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You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Thind v. Salvesen Logistics Ltd [2010] UKEAT 0487_09_1301 (13 January 2010)
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Cite as: [2010] UKEAT 0487_09_1301

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BAILII case number: [2010] UKEAT 0487_09_1301
Appeal No. UKEAT/0487/09

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
             At the Tribunal
             On 13 January 2010

Before

THE HONOURABLE MR JUSTICE UNDERHILL (PRESIDENT)

(SITTING ALONE)



MR D S THIND APPELLANT

SALVESEN LOGISTICS LTD RESPONDENT


Transcript of Proceedings

JUDGMENT

© Copyright 2010


    APPEARANCES

     

    For the Appellant MR CHRISTOPHER BRYDEN
    (of Counsel)
    Instructed by:
    Messrs Shoosmiths Solicitors
    Quantum House
    Basing View
    Basingstoke RG21 4EX
    For the Respondent MR ANDREW SHORT
    (of Counsel)
    Instructed by:
    Messrs Shakespeare Putsman LLP
    Somerset House
    Temple Street
    Birmingham B2 5DJ


     

    SUMMARY

    Claim struck out on non-compliance with unless order – Tribunal refuses to review.

    Held: Judge should have conducted a review hearing – Review conducted by the EAT using powers under section 35 of the Employment Tribunals Act 1996 and striking-out revoked - Observations on approach to such applications following Neary.


     

    THE HONOURABLE MR JUSTICE UNDERHILL (PRESIDENT)

  1. On 20 October 2008 the Claimant, who is the Appellant before me, commenced proceedings in the Employment Tribunal against the Respondent, his employer, claiming for racial discrimination, disability discrimination and unlawful deduction of wages. The particulars of claim, so far as the disability claim was concerned, referred to an injury to his knee. The Respondent denied that the Claimant was disabled.
  2. By letter dated 11 February 2009 an Employment Judge sitting at Reading gave the following directions (so far as material):
  3. "1 The claimant obtains a report from a qualified medical practitioner to deal with these issues in relation to each of his 3 alleged disabilities. A copy of such report should be sent to both the Respondent and the Tribunal no later than 18 March 2009.
    It is important that such report addresses the concepts of disability as used in the 1995 Act and to assist there is attached to this letter an outline set of instructions to the medical practitioner which can be adopted/adapted as seen fit.
    2 No later than the same date the Claimant is to provide to the Respondent and the Tribunal office a statement that explains what effect the alleged disability has on the Claimant's ability to perform normal day to day activities."

    The reference under order 1 to "three alleged disabilities" reflects the fact that it was the Respondent's understanding that, notwithstanding the lack of reference to these matters in the claim form, the Claimant was also claiming to be suffering disabilities in the form of stress and diabetes. It was however subsequently clarified that those matters were not relied on as disabilities in their own right, though it was said that they may have contributed to the problems which the Claimant was experiencing from his knee.

