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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Phipps v Priory Education Services Ltd [2023] EWCA Civ 652 (09 June 2023) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2023/652.html Cite as: [2023] EWCA Civ 652, [2023] WLR(D) 260, [2023] ICR 1043 |
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ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL
THE HON MR JUSTICE GRIFFITHS
EA-2021-000491-
VP
Strand, London, WC2A 2LL |
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B e f o r e :
LADY JUSTICE NICOLA DAVIES
and
LADY JUSTICE SIMLER
____________________
| MRS LYNN PHIPPS | Claimant/ Appellant |
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| - and - |
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| PRIORY EDUCATION SERVICES LTD |
Defendant/ Respondent |
____________________
Piers Martin (instructed by Knights PLC) for the Respondent
Hearing date: 10 May 2023
____________________
VERSION OF APPROVED JUDGMENT
Crown Copyright ©
Lord Justice Bean:
History
Phipps lodged a claim for unfair dismissal, age and disability discrimination, harassment, victimisation, "less favourable treatment", and "fundamental breach of contract". In her claim form ET1, she alleged that she was unfairly and in breach of contract dismissed by the Respondent Priory Education Services Ltd on 28 March 2017 with 10 weeks' notice pay, after concerns had been expressed about her failure to obtain a qualification which was mandatory if she was to continue her work with vulnerable children in a children's home.
Services (OALS) as her representative. The standard form wording on the ET1 explained to the Claimant that, because she was providing the name and contact details of a representative, "we will in future only contact your representative and not you." By the time of the striking out of her claim, One Assist Legal Services was being described as One Assist Legal Services Ltd, a company of which Mr Johnstone was apparently a director. However, it was Mr Johnstone personally who was the named representative on the ET1, and no one else at OALS appears to have been involved at any time.
Priory's response form ET3 agreed that the Claimant's dates of employment were between 10 March 2006 and 28 March 2017 and that her job title was Night Waking Officer, but denied her claims of unfair dismissal and breaches of the Equality Act 2010. In its Grounds of Resistance, the Respondent contended that the Claimant had been enrolled for training in the required qualification on 25 March 2015, with a target completion date of 29 September 2016, but that she had completed only one assignment, which was not of a sufficient standard, and was then suspended and given a written warning following a disciplinary process. The ET3 further alleges that the Claimant's course tutor then expressed the view that the Claimant would probably never be able to complete the required qualification, and that a formal process followed in which her lack of progress in obtaining the qualification was explored with her. This process resulted, it is said in the ET3, in her dismissal with notice on 27 March 2017.
very close to the relisted full hearing set to begin on 7 January 2019.
"Dear Sir/Madam.
STRIKE OUT WARNING
Employment Tribunals Rules of Procedure 2013
Rule 37
On the application of the respondent, Employment Judge Dean is considering striking out the claim because
- You have not complied with the Order of the Tribunal dated 18/09/17
- It has not been actively pursued.
If you wish to object to this proposal, you should give your reasons in writing or request a hearing at which can make them by 27/12/18."
Phipps' claim. It gave brief reasons as follows:-
"1. By a letter dated 17 December 2018 the Tribunal gave the claimant an opportunity to make representations or to request a hearing, as to why the claim should not be struck out because:
• the claimant had not complied with the Order of the Tribunal dated 18 September 2017.
• it has not been actively pursued.
2. The claimant has failed to make representations in writing, or has failed to make any sufficient representations, why this should not be done or to request a hearing. The claim is therefore struck out.
3. The hearing fixed for 07, 08, 09 and 10 January 2019 will not take place."
The ET decision of 3 July 2019
Services Ltd was ordered to pay the Respondent £11,906.17 by way of a wasted costs order. We were told that the latter order has never been enforced.
"13. The claimant's evidence was that OASL did not take any steps to prepare for the hearing which was due to start on 12 Mar 2018, and that she did not know about this hearing. She said she did not know about the application to postpone the hearing of 12 Mar 2018. She said she was aware of the hearing listed in Jan 2019 but was not expecting to attend it. She said she was unaware of Tribunal's order of 9 Mar 2018, OASL's failure to comply with the tribunal's order and she was unaware of the strike out warnings and OASL's failure to respond to it. The first she was aware what was happening was when she received a judgment striking out her claim. She complained that OASL deceived her and constantly fed her lies and then made it impossible for her to speak to them. We accept all the claimant's evidence on this."
