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United Kingdom Employment Appeal Tribunal |
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You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Fox v Anago Ltd [1993] UKEAT 32_92_2911 (29 November 1993) URL: http://www.bailii.org/uk/cases/UKEAT/1993/32_92_2911.html Cite as: [1993] UKEAT 32_92_2911 |
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At the Tribunal
Before
THE HONOURABLE MR JUSTICE MUMMERY (P)
MR R JACKSON
MRS M E SUNDERLAND JP
Transcript of Proceedings
JUDGMENT
Revised
APPEARANCES
For the Appellant MR M MCPARLAND
(OF COUNSEL)
Messrs Kate Patterson & Co
57 Laughton Road
Dinnington
Sheffield
S31 7PN
For the Respondents NO APPEARANCE BY
OR REPRESENTATION
ON BEHALF OF THE
RESPONDENTS
MR JUSTICE MUMMERY (PRESIDENT): This is an appeal against a decision of the Industrial Tribunal sitting at Sheffield in the autumn of 1991. The Industrial Tribunal heard a complaint by Mr Stephen Fox that he had been unfairly dismissed by Anago Limited, the Respondents, on 29 April 1991. He claimed that he had been constructively dismissed. Anago Ltd denied that Mr Fox was employed by them and contended that he was employed by an American parent company Anago Incorporated. The Tribunal found against Anago on that point.
The second submission made by Anago Ltd was that there had been no breach of contract committed by them such that Mr Fox was entitled to terminate his contract without notice. Their case was that he had resigned on that day and had not been constructively dismissed. There was a further contention that the Company had acted fairly and reasonably throughout and that therefore the dismissal was fair.
The hearing at the Tribunal took place over 4 days, 14/15/16/17 October 1991. On 8 November they came to the decision that the application should be dismissed. The reasons for that decision were contained in the document sent out to the parties on 21 November.
The concluding paragraph of their reasons states:
"The applicant [Mr Fox] has to show that he was dismissed. It is for him to satisfy us that on the balance of probabilities there was a breach of contract by the respondents entitling him to terminate his contract without notice. We unanimously conclude that the applicant has failed to discharge this burden. It therefore follows that he was not dismissed and that this application must itself be dismissed."
On this appeal the Employment Appeal Tribunal has been presented with unusual difficulties. These are caused by a number of factors. The first is that Anago, the Respondents to the appeal, are not represented. A letter was sent by the solicitors who had acted for them. The letter was sent on 25 November to this Tribunal saying:
"We have not been in touch with our client for some considerable time and have now learned that Anago Limited was dissolved by the Registrar of Companies in June 1993.
We have now been in touch with the Holding Company Anago Inc in the USA who were surprised to learn of the dissolution. They have expressed to us an intention, in early course, to revive the Company and make the necessary Application to Court.
In the circumstances we seek a postponement of the forthcoming Hearing."
This Tribunal was notified that Mr Fox's advisers did not agree to an adjournment. The Tribunal did not adjourn the matter in view of the sparsity of the information contained in the solicitor's letter of 25 November. The letter does not give any details of the circumstances in which Anago Ltd were dissolved or when the solicitors or their clients first learned of the dissolution or as to what steps, if any, have been taken by the directors of Anago Ltd or the Holding Company to have the Company's name restored to the register by the Companies Court.
When the solicitors were notified that there was no agreement from Mr Fox's advisers to an adjournment they wrote a further letter on 26 November commenting that they did not see how the hearing could continue, as the Respondents no longer existed and contended that this Tribunal had no jurisdiction to hear the appeal. If that contention was rejected, they went on to point out that the representation of Anago Ltd at today's hearing of the appeal would be impossible and they had no authority or locus standi to act or appear until the Company was revived. Finally they submitted that, if all those contentions were rejected, as they are, they trusted that a written answer of Anago Ltd submitted on 24 February 1992 should be sufficient to assist this Tribunal in dismissing the appeal.
The appeal has therefore been heard without any representation from the Respondents. That, in our view, is a handicap, first, to this Tribunal in coming to a correct resolution of an appeal secondly, to those representing Mr Fox. It is not easy for them to know precisely on what point the grounds of their appeal are disputed on fact or law.
