Baisley v South Lanarkshire Council UKEATS/0002/16/JW
Appeal against the rejection of the Claimant's claim of unfair dismissal due to lack of jurisdiction. Appeal allowed and remitted to the ET.
The Claimant's representative lodged an ET timeously with the ET and then sent in a fee remission application which was rejected. The appeal against this rejection was never received by the ET and the claim was dismissed. A second claim was then lodged along with the appropriate fee but this was out of time. The ET ruled that it did not have jurisdiction to hear either claim and the Claimant appealed.
The EAT allowed the appeal. 2 grounds of appeal were dismissed: 1) the Tribunal's conclusion that the first claim had been competently rejected was the correct one; and 2) following Cranwell v Cullen The Tribunal had erred by approaching the circumstances of the first and second claims as one for the purpose of deciding whether it had been reasonably practicable to lodge the second claim timeously.
Appeal No. UKEATS/0002/16/JW
EMPLOYMENT APPEAL TRIBUNAL
52 MELVILLE STREET, EDINBURGH, EH3 7HF
At the Tribunal
On 12 July 2016
THE HONOURABLE LADY WISE
SOUTH LANARKSHIRE COUNCIL (RESPONDENT)
For the Appellant Mr L G Cunningham (Advocate) Instructed by: Livingstone Brown Solicitors, 775 Shettleston Road Glasgow G32 7NN
For the Respondent Mr S C Miller (Solicitor Advocate) Clyde & Co 144 West George Street Glasgow G2 2HG**SUMMARY**
PRACTICE AND PROCEDURE
JURISDICTIONAL POINTS Claim in time ; extension of time : reasonable practicability
The claimant's solicitors lodged a first claim timeously but their accompanying fee remission application was rejected and a notice sent requiring payment or an appeal against the rejection by a certain date. An attempt to send, by facsimile transmission, an appeal form against refusal of remission was, unknown to the agents, never received by the Tribunal. The claim was rejected in terms of Rule 11(3) of the 2013 Rules. In receiving intimation of that the agents promptly lodged a second claim.
The Tribunal had decided to dismiss both claims for want of jurisdiction.
On appeal, four matters were argued which were resolved as follows;
1) The Employment Judge had erred in characterising rejection under Rule 11(3) as an administrative function. It was a judicial act carried out with the support of the administration. However, the Tribunal's conclusion that the first claim had been competently rejected was the correct one, so nothing turned on the error.
2) Following [Cranwell v Cullen ]()UKEATPS/0046/14 it could be regarded as illogical to invoke rule 6 to allow the Tribunal to waive its own mandatory Rule and the Tribunal had not erred in reaching that conclusion.
3) The Tribunal had erred in failing to address the question of the balance of prejudice in deciding not to exercise the discretion available through Rule 5 to allow an extension of time in relation to fee payment. The facts of the case illustrated that the prejudice was all one way.
4) The Tribunal had erred by approaching the circumstances of the first and second claims as one for the purpose of deciding whether it had been reasonably practicable to lodge the second claim timeously. Following [Adams v British Telecommunications plc]() UKEAT/0342/15 the real issue to be addressed was whether the claimant's mistaken belief that the appeal against the rejection of fee remission form had been received was reasonable.
Appeal allowed and first claim remitted to the Tribunal to proceed.**THE HONOURABLE LADY WISE****Introduction**
- This is an appeal by the claimant, Mr Baisley, against a judgment of the Employment Tribunal dated 29 October and sent to parties 2 November both 2015. The Employment Judge's decision was to dismiss Mr Baisley's claim for unfair dismissal due to lack of jurisdiction. In fact the claimant had lodged two claims as detailed below. This appeal seeks to challenge the Tribunal's decision in relation to both claims. I shall refer to parties as claimant and respondent as they were in the Tribunal below. The claimant was represented both at the Tribunal and before me by Mr Cunningham, Advocate. The respondent was represented by Mr Mays, solicitor of South Lanarkshire Council before the Tribunal, but at the hearing before me Mr Stephen Miller, Solicitor Advocate appeared on behalf of the respondent.
- As outlined in the Tribunal's judgment the claimant, having been employed by the respondent, claims that he was unfairly dismissed on 19 May 2014. On 9 September 2014 his solicitor lodged an ET1 ("the first claim") which was followed by a fee remission application on 16 September 2014. The claim form and fee remission application were made timeously following the issuing of an ACAS Early Conciliation Certificate on 10 August 2014. On 17 September 2014 the fee remission application was rejected by the Employment Tribunal Service and a notice sent to the claimant's representative requesting payment of the appropriate fee or receipt of an appeal against the rejection by 1 October 2014. The claimant's representative attempted to send, by facsimile transmission, an appeal against the refusal of the fee remission application on 1 October 2014. However, no such appeal was received by the Tribunal and on 3 October 2014 the ET1 was rejected for failure to pay the appropriate fee.
- On 8 October 2014 the claimant's solicitor lodged a further claim ("the second claim") together with the applicable fee. Following two preliminary hearings, the case was set down for a hearing to determine a number of issues relating to competency of the purported rejection of the first claim, the issue of a possible extension under Rule 5 in relation to that claim and, in relation to the second claim, whether it had been reasonably practicable to have presented the second ET1 form timeously.
