Appeal No. UKEAT/00915/03/SM

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 26 April 2004

Before
HIS HONOUR JUDGE PETER CLARK
MR K EDMONSON JP
MR D G LEWIS

MR FELIX UZOHO	APPELLANT

ANGLIAN WATER SERVICES LTD
(“ANGLIAN WATER”)	RESPONDENTS

Transcript of Proceedings

JUDGMENT

Revised

	APPEARANCES

For the Appellant	MR B UDUJE
(of Counsel)
Instructed by:
Messrs McKinnells 
Solicitors
188 High Street
Lincoln LN5 7BE

For the Respondents

	
MISS R DOWNING
(of Counsel)
Instructed by:
Anglian Water Services Ltd
Legal Services
Henderson House
Lancaster Way
Huntingdon
Cambs PE29 6XQ	

SUMMARY

Unfair Dismissal, Constructive Dismissal

Race Discrimination (Direct)

Admissibility of evidence re: events preceding limitation cut-off in Race Relations Act claim - 
Evidence which related also to the Applicant’s constructive dismissal claim, based on a series of events leading to a ‘last straw’ alleged to amount to fundamental breach of the implied term of trust and confidence.

HIS HONOUR JUDGE PETER CLARK:

1.	The principal issue in this appeal concerns a ruling by the Lincoln Employment Tribunal on 9 December 2002 as to the admissibility of certain evidence, sought to be adduced by the Applicant, Mr Uzoho, at the commencement of what turned out to be a four-day hearing, which resulted in a Decision promulgated with Extended Reasons on 17 September 2003 (the substantive Decision) dismissing his complaints of direct discrimination, victimisation and unfair constructive dismissal brought against his former employer, the Respondent, Anglian Water Services Limited.  We shall refer to the parties by their descriptions below.

2.	There is also a further issue as to the Tribunal’s approach to the question of constructive dismissal where the fundamental term of the contract, said by the Applicant to have been breached, is the implied term of mutual trust and confidence.

Background
3	The Applicant, as described by the Tribunal as black and African, commenced employment as an engineer with the Respondent on 20 August 1990.  He resigned from that employment on 4 September 2001.  On 30 November 2001 he presented an Originating Application to the then London North Tribunal office raising the three heads of complaint mentioned above.  At that time he was represented by solicitors, not his present solicitors, who appended to the application particulars of his case.  In summary, the nature of the case there set out was that the Applicant started at a lower grade than a white comparator, was exposed to racial abuse and stereotyping, made over 80 unsuccessful applications for internal promotion during the employment, on occasions losing out to less well-qualified, successful white applicants, did not receive training afforded to white comparable employees and was the subject of disciplinary proceedings as a result of his race, and/or his having done a protected act in April 2000.  That was a complaint of racial discrimination made to management in relation to training and promotion opportunities.  Finally, he was required to attend a disciplinary hearing on 5 September 2001 whilst he was certificated sick.  The Respondent refused to postpone that hearing; in consequence, he resigned on 4 September 2001.

4.	Those factual allegations were relied upon by the Applicant,

(a)	as particulars of the claim of racial discrimination 

(b)	as to the victimisation claim and,

(c)	to show a fundamental breach of the implied term of trust and confidence, entitling him to treat himself as constructively dismissed in circumstances which were unfair.  

The claims and each of them were resisted by the Respondent.

5.	On 12 March 2002 a hearing of preliminary issues in the case took place before a Tribunal at Lincoln, under the chairmanship of Mr J S Walker.  Those preliminary issues were:-

5.1.	Whether a constructive dismissal amounts to dismissal within the meaning of section 4(2)(c) of the Race Relations Act 1976 (RRA).

5.2.	Whether the events complained of by the Applicant in his Originating Application amounted to a continuing act for the purposes of section 68(7)(b) RRA.

5.3.	If not, whether it was just and equitable to extend time under section 68(6) RRA, to include as allegations of discrimination, matters arising prior to the three-month period expiring on 30 November 2001, the date of presentation of the Originating Application.