  4. At a case management discussion on 30 April 2009 (not set out in a formal order until 27 May) directions were given for a ten-day hearing, to start on 18 January 2010. There were also directions for disclosure, exchange of witness statements and the provision by the Claimant of a Schedule of Loss.
  5. The Claimant, who had not at the time of the issue of his proceedings been represented by solicitors but who shortly afterwards instructed Messrs Shoosmiths, was unlucky in his choice of expert to report on the disability issue. It appears from a witness statement from Mr Thalis Vlachos of Shoosmiths dated 27 August 2009, and also from a letter from Shoosmiths dated 7 July 2009, that the expert in question was, despite being given appropriate guidance and despite repeated requests that he clarify the draft reports which he provided, unwilling or unable to provide a report which focused on the issues relevant to a disability discrimination claim. As a result of the difficulties which they were experiencing, Shoosmiths sought and were granted extensions as regards both the expert's report required by order 1 of the directions of 11 February and the Claimant's witness statement required by order 2 – first to 24 April, secondly to 28 May (this second extension being ordered at the Case Management Discussion to which I have referred) and thirdly to 9 July. I note, because some significance is attached to it, that the second of these extensions was sought only after the original time for compliance had expired.
  6. On 7 July Shoosmiths sought a further extension, setting out the difficulties which they were experiencing in some detail in the letter to which I have already referred; and on 24 July an extension was granted by the Tribunal to 7 August, but only on the basis that the order was in "unless" terms – i.e. that the disability discrimination claim would be automatically struck out unless order 2 was complied with by the extended date.. Again the extension applied both to the provision of the expert's report and to the Claimant's witness statement.
  7. With that deadline looming, Shoosmiths finally decided to cut their losses and change experts; and with understandable difficulties they managed to obtain a report from a different consultant which was signed and lodged on the last day of the extended period – that is to say, 7 August. But unfortunately they overlooked the requirement of order 2 to serve a witness statement also from the Claimant. It is said, and not challenged as a matter of fact, that that oversight was as a result of their concentrating exclusively on the problem of obtaining a compliant expert report in the difficult circumstances described. It followed, by reason of the unless order, that the disability discrimination claim was automatically struck out with effect from 7 August. By letter from the Tribunal dated 14 August Shoosmiths were duly notified that that had occurred.
  8. By letter dated 27 August Shoosmiths applied for a review of the strike-out pursuant to rule 34 (3) (e) of the Employment Tribunal Rules of Procedure. The application was accompanied both by the witness statement of Mr Vlachos to which I have already referred and by the missing witness statement from the Claimant as required by order 2.
  9. By letter dated 14 September 2009 that application was refused. The letter is very short and says simply this:
  10. "Your application for a review of the decision was referred to Employment Judge Lewis.
    Your application for a review has been refused because the judge considers that there are no grounds for the decision to be reviewed under Rule 34(3) and/or there is no reasonable prospect of the decision being varied or revoked.
    No adequate reason has been put forward for the failure to comply with the Tribunal's unless order."

    Though this is not spelt out in the letter, it is clear that the decision in question was taken under rule 35 (3), which provides that an application for a review shall be refused if the Judge considers:

    "… that there are no grounds for the decision to be reviewed under Rule 34(3) and/or there is no reasonable prospect of the decision being varied or revoked".

    (Although the rule as so formulated suggests two alternative grounds on which the Judge must refuse the application if he considers they apply, they appear to overlap to a very considerable extent.)

  11. This is an appeal against that decision on the part of Judge Lewis. The appeal was promptly lodged on 23 September 2009.
  12. It is convenient before considering the grounds of appeal briefly to set out the further communications which occurred between the parties and the Tribunal. By letter dated 21 September Shoosmiths sought a stay on the balance of the claims pending the outcome of the anticipated appeal and asked the Judge to provide written Reasons for his refusal. That then produced a wobble on the part of the Employment Judge, who on 6 October caused a letter to be written to the parties in the following terms:
  13. "This letter is sent on the direction of Employment Judge Lewis, who states as follows.
    On further reflection, in preparation of the Reasons requested by Messrs Shoosmiths, I am concerned that the better course might have been to afford the parties the opportunity of oral submissions in relation to the application for review in accordance with rule 36(1).
    It seems to me that that course would be in the interests of justice, and is in within my powers to direct of my own initiative. The parties should treat this letter as notice given under Rule 36(2)(a), inviting each to show cause why there should not be a review. Strictly, my proposal is that I review my 14 September refusal of the review, although in substance any hearing would deal with the issue of whether the claim for disability discrimination should be reinstated. I have extended the time limit for sending this letter under Rule 36(2)(b) in accordance with Rule 10(2)(e)."

    The Respondent's solicitors, Messrs Shakespeare Putsman, objected to the course proposed by that letter, and on 22 October Employment Judge Lewis withdrew his proposal on the basis, in effect, that it was liable to cause more complications than it would solve and that the matter was best left to be dealt with by the appeal. The proceedings were stayed until 30 November. Written Reasons were supplied in the form of a letter sent the following day.