- Having heard submissions the Employment Judge dealt first with the claimant's argument that the first claim had been validly initiated in terms of Rule 8 of Schedule 1 of the Employment Tribunal's Constitution and Rules of Procedure (Regulations) 2013 [I will hereinafter refer to the Rules contained in Schedule 1 of the 2013 Regulations as the "2013 Rules"]. In essence the argument was that as the claim had not been brought to an end by an act of the Tribunal, it was therefore still live, and the Tribunal had power under Rule 6 to waive or vary the time for payment of the fee or alternatively under Rule 40 to reinstate the claim. In deciding that matter against the claimant, the Employment Judge said the following (paragraphs 40-48):
"40. In determining this issue the Tribunal had regard to the interpretation section to be found in Rule 1 of Schedule 1 to the Rules. To this end, the Tribunal noted that the definition of Employment Tribunal encapsulates the Tribunal responsible for any proceedings in question whether performing administrative or judicial functions. The Tribunal did not read the definition in Rule 1(2), namely: 'any reference to the Rules to the Tribunal applies to both a full Tribunal and to an Employment Judge acting alone' as derogating from the definition to be found in Rule 1(1).
41. Further and in any event, the Tribunal noted the distinction in the Rules between, for example, Rules 12 and 13 where there is an express reference to an Employment Judge and Rule 11 where there is not, and concluded that Rule 11 is referable to the Tribunal performing administrative functions.
42. In reaching this decision the Tribunal had regard to the case of Young V Fife Regional Council 1986 SLT 33 cited by Mr Cunningham. The Tribunal considered this to be of limited relevance given that it is the conclusion of the Tribunal that Rule 11 incorporates the Tribunal acting as an administrative body. Accordingly and given the definition of 'Tribunal' to be found in Rule 1 the Tribunal concluded that there is no requirement to delegate functions as the Tribunal itself can sit to perform administrative functions.
43. Further, in reaching its decision the Tribunal also had regard to Article 6(1) of the ECHR and to this end relied upon the commentary within 'Blackstone's Guide to The Human Rights Act 1998'. However, on this point, the Tribunal preferred the arguments of Mr Mays to the effect that Article 6 applies only to the 'determination of civil rights or obligations' and that failure to pay a fee or have a remission application accepted is not of itself determinative of civil rights and obligations. To this end the Tribunal relied upon Blackstone para 7.96 wherein it is stated: 'of civil rights or obligations, or criminal charges. "Determination" essentially requires that there be a dispute of "contestation" and a resolution procedure.'
44. In determining this issue the Tribunal also had regard to Rule 2 and the overriding objective to be found therein. The overriding objective provides:
'The overriding objective of these Rules is to enable Employment Tribunals to deal with cases fairly and justly. Dealing with a case fairly and justly includes as far as practicable –
(a) ensuring that parties are on an equal footing;
(b) dealing with cases in ways which are proportionate to the complexity and importance of the issues;
(c) avoiding unnecessary formality and seeking flexibility in the proceedings;
(d) avoiding delays so far as compatible with proper consideration of the issues; and
(e) saving expense.'
45. The overriding objective further provides that 'a Tribunal shall seek to give effect to the overriding objective in interpreting or exercising any power given to it by these Rules..'
46. Esto there is any dubiety in the meaning of 'Tribunal' in Rule 11, therefore, the Tribunal considered that it was consistent with the overriding objective that the Rules be interpreted to incorporate the exercise of administrative functions under the definition of 'Tribunal'.
47. This interpretation of 'Tribunal' was reinforced by the decision of the President in the decision of Software Box Limited. In that case it was stated: 'Thus, under Rule 11(3): "If a remission application is refused in part or in full, the Tribunal shall send the claimant a notice specifying a date for payment of the Tribunal fee and the claim shall be rejected by the Tribunal if the Tribunal fee is not paid by the date specified." The word there is 'Tribunal.' Though in practice the functions of the Tribunal may be dealt with administratively, (emphasis mine) the legal position is that it is the Tribunal, a judicial body, not 'the administration' that deals with it."
- On the issue of whether Rule 6 could be invoked to waive the fee requirement notwithstanding the absolute duty on the Tribunal in terms of Rule 11, having cited passages from Cranwell v Cullen and Deangate v Hatley and others the Employment Judge concluded as follows:
"53. In reaching the decision that Rule 6 cannot be invoked in these circumstances the Tribunal adopted the reasoning of the President in the cases of Cranwell and Deangate. To this end, the Tribunal concluded that Rule 6 is designed to allow a Tribunal to relieve litigants of consequences of their failure to comply with the Rules not to allow a Tribunal to waive an absolute obligation upon it. the Tribunal concluded that Rule 11 does impose such an absolute obligation upon a Tribunal and that in the circumstances of these proceedings the Tribunal complied with that absolute obligation and rejected the claim in terms of rule 11(3)."
- The Tribunal rejected also the claimant's argument that Rule 40(5) could be invoked to have the claim reinstated.
- So far as reasonable practicability was concerned, the Employment Judge's reasons are in the following terms:
"63 The Tribunal then proceeded to consider whether it was 'not reasonably practicable' to have presented the claim within a period of three months beginning with the effective date of termination. In deliberating this issue the Tribunal found itself bound by the line of authority relied on by the respondents starting with the case of Dedman v British Building & Engineering Appliances Ltd (1974) ICR 53 being authority for the proposition that if a claim is presented out of time due to error by solicitors the claimant's remedy is against the solicitor.