6.	The Tribunal, by a Decision with Extended Reasons promulgated on 28 March 2002 (the Preliminary Decision) answered all three questions in the negative.  We should here record that none of the preliminary issues related to the claim of constructive unfair dismissal which was to proceed to a full hearing.  The alleged act of racial discrimination and victimisation found to be provoked in time, was the Respondent’s refusal, communicated to the Applicant on 31 August 2001, to postpone the disciplinary hearing fixed for 5 September.  All other earlier acts complained of were ruled out of time.

7.	The Chairman then made the following directions which appear at paragraph 25 of the Tribunal’s reasons:-

“An agreed bundle is to be lodged not later than fourteen days before the hearing date and witness statements are to be exchanged not less than seven days before the hearing date.  The (revised) time estimate by the Chairman for the substantive hearing is two days and if possible listed before the same Tribunal because of our background knowledge of the matter and the reading we have already done which should save time, neither advocate objecting to that course.  The issues of whether or not there has been “plain” race discrimination, victimisation or constructive dismissal or (subject to any representations by the parties on the day) be dealt with first before proceeding if necessary to the question of what might have happened if the disciplinary hearing on 5 September 2001 had proceeded (see paragraph 7.5 of the Notice of Appearance.”

8.	In fact, one of the Lay Members sitting with Mr Walker on 12 March was unable to sit at the substantive hearing commencing on 9 December but nothing turns on the constitution of the final Tribunal.

9.	At the outset of the substantive hearing on 9 December, Mr Uduje, who had not appeared at the preliminary hearing, made application on behalf of the Applicant to adduce in evidence the Applicant’s employment history prior to 31 August 2001.  It was set out in detail in the Applicant’s written statement following the particulars served with his Originating Application, although Miss Downing makes the point that the final version of that witness statement was not delivered until the day of or working day before the hearing on 9 December.

10.	That application was opposed by Miss Downing on behalf of the Respondent, relying particularly on the principle of proportionality, now enshrined in Regulation 10 of the Employment Tribunal (Constitution and Rules of Procedure) Regulations 2001 and the case management principles contained in paragraph 4 of the Employment Tribunal Rules, Schedule 1 to the 2001 Regulations.

11.	The Applicant’s application to adduce that evidence was put on two bases.  First, so far as the constructive dismissal claim was concerned, the history was relevant in that it amounted to a series of acts which culminated in “the last straw” decision by the Respondent not to postpone the disciplinary hearing fixed for 5 September 2001.  Secondly, that these were, contrary to the Tribunal’s preliminary decision, continuing acts for the purpose of limitation under RRA, and, further, so the Tribunal added (EWR) that history might constitute facts from which the Tribunal might infer or conclude that that failure to postpone amounted to race discrimination or victimisation.

12.	The Tribunal, having considered the arguments of Counsel, ruled in favour of Miss Downing’s contentions.  They refused to admit any evidence of events prior to 31 August 2001.

13.	The Appeal
We return to the principal issue, which is put in two ways by Mr Uduje.  First, that the Tribunal’s finding on the continuing act issue, decided at the preliminary hearing, related only to the question of limitation in the RRA proceedings.  He does not and cannot challenge that finding today but submits that evidence of earlier events may be admissible to prove the in time acts of discrimination and victimisation alleged, see Din (Ghulam) v Carrington Viyella Ltd [1982] IRLR 281 per Mr Justice Browne-Wilkinson, P.  Secondly, and if we may say so with even greater force, nothing in the preliminary decision, either by way of interlocutory ruling or in the preliminary issues actually decided, in any way restricted the Applicant’s ability to advance the constructive unfair dismissal claim originally pleaded, namely, that the earlier events formed part of a series of events which, taken cumulatively, amounted to a breach of the implied term of mutual trust and confidence, the last straw being the Respondent’s refusal to postpone the disciplinary hearing fixed for 5 September 2001, see Lewis v Motorworld Garages Ltd [1986] ICR 157 CA; Logan v Commissioners of Customs and Excise EAT/686/00 23 May 2002 unreported, Mr Recorder Burke Q.C.  No question of limitation arose on the constructive unfair dismissal claim.

