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You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Ministry Of Defence v Nathan [1995] UKEAT 452_95_1212 (12 December 1995)
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Cite as: [1995] UKEAT 452_95_1212

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    BAILII case number: [1995] UKEAT 452_95_1212

    Appeal No. EAT/452/95

    EMPOLYMENT APPEAL TRIBUNAL

    58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

    At the Tribunal

    On 12th December 1995

    THE HONOURABLE MR JUSTICE KEENE

    MR P DAWSON OBE

    MR J A SCOULLER


    THE MINISTRY OF DEFENCE          APPELLANTS

    JANE CATHERINE NATHAN          RESPONDENT


    Transcript of Proceedings

    JUDGMENT

    Revised


     

    APPEARANCES

    For the Appellant

    For the Respondents


     

    RESERVED JUDGMENT

    MR JUSTICE KEENE:

    Brief Chronology:

    20th March 1964: Date of birth

    2nd November 1982: Joined the Queen Alexandra's Royal Army Nursing Corps on an open engagement.

    1985: Promoted to Lance-Corporal

    21st September 1985: Married a soldier

    1986: Promoted Corporal

    1st July 1988: Acting Sergeant

    12th August 1988: Discharged for the Service because of her pregnancy.

    31st November 1988: First child born

    May 1989: Husband left army

    27th January 1993: Second child born

    22nd March 1995: Decision by Industrial Tribunal on compensation.

    The Respondent, Jane Nathan, had joined the Queen Alexandra's Royal Arming Nursing Corps on 2nd November 1982. She had left school with 4 O'levels and several CSE's and on joining Q.A.R.A.N.C. she became a medical clerk. She had an exemplary record of service within the Corps: she was nominated as the best recruit in her intake and consistently received high assessments thereafter. She was recommended for service in the Falkland Islands in 1984 and duly served there before returning to Catterick and then going to Rinthelm in Germany. There she met her husband, a serving soldier in the Anglian Regiment and they married on 21st September 1985.

    She was promoted Lance-Corporal in 1985 and to full Corporal the following year, after having becoming first out of sixteen people on her Junior NCO's Promotion Course. In 1987 she was recommended for promotion to Sergeant and was serving as Acting Sergeant when it was discovered in 1988 that she was pregnant. She was discharged from the Army on 12th August 1988 in accordance with the then Ministry of Defence policy concerning pregnant service personnel. On discharge her military conduct was assessed as exemplary, it being said that she was "hard working, totally reliable, and honest, with an excellent health record." The Industrial Tribunal noted that it was with a real degree of sadness that the Army lost her.

    The Respondent's husband remained in the Army after her discharge, but this seems to have given rise to some problems because the Respondent felt that she no longer had a real status. The problems which this caused between them led to her husband leaving the Army in May 1989. The Respondent had given birth to her first child on 31st November 1988. In civilian life she obtained various forms of employment, much of it part-time, in the area of Durham. At the time of the Industrial Tribunal's hearing she was working in a doctor's practice and the Tribunal said that it had no doubt that she would be taken on full-time later that year. Her second child was born on 27th January 1993.

    She made an application to an Industrial Tribunal on 24th November 1993, claiming compensation for sex discrimination, and this claim came before an Industrial Tribunal on 2nd March 1995. The decision and extended reasons being given on that same day. In its reasons, the Tribunal noted that from the very start the Respondent had intended that she would in her own words "go all the way", meaning that she would serve for 22 years. She had hoped also to go up the promotion ladder so that she would leave in due course as a commissioned officer. The Tribunal, who heard the Respondent give evidence, were clearly impressed by the degree of commitment to an Army career which she had had. It also noted that her husband, who also gave evidence, saw himself as less successful as a soldier. The Tribunal accepted that Mr Nathan would have been and had acted as a "house husband" and would have looked after the children.

    In its Reasons the Tribunal referred to the decision in Ministry of Defence v Cannock [1994] ICR 918 and dealt with the various hypothetical questions which had to be addressed in the case of this Respondent. On the issue of maternity leave and a return to the Service after childbirth, the Tribunal stated:

    "We are quite satisfied and find that if there had been maternity leave available the applicant would have certainly have taken it both for the first child and the second child and would certainly (meaning 100%) have gone back to and remained in her rank as Sergeant. Mrs Nathan would have made substantive Sergeant with total certainty. She would have gone back to her post and rank and she would have been Sergeant in 1991."