64. In all the circumstances of this case, and particularly given the authority of the cases of Capital Foods v Corrigan (1983) IRLR 430 and Clark v H20 UKEAT/0149/12/ZT relied on by the respondents the Tribunal found that it could not be said that it was not 'not reasonably practicable' to have presented the claims within a period of three months beginning with the effective date of termination. Although the Tribunal found the evidence of Mr Allison to be entirely credible the Tribunal considered that, given that the Appeal was submitted on the deadline of 1st October and given that there were difficulties with the respondents' fax machine, Livingstone Brown ought to have followed up the transmission of the fax with a telephone call to the ETS to check it had been received and/or hand delivered the Appeal to the ETS. As they did not do so, it could not be said that it was 'not reasonably practicable' to submit the claims on time.
65. In reaching this decision, the Tribunal had regard to paragraphs 40 and 41 of the decision in Software Box, as cited by the claimant. In paragraph 41 the President stated: 'Here as it seems to me, the fact that a complaint was made within time and then rejected does not and should not, as a matter of principle, preclude the consideration of whether a second claim traversing the same ground is one in which the Tribunal should have jurisdiction. The purpose of the Act is to ensure that claims are brought promptly. But the need to do so within a short period of time is balanced by the interests of justice which Parliament has regarded as encompassed in the test of reasonable practicability. If the approach to reasonable practicability is taken as it was by Brandon LJ in Wall's Meat v Khan, it requires to focus upon what is reasonably understood by the claimant. If there is a case in which a claimant reasonably considers that there is no need to make a claim, not therefore understanding (for very good reasons) that the time limits apply to the claim, as they do, because she has already made a claim which remains effective, it seems to me to be open to a Tribunal to consider a second claim made once she realises that her view was mistaken.'
66. The Tribunal noted that in both the cases of Wall's Meat Ltd v Khan and Software Box the claimant was unrepresented at the material time and this was a factor in the emphasis on what was reasonably understood by the claimant. The Tribunal did not read these authorities as derogating from the line of authority where professional advisers are concerned commencing with the case of Dedman.
67. For these reasons the Tribunal concluded that it could not be said that it was not reasonably practicable for the claimant's claim to have been submitted timeously
68. The Tribunal found that by presenting the second claim on the 8th October 2014 the claimant presented his claim within such further period as was reasonable, all in terms of s111 of the Employment Rights Act 1996."
- Finally, the Employment Judge having decided that the Tribunal had jurisdiction to hear argument under Rule 5 in relation to extension of time expressed the following view:
"76. In deliberating whether to grant an extension under Rule 5 the Tribunal had regard to the overriding objective and in particular the need to deal with cases fairly and justly. In doing so, the Tribunal gave consideration to the examples of situations where Rule 5 might be invoked given by the President in paragraph 28 of Software Box Limited. There he cited instances where a person might be hospitalised, having a period of time abroad or perhaps did not receive correspondence for completely understandable reasons. The Tribunal adhered to the reasoning in Software Box Limited that in these circumstances it would be surprising if there was no judicial route to fairness and indeed it would be consistent with the overriding objective if such a judicial route were to be found via Rule 5.
77. However, the circumstances there cited and indeed the circumstances in Software Box itself (where the claimant did not receive the key Notice of Payment as it was sent to the wrong address) are markedly different from the present circumstances. In each of these circumstances an extension of time would be consistent with the need to ensure parties are on an equal footing as lack of receipt of the key documentation could not be said to be the fault of anyone. In the present circumstances the claimant's solicitors did not sent the Notice of Appeal timeously to the Employment Tribunal Service. There were reasons for them not doing so, but nonetheless the fault was their own. In these circumstances it is the decision of the Tribunal that fairness and justice do not favour the extension of the time limit under rule 5."**Submissions on Appeal**
- The first argument advanced by Mr Cunningham before me related to his claim that the Tribunal had erred in holding that the first claim was competently rejected. He pointed out that there are no time limits in section 111 of the Employment Rights Act 1996 ("ERA") relating to payment of fees or rejection of claims if a time limit is not met. The authority to reject claims comes only from the 2013 Regulations. Although the rules in Schedule 1 identify that for the purpose of the Rules the Tribunal includes that body performing administrative and judicial functions, that did not change the character of who the Tribunal was. In essence, Mr Cunningham submitted that as it was accepted on both sides that the first claim had never been before an employment judge prior to the applications for extension of time made by the claimant, the claim could not have been competently rejected because Rule 11 involves a judicial act. Even if Rule 11 could be regarded as involving an administrative act the administrative act must be performed by the Tribunal. The complaint was that effectively the administration of the Employment Tribunal had rejected a claim with the consequence that it was then prima facie time barred. There was support in the decision of Lord Ross in the Outer House in Young v Fife Regional Council 1986 SLT 331, for the general rule that, where statutory powers are given to a body, exercise of their powers and functions may not be delegated unless there is express provision therefor or the power to delegate can be necessarily implied.
- Mr Cunningham argued also that it was contrary to the protection afforded by Article 6(1) ECHR to determine a claim administratively. The Tribunal Office was not an independent and impartial Tribunal established by law as required by the Convention. Accordingly where a power was conferred on the Tribunal it could not be delegated to the Tribunal Office. Reference was made to Ghaidan v Godin-Mendoza  2 AC 557 at paragraphs 30-33. The Employment Judge had failed to read and give effect to Rules 1 and 11 of the 2013 Rules in a way compatible with Convention rights. The Tribunal was wrong to conclude (at paragraph 45) that there was no relevant ECHR at point. The issue was not about failure to pay the fee but about the rejection of a claim which amounts to a determination of someone's civil right for the purposes of Article 6 ECHR.