  14. This sequence of events unfortunately produced some delay in the processing of the appeal. It was not until 30 November that it came before me on the sift. I directed a full hearing, but the appeal could not be listed until today. The Appellant has been represented by Mr Christopher Bryden and the Respondent by Mr Andrew Short, both of counsel.
  15. I should also record that in the meantime the Claimant had been dismissed by the Respondent and that in August he issued further proceedings alleging unfair dismissal, victimisation contrary to the Race Relations Act 1976 and unlawful deduction of wages. I am told that on 2 October those proceedings were ordered to be consolidated with the present proceedings, apparently on the basis that they would be dealt with as part of the January 2010 hearing. Further, the Claimant's wife, who also worked for the Respondent, had herself been dismissed and had brought proceedings of her own. On 7 October those too were ordered to be consolidated with the present proceedings. (It seems a little surprising, as Mr Short conceded, that the view was taken at that stage that, irrespective of the present issue, the matters raised by those claims could realistically be prepared for and dealt with at the January hearing; but I have not heard any detail about that, and it does not fall to be considered for the purpose of this decision.)
  16. The Claimant's original Notice of Appeal, and a subsequent amended version lodged once the Tribunal's Reasons had been received, relied to a considerable extent on the line of authorities which begins with the decision of this Tribunal in Maresca v Motor Insurance Repair Research Centre [2005] ICR 197: these hold that a tribunal considering an application for relief following the activation of an unless order must have regard to the provisions of rule 3.9 of the Civil Procedure Rules. Those grounds have now been undercut by the recent decision of the Court of Appeal in Governing Body of St Albans Girls' School v Neary [2009] EWCA Civ 1190, which has over-ruled Maresca and the cases which followed it and has made it clear that there is no obligation in law on an employment tribunal to proceed by reference to CPR 3.9.
  17. The clarification brought about by Neary is welcome. The law in this area had become undesirably technical and involved. It had also, I might note in passing, caused considerable concern in Scotland, where the CPR has of course no application. The law as it now stands is much more straightforward. The tribunal must decide whether it is right, in the interests of justice and the overriding objective, to grant relief to the party in default notwithstanding the breach of the unless order. That involves a broad assessment of what is in the interests of justice, and the factors which may be material to that assessment will vary considerably according to the circumstances of the case and cannot be neatly categorised. They will generally include, but may not be limited to, the reason for the default, and in particular whether it is deliberate; the seriousness of the default; the prejudice to the other party; and whether a fair trial remains possible. The fact that an unless order has been made, which of course puts the party in question squarely on notice of the importance of complying with the order and the consequences if he does not do so, will always be an important consideration. Unless orders are an important part of the tribunal's procedural armoury (albeit one not to be used lightly), and they must be taken very seriously; their effectiveness will be undermined if tribunals are too ready to set them aside. But that is nevertheless no more than one consideration. No one factor is necessarily determinative of the course which the tribunal should take. Each case will depend on its own facts.
  18. Neary also contains a convenient restatement of the limitations on this Tribunal interfering with the decision of an Employment Judge whether or not to grant relief in a case of this kind. At paragraph 49 of the judgment, Smith LJ says this:
  19. "It is often said that decisions of this kind are discretionary. It seems to me that a decision such as this is not so much an exercise of discretion as an exercise of judgment. But this may be a distinction without a difference in that, in both cases, there is a duty on the judge to decide the case rationally and not capriciously and to make his decision in accordance with the purpose of the relevant legislation, taking all relevant factors or circumstances into account. He must also avoid taking irrelevant factors into account. In both cases there may be two correct answers or at least two answers which are not so incorrect that they can be impugned on appeal. Whereas with the exercise of discretion, the question will be whether the judge's decision was permissible on the evidence, with an exercise of judgment, the question will be whether his decision was fair. But provided that the judge has met these requirements, his judgment should not be impugned merely because the appellate court would or might have reached a different conclusion."

    I direct myself accordingly.

  20. Against that background I can turn to the reasons given by the Employment Judge and the Claimant's criticisms of them. The Reasons start by setting out the procedural history, which I have already sufficiently summarised above. The Judge then proceeds to give his reasons for refusing the application in nine numbered paragraphs. I will take those in turn.
  21. Paragraph 1 reads as follows:
  22. "I understood the Strike out to have been ordered under the provisions of Rule 13(2) and not under any other rule. I understood the application for a review to be made under Rule 34(3)(e) i.e. in the interests of justice, and that my consideration of it was undertaken under Rule 35(3)."

    That is plainly introductory in character and is unobjectionable.

