licence. At paragraph 3 Mr O’Donohoe is recorded as submitting that he “had no idea this was the position”. That is rather surprising, since it was implicit from the contemporaneous documents and his own lay client’s witness statement that there would from time to time at least, be engineers without such a licence but who had the ability to obtain such a licence, as the Claimant had accepted.
11. The Tribunal considered whether this was a serious failure of disclosure by the Respondent that had materially prejudiced the Claimant. Mr O’Donohoe conceded before me that this was not a matter that could have materially prejudiced the Claimant in circumstances where this was the Claimant’s own case and the Respondent was merely bringing itself into line with the Claimant’s own case. Having found that the Respondent’s pleaded case was different from the case now being advanced and that none of the documents (identified at paragraphs 11 to 13 by the Tribunal) supported the wider PCP, at paragraph 14 the Tribunal referred to the fact that the Respondent was now saying that it did have engineers without licences and had a document setting out a list of engineers without PCV licences who were not allowed to drive buses but this document had not been disclosed. The Tribunal then posed for itself at paragraph 15 the question whether the material failure to disclose the document just referred to prejudiced the Claimant to such an extent that in the interests of justice it would not be right to allow the case to proceed. In reaching the conclusion that was the position and that the ET3 should be struck out, the Tribunal gave the following reasons:
“16. The tribunal was also aware that the Court of Appeal’s decision in Chapman v Simon [[1994] IRLR 124] made it quite clear that the tribunal could only deal with matters set out in the claim or response and nowhere in the response or in the witness statements for the respondent was it suggested that the requirement was only that an individual would have the potential to get a PCV licence once employed.
17. The respondent then suggested that there should be an amendment to the response and an adjournment for the respondent to be allowed to change their response to this claim.
18. The relevant Rule is set out at Rule 37 of the Employment Tribunals Rules of Procedure 2013 which states in sub rule 1:
“At any stage of the proceedings, either on its own initiative or on the application of a party, the tribunal may strike out all or part of a claim or response on any of the following grounds -
…
(b) that the manner in which the proceedings have been conducted by or on behalf of the claimant or the respondent (as the case may be) has been scandalous, unreasonable or vexatious.”
19. The view that the tribunal takes is that there should be a strike out in this case because the manner in which these proceedings have been conducted by the respondent has been scandalous and unreasonable.
20. The respondent has put forward what Mr Donohoe, on behalf of the claimant, has asserted is a false defence. That is a submission that the tribunal agrees with. It is not, in our view, fair, just or reasonable to allow the claimant to have to face a further amended defence when the respondent who has been represented throughout has failed to comply with its duty of disclosure and has put forward a false defence. So, in those circumstances, we take the unusual course of striking out this response.”
The Appeal
12. Against that background I turn to address the appeal. The essential issue raised by the appeal is whether the Employment Tribunal erred in law in striking out the Respondent’s ET3 and preventing the Respondent from defending this claim on its merits. Seven different arguments were originally advanced in support of the conclusion that there was such an error. Not all are pursued. They are as follows:
(i) there was a fundamental misunderstanding of the case and the Tribunal wrongly proceeded on the basis that the response was false and the Respondent’s behaviour in failing to disclose the list of engineers without PCV licences was culpable;
(ii) the Tribunal erred in law in relying on the principle in Chapman v Simon [1994] IRLR 124 CA;
(iii) the Tribunal wrongly concluded that the Claimant would suffer prejudice if required to face a further amended defence;
(iv) this is not pursued, as it has resulted in a correction;
(v) the Tribunal failed to apply the principles set out in Blockbuster Entertainment Ltd v James [2006] IRLR 630 CA and Bolch v Chipman [2004] IRLR 140 EAT in that a fair trial was possible and a strike out order was disproportionate;
(vi) this was not pursued in light of the Tribunal’s correction;
(vii) the decision to strike out the claim reflects a failure to understand the procedural history of the case and in particular that there had not previously been any amendment of the ET3.
13. Before addressing those grounds of appeal, it is necessary to deal with an application made by Mr O’Donohoe on the Claimant’s behalf seeking remission to the Employment Tribunal for the Tribunal to clarify, supplement or give additional reasons for its conclusions on four particular issues under what has become known as the Burns-Barke procedure (see Burns v Royal Mail Group plc [2004] ICR 1103 EAT and Barke v SEETEC Business Technology Centre Ltd [2005] ICR 1373 CA). The application was originally made at an earlier stage but was left to be dealt with today. It was renewed by Mr O’Donohoe but only after the substantive appeal had been fully argued. The Respondent resists it.