The absence of the Respondents is therefore the first unsatisfactory feature of this appeal.
The second unsatisfactory feature is that this Tribunal was presented only this morning with the detailed 8 page Skeleton Argument on behalf of Mr Fox. It would have been more helpful to the Tribunal to have had this document at an earlier stage. We are informed by Mr McParland, who prepared the Skeleton Argument and who appeared for Mr Fox, that it has not been provided to the solicitors acting for Anago Ltd. They have had no opportunity of considering the submissions and commenting on them, either in writing, or if so advised, by oral representation.
We appreciate that under the present practice of this Tribunal it is not compulsory to exchange Skeleton Arguments prior to the hearing. We will say now that this Tribunal finds such arguments invaluable in identifying, on a reading of the papers before the hearing, the points of law which will be argued on the appeal.
With those preliminary observations we now turn to the grounds on which this appeal is made. The appeal is not unlike most appeals, concerned directly with the substance of the decision. It is an attack on the procedure adopted at the hearing and is, therefore, an indirect attack on the substance. What is sought is an order from this Tribunal allowing the appeal and directing that the whole matter be remitted to be heard by a differently constituted Tribunal. The complaints about the hearing were first notified in an extract of an opinion written by Mr Fox's Counsel headed "Grounds of Appeal" attached to the Notice of Appeal and forming part of the appeal document.
The grounds are stated to be these:
"The tribunal erred in law in preventing counsel for the applicant the right to cross-examination in full the respondent's witness Mr. Steven Brown as to any financial consideration or other inducement he had received or had been promised by the applicant's director Mr. Tim McKibben in order to testify against the applicant. The said Mr. Brown had previously signed a statement which he believed was an affidavit whose contents directly contradicted the evidence he gave under oath to the tribunal. He had also indicated to the applicant that he would "cancel" his "affidavit" if he did not receive sums he alleged were due to him from the applicant. The said Mr. Brown accepted the aforesaid and gave evidence to the Tribunal that he had decided to give evidence on the respondent's behalf after discussions with the respondent's Mr. McKibben shortly before the tribunal hearing. That in the circumstances, the applicant contends that his counsel should have been permitted to cross examine fully on inducements etc offered to Mr. Brown to secure such testimony, and to consider where appropriate the calling of evidence in rebuttal. The tribunal's refusing him that right was an improper exercise of the tribunal chairman's discretion under rule 8 of the tribunal rules of procedure 1985."
Secondly:
"The tribunal erred in law and/or reached a decision that was perverse in finding that the substantive allegations contained in the evidence of Mr. Brown as summarised at paragraph 12 of the tribunal's decision were allegations that the applicant had been specifically cross-examined about. The applicant had not been cross-examined the matters specifically identified in paragraph 12. In support of these contentions, the appellant will rely on the fact that the tribunal chairman agreed with his counsel on this fact upon the latter's objection during Mr Brown's evidence in chief that this evidence had not been put to the applicant in cross-examination. The tribunal chairman stated this opinion to the solicitor for the respondent at that time. If the tribunal chairman had indicated otherwise an application by counsel for the applicant could have been made to recall the applicant to allow him to rebut the allegations made. In the light of the tribunal chairman's agreement with counsel for the applicant, and of there being no application made by the respondent to recall the applicant to put these matters, the applicant and his counsel were entitled to proceed on the basis that the tribunal accepted that the allegations contained in paragraph 12 of the tribunal's decision had not been put in cross-examination and would be treated by the tribunal appropriately."
The Grounds of Appeal conclude:
"The tribunal's decision to rely on the evidence of Mr. Brown in the manner set out in paragraphs 12 & 13 of their decision, without any further explanation or discussion in the light of the evidence produced to the tribunal indicating the un-reliability of the witness, was in all the circumstances of the case, perverse and/or an error of law."
On that basis it was sought to have the matter re-heard in front of a differently constituted Tribunal.