  23. Paragraph 2 reads:
  24. "The unless Order related to a relatively straightforward aspect of the case. The Claimant's time for provision of a statement had been from 11 February to 7 August. He had been professionally represented for all but the first three weeks of that period. His solicitors had candidly admitted error."

    That is true, but it too is essentially introductory.

  25. Paragraph 3 reads as follows:
  26. "The meaning, nature and effect of an unless Order are well understood by practitioners. That it was so understood in this case was demonstrated by the alacrity with which a new expert was found, instructed and reported. It seemed to me that the interests of justice required the Claimant's solicitors to respect an unless Order as a conditional judgment to be complied with in full with the risks of sanctions if it is not."

    This is unobjectionable as far as it goes: the importance of respecting an unless order is an entirely reasonable starting-point. But it does not advance the particular case very far. The question in every case is whether, notwithstanding the importance of respecting the unless order, there are grounds justifying the grant of relief. The meat of the Tribunal's reasoning essentially begins with the following paragraphs.

  27. Paragraph 4 reads as follows:
  28. "The sole explanation given for non-compliance was 'oversight'. The explanation appeared to focus on the period after 24 July. It failed to explain adequately the five months which preceded that date. It did not seem to me that mere oversight by solicitors and over a period of five months was sufficient reason for or explanation of failure to comply with the unless Order."

    I do not regard this paragraph as giving a fair characterisation of the position. I do not think that it is right to describe the Claimant's failure to lodge his witness statement in accordance with order 2 (of 11 February) as an oversight which lasted for five months. It is in my judgment clear that the common expectation of the parties, and indeed the Tribunal, was that the expert's report as required by order 1 and the Claimant's own witness statement as required by order 2 would be served at the same time. That understanding is implicit, though I accept not literally stated, in the order itself; and it is in any event confirmed by the fact that it was not, on the occasion of any of the subsequent applications for an extension, suggested that since the only problem identified was with the expert's report there was no need for an extension as regards the Claimant's witness statement. The two were clearly regarded as going together. That is in my experience the approach commonly adopted in this class of case, and there are understandable reasons for it: see the observations of HHJ Richardson in Hazelwood v Eagle (UKEAT/0011/09), at paragraph 4. It is clear from Mr Vlachos' witness statement that the oversight relied on occurred only in the final phase of the five-month period, when Shoosmiths were desperately trying to get an expert's report in in time. It remains of course the case that an oversight of this kind can never excuse a failure, but the fact that the breach of an unless order is the result of carelessness on the part of the party or his solicitor is not by itself an absolute reason for refusing relief. On the contrary, most such cases involve an oversight of one kind or another.

  29. Paragraph 5 reads as follows:
  30. "I was aware that the Claimant had complied with the other requirement of the unless Order at the very last moment and after several extensions some requested after expiry of the original deadline for compliance."

    This is true as far as it goes, but it fails to take account of the fact that there was on the face of it a good reason for the repeated requests for extensions and the last-minute nature of the final compliance with the order, namely the unhelpfulness of the expert instructed on behalf of the Claimant. Unless the Judge found fault with Mr Vlachos' detailed explanation of the difficulties experienced with the expert, which he did not, he could not fairly hold against the Claimant the fact that there had been repeated requests for extensions and only last-minute compliance. I accept that the point made by the Judge that one or two of the applications had been made after the date for compliance had expired (though only, as I understand it, by a short period) is strictly speaking a criticism; but it is a very minor one. (In saying that it was not open to the Judge to hold these delays against the Claimant, I mean only that he should not hold them against the Claimant in assessing his, or his solicitors', culpability. He could of course take into account the length of the delay, or any prejudice caused by it, even if the Claimant and his solicitors were faultless; but that does not seem to be the point being made by him in this paragraph.)

  31. Paragraph 6 reads as follows:
  32. "I noted that by contrast the Respondent has been diligent in his compliance and correspondence with the Tribunal."

    It is not entirely clear to me, and Mr Short has not been able to elucidate, what obligations on the part of the Respondent had fallen for compliance at the relevant time: the timetable was largely dependent on the supply by the Claimant of the report and witness statement. But if, as may be the case, there were some obligations with which the Respondent had complied, I cannot myself regard this as a point of very great weight. It is true that if the Claimant had been able to point to substantial defaults on the part of the Respondent, that might, depending on the circumstances, have been a factor which the Judge should have put in the balance, and it was perhaps legitimate to point out that this was not such a case; but the point does not go any further than that.