    The Tribunal then dealt with the evidence before it about the shrinking size of Army, referring to the White Paper "Options for Change". It noted that there had been compulsory redundances proceeded by voluntary redundancies from all layers of the Army, officers and other ranks as well. The re-organisation of much of the administrative support functions for the Army had led to the creation of an Adjutant General's Corps and Personnel Support Branch to provide all necessary clerical and administrative back-up for the Army. Consequently in 1993 those clerks amongst whom Mrs Nathan would have been, had she remained, were amalgamated with others into that new Corps. The Tribunal then stated this:

    "The Army therefore is shrinking, but also in relation to the Adjutant General's Corps there is now a significantly larger pool of people for promotion. Therefore, the chances for promotion are different. We have to take into account all these current developments. Equally, we take into account the fact that Mrs Nathan cherished the dream that she would be accepted for a commission one day after taking the necessary exams and selection boards. She aspired then to at least five years of her life in a commissioned rank. It is plain to us from the evidence of Major Stewart that even if a suitable person is offered a late entry commission and they have the right experience and are of the right age, they would not be offered a commission unless they have at least the time to do five complete years in commissioned rank before retirement. It does seem clear to us, when we look at Mrs Nathan's likely career path, that there are clear problems about the amount of time available for her to achieve that which she hoped in her heart of hearts that she would be able to achieve. What we are certain of is that she would have remained in Army and completed her full 22 years. We assess this at a 100% certainty. It is agreed all round that Mrs Nathan would have attained the rank of Sergeant in 1991."

    The Tribunal then went on to conclude that there was a 50% chance of her attaining the rank of Staff Sergeant by 1995 and a 25% chance of her winning promotion to the rank Warrant Officer Second Class in 1999. However, they concluded that the chances of her getting a commission were NIL. The parties were left to do the calculations of compensation based on the above conclusions, together with an award of 1,000.00 for injury to feelings. In the event the total figure for compensation excluding pension losses came to 142,990.00.

    That decision is now challenged by the Appellant in respect of the various findings that there was a 100% chance of various things happening, had the respondent not been dismissed unlawfully because of her pregnancy. In particular, Mr Pitt-Payne attacks the conclusion that there was a 100% chance of the Respondent remaining for the full 22 years period of service, but criticism is also made of the findings that there was a 100% chance of the Respondent taking maternity leave and returning to the service on the birth of each of her children and a 100% chance of her having returned at and remained in the rank of Sergeant after each birth. It is argued that the 100% chance finding in respect of 22 years service could not have been reached on the application of proper principles, so that it can be inferred that the Tribunal was not applying such principles. Alternatively it is contended that that finding was perverse, in the sense that it was one which no reasonable tribunal properly directing itself could have reached.

    Mr Pitt-Payne accepts that a finding of 100% chance is not in itself perverse or an indication of an error of law per se. He recognises that this Appeal Tribunal in the Ministry of Defence v Hunt & Others [unreported; judgment delivered 8th December 1995] upheld a number of findings of 100% chances. It rejected an argument by the Ministry of Defence that such assessments of a chance were perverse per se. However, the Appellant in the present case makes three points. The first and main submission begins with the point that an assessment of a chance at 100% when dealing with what would have happened over a long period of time requires unusual and exceptional circumstances, as was indicated in the Hunt case. But it is then pointed out that a distinction is to be drawn between those cases where the long period of time has in fact already passed and those where the assessment of a chance relates to a long period of time stretching into the future when seen from the date of the Tribunal's decision. Thus in the case of Mrs Hunt herself, she had joined the Armed Forces in 1976 and been discharged in 1982; the EAT upheld the Industrial Tribunal's assessment of 100% chance that she would have served a full 16 years from the date of enlistment had she not been unlawfully dismissed; but the whole of that 16 year period had expired by the date at which the Industrial Tribunal had to consider the assessment of her chance of serving for such a period of time. In other words in such a case the Industrial Tribunal is able to look back at what has in fact happened and take that into account. In such a situation a Tribunal knows how many children the ex-servicewoman has had during that time, her work record and whether she has been able to combine full-time work with child rearing, and whether she has been affected by the normal contingencies of life, such as ill-health.

