1. With commendable clarity, the Tribunal separated the issues of unfair dismissal and wrongful dismissal. We are satisfied that they were fully aware of the need, when determining the former, to have no regard to the findings they had to make, for the purposes of determining the latter, about what was actually said at the meeting on 23 October. It is clear that they knew of the trap for the unwary that existed in that regard and we have no concerns that they confused their role.

Findings on Credibility/ Reliability

1. For reasons which are explained at paragraphs 62 – 66, and, regarding Mr McDonald, at paragraph 71, the Tribunal found the Claimant and his wife to be credible and reliable, Mr McDonald to be unreliable, Mr Kerwin to be unimpressive and vague and Ms Stewart to be generally truthful but mistaken in having asserted that the Claimant was confused about his position at the disciplinary meeting. In respect of the latter, the Tribunal, evidently referring to their own observations as to the manner in which the Claimant answered questions, stated, at paragraph 63:

"The tribunal also suspects that the claimant on occasion gave the opposite answer to a question to that which was syntactically accurate if the question contained a negative or was posed by way of assertion."

and said that they considered that that should have been obvious to Ms Stewart.

Unfair Dismissal

1. The Tribunal found that the Respondent failed to carry out as much investigation as was reasonable in the circumstances. They list their reasons for so concluding at paragraph 68:

"….

* The starting point was the lack of a focused remit to Mr Kerwin as to what he was investigating.

* The Tribunal considered it inappropriate and prejudicial that the basis for investigation should have been Mr McDonald's memorandum dated 26 October 2008 (document 58-59). Ms Stewart described Mr McDonald as being emotionally charged and that the memorandum was an "over the top reaction to what had happened that week". She was surprised this memorandum had been the basis of Mr Kerwin's instructions to investigate the claimant. The grave charges contained in that document that the claimant had acted against direct instructions of the IMP Board struck no resonance with Ms Stewart who as Finance Director and Company Secretary, attended all meetings of the respondent's Board.

* It was inappropriate and prejudicial that the explanation given by Mr Kerwin to each interviewee (except Mr McDonald) for his investigation was "that the purpose of the meeting was to establish the chain of events that led the employees at Bradford being advised of the closure of the operation by David Boyle". Such an explanation clearly indicated that Mr Kerwin was looking for supporting evidence of the claimant's guilt not whether or not the claimant was guilty.

* To neither interview nor make any serious effort to interview Mr Bellwood was in the Tribunal's view a grave deficiency in the investigation.

* To fail to obtain Mr McKeown's approval to the accuracy of the statement taken from him and to then substitute a different version of Mr Keown's statement from the one sent to him for approval, was inappropriate and prejudicial particularly as it involved the addition of critical words viz. "that I was going to be made redundant".

* The failure to obtain a statement from Mr Tracey was indicative of an inadequate investigation. It appeared that his confirmation to Mr Kerwin that he agreed with Mr McDonald's statement was a reference to the memorandum (document 58-59) rather than the statement (document 63-64).

* The conflict between the claimant's memorandum (document 53-54) in relation to Mr Moffat, namely that he should be offered a driving job in Glasgow or dismissed by reason of redundancy should he not wish to accept that and the account given by Mr McDonald of what Mr Tracey said at the suspension meeting, namely that the claimant had implied at the previous meeting that Mr Moffat had also resigned, merited careful investigation.

* Mr Kerwin should have carried out an investigation with Mr McDonald into, for example, what had occurred at the meeting on 23 October 2008, the reasons for the meeting and the significance of any perceived inaccuracies perpetrated by the claimant. The inconsistency referred to in the preceding bullet point should have been explored with Mr McDonald.

* The Tribunal believes that this was a case where the claimant should have been interviewed as a part of the investigatory process. The Tribunal believed that this failure was indicative of Mr Kerwin's investigation being focused on establishing the claimant's guilt.