  33. Paragraph 7 reads:
  34. "I noted that Strike out would in this case not deny the Claimant access to the Tribunal and that on the contrary his complaints of racial discrimination and in relation to other matters would proceed to a hearing. I was aware at the time of the review that he had issued a further claim for unfair dismissal which likewise would not be affected by Strike out of one head of claim. The Strike out did not seem to me disproportionate in the overall context."

    Mr Bryden submits that the matters referred to in this paragraph were wholly irrelevant. Each head of claim should be considered individually, and if a claimant is unable to proceed with one it is immaterial that he may still be able to proceed with another. I think that is too absolute a position. Often different aspects of a claim may overlap; and, in a case where all or most of what the claimant might have hoped to achieve under one head may be obtainable (if his case is good at all) under another, it may well be reasonable for a tribunal to put that factor into the balance in considering the impact of the strike-out order. But it is far from clear whether that was the case here.

  35. Paragraph 8 reads as follows:
  36. "I consider that reinstatement of the claim would on the other hand require the Respondent to prepare for a case focussed not just on its management of the Claimant, but on additional issues relating to the Claimant's medical history."

    This is the nearest that the Tribunal gets to a consideration of the important question of the prejudice likely to be suffered by the Respondent if the disability discrimination claim were reinstated, and the related question of whether that claim remained fairly triable; but it cannot be said to deal with those questions at all adequately. It is no doubt true that if the claim were reinstated the Respondent would have to address the medical issues raised by the disability claim, but it would have had to do that in any event but for the strike-out. The real question is whether its ability to do so had been damaged by the default and by any consequential delay. That issue is simply not addressed.

  37. Paragraph 9 reads as follows:
  38. "In all circumstances I have formed the view that the application fell within Rule 35(3) and that the interests of justice did not require that I review my decision to strike out the claim of disability and discrimination."

    I mention this only for completeness. It does not of course add to the Tribunal's reasoning.

  39. For, principally, the reasons which I have developed in relation to paragraphs 4, 5 and 8 I believe that the decision of the Employment Judge dated 14 September was legally flawed. It did not properly take into account all the relevant factors. In my judgment, on the material before him Employment Judge Lewis ought to have held that a proper case for a review – that is, for a review hearing under rule 36 – had been made out. I reach that conclusion with less reluctance in the light of the Judge's own second thoughts on the issue expressed in his letter of 6 October. I can understand the temptation for Employment Judges to deal summarily with applications for reviews of strike-outs pursuant to the operation of an unless order. No doubt such applications are quite commonly received and are quite commonly wholly unmeritorious; but it needs to be borne in mind that rule 35 (3) is concerned only with a preliminary consideration of the application and that if substantial points are raised then a review hearing will be necessary.
  40. The question which then arises is whether I should simply remit the matter to the Employment Tribunal for a review hearing under rule 36 or whether I should consider for myself the substantive question of whether relief from the effect of the unless order should be granted, using my power under section 35 of the Employment Tribunals Act 1996. Mr Bryden invites me to take the latter course and Mr Short invites me to take the former. Mr Short accepts that it would be open to me to decide the question myself, and that there would be a strong case for my doing so if that would involve a substantial saving in time which would otherwise have to be spent at a hearing in the Employment Tribunal. But he points out that there will have to be a case management discussion in any event in order to consider what directions are required in the adjourned cases, and he says that the issues raised by the review can conveniently be dealt with on that occasion.
  41. I think I should decide the point myself. I am in as good a position as the Employment Judge to do so. (Indeed on one view I am in a better position, since I can consider the question without reference to subsequent events, which it would be difficult for him to put out of his mind and which it would arguably be unjust to the Claimant to have taken into account. But I do not base my decision on that consideration.) Despite Mr Short's point, it seems to me that there is still likely to be a real saving in costs to the parties and tribunal time if I, having heard the full argument, were to decide the review issue now.
  42. In my judgment relief should be granted. To some extent my reasons will be apparent from what I have already said by way of commentary on the Judge's reasons; but the factors which weigh with me are as follows.
  43. First, the default which triggered the operation of the unless order was in no sense deliberate. It was a straightforward oversight – it could properly be called carelessness, though that may convey a rather higher degree of fault than may be justified. The oversight in question though no doubt still culpable, was at least understandable, for the reasons explained by MrVlachos: it does not take much imagination to see how the grave difficulties experienced by Messrs Shoosmiths in obtaining the expert's report led them to take their eye off the ball and overlook the need for a statement also from the Claimant.
  44. Secondly, the non-supply of the witness statement was excusable up to and until the final period. The problems experienced with the expert were genuine, and there has been no criticism of the way in which Shoosmiths dealt with them. Extensions were granted in recognition of that fact. As I have already pointed out, everyone proceeded on the basis that the Claimant's own witness statement should be supplied at the same time as the expert's statement.
  45. Thirdly, the error was that of the Claimant's solicitors rather than himself. That is by no means decisive, but it is a relevant consideration. Mr Short has sensibly not sought to rely on the fact that if relief were refused the Claimant might well – indeed, on the face of it, would – have a remedy in damages against them. As has been observed on more than one occasion (see, for example, the recent decision of the Court of Appeal in Welsh v Parnianzadeh [2004] EWCA Civ 1832) such a remedy is not a satisfactory alternative to being able to pursue the primary claim.
  46. Fourthly, the Claimant applied promptly for a review of the strike-out and accompanied that application with the missing statement. Mr Short has made some criticisms of the statement, including in particular the fact that the Claimant purported to reserve the right to amplify it subsequently. It remains to be seen whether the Tribunal will permit him to do so; but Mr Short did not go so far as to submit, and could not reasonably have done so, that the statement itself did not comply with the order – and that seems to me to be enough.
  47. Fifthly, I do not see that the Respondent was seriously prejudiced by the default. As at 14 September there were still four months to go before the date fixed for the hearing. In my judgment that would be ample time for it to have obtained its own medical evidence, as I fully accept it would have been likely to wish to do, and to prepare itself on the disability issue. Mr Short, however, has pointed out that if the Judge had, as I have held he should, directed a review hearing under rule 36 that would have taken some time to come on. He points out that employment tribunals in general, including the Reading Tribunal, are under enormous listing pressures and that I should be considering the position not as at September, but as at some much later date, perhaps in November or December: on that basis the reinstatement of the disability discrimination claim at such a date would have made the preservation of the January 2010 hearing date impossible. That is a legitimate point; but in my judgment if the Judge had ordered a review he should and would have insisted on it being heard in sufficient time that the trial date could be preserved - in practice at some point before the end of October. Although that would reduce the relevant period to, at worst, two and a half months, I remain of the view that it would have been perfectly possible for the Respondent, albeit with rather less elbow room, to prepare its case on that issue. I am of course very well aware of the listing pressures on busy employment tribunals; but I am also aware from my own experience that in a case where real urgency is shown a slot can almost always be found at short notice, and the time required for a review hearing would not have been more than a couple of hours. Mr Short also pointed out that the Claimant had not as at the date of the strike-out served his witness statements or Schedule of Loss although the time directed for doing so had expired in July; but again I do not doubt that the Employment Judge would, at least if prompted by the Respondent, have required early compliance with those directions – if necessary pending the outcome of the review hearing.
  48. For all those reasons it seems to me that the interests of justice required that the Claimant be granted relief from the effect of the striking out. I would if necessary, though this is not the primary way I put it, go so far as to say that is the only conclusion to which an Employment Judge could properly have come on the material before it and before me.
  49. I wish to close by emphasising, in case this judgment is referred to in other cases, that, as I have already observed, all these cases turn on their own facts. I certainly would not wish it to be thought that it will be usual for relief to be granted from the effect of an unless order. Provided that the order itself has been appropriately made, there is an important interest in employment tribunals enforcing compliance, and it may well be just in such a case for a claim to be struck out even though a fair trial would remain possible. As has been pointed out, the case of Blockbuster Entertainment Ltd v James [2006] IRLR 630 did not concern an unless order; and the facts of Neary illustrate that a claim may be struck out even though a hearing is still possible – see in particular paragraphs 63 and 64 of the judgment.


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