In view of the allegations contained in those Grounds of Appeal this Tribunal required an Affidavit to be sworn on behalf of Mr Fox dealing with the matters raised by the Notice of Appeal. The request by the Employment Appeal Tribunal was made on 10 February 1992. On 20 February the solicitor acting for Mr Fox (who, we are told, was not present at the hearing before the Industrial Tribunal) swore an Affidavit stating that she had perused the papers and obtained Counsel's opinion and that, in her opinion, there were arguable grounds for appeal to the Employment Appeal Tribunal. The rest of the Affidavit repeats practically word for word the Grounds of Appeal.
It is not, therefore, direct evidence by the Deponent as to what actually happened before the Tribunal. Nevertheless, it is implicit that there was evidence available to support the allegations on which the Grounds of Appeal were drafted.
When the Affidavit was received by this Tribunal it was passed to the Chairman of the Industrial Tribunal for him to comment on, if he so wished. The Chairman wrote to this Tribunal on 9 March saying that he had no comment to make on the Affidavit. It can be safely assumed that there is no serious dispute by the Chairman about the factual basis on which the complaints are made in relation to the hearing.
The Respondent Company did, however, take issue with the matters in a Respondent's Answer dated 24 February 1992. It was stated there that Anago Ltd intended to resist the appeal and relied on the grounds relied upon by the Industrial Tribunal for making the decision in its favour. They took a point on whether the appeal was out of time. It is unnecessary to deal with that. The important part is in paragraph 3(ii) of the Respondents' Answer where it is stated that with regard to the first ground of appeal:
"and to the best of the Respondent's recollection Counsel for the Appellant did cross examine Mr. Steven Brown concerning the matters mentioned in the Grounds but that the Chairman of the Tribunal was concerned, after some time, to restrict the manner in which such cross examination was being pursued. The Chairman was also concerned, to the best of the Respondent's recollection, that this type of cross examination should not carry on for an inordinate length of time. Certainly by the time Counsel to the Appellant was restrained (and not on the first attempt by the Chairman to the Tribunal) Counsel for the Appellant had driven home the allegation or implication that Mr. Brown had been induced to testify in favour of the Respondent. As such the Respondent does not consider that the Tribunal had refused any right to the Counsel of the Appellant."
The Respondents' Answer also contained a cross-appeal as to the determination of facts set out in certain paragraphs of the decision and to take the point that a contract of employment did exist in the form of a letter dated 1 August 1986 from Anago Inc, not Anago Ltd, to the Appellant and that this document of record produced to the Tribunal, together with all the subsequent correspondence between Anago Inc and the Appellant, adjusted, varied or redefined the relationship between Anago Inc and the Appellant. It is intended to be argued on the cross-appeal that that clearly identified that the relationship was between Mr Fox and Anago Inc, either as employer or subcontractor, and was not in any event as employee of Anago Ltd. As the Respondents have not appeared, we have not heard any argument in relation to their cross-appeal. We have also read a letter of 25 March 1992 from the Respondents' solicitors making comments on the Affidavit of 20 February.
That is the background to the hearing today. As we had refused an adjournment to Anago Ltd on the grounds that there were insufficient facts put before the Court to justify an adjournment, we allowed Mr McParland to open his appeal. He has argued it in detail by reference to the facts and the relevant law. Turning first to the relevant law it cannot be disputed that the particular rule relevant to the complaints in this case is rule 8 of the Industrial Tribunal's Rules of Procedure Regulations 1985. Rule 8(1) provides:
"The tribunal shall conduct the hearing in such manner as it considers most suitable to the clarification of the issues before it and generally to the just handling of the proceedings; it shall so far as appears to be appropriate seek to avoid formality in its proceedings and it shall not be bound by any enactment or rule of law relating to the admissibility of evidence in proceedings before the courts of law."
Sub rule (2) reads:
"Subject to paragraph (1) of this Rule, at the hearing of the originating application a party (unless disentitled by virtue of Rule 3(2)), the Secretary of State (if, not being a party, he elects to appear as provided in Rule 7(5)) and any other person entitled to appear shall be entitled to give evidence, to call witnesses, to question any witnesses and to address the tribunal."