- In any event, it was argued that in referring to the dicta of Langstaff J in [Software Box Limited v Gannon]() UKEAT/0433/14 the Tribunal had misunderstood the relevant dicta. Focus had been put on the expression in paragraphs 28 and 29 of Software Box that "... in practice the functions of the Tribunal may be dealt with administratively ..." while ignoring the proper context of that statement which was followed by clarification that "... the legal position is that it is the Tribunal, a judicial body, not 'the administration' that deals with it". The correct interpretation of Software Box was that rejection of the claim was a judicial function that ought to be carried out by the Tribunal judicially. The administration has no power to carry out such functions. Software Box was not authority for the proposition that the administration was entitled to carry out judicial functions on behalf of the Tribunal.
- The second ground argued for the appellant was the issue of whether Rule 6 of the 2013 Rules, which is designed to relieve a party of the consequence of non-compliance, can be used to excuse the Tribunal from doing something it is otherwise obliged to do. In other words, could Rule 6 be used to get round the otherwise mandatory provision of Rule 11? In deciding that Rule 6 could not be used in this way the Employment Tribunal had relied on the cases of Cranwell v Cullen UKEATPS/0046/14 and [Deangate v Hatley and Others]() UKEAT/0389/14. Mr Cunningham argued that in so doing the Tribunal had placed undue weight on obiter comments in Deangate made without substantive argument on the application or interpretation of Rule 6. The Employment Judge in this case ought to have carried out her own analysis for the arguments in respect of Rule 6. The obligations under the Human Rights Act were relevant to this aspect of the complaint also. Mr Cunningham maintained that Rule 11(2) was broad enough to cover a failure by the claimant. A purposive interpretation of Rule 6 was required. The Tribunal already gave a 7 day grace period for the submission of the proper fee remission form, something for which there is no provision in the Rules. The alternative would be the immediate rejection of a claim which did not include such remission. If it was competent for the Tribunal to qualify its otherwise absolute obligations within Rule 11 then it could take a similar approach to its interpretation of Rule 6. Rule 11(2) was broad enough to cover a failure by the claimant.
- The third matter related to the Employment Judge's approach to the application of rule 5. While the correct test of that contained within the overriding objective was set out, the Employment Judge had then failed to demonstrate that she had actually applied that objective. Reference was made to paragraphs 76 and 77 of the judgment. The error was to treat the examples given within paragraph 28 of Software Box Limited as either an exhaustive list of grounds in which Rule 5 might be invoked or as imposing an additional requirement that an extension of time could only be granted in circumstances where no fault lay on the part of the party seeking to invoke it, or on the part of their advisors. In any event, the Employment Judge had failed to consider the balance of prejudice. Mr Cunningham argued that the important dicta in Software Box Limited related to the competency of Rule 5 being used to excuse a failure of this type. The comments in relation to the types of circumstances in which it might be used were obiter and in any event were intended simply to demonstrate the potential perversity of an argument that Rule 5 could never be used to extend time for payment of a fee. Each case involving Rule 5 will be fact sensitive and that was not appreciated by the Tribunal in this case. There was a complete absence in this case of identification of the factors which rested in favour of and against the exercise of discretion in favour of the claimant. It is implicit that a balancing exercise must be carried out in terms of Rule 5, and within the confines of the overriding objective. The Employment Judge's sole focus appeared to have been the question of whether there was fault, which was the wrong test. Even if there was fault, that would simply be fed into the balance of the various relevant factors in deciding whether it was fair and just to extend the time limit. Had a proper balancing exercise been carried out the Employment Judge would have taken into account the following important factors:
- The balance of prejudice weighed heavily in favour of extension of time to the claimant who would otherwise be unable to proceed with his claim. The respondent would suffer no prejudice other than a possible tactical one.
- The claimant had acted timeously in seeking an extension of time having done so immediately on it becoming apparent that the claim had been rejected on 3 October 2014.
- The claimant had submitted his ET1 timeously.
- The claimant had submitted his fee remission timeously.
- In considering the question of prejudice, regard had to be had to the outcome sought by the claimant. If his dismissal on grounds of gross misconduct stood he would be significantly prejudiced in the job market standing the length of time he had been employed by the respondent.
- The respondents had had the opportunity to make representations and to put forward all matters, including any prejudice to them that might be relevant to the Rule 5 exercise.
- The claim had a potentially high value having regard to the salary of the claimant.
- The claimant and his representatives had not wilfully or recklessly failed to comply with the Rules.
- Had these factors all been taken into account the only feasible outcome would have been to allow the claim to proceed. In interpreting Rule 5 as leading to a conclusion that because there was fault on the part of the claimant's solicitors extension should not be granted was directly inconsistent with the overriding objective as fault is irrelevant to issues of fairness and justice absent any issue of prejudice. The failure to address the balance of prejudice in considering the Rule 5 application was sufficient to allow the appeal.