14. In brief, the matters that are, on Mr O’Donohoe’s submission, proper for a Burns-Barke reference because they are so plainly implicit in the Tribunal’s reasoning are the following four matters: first, that a fair trial was not regarded as possible at least without an adjournment because of the non-disclosure (see paragraph 15); secondly, that the Tribunal regarded it as proportionate to strike out the ET3 in view of the need for an amendment that would necessitate an adjournment (see paragraphs 14 and 20); thirdly, that the reference to Chapman was not material to the Tribunal’s view that a strike out was appropriate (see paragraph 16); and fourthly, that when the Tribunal referred to a “further amended defence” what it meant was a further, amended defence rather than a second attempt at amending the defence.
15. The power to make a reference back to a tribunal for clarification, supplementing or providing additional reasons for its conclusion on a particular issue is a discretionary power made in the exercise of the Appeal Tribunal’s case management functions. As the case of Barke itself makes clear, there are dangers inherent in the procedure, and in circumstances where the inadequacy of a tribunal’s reasoning is so fundamental that there is a real risk that supplementary reasons will be a reconstruction of proper reasons rather than the unexpressed actual reasons for the decision, the procedure ought not to be invoked. I have concluded that this case falls on the wrong side of the line and that it is inappropriate to invoke the Burns-Barke procedure here. Judged at this stage, if the Respondent is correct in its submission in relation to the errors of law identified, the Judgment falls into the “fundamentally flawed” category rather than the category of having inadequately articulated or overlooked giving reasons for a particular point.
16. I turn, therefore, to address the substantive appeal. For the reasons that follow, I do not consider it necessary to deal with each of the separate grounds relied on by the Respondent as errors of law, though I hope that most if not all will be encompassed in the two issues that seem to me to be the critical issues to be addressed. They are: first, whether the Tribunal was entitled to conclude that the Respondent put forward a false defence to the claim and was culpable in relation to non-disclosure of the document referred to; and secondly, even if entitled to reach those conclusions, whether the Tribunal erred in law in its conclusion that striking out was an appropriate sanction in this case.
17. On the first issue the Respondent contends that the conclusion that the defence that it had advanced was false and the non-disclosure culpable was based on a fundamental misunderstanding of the Respondent’s case and an erroneous interpretation of the principle established by Chapman. The Tribunal concluded at paragraph 10 that it was no part of the Respondent’s case that it was a requirement only that the individual had the potential to get a licence once employed. Although the ET3 proceeds on the basis of a PCP that all engineers must hold PCV licences and does not explain that some engineers are recruited with the potential to obtain such a licence, there was as a matter of fact ample material available to the Tribunal suggesting that the existence of such a licence or the ability to obtain one is what was required. Significantly, that was, as I have indicated, the Claimant’s own understanding, as pleaded in his ET1 and witness statement, and it was his understanding not only at the time of the hearing but at the time of the discriminatory treatment about which he complained.
18. Paragraph 11 of the Tribunal’s decision may be an indication that the Respondent’s response to the Tribunal’s question on the first morning was interpreted by the Tribunal as a concession that there was in fact no requirement to hold a PCV licence at all. That would make sense of the Tribunal’s reference at paragraph 11 to a number of contemporaneous documents that made no reference at all to the requirement of an engineer to have a PCV licence. It is also how the Tribunal recorded Mr Huggett’s response to the question that had been asked of him at paragraph 14. Against that, however, it is clear from paragraph 16 that the Tribunal understood the Respondent’s position to be more nuanced. The Tribunal record at paragraph 16 the fact that the Respondent was saying not simply that it would only employ engineers who held a PCV licence but would also employ those who had the potential to get a PCV licence once employed. In other words, the Respondent was advancing the same case as that advanced all along by the Claimant. The Tribunal did not, however, grasp that fact. It did not refer to the Claimant’s pleaded case, and nor did it refer to the witness statement on this particular point. Moreover, although Mr O’Donohoe confirmed during the course of this hearing that Mr Huggett referred to the contemporaneous email of 27 October and the transcript of the telephone call between the Claimant and the recruiting agent in which the wider PCP was confirmed, the Tribunal made no reference to these documents at all.