We were referred by Mr McParland to the following cases - Aberdeen Steak Houses Group PLC v Ibrahim [1988] ICR 550, Snowball v Gardner Merchant Ltd [1987] ICR 719 at p. 722G and 723B-C, Rosedale Mouldings Ltd v Sibley [1980] ICR 816 at p. 822A-B and Coral Squash Clubs Ltd v Matthews [1979] ICR 607 and p. 611. It is unnecessary to go into the details of any of those cases since the propositions that Mr McParland seeks to extract from them appear to be well founded. Those propositions are (1) In the exercise of the discretion under Rule 8 regarding the admission of evidence and appropriate procedure, the Tribunal must act judicially; (2) Although the Tribunal is not bound by the strict rules of law, it must not ignore or totally disregard well-established principles of law regarding evidence and procedure and (3) It is not a proper exercise of the discretion by an Industrial Tribunal to refuse to admit evidence which is admissible, relevant and probative of one or more of the issues before it. (4) In disputes about admissibility and relevance the Tribunal should deal with such matters on the usual common law basis of admissibility, relevance and probative value; (5) Evidence can be relevant which goes to an issue of the credit of a witness. It is always possible in proceedings to give evidence to the effect that a witness cannot be believed and anything which goes to affect the credibility of that witness is relevant to an issue before the Court and cannot properly be disregarded by the Tribunal. It also appears from those cases that, if there is an improper exercise of discretion in relation to those matters, the normal course adopted by this Tribunal will be to remit the case to be decided by a differently constituted Tribunal.
On those legal foundations Mr McParland submits that there were errors of law by the Tribunal in this case. He submits that the principal issue before the Industrial Tribunal was whether, as Mr Fox claimed, he had been constructively dismissed from his position as managing director and company secretary of Anago Ltd or whether he had resigned as Anago contended.
At the hearing evidence was given by Mr Fox. His evidence was interrupted on the second day by a request that was made by Anago to allow Mr McKibben to give evidence out of sequence. Mr McKibben was a director of Anago as well as holding a position in the
American company Anago Inc. That request was granted. Then Mr Fox's case closed and Anago's solicitor indicated that a witness due to be called would not in fact be called. Complaint was raised by Counsel for Mr Fox at that time.
What the Company then did was to call Mr Brown as a witness. He was a former employee of Anago Ltd. He was, as far as Mr Fox was concerned, a surprise witness for Anago. He had been dismissed by Anago in about June 1991, at about the same time as the events complained of by Mr Fox. He had gone to work with Mr Fox after leaving Anago's employment. Mr Brown gave evidence to the Tribunal in which he claimed that Mr Fox and he had decided to set up their own business during the course of their employment with Anago. Mr Brown's evidence was used by the Tribunal to throw light on Mr Fox's decision to resign. They stated it had helped them to decide who to believe when considering the crucial facts of the case. Mr Brown was clearly an important witness.
There was an objection raised by Counsel for Mr Fox during Mr Brown's evidence in chief. It was pointed out to the Tribunal that the vast majority of Mr Brown's evidence had not been put to Mr Fox when he was cross-examined. The Tribunal Chairman indicated that he accepted this objection and stated so to the solicitor acting for Anago. No application was made by Anago's solicitors to have Mr Fox recalled so that these matters could be put to him in cross-examination.
Mr Brown was then cross-examined by Counsel. We are informed by Mr McParland, as set out in his Skeleton Argument, that a number of matters were put to Mr Brown and accepted by him. Those matters were as follows:
(i)that Mr Brown had previously "sworn" what he believed was an "affidavit" to be used in these proceedings in which directly contradicted the evidence that he gave before the tribunal;...It was signed and dated 8th August 1991, the day before the hearing was originally due to take place but had been adjourned.
(ii)that Mr. Brown had written to Mr. Fox on the 13th August 1991, indicating his total dissatisfaction with Mr Fox and his company BFG Medical and claiming money from Mr Fox.
(iii)that Mr. Fox's failure to comply with Mr. Brown's requirements for money etc resulted in Mr Brown threatening Mr. Fox's secretary on the 19th August 1991 that he would "...call Tim McKibben and nullify (his) affidavit
(iv)that Mr. Fox had not satisfied Mr. Brown's demands for money since that date.
(v)that he, Mr. Brown, was either telling lies to the tribunal at that hearing, or had been prepared to lie to a tribunal with his "affidavit" which he now claimed was entirely true save for the matters relating to the setting up of the new company which were entirely false.