14. The respondent submitted that it could be inferred from this that OASL's real motivation for applying for a postponement of the March 2018 hearing was that it was not ready for trial and that the postponement application made was dishonest………
17. Under Rule 70 of the ET Rules, a judgment may be reconsidered where it is necessary on the interests of justice to do so. Judicial discretion as to reconsideration should be exercised having regard to the interests of both parties and the public interest in finality in litigation (Outasight
...
21. We do not consider it in the interests of justice to reconsider the Tribunal judgment of 4 Jan 2019 striking out her claim. The claimant did not comply with the Order of the Tribunal of 9 Mar 2018 and failed to respond to a strike out warning from the respondent. The claimant relied on the default of her representative, OASL. However, under the principles in Lindsay, failings of a party's representative will not generally constitute grounds for review."
"22. There was unreasonable conduct of the claimant or her representative under Rule 76(1)(a) of the Regulations in that the claimant or her representative failed to comply with an order of the Employment Tribunal of 9 March 2018, and a breach of the said order under Rule 76(2) of the Regulations.
23. We are not persuaded that the claimant is implicated in the unreasonable conduct and the breach of the order. It was her representative who failed to provide evidence of his inability to attend the hearing listed for 4 March 2018, not the claimant. We accept the claimant's evidence that her representative did not keep her informed on developments in her case and that she did not know of the Tribunal's order of 9 Mar 2018 or the strike out warning nor her representative's failure to respond to it. The fact she was told in or after April 2018 that there was a hearing listed for January 2019 does not mean that she was told of the requirement for her representative to provide medical evidence or of its failure to do so.
24. We find that the claimant's representative acted improperly, unreasonably and negligently. The only reasonable inference from its failure to provide the medical evidence ordered is that there was none and it had mislead the tribunal into postponing the hearing listed for with an untrue reason 12 March 2018. If in fact there was no deception and medical evidence was available, the failure of OASL to provide it was improper, unreasonable and negligent.
25. OASL's conduct caused the respondent to incur unnecessary costs because it had to defend a claim and prepare for its hearing listed on two different dates when, in fact, the hearing never went ahead.
26. Given the claimant's lack of culpability and her representative's entire culpability, it is just for the respondent's costs to be paid entirely by the claimant's representative, OASL…….."
The appeal to the EAT
Phipps, with the assistance of her new solicitors, appealed to the EAT. The appeal was heard by Griffiths J on 6 October 2021. Mr Kohanzad and Mr Martin represented the Appellant and the Respondent respectively as they have before us. The published summary of Griffith J's decision was as follows:
"The ET made no error of law when deciding on an application for reconsideration not to
Although at a full hearing of the application for reconsideration new information was provided, indicating that the fault lay with the claimant's representative rather than herself, the ET was entitled to decide that the interests of justice and the broad discretion it had under Rule 70 made it appropriate for the claim to be struck out. The claimant had a remedy against her representative, and the findings of the ET made that remedy even more promising for her by accepting her evidence, examining the facts and the circumstances, and making strong findings against the representative, leading to a wasted costs order against it. The interests of justice included also the interests of the other party, who had prepared for two full hearings neither of which had been effective, and to the public interest in finality of litigation."
"The assessment of what is in the interests of justice is pre-eminently a first instance exercise and it is not to be done afresh by an appellate tribunal or court in the absence of an error of law, or an assessment which is extreme in its unreasonableness, or which fails to take into account or apply the relevant considerations, such that it constitutes an error of law. There would be no finality in litigation if the interests of justice test was one to be re-examined in the light of the appellate court's own opinion and assessment. The cases in this area all agree that finality is an important factor when considering the jurisdiction to reconsider a decision which has already been made under rule 70."