    That is contrasted with the case where an Industrial Tribunal is having to make an assessment of the chance of something happening or not happening over a lengthy period of time into the future. In the present case Mr Pitt-Payne points out that the Tribunal's finding of 100% chance of the Respondent serving for 22 years from her enlistment in November 1982 involved making a judgment about what might or might not happen between March 1995 (when the Tribunal made its decision) and the year 2004. Thus, it is said, the Tribunal was having to make an assessment inter alia of what might have happened during the remaining nine years after the date at which it was making its decision. Many unpredictable factors could effect the Respondent's ability or willingness to serve throughout that remaining nine years of the 22 years service. Those would include the usual contingencies concerning her health, the possibility of this then 31 year old woman having further children, the uncertainties of childcare, and the risks of redundancy resulting from the fact that the size of the Armed Forces was decreasing. Mr Pitt-Payne argues that no reasonable tribunal could be 100% certain that the Respondent would not have been affected by such possibilities between 1995 and 2004. Consequently it cannot have properly directed itself or if it did so its decision is perverse.

    The second and third point of the Appellant are essentially subsidiary ones. It is said that there were in this case multiple assessments of 100% chances, and that the assessment in respect of the 22 years service was dependent on the making of several earlier 100% assessments, namely those in respect of the chance of the respondent taking maternity leave and returning after the birth of each child. This, it is said, makes the assessment of the chance of 22 years service at 100% even more questionable. Finally it is argued that the Tribunal fell into error in the way in which it approached the possibility of the Respondent's husband acting as a "house husband" and looking after the children. The Tribunal stated "Mr Nathan would have been and has acted as "house husband" and would have looked after the children". Mr Pitt-Payne argues that while the Tribunal was entitled to find that he had so acted, it should have recognised that in dealing with whether he would have so acted in the future is was assessing a chance. He observes that the Tribunal seems to have approached this as if it were an issue of the credibility of Mr and Mrs Nathan.

    We do not accept either of these subsidiary points. Given the cumulative nature of a series of chances which have to be assessed (on which see the decision in Hunt), the assessment of the percentage chance of staying on in the service for a full 22 years was not truly dependent on the assessment of the chance of taking maternity leave and returning to the service thereafter. It would have been perfectly possible for the Tribunal to have put a lessor percentage on the chance of maternity leave and a return to the service, and yet still have assessed the chance of staying on for 22 years at 100%: what would have happened would have been that when it came to calculating the compensation payable, the 100% chance of staying for 22 years would be 100% of the lessor percentage or percentages which proceeded it: see Hunt, page 6. That being so, the Ministry's argument on this simply becomes one of saying that it is surprising to find a number of chances all assessed at 100%. That may be so, but each has to be looked at individually to see whether there is anything wrong in law which the particular individual assessment.

    Nor do we accept that the Tribunal below went wrong in their approach to the prospects of Mr Nathan looking after the children. Mr Pitt-Payne conceded that the Tribunal did not have to express that ingredient in their ultimate assessment in percentage terms. While the Tribunal in the particular sentence being criticised emphasised their acceptance of Mr Nathan's evidence, that single sentence must be looked at in the context of the whole decision. The Tribunal had already referred to evidence that Mr Nathan was of a lessor rank than the Respondent and apparently had poorer prospects than his wife of promotion and success in the Army. It seems to us that the Tribunal was taking all that into account in assessing the prospects of Mr Nathan acting as a "house husband". Where the Appellant may have a point is in the way in which this factor was taken into account in the overall assessment of the prospects of the Respondent serving the full 22 years. That really brings one back to the main submission on behalf of the Appellant, to which we now return.

    Miss Beale on behalf of the Respondent accepts that it is exceptional to assess at 100% the chance of her serving for a full 22 years, when that involves nine years which still lye in the future. But she submits that the Respondent and is an exceptional woman, of whom the Tribunal spoke in glowing terms. Moreover the documents available to the Tribunal demonstrate her exceptionally fine record. She was highly valued by the Army and that would have affected the Tribunal's assessment of her prospects of being kept on in an Army which was shrinking in size. There was no suggestion that the Respondent was not in excellent health. She was not only a person of ability but someone who was heavily committed to an Army career, ambitious enough to want to obtain a commission. All of this, it is argued, was being reflected in the assessment of a 100% chance of 22 years service. That assessment cannot realistically be attacked in so far as it fell within the period up to the date of the Tribunal hearing; so far as the period after that date is concerned, Miss Beale submits that a Tribunal is not obliged as a matter of law to make a discount simply because it is looking into the future. Finally she contends that this main argument is not open to the Appellant because no distinction was drawn in the submissions before the Industrial Tribunal between the period of service prior to the hearing and the period after it, nor is any such distinction drawn in the Notice of Appeal.

    We have noted that the Appellant seeks to present this argument as one which demonstrates a wrong approach by the Tribunal as well as a perverse decision by it. We do not see that any argument separate from that of perversity is in fact being advanced. On the face of the decision the Tribunal below was adopting the proper approach of making an assessment of the percentage chance of the Respondent serving for 22 years had she not been dismissed. The Appellant cannot point to any latent misdirection of itself by the Tribunal. To infer a latent misdirection is simply to argue that the decision is so unreasonable that the Tribunal must have misdirected itself. That, however, is no different from the argument as to perversity. We approach this main submission on that basis.

    There is no doubt that, in this field of law as in many others, an argument that a decision, where nothing improper can be identified as to the decision-making process, is nonetheless so unreasonable on its merits as to be perverse and hence wrong in law is always very difficult to maintain. A valuable summary of the ways in which perversity has been approached in the cases was provided by Mummery J. in the case of Stewart v Cleveland Guest (Engineering) Ltd [1994] IRLR 440, where the learned judge was presiding over the Employment Appeal Tribunal. At paragraph 33 he said this:

    "Whenever an appeal is based on the perversity ground, this Tribunal must be extremely cautious not to conclude that the decision of the Industrial Tribunal is flawed because the Appeal Tribunal would have reached a different conclusion on the evidence or thinks that another Industrial Tribunal would have reached another conclusion on the evidence. An appeal should not be allowed on this ground simply because the Employment Appeal Tribunal disagrees with the Industrial Tribunal as to the justice of the result, the merits of the case, or the interpretation of the facts. This Tribunal should only interfere with the decision of the Industrial Tribunal where the conclusion of that Tribunal on the evidence before it is "irrational", "offends reason", "is certainly wrong" or "is very clearly wrong" or "must be wrong" or "is plainly wrong" or "is not a permissable option" or "is fundamentally wrong" or "is outrageous" or "makes absolutely no sense" or "flies in the face of properly informed logic". This variety of phraseology is taken from a number of well-known cases which describe the circumstances in which this tribunal (and higher courts) have characterised perversity. The result is that it is rare or exceptional for an appeal to succeed on the grounds of perversity. The reason why it is a heavy burden to discharge is that it has been recognised by those with wide experience and practical wisdom that there are many factual situations arising in the field of industrial relations, including sex discrimination, in which different conclusions may be reached by different tribunals, all within the realm of reasonableness. It is an area in which there may be no "right answer"".

    We proceed on the basis outlined in that judgment. The Appellant in this case has a very heavy burden to discharge. It is right that none of the decided cases dealing with the dismissal of pregnant servicewomen have had to consider the assessment by a tribunal of a 100% chance of the applicant serving for any period of time into the future beyond the date of the Tribunal's decision. Certainly counsel before us have been unable to identify any decision which has had to deal with that situation. In the case of Hunt (ante) the assessment of a 100% chance of 16 years service related to a period of time which had expired by the time of the hearing by the Industrial Tribunal. That factor was given some emphasis in that decision, where at page 4 the Employment Appeal Tribunal (presided over by Maurice Kay J.) stated:

    "A significant feature of the present cases is that industrial tribunals have been called upon to assess chances many years after the unlawful act upon which liability is founded. It follows that for most and sometimes all the period requiring consideration, the tribunals have been looking back at a reality which has materialised rather than having to assess chances in futuro. This in itself eliminates some of the risks which courts often have to discount." (Page 4).

    It also noted that:

    "When an Industrial Tribunal is looking back over a substantial period of time and assessing chances at different stages during that period, it must be the case that earlier and shorter periods calling for consideration are far more likely to attract a high or very high quantification of chance than longer or later periods."

    Likewise in Ministry of Defence v Bristow [unreported; judgment delivered on 24th July 1995], the Tribunal below had held that there was a 90% chance that the servicewoman would have remained in the Royal Navy for the full 22 years, and that decision was upheld by the EAT presided over by Tucker J. However the 22 year period had expired in 1992, two years before the hearing before the Industrial Tribunal.

    In some cases this Employment Appeal Tribunal has had to consider assessments by Industrial Tribunals of chances which do relate to a period of time after its decision. In three of the appeals determined as part of the Hunt group of decisions (ante), the Tribunal below had had to make an assessment of the chance of the applicant serving for 22 years. In the case of Mrs Wheeler that involved in looking forward to 1998, as it did in the case of Mrs George. In the case of Mrs Donald the period expired in 1995. However in all three cases the chance of the applicant completing such a period of service was put at less than 100% being respectively 20%, 75% and 25%. An assessment of a 100% chance of serving in the Armed Forces until the year 2004, some nine years ahead, does therefore seem to break new ground.