14.	In response, Miss Downing invoked, as she did before the Tribunal at the substantive hearing, the principal of proportionality.  She is right to do so.  It is an important part of the Tribunal’s function to case manage.  The difficulty she has in this case, is that an application by the Applicant’s new advisers for a new Directions Hearing, was refused by Mr Walker by letter dated 31 July 2002.  Thus, this important question of admissibility of evidence was left until the first day of the substantive hearing.

15.	Our jurisdiction is limited to correcting errors of law by the Employment Tribunal.  We therefore look to the Tribunal’s reasons for the substantive decision and initial ruling on 9 December 2002.  In order to see how and why they ruled out evidence of events relied upon by the Applicant prior to 31 August 2001, the relevant passage is at paragraphs 13 to 19 of their Reasons.  First, Miss Downing raised the spectre of a 10 day hearing, if all earlier events were to be explored in evidence.  The substantive hearing had been fixed for only two days with the consent of the parties.  Secondly, the Tribunal recall their earlier ruling on limitation under RRA.  Then they refer to the date of the protected act, strictly relevant only to the victimisation claim, that is April 2000.  Next to the overriding objective under the 2001 Employment Tribunal Rules and the principle of case management.  Then to the case of Logan in relation to unfair constructive dismissal and the judgment of Mr Justice Mummery, P in Qureshi v Victoria University of Manchester now finally reported at [2001] ICR 863, on the dangers of race cases running away with historical matters.

16.	In summary, having borne in mind the principal of proportionality relied on by Miss Downing, they conclude at paragraphs 18 to 19:-

“18.	Having considered the matter afresh in the light of all those circumstances, we have concluded that the evidence in relation to that history should not now be admitted in relation to the matters raised in paragraph 12 above for all of the above reasons.

19.	The effect of that decision is that the matter comes before us no longer as a “last straw” case and now revolves primarily around what happened in relation to the proposed disciplinary hearing on the 5th September 2002.”

17.	In our judgment, that reasoning is open to a number of criticisms, particularly:-

17.1   There is no explanation as to why the Tribunal ruled inadmissible 
(a)	potentially relevant evidence to show that the in time alleged act of racial discrimination/victimisation and,
(b)	the evidence upon which the Applicant’s pleaded case of “last straw” unfair constructive dismissal based on the series of events cumulatively amounting, it was alleged, to a fundamental breach of the implied term. 

17.2	Consequently on what basis the Applicant was prevented from advancing his constructive unfair dismissal case.

18.	We accept of course Mr Justice Mummery’s dictum in Qureshi.  Proper case management in advance of a substantive hearing may involve a fairly careful analysis of both the relevance and necessity of adducing historical evidence in a discrimination/victimisation case.  There is no indication that such analysis was ever carried out by this Tribunal.  On the contrary, it seems to us, that the Tribunal have conflated their ruling on continuing act, for the purposes of the discrimination/victimisation complaints, with the two separate admissibility questions in relation to (a) those claims, and, (b) the constructive unfair dismissal complaint.  That was a wrong approach in law in our judgment.  Further, we can see no warrant for arbitrarily restricting the Applicant’s constructive unfair dismissal claim, in the way in which they did.  If there is, it is wholly unclear from the Tribunal’s reasoning, which appears to set out a number of unrelated propositions and then expresses a conclusion without providing reasoning to show the necessary link between the two.

19.	It follows, in our judgment, that this appeal succeeds.  The Tribunal’s substantive decision must be set aside.  It was reached on the basis of an unsupportable limitation on the evidence to be admitted.  The case must be remitted to a fresh Tribunal for re-hearing.  Before that hearing takes place, either on application by one or both of the parties or by the Tribunal of its own motion, a Directions Hearing to address issues of admissibility is desirable so that both parties may properly prepare their respective cases for the substantive hearing.  In approaching that question the principles of relevance, necessity and proportionality will inform the Tribunal or Chairman’s exercise of discretion.

20.	Finally, as to Mr Uduje’s last point in relation to this Tribunal’s self-direction on constructive dismissal, we need say no more than that it is now strictly moot.  At the remitted hearing the new Tribunal will, we anticipate, find the necessary facts on the evidence before it and then apply the formula approved by the House of Lords in Malik v BCCI [1997] IRLR 462.