v Ironsides Ray and Vials [1994] ICR 381. Griffiths J said:-
"42. I do not think that is a fair reading of the ET's decision. Paragraph 21 is preceded by a
43. The tribunal clearly had
44. Moreover, the tribunal, in giving its full written Reasons, some time after making its decision based on those Reasons following the hearing of 3 July 2019, no doubt had in mind that building upon its findings of fact about the outright misconduct of the representative, it had gone on to mitigate the effects of the refusal to reconsider, and therefore the shutting out of the claimant from further pursuing her claim, by ensuring, first of all, that the whole costs penalties of those proceedings fell on her representative and not on herself and, secondly, by
45. It is therefore, in my judgment, incorrect to say that the tribunal was applying a blanket rule in its Second Decision or to read the decision not to revoke the Original Decision as being based entirely on the points made in the last two sentences of paragraph 21 of the Reasons.
46. It is said that the Reasons should have stated the potential exceptions to the general rule stated by Lindsay, and that the failure to do so demonstrates a lack of appreciation of the breadth of the discretion. It is said that the full Reasons should have explored the circumstances of the case. It is said that they should have discussed the interrelation between their findings of fact in paragraph 13 and their decision that it was not in the interests of justice to reconsider the Tribunal Judgment striking out the claim in paragraph 21.
47. All of this seems to me, however, to encourage precisely that formulaic recital of authorities decided on particular facts of particular cases, and to add encrustations into the interests of justice exercise in rule 70, which is discouraged in the judgment of Underhill J. Once one reads the decision as a whole, one sees that it was a flexible, conscientious and just decision, applying the correct principles of law, based on the facts of the case.
...
53. Rule 70 confers a broad discretion. I see no error of law in the ET's approach to this case. In the absence of an error of law there is no reason in this case to overturn the ET's decision that the interests of justice did not require it to revoke the Original Decision. The claimant had a remedy against her representative, and the findings of the ET made that remedy even more promising for her by accepting her evidence, examining the facts and the circumstances, and making strong findings against the representative leading to the wasted costs order. The respondent had prepared for two full hearings and, although it receive an order for costs, it could never recover the time lost in preparation, or the burden on witnesses who expected a hearing and then found it postponed, and then postponed again, before the case was struck out.
54. It was also the case that no steps at all had apparently been taken towards making the case ready on the claimant's side. The claimant was aware of the hearing fixed for January 2019 but was not intending or expecting to give evidence or to attend (Reasons paragraph 13). By the date of the hearing on 3 July 2019 which led to the Second Decision, the claimant's effective date of termination was already more than two years in the past. Given the claimant's remedy against her representative, the ET cannot be criticised for leaving the strike out in place in the Second Decision rather than saying that the case should be reinstated and restarted on a path to a third listing of the full hearing."
Grounds of appeal
i) The ET erred in treating Lindsay v Ironsides Ray and Vials [1994] ICR 381 as a rule of law giving a conclusive answer in every apparently similar case. The ET erred in failing to explore whether the facts found by it (at §13 ET Reasons) amounted to exceptional circumstances, taking the case outside of the general rule (that failings of a party's representative will not generally constitute grounds for review) or are not Meek compliant in that respect.
ii) The ET erred in failing to apply the principles set out by Sedley LJ in Bennett v London Borough of Southwark [2002] IRLR 407. (In the light of the view I take of the first and third grounds it is unnecessary to consider ground 2.)
iii) The ET's refusal to grant the Claimant's application for reconsideration was perverse.