* The Tribunal did not believe the foregoing deficiencies were made good by Ms Stewart's investigations conducted by telephone in the 35 minute adjournment of the disciplinary hearing. Ms Stewart made five telephone calls as set out in document 73-74 and also formulated her conclusions during that adjournment.

* The Tribunal regarded Ms Stewart's record of her conversation with Mr Kerwin instructive. That the witnesses appeared to have been led to a conclusion was not simply a point raised by the claimant, it was patent from the terms of Mr Kerwin's statements. Ms Stewart's apparent acceptance of Mr Kerwin's confirmation that he had not so led them, was not in the Tribunal's view a conclusion which a reasonable disciplining officer could have reached, nor was her apparent acceptance of Mr Kerwin's explanation for not interviewing Mr Tracey and Mr Bellwood.

* The Tribunal noted that in Ms Stewart's conversation with Mr Bache that Ms Stewart, having regard to Mr Bache's alleged operational responsibilities, did not follow up Mr Bache's assertion that he had no contact details for Mr Bellwood (an employee whose duties included being on call) nor did she ask him what steps he had taken with regard to the Muller "not being fit for purpose" having been copied in on the email by Mr Moffat to Mr McCamley dated 16 October 2008 (document 50).

* The Tribunal noted that having spoken to Mr McKeown who supported the claimant's version of events, Ms Stewart did not revert to Mr Kerwin to explore the conflict between the statement taken by him and her telephone conversation with Mr McKeown. The Tribunal acknowledges that Ms Stewart did not uphold this aspect of the charges, (she could hardly have done otherwise having regard to the absence of any evidence pointing to the claimant's guilt) but considered such further inquiries with Mr Kerwin as something a reasonable employer should have done in order to inform her assessment of credibility on the other charges.

* The conversations with Mr McDonald and Mr Tracey which appear to have been shorter than those with the other three witnesses were once again seeking confirmation rather than getting a proper account of what took place at the meetings on 23 and 27 October 2008. It was patent that the alleged representations about Mr McKeown's resignation was a point of detail in a much bigger picture so far as Mr McDonald in particular was concerned. Ms Stewart could not have doubted that the claimant was acutely concerned about the respondent's profitability during the earn out period or the inherent improbability that the claimant would set out to damage the respondent's profitability during that period. There was clearly a conflict between Mr McDonald's strategy for the future and the claimant's. Ms Stewart made no effort to explore that wider context with Mr McDonald and in particular where Mr McDonald's assertions did not sit with her own knowledge e.g. disobedience by the claimant of board instructions. She did not explore or investigate the internal conflict exposed in Mr McDonald's statement (document 63-64) as to whether the claimant had represented that Mr Moffat had also resigned. She made no investigation into the discrepancy between the grounds for suspension and the grounds for disciplinary action."

1. They also found that Ms Stewart did not have in mind reasonable grounds on which to sustain her belief in the Claimant's guilt. They list their reasons for so concluding at paragraph 69:

"……

* In the Tribunal's view the inadequacy of the investigation was patent. By inadequacy the Tribunal means having fallen well outside the band of a reasonable investigation which a reasonable employer of the resources available to this employer should have carried out. Reasonable grounds were accordingly lacking.

* The Tribunal did not regard the late notification of the vehicle operator's licence issue in the course of negotiations between the respondent's previous shareholders (i.e. the claimant and his wife) and the Tracey Group as a justifiable basis to doubt the claimant's truthfulness.

* In her assessment of where the truth lay, Mrs Stewart seemed content to ignore certain matters within her knowledge, for example:

(a) that Mr McDonald's description of the claimant's role as Operations Director as unchanged in his email to the claimant dated 14 August 2008 (document 46) was at best less than candid.

(b) that assertions by Mr McDonald in his memorandum dated 26 October 2008 (document 58-59) did not square with her understanding as a participant in the respondent's Board meetings. It was also clear from her evidence that Ms Stewart did not regard that document as a reliable exposition of the facts.

(c) that the statement by Mr McDonald (document 63-64) contained inherent inconsistencies as to how many and which operators the claimant had said had resigned.