    There is nothing necessarily wrong with that. Any assessment of such a chance must depend on the facts of the individual case. We do not accept that any assessment of a 100% chance which relates to a future period beyond the date at which the assessment made is necessarily perverse. Whether it is or is not must depend upon the facts of the individual case and especially on how far into the future the Tribunal is having to look. The further into the future a tribunal is having to pere, the more difficult it must become to regard a 100% chance as a permissable option. But in itself it there is nothing legally wrong with holding that a future event is virtually certain. This is implicit in the words of Lord Reid in Davies v Taylor [1974] AC 207, at 213:

    "You cannot prove that a future event will happen and I do not think that the law is so foolish as to suppose that you can. All that you can do is to evaluate the chance. Sometimes it is virtually 100%: sometimes virtually nil. But often it is somewhere in between."

    Apart from the length of the future period involved, the permissibility of a 100% assessment will depend upon such factors as the strength of the applicant's commitment to a service career, the ease at which she would have pursued such a career as well as being a mother, the value attached to her by the armed services and the risk of redundancy, her health and her age. An industrial tribunal is not obliged to make a discount in the percentage because some period of time in the future is involved. However it must be recognised that the further into the future one is seeking to look, the greater are the opportunities for what in personal injury cases have been called the vicissitudes of life, such things as illness, injury and death. It is for those reasons that a court dealing with personal injury claims normally makes a discount in respect of damages for the future loss of earnings: see Graham v Dodds [1983] 2 AER 953. In the present case there will also uncertainties resulting from the anticipated future decrease in the size of the armed forces and the expected redundancies in all ranks. We accept that the Industrial Tribunal took account of this factor, but that in itself is not enough to prevent a finding of perversity if one is justified on the circumstances of the case. It is to be noted that the Industrial Tribunal does not give any explanation as to why it was able to arrive at a 100% assessment of her chance of remaining until the year 2004 despite the shrinking size of the Army. This factor however only adds to our anxieties about this decision. To say that there is no possibility of anything happening during those nine future years between 1995 and 2004 which would lead to the cessation of the Respondent's service is stretching credulity beyond an acceptable limit. We give full recognition to the strength of the Respondent's commitment to the armed forces while she was serving and to her exemplary record during that service. Even so there are bound to be a number of uncertainties if one is gazing into the crystal ball over such a period of time. No tribunal can predict with accuracy the possibility of a future illness affecting the Respondent, however good her health may be now; it cannot accurately foresee the prospect of something happening to her husband, who was assumed by the Tribunal in this case to be playing a vital part in providing childcare into the future; and over such a period of time no one can rule out with certainty the possibility of divorce, redundancy from the Army or other adverse contingencies.

    In our judgment it was irrational of the Tribunal to regard as a 100% certainty the prospect of the Respondent having continued in military service until the year 2004. They would have been entitled to have arrived if they so chose at a very high percentage assessment of her chance of so doing and for our part this Appeal Tribunal would not have interfered with such an assessment. We say nothing about whether an assessment of 100% would have been acceptable if the period into the future involved had been substantially shorter, because that does not arise on the fact of this case. But the decision on this one aspect goes outside the range of permissable options.

    We do not accept the Respondent's argument that this point is not open to the Appellant on this appeal. Whether a specific distinction is drawn a period of time before the hearing and one after it, the fact remains that however the issues are approached some allowance needed to be made for the uncertainties inevitably attaching to an assessment of nine future years. Such uncertainty is inherent in the exercise which the Industrial Tribunal has to do in circumstances such as this.

    As we have already indicated, none of the Appellant's subsidiary arguments find favour with this Appeal Tribunal, but the Ministry's main submission as to perversity is well-founded and for that reason this appeal must be allowed. There was disagreement between the parties as to what should happen in the event of us reaching such a conclusion. Mr Pitt-Payne contended that the 100% assessment in relation to the 22 years should go back as a whole to an industrial tribunal for redetermination, whereas the Respondent submits that only that part of the assessment which relates to the period after 1995 should be so remitted. We make it clear that we do not question the lawfulness of the assessment in so far as it relates up to the date of the Tribunal's hearing in 1995. Nonetheless, as a matter of form it seems to us that the assessment of a 100% chance of 22 years service was a single assessment and must be reconsidered. We would expect the tribunal on such reconsideration to take into account the fact that we have found no reason to question that part of the 22 year period which extended up to the year 1995. We see no reason why this matter should not go back to the same Industrial Tribunal which dealt with this claim originally. We shall therefore remit this case to the same Industrial Tribunal solely on the issue of the assessment of the chance of the Respondent serving for the full 22 year period up to 2004. To that extent this appeal is allowed.


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