- The fourth ground argued by Mr Cunningham related to the Employment Judge's treatment of the second claim. In particular, in addressing the question of whether or not it was reasonably practical for the claimant to have presented the second claim within the statutory time limit, the Judge had treated the fact that the claimant was represented by skilled advisers as determinative rather than a factor, albeit a significant one, relating to the application of the test (paragraph 63). While the Tribunal purported to have regard to Software Box Limited (paragraph 65) there had been a complete failure to identify and apply the principle stated therein to the factor of represernation. In particular, the Judge had failed to consider the question of whether the professional advisers reasonably understood the first claim to have been submitted in time. Albeit that that was the point made with reference to an unrepresented claimant by Langstaff J in Software Box Limited (quoted by the Employment Judge at paragraph 65) the error was in then implying (paragraph 66) that Dedman v British Building & Engineering Appliances Ltd (1974) ICR 53 was authority for requiring absolute perfection from skilled advisors. Mr Cunningham submitted that taken together, the principle of "reasonable understanding" in Software Box applied equally to the reasonable understanding of a skilled adviser, albeit that the question of whether any misunderstanding was reasonable would factor in the more onerous expectations on a professional adviser than on a lay individual. An error made by a skilled adviser is not absolutely determinative. Further, the issue for reasonable practicability was not whether a mistake was a reasonable one but, in the context of where an earlier claim has already been submitted timeously, whether a mistaken belief that a first claim validly presented remained competent before the Tribunal was reasonable, having regard to all the facts and circumstances. The Employment Judge's focus on an error with reference to the first claim rather than considering the circumstances in which the second claim was presented was a clear error in law. The question of reasonable practicability related to the circumstances pertaining to the second claim and the only relevance of the first claim was that it was, until rejected, pending before the Employment Tribunal at first instance. This approach was the one confirmed as correct in the recent decision of Simler J (President) in the recent decision in Adams v British Telecommunications Plc UKEAT/0342/15.
- Mr Miller for the respondent addressed each of the four main issues argued by Mr Cunningham. In relation to whether the rejection of the claim had been an administrative or judicial act he referred to Rule 1 of the 2013 Rules, the interpretation rule and in particular the following:
"(1) 'Employment Tribunal' or 'Tribunal' means an employment tribunal established in accordance with regulation 4, and in relation to any proceedings means the Tribunal responsible for the proceedings in question, whether performing administrative or judicial functions."
- Under reference to Langstaff J's decision in Software Box Mr Miller argued that the statements at paragraphs 28 and 29 thereof made clear that while fee payment and fee remission were dealt with administratively the law treats it as a decision made by the Tribunal. Accordingly it is the Tribunal, a judicial body, not the administration that deals with it. It had to be conceded on behalf of the respondent that the Employment Judge had been wrong in characterising the rejection of the claim as an administrative act. However, her overall decision was correct in that the Tribunal as a judicial body had rejected the claim. In essence not every act of the Tribunal had to come from a judge. Certain acts could be carried out by the Tribunal office but they carried the authority of the Tribunal itself.
- So far as the second argument relating to Rule 6 and its possible application to Rule 11, Mr Miller contended that the decision of Langstaff J in Software Box clearly rejected the claimant's position. Further, the relevant passages in Cranwell v Cullen and Deangate v Hatley and others were directly in point. The dicta in Cranwell was part of the ratio and not observational although it was accepted that the comments in Deangate had been obiter. In Cranwell Langstaff J had included as follows:
"Rule 6 is, in the way it is constructed, plainly designed to allow a Tribunal to relieve litigants of the consequences of their failure to comply. It makes little sense to construe it as entitling the Tribunal to avoid having to satisfactory an obligation which is placed upon the Tribunal itself in absolute and strict terms. To say in one part of the Rules 'The Tribunal has no option but to do X' and then to read it as subject to the proviso 'except where it does not want to' is incoherent."
- In this case, just as it did in Cranwell in relation to another mandatory rule, Rule 10, the Tribunal complied with its obligations in terms of Rule 11. The issue under discussion in Cranwell was directly in point to that before the Employment Judge in this case and was binding upon her. It was therefore wrong to say that the Employment Tribunal in this case had fallen into error in its interpretation of Rule 6. There was a relationship between this argument and the ability to exercise discretion under Rule 5. It would make no sense if claimaints could resort to either Rule 5 or 6 in circumstances such as the present.
- On the issue of the approach to the exercise of discretion under Rule 5, in contrast to the first two arguments, Mr Miller characterised this as one that would require to be almost perverse before it could be overturned. By the time the Employment Tribunal in this case made a decision the issue of law in relation to the ability to use Rule 5 in these circumstances had been resolved by Langstaff J in Software Box. There is no doubt that Rule 5 can mitigate the consequences of Rule 11 where there are exceptional facts.
- It was pointed out that the appellant in this case conceded that the Employment Tribunal had stated the correct test. Accordingly it had been for the Tribunal to apply that test to the facts. One of the issues of contention was whether the Employment Judge had treated the examples in Software Box as some sort of exhaustive list. Reference is made to paragraphs 76 and 77 of the judgment. The Employment Judge concluded that the examples given in Software Box were markedly different from the present case. That was indisputable. The court should be slow to overturn the decision of a primary fact finder on such an issue. On a fair reading of the judgment the criticism that the judge treated the list in Software Box as exhaustive was not borne out. The EAT can only interfere with the exercise of a Judge's discretion where no reasonable Employment Tribunal would have reached the same decision.