Discussion
Three previous decisions of the EAT
v Supertravel Ltd [1982] ICR 440. An industrial tribunal had refused to award the claimant compensation for her unfair dismissal on the ground that by not accepting a change in work she had failed to mitigate her loss. She had not been given an opportunity to deal with the issue. The tribunal refused a review. Browne-Wilkinson J said:-
"As it seems to us the fundamental question is whether or not the industrial tribunal's decision that the employee had failed to mitigate her loss was reached after she had had a fair and proper opportunity to present her case on the point, being aware that it was a point which was in issue. We do not think that it is appropriate for an industrial tribunal to review their decision simply because it is said there was an error of law on its face. If the matter has been
v Ironsides Ray & Vials [1994] ICR 384 one of the issues before the industrial tribunal had been whether it was just and equitable to extend time for the presentation of a discrimination claim. The claimant's representative had failed to make submissions on this point at the hearing. Mummery J said:-
"The Industrial Tribunal erred in law in holding that it had jurisdiction to grant a review of the earlier decision and to
v Supertravel Ltd which I have just quoted, Mummery J continued with the following much-cited paragraph:-
"In our judgment, the Industrial Tribunal, in granting the review sought by Miss Lindsay, misapplied the provisions of Rule 10, as interpreted in the Trimble case. The facts in this case cannot be properly
v Marsden [2010] ICR 743 the claimant's counsel had made a misleading statement to the Tribunal which deprived his client of the opportunity of an adjournment. The misleading statement arose in these circumstances. A pre-hearing review was listed to determine the issue of whether the claimant was disabled for the purposes of the Disability Discrimination Act 1995. The claimant did not attend. Counsel told the tribunal that he was unable to say whether his client had been advised that he would be required to attend. EJ Hargrove felt obliged to dismiss the claim of disability discrimination. A few days later the claimant applied for a review of that decision in the interests of justice because the only reason that he had not attended the PHR was that counsel had advised him in conference that his attendance was unnecessary. The employment judge granted the application for review, saying:-
".. the claimant specifically asked if he needed to attend the prehearing review and was told by counsel that he need not.
"(i) Having read the claimant's witness statements, one undated and another dated 29 April 2009 I think it is highly likely that had he been present at the pre-hearing review and given evidence, subject to it being believed, he would have succeeded on the long term effect principle which was the decisive factor upon which I was not satisfied at the pre-hearing review. The non-calling of the claimant was a fundamental reason for his failure.
(ii) No fault whatsoever can be attributed to the claimant personally in this respect.
(iii) If the application for a review is refused the claimant's claim in its entirety (including the unfair dismissal claim) is likely to fail. I am far from satisfied that the claimant would be adequately compensated by his right to bring a claim against his former Counsel's insurers. There might for example be an argument that negligence actually during the course of a Hearing is not actionable. Certainly there would be considerable delay in dealing with the matter. That is a relevant factor which I am entitled to take into account. It is not one to be ignored as occurred in Flint
(iv) Any injustice to the respondent could be adequately cured by an appropriate order for costs. The costs of the hearing on 27 March have already been recovered by the respondent from Counsel's insurers. There is no injustice in refusing to allow the respondent to benefit from a fundamental error by the claimant's Counsel which led to the respondent succeeding in a submission on which it would, in my
"15. ... There is in this field as in others a tendency – often denounced but seemingly ineradicable - for broad statutory discretions to become gradually so encrusted with case-law that decisions are made by resort to phrases or labels drawn from the authorities rather than on a careful assessment of what justice requires in the particular case. Thus a periodic scraping of the keel is desirable. (The exercise would indeed have been justifiable even apart from the introduction of the over-riding objective. It is not as if the principles of the over-riding objective were unknown prior to their explicit incorporation in the Rules in 2001: rule 34 (3) (e) itself is based squarely on the interests of justice. But I can see why its introduction has commended itself to judges of this Tribunal as a useful hook on which to hang an apparent departure from a long stream of previous authority.)
16. But it is important not to throw the baby out with the bath-water. As Rimer LJ observed in Jurkowska
"… that dealing with cases justly requires that they be dealt with in accordance with recognised principles. Those principles may have to be adapted on a case by case basis to meet what are perceived to be the special or exceptional circumstances of a particular case. But they at least provide the structure on the basis of which a just decision can be made."
17. The principles that underlie such decisions as Flint and Lindsay remain
18. To the extent, therefore, that the Judge felt free to ignore Flint and, in particular, Lindsay on the basis that the over-riding objective had made them irrelevant, I believe that he went too far. Other errors can also be detected in his detailed reasoning on the alternative remedy issue. In particular……the suggestion in the same sub-paragraph that the possibility of recovery against a third party was inherently of little or no weight seems to me to go further than the authorities would support.