19. Once it is understood that the Respondent was not abandoning its case that engineers required PCV licences before obtaining employment but was making clear that this requirement remained a requirement but was capable of being fulfilled either before employment with the Respondent or once so employed, it is difficult to see how the Tribunal could have concluded that the Respondent put forward a false defence. Both parties before me accept that the reference to a false defence was to a defence that was deliberately intended or calculated to mislead. The failure of the ET3 to make clear that the wider rather than the narrower PCP was relied on was certainly capable of criticism. I have little doubt that it required clarification. There was, however, nothing to support a conclusion that the Respondent pursued a defence deliberately intended or calculated to mislead.
20. Mr O’Donohoe maintains that he was entitled to make the submission that the Respondent had pursued a false defence intended or calculated to mislead and, moreover, that the Tribunal was entitled to accept his submission. He submits that the discrepancy between the Respondent’s pleaded case as repeated in the witness statements and advanced on the basis of the narrow PCP, and the wider PCP advanced at the hearing was so marked that a proper explanation for the discrepancy was required. This, allied with the asserted failure to disclose the list of engineers employed notwithstanding the fact that they did not have licences, meant, in his submission, that Mr Huggett’s explanation that the discrepancy was explained by simple error was simply not credible.
21. I find that submission incomprehensible in circumstances where the Respondent was simply seeking to advance the same case as that which the Claimant had been advancing all along and which it had failed in error to make clear. It would have been different, and I would have understood the submission, if the Respondent had been found out as employing engineers without licences for the first time on the day of the hearing, having concealed that fact, and was seeking to explain that difficulty away with a new defence cobbled together at the eleventh hour. That was far from the case however. Nothing was hidden. The Claimant was not misled. The Respondent’s recruiter said at the outset what the requirement was and made clear that the wider PCP was applied. There is little doubt that this was understood by the Claimant. It was pleaded by him in his ET1. It was reflected in his witness statement. He was in no doubt about it, and his understanding was supported by the contemporaneous documents. It is only once the Tribunal properly understood the issues in the case that it could have put itself in a position to understand the extent and nature of the change or qualification being sought by the Respondent to its defence and the extent to which that change would or might prejudice the Claimant. Had the Tribunal considered and properly identified the PCP relied on by the Claimant as applied to him by the Respondent and its recruiter, and considered his witness statement and contemporaneous documents that supported his case, it would have been apparent that the failure in the Respondent’s pleading could not have been described as deliberately intended or calculated to mislead. The Respondent was bringing its pleading into line with the case advanced and understood by the Claimant.
22. It seems to me that the Tribunal fundamentally misunderstood the case before it and failed to have regard to the Claimant’s own case, having failed to make any reference to it or to his witness statement and the contemporaneous documents. There was no proper basis for the conclusion that the response pursued by the Respondent was false, still less that it had been advanced deliberately to mislead or in a way that was calculated to mislead. Mr O’Donohoe realistically accepts that there was no prejudice to the Claimant in the identification of the fact that some engineers were not in fact holders of PCV licences, because this was necessarily implicit in the wider PCP as pleaded and by reference to the contemporaneous documents. The Tribunal failed to appreciate this, and for all these reasons the Tribunal’s conclusions that the pursuit of a false defence and the serious failure to disclose the fact that engineers without licences had been employed, materially prejudiced the Claimant were flawed.
23. Moreover, once it is accepted that the failure to plead the wider PCP was an error, and there was no misleading or deliberate conduct on the part of the Respondent, it is difficult to see how the failure to disclose the document identified by the Tribunal can be regarded as deliberate or wilful. Indeed, during the course of the hearing Mr O’Donohoe conceded that this was not the case and could not be inferred from the Tribunal’s Reasons as forming part of its finding.