(d) that her acceptance of Mr McKeown and the claimant's evidence about what the claimant had said with regard to the potential closure of Bradford, which conflicted with Mr McDonald's statement, might raise issues of reliability on the other matters canvassed in that statement.

(e) that the documented explanation by the claimant for bringing the Muller to Glasgow (i.e. for repair) cast doubt on Mr McDonald's conviction that the bringing of the Muller to Glasgow was part of an unauthorised programme of closure by the claimant of the Bradford operation.

* In addition Ms Stewart failed to advise or give the claimant the opportunity to comment on the information gathered by her during the adjournment."

1. At paragraph 70, they conclude that, in those circumstances, it was not open to Ms Stewart to find the Claimant guilty of gross misconduct.

Breach of Contract

1. The Tribunal having accepted the Claimant's evidence that he did, at the meeting with Mr Tracey and Mr McDonald, correct his earlier statement that Mr McKeown was resigning and that he did not tell the men that the Bradford operation was definitely closing, they found, at paragraph 71, that he had not breached his contract with the Respondent. They observed that Mr Tracey did not give evidence, that Mr McDonald was not a reliable witness and that he did not, in any event, actually give evidence about what had happened at the meeting. All he had done was confirm that a particular document was a statement prepared by him.

1. The Notice of Appeal is lengthy (16 pages) and discursive in nature. There is overlap between some of the grounds of appeal. The notice was amended (on an unopposed motion) at the start of the appeal hearing so as to add another ground of appeal (ground 12A). Not all of the grounds of appeal were spoken to in argument. We find it convenient to deal with each ground of appeal that was addressed (in the order in which Mr Walker made his submissions), the response and our discussion, sequentially.

1. General Submission – delay

1. Mr Walker referred to the lapse of time between the issuing of the judgment and the issuing of the written reasons. He also referred to various small errors such as that Michael Tracey was referred to as "William" Tracey and some errors regarding dates of meetings and documents. The judgment was, he submitted, less than accurate in respect of these details. His point appeared to be that that must have been due to the passage of time and was indicative of that passage of time having had a detrimental effect on the overall quality of the judgment.

1. We do not accept that there is any merit in this submission. Quite apart from anything else, it ignores the fact that the Tribunal had evidently been able to reach a decision in respect of all parts of the Claimant's claim by 29 September 2009, the date that the judgment was signed. We cannot see that there is any basis for drawing an inference of deficiency in the reasoning that lay behind it from the fact that the written reasons were not issued until four months later (a period which included the Christmas and New Year break), which is all that the submission amounted to.

2. Breach of Contract:

(a) The Tribunal erred in holding that the Claimant and his wife were credible and reliable

1. Mr Walker referred to evidence before the Tribunal about a letter sent by the Claimant's solicitor to Mr Tracey, dated 20 November 2008, on the instructions of the Claimant. Both he and his wife had confirmed its accuracy, in their evidence. It referred to "the material resignation" as being that of Mr Bellwood. The Claimant's wife had been cross examined about the meaning of the expression "material resignation" and she had said that it was a reference to the "only" resignation. The Tribunal had not dealt with this passage of evidence. The essence of Mr Walker's submission was that the terms of the letter were indicative of the Claimant having said that there was more than one resignation, that supported the Respondent's account of events, that pointed to the Claimant and his wife not being credible witnesses and the Tribunal was obliged to make findings about the matter. Mr Walker also submitted, under reference to evidence given by the Claimant and his wife about their attendance at meetings with the solicitor, that their evidence conflicted on the matter of whether Mrs Boyle attended or not. That too had the potential to undermine their credibility and reliability and the Tribunal had erred by not making findings about it.

1. Mr Napier submitted that the evidence relied on did not support the proposition that it pointed to the Claimant or his wife lacking in credibility or reliability.

1. We agree. Mrs Boyle's evidence, namely that as far as she was concerned the solicitor's letter referred to the Claimant speaking of there being only one resignation does not conflict with his or her position on the matter. As to the evidence about attendance at meetings with the solicitor there was more than one meeting, as Mr Walker appeared ultimately to accept, and there was no evident contradiction as between their accounts about that. Moreover, findings on credibility and reliability lie within the province of the Tribunal of first instance. Rarely will it be open to this Tribunal to interfere with them – it will usually only be in cases of perversity that it would be appropriate to do so. Here, even on the basis that Mrs Boyle's evidence on these collateral matters was open to question, we could not have concluded that the Tribunal's overall conclusion that both she and the Claimant were credible and reliable was thereby demonstrated to have been perverse.

(b) The Tribunal erred in finding that Mr McDonald was not a reliable witness

1. Mr Walker referred to paragraph 65 of the Tribunal's reasons and, in particular their reliance on what they referred to as contemporaneous emails. He submitted that there were no such emails. Also, the conversation on 27 October with Mr McDonald that was spoken to by the Claimant's wife only emerged when she gave evidence before the Tribunal. He also referred to his submissions regarding the credibility of Mrs Boyle. Mr Napier submitted that it was plainly open to the Tribunal to take the view that Mrs Boyle's email of 3 November did support her account of the conversation on 27 October, given the reference to a "settlement" being offered to the Claimant and nothing was to be taken from her not having referred to the conversation earlier.

1. We agree. The reference to the position being that Mr Tracey would be offering a settlement to the Claimant was plainly supportive of Mr McDonald having made it clear to Mrs Boyle that her husband would not be back at work, the intention being to "buy him off" and we cannot see that anything turns on the conversation not having been referred to prior to Mrs Boyle giving evidence about it.

(c) The Tribunal erred in failing to make material findings regarding the Respondent's note of the disciplinary hearing

1. Mr Walker focused on the final sentence of the penultimate paragraph on the last page of the minute and seemed to be submitting that notwithstanding the two paragraphs on the previous page which were plainly to the effect that the Claimant stated he had told Mr Tracey and Mr McDonald that Mr McKeown was not resigning, it was not open to the Tribunal to find that "No" should, on the last page, have read "Yes". Mr Napier submitted that the apparent conflict in the entries in the notes gave rise to no concern. It was obvious that the last entry was in error. The two earlier entries would not, otherwise, have made sense.

1. We agree. There was nothing in this point. Nor was there anything else in the evidence before the Tribunal that suggested the Claimant had made what would have been a damning admission at the disciplinary hearing.

(d) The Tribunal erred in failing to take account of the totality of the evidence relating to the breach of contract claim

1. Mr Walker referred to evidence given at the tribunal hearing by Mr McKeown; he had stated that he did not tell Mr Bellwood or the claimant that he had resigned. Separately, the claimant had accepted in evidence that Jane Stewart could have had "a trust issue" with him, given his late disclosure of the Traffic Commissioners matter. The tribunal ought, he submitted, to have made findings about these matters. He did not, however, indicate what difference, in his submission, it would or ought to have made had they done so. Mr Napier did not make specific submissions in relation to this ground of appeal but he had a general submission that there was no substance in the attack on the tribunal's finding that the claimant was not in breach of contract.

1. We do not consider that the tribunal was bound to make any findings in relation to these matters. Regarding Mr McKeown's evidence about what he told Mr Bellwood, it was not demonstrative of what Mr Bellwood had told the claimant. So far as it related to what Mr McKeown had told the claimant, the tribunal made findings about that and they did not need specifically to relate those findings to his evidence. Regarding the Traffic Commissioners matter the point was not whether or not Jane Stewart would have been entitled to have a "trust issue" with the claimant. The tribunal's concern was that she allowed it to influence her thinking in circumstances where they evidently considered it was not relevant.

1. We are, in these circumstances, satisfied that there is no merit in the Respondent's appeal against the finding that the Claimant was not breach of contract and was, accordingly, wrongfully dismissed.

3. Unfair Dismissal

(a) The Tribunal erred by substituting its own decision for that of the Respondent

1. Mr Walker referred to the Tribunal having found that Mr McKeown was "second man" to Mr Bellwood; there was, he said, no evidence about that. He referred to their having rejected Ms Stewart's position that the Claimant was confused at the disciplinary hearing and submitted that that showed they were substituting their own view for that of the Respondent. He referred to the evidence regarding the Claimant's business proposals document, particularly that it was typed up on 22 October but no fax bearing that date was produced at the Tribunal, he referred to certain emails having been before the Tribunal but not before the disciplinary hearing, he referred again to Mrs Boyle's email of 3 November as not having, in his view, supported her account of the conversation with Mr McDonald on 27 October, and he referred to the Tribunal having taken into account the administrative resources of the Tracey Group rather than confining their considerations to the resources of the Respondent; he believed it to be wrong to suggest that they could look beyond their own resources to the wider resources of the group. He said that he did not consider it critical that Ms Stewart/Mr Kerwin did not contact Mr Bellwood. He did not consider that Mr Kerwin required to interview the Claimant. He considered that Ms Stewart was entitled to deal with matters as she did and the Tribunal's findings about her reaction when she first received Mr McDonald's memo simply showed that she was fair; he did not appear to appreciate that the Tribunal's concern was that when it came to considering her decision on the sharp issue of credibility that she had to determine, she had no regard to her own, significant, earlier reaction. He referred to his earlier submissions regarding the Tribunal's rejection of Mr McDonald's evidence and submitted that if we were persuaded about that then it would assist in showing that the Tribunal had substituted their own view for that of the reasonable employer. He also referred to the Tribunal having considered that Ms Stewart ought not to have taken the late disclosure of the Traffic Commissioners' matter into account.

1. Mr Napier submitted that the proposition that the Tribunal had substituted its own view was ill founded. They had not erred in the applicable law. They had taken account of the relevant facts. It could not be said that they had reached a view that no reasonable tribunal could have reached. They had a tenable basis for rejecting Mr McDonald's evidence.

1. We do not consider that there is any merit in the submission that the Tribunal substituted its own view for that of the reasonable employer. This is not a case where they have referred to the "reasonable employer" by way of mantra; on the contrary, it is clear from their reasons that they have been very careful to be maintain the objectivity that the "reasonable employer" test requires. None of the small details referred to by Mr Walker demonstrate otherwise. In particular, he was, we consider, not correct in his submission that they were not entitled to regard the whole administrative resources of the Tracey group as being available to the Respondent (the Tribunal made a finding in fact that that was the case), not correct in his submission regarding the failure to interview the Claimant – it was plainly open to them to find that a reasonable employer would, in such circumstances of a sharp conflict of accounts as to what was said, have done so and his submission regarding Ms Stewart's initial reaction to Mr McDonald's memo missed the point. As for Mr McDonald's reliability, as above noted, we consider the Tribunal were entitled, in the circumstances, to reject his evidence. Regarding the Traffic Commissioners matter, there is no indication of the Tribunal's view being other than their assessment of how a reasonable employer would have conducted itself.

1. We note that the circumstances included that the matter did not have obvious relevance to the issue for the employer and, further, that Ms Stewart had not told the Claimant that she was taking it into account; an Employment Tribunal was plainly entitled to conclude that a reasonable employer would not have allowed the matter to carry weight in the decision making process.

(b) The Tribunal erred in finding that Ms Stewart did not have reasonable grounds for her belief in the Claimant's guilt because (i) they used the wrong test regarding the availability of administrative resources (ii) erred in holding that Ms Stewart "seemed content to ignore certain matters within her knowledge" (paragraph 69) (iii) failed to specify what the Claimant could have given clarification of or comment on in their criticism of the failure to give the Claimant an opportunity to comment on the information gathered by Ms Stewart during the adjournment of the disciplinary hearing, and (iv) erred in failing to find what was the reason for dismissal and in then criticising Ms Stewart for adding a reason which had not formed part of the 'charge' against the Claimant when it came to her dismissal