- So far as balance of prejudice was concerned, it was accepted for the respondent that the balancing exercise had to be carried out. However this was done as part of the overriding objective. In this particular case fault on the part of the appellant or his agents amounted to the same thing as prejudice to the respondent. No difficulty arose from the Employment Judge's reference to the relevant case law on the alternative remedy of suing the solicitor. In this case the Employment Judge focused on the fault of the solicitor because she relied on the Dedman line of authority. It is because of the existence of a remedy against the adviser that the prejudice to the claimant is balanced out. It was acknowledged, however, that in light of the finding at paragraph 17 of the judgment that the solicitor's had been experiencing difficulties with their fax machine but that those did not include the non-receipt of faxes sent from that office there could be no cast iron case against the solicitors. In summary the Employment Judge had been correct to regard this case as not being an exceptional one of the type that Langstaff J had suggested was required. While Rule 5 could not be applied in a punitive way neither could it be said that fault was irrelevant and so the Employment Judge had not erred. At paragraph 64 the Employment Judge had made clear that some sort of follow up after the sending of the fax would have been prudent. Had that been done no issue of prejudice would arise.
- So far as the reasonable practicability argument in relation to the second claim was concerned a reference was made to section 111 ERA 1996. It was accepted that the first claim had been lodged timeously and was subsequently rejected for other reasons. Where there has been a first timeous claim and a subsequent late second claim provisions of section 111 on the face of it did not apply. The problems that engendered had been resolved by Langstaff J in Software Box. Accordingly, the analysis of the second claim had to be informed by the factual circumstances of the first claim.
- The Tribunal had been correct to note that in both the cases of Walls Meat Ltd v Khan and Software Box the claimant had been unrepresented. It was a question of whether there was any impediment to the lodging of a timeous claim. Mr Miller was constrained to accept that the Employment Judge had not drawn any real distinction between claims 1 and 2 in addressing the facts but argued that there had been no real need for her to do so as the facts in relation to both claims were relevant in considering the question of reasonable practicability.
- The first question that arises for determination in this appeal is whether the Employment Tribunal erred in finding that the rejection of the first claim had been made by the Tribunal for the purposes of Rule 11(2) and that it was competently rejected under the terms of that Rule – paragraph 48 of the judgment. There seems to have been some confusion on the part of the Tribunal in this case about whether the rejection of the claim was a judicial or administrative act. It appears that the Tribunal concluded that the claim was rejected as some sort of administrative function. To that extent, I consider that the Employment Judge fell into error. However, I reject Mr Cunningham's contention that, as rejection of a claim is of its nature a judicial act, that act cannot be carried out in the name of the administration. It is relatively commonplace in the ordinary courts for a judge's order to be initialled or signed by an administrative clerk. Such performance does not render the making of the order an administrative rather than a judicial act. It is a judicial act carried out with the support of the administration. That is what happened in this case. All of this is consistent with the decision in Software Box Ltd where Langstaff J observed:
"Though in practice the functions of the Tribunal may be dealt with administratively, the legal position is that it is the Tribunal, a judicial body, not 'the administration' that deals with it."
- Properly understood, that passage, which was itself directed to Rule 11(3), makes clear that rejection of the claim is the judicial act of the Tribunal, albeit conveyed to the party through the Tribunal office or administrative support. Accordingly, no issue of delegation of the type discussed in Young v Fife Regional Council 1986 SLT 331 arises. In rejecting the appellant's claim in this case, the Tribunal did not delegate its function under Rule 11. The function was a judicial one carried out with administrative input. Once the nature of the function performed is properly characterised as being a judicial act performed in the name of the Tribunal through its administrative office, it is clear also that no difficulty with Article 6(1) ECHR compliance arises. The rejection of a claim for failure to comply with a fee requirement is a determination in the sense that it disposes of the applicant's right to have the matter adjudicated, subject only to a possible second claim such as arose in this case. However, as I have found that it is a judicial act and there being no suggestion that the Tribunal itself is not an independent and impartial Tribunal established by law, an applicant's Convention rights are adequately protected. For these reasons, which differ from those of the Employment Tribunal while reaching the same conclusion, I consider that the first challenge to the Employment Tribunal's decision must fail.
- The second matter for my determination is whether Rule 6 of the 2013 Rules can be invoked to waive the fee requirement in this case notwithstanding the absolute duty on the Tribunal in terms of Rule 11. Rule 11(3) provides:
"If a remission application is refused in part or in full the Tribunal shall send the claimant a notice specifying a date for the payment of the Tribunal fee and the claim shall be rejected by the Tribunal if the Tribunal fee is not paid by the date specified."
Rule 6 provides, amongst other things that:
"A failure to comply with any provision of these rules (except Rule 8(1), 16(1), 23 and 25) or any order of the Tribunal (except for an order under Rule 38 or 39) does not of itself render void the proceedings or any step taken in the proceedings. In the case of such non-compliance, the Tribunal may take such action as it considers just ....".
One of the actions noted in a non-comprehensive list that follows is the waiving or varying of a requirement.
Mr Cunningham's argument, that a purposive interpretation is required to enable Rule 6 to be invoked such that it creates a remedy for those who have fallen foul of Rule 11 by not paying the Tribunal fee timeously following refusal of a remission application, is flawed for three reasons. First, Rule 11(3) sets out the unavoidable consequence of failure to comply. Whatever avenues may be available to relieve a party of those consequences there is no doubt that rejection in terms of Rule 11(3) brings a claim to an end initially. To that extent the language of Rule 6 does not lend itself to being applicable as it talks in terms of not rendering void proceedings merely because of a failure to comply. In other words in the face of the clear language of the two rules it would be inapposite and illogical to seek to invoke Rule 6 such that something that Rule 11(3) has brought to an end is not then brought to an end. Secondly, there was authority binding on the Employment Tribunal and to which I afford the greatest respect, consistent with the interpretation I have given. In particular, Langstaff J in Cranwell v Cullen was also of the view that it makes no sense to construe a rule that is in absolute and strict terms so far as the Tribunal is concerned and with another rule (Rule 6 that gives the Tribunal power to relieve a party of a failure to comply with the Rules generally. Thirdly, and most importantly from a fairness perspective, for situations such as the one the present claimant has found himself in, there is now, following the decision of Langstaff J in Software Box Ltd, a clear route available to apply for relief using Rule 5 where appropriate. I reject the contention of counsel for the claimant as Rule 11(2) was broad enough to cover a failure by the claimant. The Employment Tribunal was correct in reaching a conclusion that Rule 6 could not be invoked to allow the Tribunal to waive the requirement imposed upon it in terms of Rule 11(3). I should record for the sake of completeness that Mr Cunningham did not advance an argument in relation to Rule 40 before me. Had he done so, for the reasons given by the Employment Tribunal below, I would have rejected any contention that Rule 40(5) of the Rules could be invoked to provide relief in this situation.
- I now turn to address the Employment Tribunal's approach to the application of Rule 5. Rule 5 provides:
"The Tribunal may, on its own initiative or on the application of a party, extend or shorten any time limit specified in these rules or any decision, whether or not (in the case of an extension) it has expired."
- It was common ground between those appearing before me that the Employment Tribunal had stated the correct test in relation to this aspect of the case. It is now accepted, that following the guidance given by the then president in Software Box that there is a judicial "route to fairness" available in circumstances where a fee was required to be paid by a particular date and had not been. Rule 5 is available to the Tribunal so that it may, on its own initiative or on the application of a party extend or shorten the time for the payment of the fee, or submission of the appeal against fee remission, notwithstanding that the earlier time limit has expired. The main issue was whether the employment judge in this case had treated the examples given by Langstaff J in Software Box as some sort of exhaustive list and thereby erred. There was also the question of whether the Tribunal's reasoning implies that an extension of time could be granted only in circumstances where no fault lay on the part of the party seeking to invoke it or there advisers. Having recorded (at paragraph 77) that the circumstances listed in Software Box and the facts of that case were markedly different from the present circumstances the Tribunal notes that extension of time would be granted where consistent with the need to ensure parties were on an equal footing where lack of receipt of key documentation could not be said to be the fault of anyone. The Tribunal goes on:
"In the present circumstances the claimant's solicitors did not send the notice of appeal timeously to the Employment Tribunal service. There were reasons for them not doing so, but nonetheless the fault was their own. In these circumstances it is the decision of the Tribunal that fairness and justice do not favour the extension of the time limit under Rule 5."
- I have reached the view that the Employment Tribunal in this case did rely on what was regarded as fault on the fact of the claimant's advisers as determinative of the issue. There are two main problems with such an approach. First, on the facts found, the only conceivable "fault" on the part of the advisers was that they did not take an active step to contact the Tribunal to ensure that the facsimile transmission they had sent had actually been received. Standing that the problems they had encountered with their fax machine were not understood to include the non-receipt of faxes by the recipient, describing such an omission as "fault" seems to me to demand something approaching a perfectionist method of working. I do not consider that it can safely be concluded that any reasonable solicitor would have made such an inquiry. Secondly, and more importantly, even if on the facts found there was clear fault on the part of the claimant's advisers, there were other factors to be weighed in the balance before it could be proper to reach a conclusion whether discretion should be exercised in terms of Rule 5. There is on the face of the judgment, no attempt to address the balance of prejudice. A failure to address the issue of balance of prejudice in such circumstances is in my view a clear error of law. I am fortified in that conclusion by the decision of the current President, Simler J, in the case of Adams v British Telecommunications Plc UKEAT/0342/15. That was also a case involving two claims, the second one raised while it was thought that the first one was defective and I will return to it in addressing the second claim in this case. However, for present purposes the following statement by Simler J is pertinent:
"The balance of prejudice is plainly a material factor and was a significant factor in this case. It was not a factor to which the Employment Judge had regard. To the extent that there was some consideration or prejudice to the respondent, it was addressed by reference to irrelevant matters and not by reference to prejudice caused by the claimant's short delay. The question of prejudice is significant, because, on the one hand, the claimant has lost the right to bring a discrimination claim on its merits in the circumstances described and, on the other, the short delay caused no actual prejudice to the respondent in conducting its defence of the claim, apart from the prejudice in having to defend the claim on its merits."
- On that basis Simler J decided that the Tribunal's decision that it was not just and equitable to extend time in that particular case was vitiated through error of law.
- The importance of addressing the balance of prejudice is, as the expression demands, to balance the relative fairness and unfairness, convenience and inconvenience and consequences to each party of the decision to be made in the exercise of the Tribunal's discretion. Nowhere in the decision is the prejudice to the claimant of losing the ability to litigate an important matter balanced against the absence of prejudice to the respondent who is left in no worse a position than they would have been had the fee remission application been received timeously. It seems to me that this is a fairly clear case in assessing the balance of prejudice in that the prejudice is all one way. I take into account all of the factors listed by Mr Cunningham as matters that ought properly to have been considered by the Employment Tribunal. I conclude that the failure in this case to address the balance of prejudice in considering whether the Rule 5 application should be granted amounts to an error of law sufficient on its own to allow the appeal. I will return to that matter in addressing questions of disposal.
- Notwithstanding my decision that the error of law in relation to the application of Rule 5 is sufficient to allow the appeal, I require to address the fourth main argument for the claimant which is the approach taken to reasonable practicability. As Mr Cunningham pointed out, the question of reasonable practicability in this particular case relates to the circumstances in which the second claim was lodged. The relevance of the first claim in this context is that it is part of the factual background explaining the circumstances that required a second claim to be made. The difficulty with this chapter of the judgment, at paragraph 63-66, is that the circumstances of the two claims are treated as one. It is clear from paragraph 64 that the only circumstances taken into account were those relating to the problems with the fax machine on 1 October. Again on the basis of perceived fault on the part of the claimant's advisers the Tribunal concluded that it could not be said that it was "not reasonably practicable" to submit the claims in time. However, there can be little doubt that the second claim was lodged on 8 October 2014 within a very short period after the discovery of the rejection of the first claim due to lack of receipt of the appeal against the fee remission decision. This is acknowledged by the Tribunal in paragraph 68 where it is specifically recorded that the claimant had presented the second claim within such further period as was reasonable in terms of section 111 of the Employment Rights Act 1996. On any view the Tribunal decision is internally contradictory in relation to the issue of reasonable practicability. A proper analysis of the facts and circumstances relating to each claim would have been to acknowledge that the claimant and his advisers wrongly but genuinely understood that the appeal against the refusal of fee remission had been lodged timeously on 1 October. On discovering that the application had not been received and the first claim therefore rejected, there was no delay in the lodging of the second claim. Accordingly, had the Tribunal separated the first and second claims in its analysis, the irresistible conclusion would have been that, while the circumstances that led to the first claim being rejected and therefore not timeous had to be acknowledged, the second claim was initiated promptly following the realisation by the solicitors that their understanding that they had lodged a fee remission claim timeously was wrong. In the absence of any criticism that can be made of the claimant and his adviser in relation to the second claim being lodged as soon as reasonably practicable in the circumstances and having regard to the balance of prejudice which overwhelmingly militates in favour of allowing a claim that would otherwise be lost to proceed, it is difficult to see the justification for also rejecting the second claim. Again the approach taken by Simler J (President) in Adams v British Telecommunications Plc is of interest. In that case, a first claim was presented timeously but was defective because the ACAS certificate number was inaccurate. By the time the Tribunal had returned the form to the claimant's solicitor and a second form was completed, the time limit for lodging the claim had passed and the second claim was accordingly lodged two days out of time. Simler J held that it was an error on the part of the Employment Judge to focus on the first claim in deciding the question of reasonable practicability. The first claim could and should have been used as a "guiding light" in determining the factual matters but the real question was whether the claimant's mistaken belief that she had correctly presented the first claim on time and therefore did not need to put in a second claim was reasonable having regard to all the facts and all the circumstances - paras 18 and 19. In the present case, the state of mind of the claimant and his advisers was not analysed in the way required. I agree with Mr Cunningham that a mistaken belief may be held by professional advisers just as it may be held by a claimant. The Tribunal ought to have approached matters by considering whether the advisers' mistaken belief in this case, that the fee remission appeal form had been received, was reasonable. Had it been approached that way again the balance of prejudice would have had to be considered and would have favoured the claimant.
- For these reasons I considered that the Tribunal erred in its approach towards the application of the reasonable practicability test and for that reason also the decision cannot stand.
- At the conclusion of the hearing on appeal, Mr Cunningham and Mr Miller addressed me on the various types of disposal that might be appropriate depending on which of the arguments presented, if any, succeeded. As I have rejected the first two arguments presented by Mr Cunningham, I do not need to consider any disposal that might have been appropriate in relation to those. My decision in relation to the first claim is that while it was properly initially rejected by the Tribunal in terms of Rule 11, the Employment Tribunal erred in its approach to extension of time under Rule 5. I have expressed views on the inevitable outcome, once the balance of prejudice is properly considered. I do that as it seems to me to be disproportionate to remit to the Tribunal to consider again the question of extension of time under Rule 5 when the facts are all known and the issue can be easily decided by me as part of the disposal of the appeal. I accept in its entirety the submission made by Mr Cunningham in relation to the balance of prejudice. The eight factors that he put forward as important, when taken into account lead to the inevitable outcome that the claim should be allowed to proceed. There is no prejudice of any note to the respondent. Accordingly I intend to dispose of the matter as suggested by Mr Cunningham by remitting the first claim back to the Employment Tribunal, allowing 28 days for the claimant to resolve the payment of the fee/fee remission matter so that it can proceed thereafter as a first instance claim. There was at this stage no need for me to decide whether to remit back to the same Tribunal or a separately constituted Tribunal. The claim will proceed and be heard by whichever Employment Judge is available to hear it at the relevant time.
- Had I decided the case on the basis that the only error on the part of the Tribunal was the treatment of the second claim, I would have allowed that claim to be remitted back to the Tribunal to proceed again, on the basis that it could be heard by any available Employment Judge.
- In conclusion then I allow the appeal and remit the original claim made in this case to the Employment Tribunal to continue to be processed as an unfair dismissal claim.
Published: 22/11/2016 13:15