24. So far as the Chapman point is concerned, the Respondent contends that the principle in Chapman was wrongly applied by the Tribunal and led it to conclude that it had no jurisdiction to deal with the wider PCP absent a pleading based on that wider PCP. It is common ground that the principle in Chapman did not apply here and that the Tribunal did as a matter of fact have jurisdiction to consider the wider PCP as part of the Respondent’s defence. Whether or not an amendment would be necessary and whether or not an adjournment to plead such an amendment would be necessary would depend on the extent of any lack of clarity about the case and any prejudice the Claimant might suffer. The Tribunal did not address the extent and nature of the amendment being sought, nor did it make a comparison between what the Respondent was now seeking to rely on by way of the wider PCP with what the Claimant had pleaded himself, namely the wider PCP, nor did it address prejudice in relation to the amendment at paragraph 17. It simply identified the principle in Chapman.
25. Mr O’Donohoe submits that the error by the Tribunal in this regard is not material because this part of the Tribunal’s reasoning was not central to the strike out decision. In his submission, the Tribunal had already decided that an amendment was necessary before the case could proceed on the wider PCP basis. This was not a perverse conclusion and the error was accordingly not material. I cannot see where the Tribunal had already concluded that an amendment would be necessary before the case could proceed on the wider PCP basis, and, if the Tribunal had reached that conclusion, it seems to me that without first identifying and understanding the nature and extent of the clarification or change being sought by the Respondent and accordingly how significant the amendment was and what prejudice might flow from the amendment, the Tribunal was not able to address the amendment question.
26. In any event, it seems to me that the principle in Chapman was material to the Tribunal’s conclusion that it was not fair, just or reasonable to allow the Claimant to have to face a further amended defence. The Tribunal plainly took the view that in order to enable it to have jurisdiction to address such a defence an amendment would be required. Nevertheless, had the Tribunal considered the pleadings and the witness statements properly, it would have understood that the nature and the extent of the clarification or change being sought was simply to bring the Respondent’s case into line with the Claimant’s, and in those circumstances it is difficult to see how any tribunal could have concluded that the amendment was significant or that any prejudice would flow from an amendment based on the wider PCP already pleaded and relied on by the Claimant. In these circumstances, I am satisfied that this was a further material error in the Tribunal’s reasoning.
27. On the second issue, Rule 37(1)(b) provides that a claim or response may be struck out if the manner in which the proceedings have been conducted by or on behalf of a party has been scandalous, unreasonable or vexatious. There is nothing automatic about a decision to strike out. Rather, a tribunal is required to exercise a judicial discretion by reference to the appropriate principles. Even in a case where the impugned conduct consists of deliberate failures in relation, for example, to disclosure, the fundamental question for any tribunal considering the sanction of a strike out is whether the party’s conduct has rendered a fair trial impossible: see Bolch, where Burton P cited De Keyser Ltd v Wilson [2001] IRLR 324 EAT and Arrow Nominees Inc & Anr v Blackledge & Ors [2000] EWCA Civ 200. Those cases make clear that even where conduct is held to be scandalous, unreasonable or vexatious in relation to the conduct of proceedings, before making a strike out order a tribunal must consider whether a fair trial is possible. If a fair trial remains possible, the case should generally be permitted to proceed because the sanction of strike out is not regarded as simply punitive. Even where a tribunal concludes that a fair trial is not possible, it is necessary to consider whether a lesser remedy that does not bar the defendant from defending the claim in its entirety is a more proportionate and available course to adopt. (See also James v Blockbuster to similar effect, where Sedley LJ recognised the draconian nature of the strike out power and said that it is not to be readily exercised and that even where the conditions for making a strike out order are fulfilled, it is necessary to consider whether that sanction is a proportionate response in the particular circumstances of the case.)
28. The Tribunal made no mention of the authorities to which I have just referred. Although aware of those authorities from the researches he conducted on the day, Mr O’Donohoe did not refer the Tribunal to them, nor did he make any mention of them at all, assuming that the Tribunal itself understood and would apply the appropriate legal principles. I am surprised that a member of the Bar acting in accordance with his or her duty to the Court or Tribunal should take that approach. In the event the Respondent contends that those authorities were not considered by the Tribunal. The mere fact that particular authorities are not referred to by a tribunal does not of course mean that the principles established by them have not been applied. What is required is to look at the decision as a whole to see whether the Tribunal has in fact properly applied those principles.
29. Mr O’Donohoe initially argued, both in writing and orally, that it was unnecessary for the Tribunal to consider whether a fair trial was possible because the conduct of the Respondent in pursuing a false defence and wilfully failing to disclose a material document was tantamount to wilful, deliberate or contumelious disobedience and justified a strike out order without exploring whether a fair trial remained possible. For the reasons I have given, I disagree, and in any event he conceded this point in the course of his submissions.
30. Alternatively, Mr O’Donohoe contends that it is implicit in the Tribunal’s decision both by reference to paragraph 15, where the Tribunal referred to material non-disclosure, and paragraph 20, where the Tribunal in effect concluded that it was not fair, just or reasonable to allow the Claimant to proceed in the circumstances, that the Tribunal in this case did consider whether a fair trial could proceed but concluded that a fair trial could not proceed as listed in a manner that would be fair to the Claimant. He submits that this was a conclusion open to the Tribunal and not even arguably perverse. He relies on the absence of any disclosure in relation to the employment of engineers without licences, that the documents would undoubtedly have been relevant to the issues in the case and the Claimant would have been entitled to consider such disclosure, in particular the document the Tribunal identified and the implications of that document, together with the possibility of additional documents. Moreover, he submits that witness statements would have required amendment and this would have had to be permitted in an orderly manner that would not prejudice the Claimant if the matter was to proceed. He submits that it is implicit in the Tribunal’s decision that the only way a fair trial could take place would be with an adjournment. That, he submits, was in fact the Respondent’s own position, and accordingly the Tribunal was entitled to conclude that an adjournment of the Full Merits Hearing was a disproportionate response in the circumstances and that a fair trial could not take place in a proportionate manner so that strike out was a proportionate sanction.
31. Whether Mr O’Donohoe is right that the Tribunal was implicitly addressing the question of a fair trial or not, the explicit conclusion of this Tribunal at paragraph 20 is that:
“20. … It is not, in our view, fair, just or reasonable to allow the claimant to have to face a further amended defence when the respondent who has been represented throughout has failed to comply with its duty of disclosure and has put forward a false defence. …”
Leaving aside the question of a further amended defence, in respect of which I accept Mr O’Donohoe’s submission that the Tribunal was simply referring to a further, amended defence, Mr O’Donohoe submits that the situation in this case was analogous to the example given in James v Blockbuster at paragraph 15 of a situation in which a party’s conduct might well make a fair trial impossible at least without an adjournment. The example given there involved a party serving a significantly different account of material events on the day of the hearing than that which had been given previously. In Mr O’Donohoe’s submission, the Tribunal could not simply exclude the point advanced by the Respondent nor could it exclude any late evidence, because to do so would reward the Respondent for its conduct at the expense of the Claimant so that a fair trial could not be secured by the late production of relevant documents and the Respondent having accepted that an amendment was required with a corresponding adjournment, the Tribunal was entitled to reach the conclusion that it did.
32. I do not accept Mr O’Donohoe’s arguments. This Tribunal did not consider any of the potential avenues identified by the Court of Appeal as possible responses to a significant change introduced on the day of the hearing. A significant change in the account given might be superfluous and capable of being ignored. It might be relevant but capable of being dealt with by the other party. It might be embarrassing and simply needs to be struck out. The Court of Appeal said in relation to that example that it was “most unlikely to call for anything more drastic than any one of those measures”. In other words, even a significant change in account on the day of the hearing would not justify (in most cases) a strike out sanction. Here, because it did not consider the PCP relied on or the extent and nature of the amendment the Tribunal prevented itself from considering the significance of the change. Moreover, the fact that the Respondent asked for an adjournment to enable it to amend the ET3 did not absolve the Tribunal from going through the staged approach required and considering for itself whether a fair trial was possible before the sanction of strike out was applied.
33. To the extent that the Tribunal implicitly addressed the question of a fair trial, it did so, as I have indicated, on a fundamental misunderstanding of the case. Such clarification of the response as the Respondent or the Tribunal considered necessary was not capable of being viewed as a significantly different account of material events, nor was an adjournment inevitable. This is a case where the Claimant’s own evidence proceeded on the wider PCP. The contemporaneous documents were consistent with the wider PCP having been applied. The Claimant knew and understood that from the moment his application was rejected. He had not previously sought to investigate these matters, and it is difficult to see why, in the absence of an explanation or reasons given by the Tribunal, the change to the response that would bring the Respondent’s response into line with the Claimant’s ET1 was regarded as so significant by the Tribunal. The Tribunal does not explain what difficulty it would cause the Claimant, given that was his own understanding and was reflected in the contemporaneous documents.
34. This was a case where it was admitted the Claimant was disabled and it was admitted that he was denied potential employment on the basis of the wider PCP. The Liability Hearing would involve testing the Respondent’s justification for maintaining the PCP and not relaxing or removing it in the circumstances of this case. As Mr O’Donohoe observed in the course of his submissions, he had prepared to cross-examine on the basis of the wider PCP pleaded by his client. It is difficult, if not impossible, in those circumstances, to understand why the Tribunal concluded that the hearing could not have proceeded either then or following a short adjournment and be conducted fairly on that basis. Had the Tribunal understood and identified the PCP relied on by the Claimant, it would inevitably have concluded that the amendment, whilst obviously relevant, was capable of being dealt with by the Claimant, given that it coincided exactly with his own case.
35. So far as disclosure was concerned, the Tribunal identified a single document that had not been disclosed. I accept that was a relevant document. Nevertheless, there is no reason in principle why that document could not have been provided within a short period to the Tribunal, and to the extent that further documents were identified these could also have been obtained within a short period on the day of the hearing. The Tribunal did not address the possibility whether in the course of argument or in the Reasons. I recognise that the Respondent sought an adjournment of the hearing itself, as Mr O’Donohoe submits, but the parties’ own positions do not constitute tramlines within which the Tribunal is bound to remain. It was incumbent on the Tribunal to look carefully and critically at the pleadings and the proposed change in order to determine the significance of what was being proposed. The Tribunal failed to do that and in failing to do that failed also properly to address the question of whether a fair trial was possible.
36. Separately, and importantly, in my judgment, the Tribunal mischaracterised the position by describing the Respondent as having pursued a false response or defence. The response was not false. True it is that it required some clarification, and true it is that the Respondent could properly have been criticised for not clearly pleading the wider PCP, but there was no basis for the conclusion that the Respondent’s actions were deliberate or calculated to mislead, and nor was there any basis for the conclusion that there had been a deliberate failure to disclose a relevant document if that is the basis on which the Tribunal proceeded.
37. Finally, and also separately, I am not satisfied that the Tribunal gave any or proper consideration to the proportionality of the sanction of a strike out here. Mr O’Donohoe invites me to infer that the Tribunal concluded that there was no less drastic means to the end for which the strike out power exists in this case. He relies on significant prejudice to the Claimant in the denial of a document that “stuck at the heart of the Respondent’s case”. Given the Claimant’s own case, that is difficult to accept. Moreover, such prejudice as is referred to would have been met by the immediate disclosure of the relevant document and any other documents that related to employed engineers without PCV licences without going down the avenue of identifying what documents were available and how quickly they could be produced. The Tribunal did not begin to address the question of proportionality.
38. So far as concerns the suggestion that the Claimant’s evidence would require redrafting that is difficult to understand when on his own case he understood that the Respondent was prepared to recruit engineers with the potential to obtain a PCV licence whilst employed, and there was no need for the Respondent to amend its witness statements to make this clear once it was accepted that the PCP was the wider PCP. Mr O’Donohoe could have cross-examined after that clarification in the same way as he could have done before it and as he intended to do.
39. It may be that the Tribunal’s own strong disapproval of the Respondent’s conduct led it into error and obscured the structured exercise it was required to conduct. Whether that is so or not, I have concluded that this Tribunal erred in law in its approach to the discretion to strike out in this case. A defence ought to be struck out in exceptional circumstances only, particularly if any deficiency in the pleading is capable of being rectified and any missing document capable of prompt production. This was not a case where the consequences of the Respondent’s failings were not capable of being remedied on the morning of the hearing with some time given for the Claimant to consider the changed position. The failings were capable of prompt remedy without any adjournment, and to the extent that the Claimant regarded an adjournment as necessary to protect his position that could have been contemplated on condition that the Respondent paid any costs wasted by such an adjournment. None of those matters having been considered, it seems to me that the Tribunal erred in law.
40. There also seems to be some force in the submission made by Mr Bailey on behalf of the Respondent that the Claimant was opportunistic in adopting the erroneous and peremptory approach instigated by this Tribunal. The Claimant should not have submitted that the response was false and should not have exaggerated the relevance of the change introduced by the Respondent in adopting the wider PCP, and the relevance of the list of engineers employed without PCV licences as trainee drivers.
41. It follows that this appeal must be allowed. The claim will be remitted to proceed to a Full Hearing. My preliminary view was that the hearing should be before a differently constituted tribunal in the circumstances. If either party wished to persuade me that it should return to Employment Judge Mahoney, I indicated that I would hear those submissions, but neither did.
Costs
42. Two applications for costs were made by the Respondent. First the Respondent seeks Rule 34A(2)(a) fees incurred in lodging the appeal and pursuing it to a Full Hearing. The Rule provides that if the Appeal Tribunal allows an appeal in full or in part it may make a costs order against the Respondent, specifying that the Respondent pay to the Appellant an amount no greater than any fee paid by the Appellant under a notice issued by the Lord Chancellor. Such an order depends on discretion exercised by reference to the extent of success on of the appeal. Seven grounds of appeal were pursued originally. Two were not pursued at the hearing because the Tribunal corrected its decision. Nevertheless, they were proper grounds to pursue. The only ground that was pursued and did not succeed was a minor ground relating to the phrase “further amended defence” and the question whether that reflected a mistake by the Tribunal or whether there was simply a grammatical ambiguity. Although I found that there was a grammatical ambiguity and that the ground was not established, that was a minor and peripheral matter, and I am satisfied that the Respondent has been so substantially successful in its appeal that this is a case where all £1,600 of the lodgement and hearing fee should be awarded and the Claimant should be responsible for those fees. Those are accordingly awarded.
43. The second application is based on Rule 34 and unreasonable conduct both in the Employment Tribunal below and in this Appeal Tribunal. Mr Bailey recognises that there is no right to the costs of an appeal to the EAT simply because the appeal succeeds. In determining whether a party’s conduct can be characterised as so unreasonable as to justify an order for costs the conduct of the party in the appeal proceedings is the principal consideration but regard can be had to the party’s conduct of the Employment Tribunal proceedings below and these can also be taken into account.
44. I have regard to the fact here that the initial fault was the Respondent’s fault in failing to plead properly the PCP that was relied on and that the question of a strike out was raised on the morning of the hearing by the Tribunal itself - so, not instigated by the Claimant or his counsel - and raised in circumstances where the Tribunal made as clear as could be that it intended to follow through with a strike out order and considered the Respondent’s conduct to be reprehensible, for reasons that remain opaque to me. Although I have been critical of Mr O’Donohoe I am not persuaded that the conduct (in jumping on the Tribunal’s “band wagon”) falls so plainly on the wrong side of the line as to justify an order for costs. It might have been different if the issue had been raised in writing giving the Claimant and his counsel the benefit of time to reflect and identify the relevant principles and the matters on which they wished to rely. But this issue was raised at the eleventh hour by the Tribunal, just at the beginning of the Full Merits Hearing. There is always, as Mr Bailey submits, a band of conduct available to counsel caught in the crossfire in the heat of battle, seeking to promote his or her lay client’s case.
45. I have been critical of Mr O’Donohoe’s conduct, but accept his explanation that he did not mislead and fully expected that the law would form part of the Judgment, not anticipating that the Tribunal would get it wrong. He questioned the plausibility of the Respondent’s representative’s explanation for not pleading the wider PCP without advancing any argument that the Claimant never had any understanding of the wider PCP. This was readily adopted by the Tribunal and indicates a strong view already adopted by the Tribunal that there had been a material non-disclosure that was prejudicial to the Claimant, and I am not confident that even if Mr O’Donohoe had said that he did not support the strike out or had remained neutral that this was a Tribunal that would have pulled back from applying that sanction, determined as it appears to have been on adopting that course irrespective of what he said. In those circumstances I have concluded that this is not a case where I should make an order for costs under Rule 34 on the basis of unreasonable conduct in the Tribunal below.
46. So far as pursuit of a misconceived defence to the appeal is concerned, the same conclusions apply. Mr O’Donohoe has been forceful in his advocacy, and has pursued arguments that have not succeeded, but I am not persuaded that they fall so plainly on the wrong side of the line as to constitute a misconceived defence that justifies an order for costs here.
Conclusion
47. The appeal is allowed. The case is remitted to a fresh tribunal to proceed as a Full Hearing. The Claimant shall pay the Respondent’s costs under Rule 34A(2)(a) but not their ordinary costs order under Rule 34.