(vi)that he, Mr Brown, had been on his own version of events, prepared to lie to a tribunal with his "affidavit" when he thought it was in his own financial interest to do so.
(vii)that originally, when in June 1991 when he was dismissed, Mr Brown had been questioned by Mr.McKibben about whether or not he had had any involvement with any plan to set up a new company and had denied it. Mr. Brown indicated that Mr. McKibben had threatened him with severe financial consequences if Mr. McKibben found out that he was lying. Mr Brown stated that he thought Mr. McKibben was merely "bluffing".
(viii)that he, Mr. Brown, had been dismissed by the Respondent.
(ix)that he, Mr. Brown, had taken time away from his present occupation in a different part of the country to come to Sheffield for a couple of days to give evidence on behalf of his former employers who had dismissed him.
(x)that he, Mr Brown, had decided to give evidence on the Respondent's behalf after discussions with the Respondent's Mr. McKibben shortly before the tribunal hearing."
I have followed the words of the Skeleton Argument on those matters which Mr McParland says were put to and accepted by Mr Brown in his evidence down to the point when the Industrial Tribunal Chairman prevented Mr McParland from cross-examining Mr Brown as to any financial consideration or other inducement that Mr McKibben did or might have offered to Mr Brown to secure his testimony on behalf of Anago. The submission made by Mr McParland was that he was unable to cross-examine on these points because the Tribunal Chairman ruled against him.
During his closing speech Mr McParland pointed out that the vast majority of Mr Brown's evidence had not been put to Mr Fox and no application had been made by Anago to recall Mr Fox to put these matters to him.
In the reasons given by the Tribunal for their decision in favour of Anago, it is stated in paragraphs 12 and 13 that the Tribunal preferred the evidence of Mr Brown to Mr Fox. They regarded Mr Brown as helping them to decide who to believe when considering the factual issues in the case. The Tribunal also stated that Mr Fox had been cross-examined about these matters.
In paragraph 13 the Tribunal say:
"We also prefer the evidence of Mr Brown to that of the applicant's. Again where there are differences we accept Mr Brown's version."
In those circumstances Mr McParland submits that there was an error of law in the improper exercise of the Tribunal's discretion to allow full cross-examination of Mr Brown in respect of relevant matters which went to issues in the case before them. One issue was whether what happened on 29 April was constructive dismissal or resignation. The issues also included Mr Brown's credit worthiness as a witness. He went on to emphasise that the decision of the Tribunal had relied on Mr Brown's evidence in deciding who to believe without any further indication or discussion of the objections which had been raised in relation to the prevention of further cross-examination of Mr Brown or the failure of Anago to put certain points in cross-examination to Mr Fox. The result was that that decision was perverse or vitiated by error of law.
We see the force of these submissions on the law in relation to the facts referred to in Kathleen Patterson's Affidavit, on which the Chairman of the Industrial Tribunal had no comment. We see force in the submissions in the light of the additional material about what happened before the Tribunal, as set out in the first three pages of Mr McParland's Skeleton Argument.
We do, however, feel real difficulty in reaching a final decision on this appeal today in the absence of the Respondents. We propose to adjourn the hearing of this appeal to be refixed at a later date. In the meantime the following steps should be taken: a transcript of the judgment should be sent to the solicitors acting for Mr Fox and the solicitors who had been acting for Anago Ltd, and Anago Inc or others interested in the affairs of Anago (that will include the directors. They will have liberty to give notice of intention to attend on the adjourned hearing of this appeal in order to make representations both in relation to Mr Fox's appeal and in relation to their cross-appeal. If they do not wish to make any representations and do not notify this Tribunal within the period of 14 days from this order, the matter will be restored for hearing. Submissions can then be made on behalf of Mr Fox as to why the appeal should be allowed. If, however, they do wish to make representations a date must be fixed and those representations will be heard. Those advising and appearing for Mr Fox will, of course, be entitled to make further representations both in relation to Mr Fox's own appeal as well as in relation to the cross-appeal. They should submit a skeleton argument 14 days before the adjournment hearing. They should be sent a copy of the Appellant's skeleton argument.
The order we make today is that the hearing of this appeal be adjourned with those directions.