1. Mr Walker repeated his submissions regarding the relevance of the Tracey Group's administrative resources. The basis on which he submitted that the Tribunal were not entitled to find that Ms Stewart seemed content to ignore the matters listed by them at paragraph 69 was not entirely clear. Regarding (iii) he stated that the only finding made by the Tribunal related to Mr McKeown having confirmed that the Claimant did not say that Bradford was going to be closed; he did not appear to appreciate that what the Tribunal were pointing out was that Mr McKeown had told Ms Stewart something which plainly supported the Claimant's account of matters yet she did not make him aware of that. Regarding the additional matter which appeared as a reason for dismissal in Ms Stewart's letter, he submitted that it did not matter since it was not the principal reason and the Claimant had had notice of the "charge" to which the principal reason related.

1. Mr Napier made some general observations to the effect that Ms Stewart had the task of making a career critical decision so far as the Claimant was concerned. He would be wholly deprived of the opportunity to receive the additional payment of £600,000; the circumstances were comparable to those in A v B [2003] IRLR 405. The Tribunal required to look at what was done and not done in the course of investigation. They were entitled to take the view that they that there was a series of significant failures in the investigative process. They focused on important matters in so doing.

1. We are satisfied that there is no merit in this ground of appeal either. There were significant failings in the investigative process, as discussed by the Tribunal at paragraph 68. These were, as Mr Napier submitted, important matters and it was plainly open to the Tribunal to conclude that, when considered together, they could only conclude that the investigation fell well outside the band of the reasonable investigation which an employer with the resources of the Tracey group available to it, would have carried out. Had Ms Stewart stood back and looked at the whole investigation, it ought to have been clear to her that the deficiencies, as identified by the Tribunal, were such that she could not reasonably rely on it. The Tribunal did not rely on the "career impact" factor to which Mr Napier referred but we accept that, in the particular circumstances of this case, a reasonable investigative process would have had regard to the potentially devastating wider implications of dismissing the Claimant, namely that he would lose all prospect of receiving an additional £600,000.

(c) The Tribunal's finding that it was not within the band of reasonable responses for Ms Stewart to conclude that the Claimant was guilty of gross misconduct was perverse in respect that they failed to make any findings as to the principal reason for dismissal and whether it fell within that band

1. Mr Walker submitted that the Tribunal had not actually found what was the reason for the Respondent's dismissal of the Claimant. They required to do so. If it was that the Claimant had deliberately misled the Respondent, they then required to consider whether dismissal was within the band of reasonable responses. Mr Napier submitted that there was nothing in this ground. It was plain that the Tribunal had found that the reason for the dismissal was misconduct. Further, since the Tribunal had found that Ms Stewart did not have reasonable grounds for her belief in the Claimant's misconduct, there was no requirement for them to go on and consider what would have been their decision had they done so.

1. We agree with Mr Napier. Mr Walker's submission proceeded on a misunderstanding of Burchell and the demands of s.98(4). A Tribunal does not require to consider whether dismissal was a reasonable sanction if it has found that the employer did not have reasonable grounds for believing that the employee was guilty of misconduct in the first place. It is self evident – as the Burchell** guidance strives to demonstrate - that, in such circumstances, if the employee was dismissed then the dismissal was not fair.

General Observations

1. Mr Napier submitted that this was a simple case of unfair and wrongful dismissal and that it had been made unnecessarily and hugely complicated by the detail of the appeal. We agree. The appeal was, we consider, a classic case of a failure to see the wood for the trees and, further, no more than an attempt to have us perform upon the judgment of the Tribunal the type of microsurgery that was condemned by the Court of Appeal as long ago as 1979 in the case of Hollister, a condemnation to which they have since held fast, as recently as this year, in the case of Fuller**.

1. We will record our granting, at the start of the appeal hearing, of the Respondent's motion to add ground of appeal 12A, but otherwise we will pronounce an order dismissing the appeal.