19. But it does not follow that the Judge's decision, or his fundamental reasoning, were wrong. It is clear that he attached decisive weight to the (related) facts (a) that the Claimant's counsel misled the Tribunal and (b) that by doing so he deprived him of the opportunity of an adjournment which would otherwise have been granted: see para. 12 (2) above. Those are an exceptional circumstance. They take the case outside the straightforward "fresh evidence" category which, as Phillips J accepted in Flint, falls to be dealt with under head (d). They also take it outside the ordinary run of cases where a party suffers from the wrong, or indeed incompetent, advice of his representative. Whereas in a case of that kind the overall interests of justice, and in particular the weight to be attached to finality in litigation, may well require that a party bear (as between himself and the other party) the consequences of the errors of his own representative, the Judge was entitled to take a different
20. As regards the errors in the Judge's reasoning on the alternative remedy point noted at para. 18 above, although the Judge may have gone too far in discounting this point altogether, the trend of the modern authorities in this and analogous situations is to emphasise the inherently less satisfactory nature of such a remedy. In this connection I should mention a contention by Mr Anderson to the effect that the Judge failed to address submissions made by him about the availability of a remedy through the Bar Standards Board. There is in fact considerable doubt whether any remedy available through the Board's procedures would be adequate; but in any event I am satisfied that the point was not of such substance that it required to be specifically addressed.
21. I would accordingly uphold the Judge's decision. Further, even if I took the
(1) The interests of justice test is broad-textured and should not be so encrusted with case law that decisions are made by resort to phrases or labels drawn from the authorities rather than on a careful assessment of what justice requires. The ET has a wide discretion in such cases. But dealing with cases justly requires that they be dealt with in accordance with recognised principles.
(2) Failings of a party's representative, professional or otherwise will not generally constitute a ground for review where the disappointed party has had an opportunity to argue the case and wishes to reargue it. This is because considerable weight must be given to the public interest in the finality of judicial decisions, both to protect the opposing party and to avoid over-burdening the employment tribunal system. A typical example of this is a case where a full hearing has been conducted but an argument was not put, or a witness was not called. In most such cases reconsideration will be refused on the grounds that the claimant has had a fair opportunity to put her case.
(3) However, the general rule that a party to tribunal proceedings cannot rely on the default of her representative as the basis for an application for reconsideration is not a blanket rule. In the exceptional circumstance where a party has not had a fair opportunity to present her case, that is a significant procedural shortcoming which may be appropriately dealt with by reconsideration.
The alternative remedy argument
Phipps would have to start by finding a lawyer who was willing to act on a conditional fee basis. Such a lawyer would have to calculate the value of the chance which has been lost by Mr Johnstone's misconduct. This would be difficult when witness statements have not been exchanged, disclosure has not been given, and there would be little if any way of reliably estimating either what prospects of success the ET claim had or the amount of compensation which Mrs Phipps would have been awarded in the event of liability being established. When one adds this to the improbability of OALS Ltd being good for the money - including not only compensation but potentially the enormous costs of a multi-day trial in the county court - the obvious conclusion is that the alternative remedy is a figment of the imagination.
The Rule 70 decision in the present case
view of the judge's finding at paragraph 13 that the first that the Claimant was aware was happening was when she received a judgment striking out her claim, and her further finding at paragraphs 23 and 24 that the Claimant was not implicated in the unreasonable and improper conduct of her representative.
view the reconsideration decision as it was in 2019. The lamentable delays since that time, all of which appear to be attributable to the tribunal system rather than the fault of either party, should not be taken into account.
(1) The strike-out occurred entirely because of the improper conduct of the Claimant's representative.
(2) As the ET found, the Claimant was not implicated in this misconduct and had no knowledge of what was happening until she received the strike-out decision.
(3) The application for reconsideration was made within 10 days of the strike-out decision.
(4) The Claimant had not at any stage been given a fair opportunity to present her case.
(5) Any supposed alternative remedy was fanciful.
very substantially outweighed by the factors in the Claimant's favour.
Phipps' appeal. If the parties cannot reach agreement, then, despite the highly regrettable delay, the case must return to the ET to proceed on the merits in the usual way.
Footnote
very different course.
Lady Justice Nicola Davies:
Lady Justice Simler: