Freeman v. Sovereign Chicken Ltd [1991] UKEAT 514_89_2707
[1]The practice in the Employment Appeal Tribunal and the Industrial Tribunals is similar - TIMES NEWSPAPERS .[2]Where an agreement is or is alleged to have been entered into prior to the issue of proceedings, it is open to an Industrial Tribunal to investigate facts relevant to Ss.133, 134 and 140; DUPORT and HENNESSY .[3]Once an order of the Court has been made by consent, such an investigation as envisaged in 2. above is no longer relevant, TIMES NEWSPAPERS .[4]Once made, an order of the Court can only be set side if the agreement upon which it was based is set aside also and this can only be done on common law or equitable grounds by separate action in the High Court or a County Court, EDEN and TIMES NEWSPAPERS .[5]Neither before the Employment Appeal Tribunal nor in the Court of Appeal in HENNESSY were the cases of EDEN and TIMES NEWSPAPERS cited nor was the point ever argued that the correct procedure was by way of separate action.[6]It was found in TIMES NEWSPAPERS that there was ostensible authority and the only issue not as yet specifically decided in the cases, is whether or not an Industrial Tribunal is entitled to investigate the authority of the agent signing a COT3 on behalf of a party. This Industrial Tribunal decided that it was not precluded from doing so as the question of authority went to the basis of the issue whether or not any agreement existed. We agree, but would only add that as indicated by Mr Justice Browne-Wilkinson in TIMES NEWSPAPERS it is of vital importance that there should be an end to litigation and that where a barrister or solicitor is involved the likelihood of disproving ostensible authority is slim indeed. It follows therefore that Miss Booth's first point fails. Those who practice before Industrial Tribunals know that the whole tenure of the statutory provisions and the presence and help of conciliation offered by ACAS, engenders an invaluable atmosphere in which to seek to achieve a resolution of the issues between the parties arising out of the employment relationship which is under scrutiny. There may be claims or threats of claims for unfair dismissal, redundancy payments, holiday or sick pay, arrears of pay and allegations or threats of allegations of discrimination. The object of any attempts at settlement will be to dispense with all such issues by agreement which may or may not include the payment of money. Some or all of these issues may be the subject of discussion between the parties and those representing them. As we have commented on other occasions, delay in bringing issues or complaints is contrary to the best interests of good industrial relations and it would be unfortunate if one or other party (more likely the applicant) could, as a matter of tactics, bring and settle one claim and then follow it with another. The very threat or existence of proceedings before Industrial Tribunals can be time consuming and financially onerous. By so saying we in no way intend to diminish the invaluable contribution to sound industrial relationships which has been made by the Industrial Tribunals and the jurisdiction which they exercise, but it is clearly in the interests of all that settlements reached in accordance with the provisions of the statute should be capable of including a "sweeping up" clause as is so often done in practice. We therefore agree completely with the reasoning of the Industrial Tribunal as succinctly expressed in paragraphs 41 - 45. " 41 A solicitor acting for Mrs Freeman would certainly have had such authority, but it does not follow that any lay representative has it. In the present case we think that the question must be decided on first principles, and we confine ourselves to the case of representation by a CAB adviser. In the case of representation by other lay advisers, the position may not necessarily be the same. 42 As far as the CAB is concerned we think that the matter must be looked at in an historical context. CABs up and down the country have for many years provided a service for parties who have felt incapable by themselves of doing justice to their cases before the tribunals, and that service has normally extended to handling the case in its interlocutory stages as well as actually appearing in the Tribunal. The CABs are a recognised and respected source of tribunal representation and CAB advisers have habitually signed COT3s for their clients, which have been accepted without demur by ACAS. 43 There may be cases where a CAB adviser's authority to compromise proceedings has been specifically excluded or restricted by the client, and in such cases, if the advisers purpose to act in excess of their authority, they may be liable to the client. But it seems to us that where CAB advisers, named as representatives by a party to the proceedings, hold themselves out as having authority to negotiate, and to reach a settlement, on behalf of a client, the other party to the proceedings is entitled, in the absence of any notice to the contrary, to assume that the CAB adviser does in fact have such authority, and to enter into an agreement with the CAB adviser on that basis. That is what it meant by ostensible authority. 44 Where in such circumstances an agreement is reached between the CAB adviser and the other party, or the other party's authorised representative, under the auspices of a Conciliation Officer, the agreement will be binding on the CAB's client as against the other party, whether or not in fact the CAB adviser had any authority to enter into it. If the CAB adviser entered into the agreement without actual authority, the client may have a cause of action against the adviser, but that is of no concern to the other party. 45 In the circumstances of the present case we find that Sovereign had no reason to question Dr Byford's authority and, as far as Sovereign was concerned, the COT3 was properly agreed to and signed by him on behalf of Mrs Freeman, under the auspices of the Conciliation Officer. In the result Mrs Freeman is bound by the COT3 as far as the January application is concerned. The main submission of Mr Marsden is that when one looks at the wording of the agreement it seems to fall into two halves. The first half fell within the ostensible authority of Dr Byford but not the last sentence. Those words read " The applicant understands that the acceptance of this agreement prevents her from making any claim to an Industrial Tribunal or any other court. " He supports his submission by reference to a number of cases which established the well known common law principle that in litigation the ostensible authority of counsel or solicitor to settle only extends to the issues on the pleadings and not for instance after judgment has been given. See - Re A Debtor [1914] 2 KB 758 Matthews v. Munster (1888) 20 QBD 141 Waugh & Ors v. H B Clifford and Sons Ltd & Anr [1982] 1 Ch. 374 As was pointed out in FREEMAN & LOCKYER V. BUCKHURST PARK PROPERTIES (MANGAL) LT D [1964] 2 QB 482 by Diplock LJ at p.502A the basis of implied authority is that of holding out or representation, and although as indicated by the cases above the strict common law position may be as Mr Marsden submits it to be, for the reasons which we have given above it seems to us that the ostensible or implied authority in cases such as the present must be somewhat wider and include all actual and potential issues between the parties arising out of the employment relationship and which are or should be known to the parties at the time. (We use those words so as to exclude some future claim for personal injuries, for example pneumoconiosis, which might not be known to the parties at the time). The spirit and intention of parties must be to "wipe the slate clean". Whilst the present agreement might have been differently drafted, we are unable to read it in the way urged upon us by Mr Marsden. It seems to us that the clear intention was to exclude only those claims arising out of the employment relationship. The reference to any other court would apply to such claims as holiday or sick pay. There is at present no common law jurisdiction in Industrial Tribunals. Another way of reading that last sentence is merely to clarify the full import of what went before. The facts of the present case show that Dr Byford was named in the Applicant's Originating Application as her representative, that he was the person who had approached and communicated with the Industrial Tribunal on her behalf and engaged in correspondence on her behalf. He also signed the COT3 as her representative. The Respondents and the Industrial Tribunal were clearly entitled to rely upon his ostensible authority. As one of her submissions in support of her argument that no party should be allowed to go behind a COT3 which was apparently properly completed, Miss Booth submitted that she was caused considerable embarrassment in the present case by having to call Dr Byford and the Conciliation Officer. It seems to us that if the ostensible authority is clear there is no need to investigate further and this is supported by that passage cited from TIMES NEWSPAPERS . It is however clear that where it is at all possible, and it may not always be so, all those representing parties before or after proceedings had been initiated in an Industrial Tribunal should ensure that "the client" has seen and approved the wording of a proposed settlement. This can be achieved by initialling a letter or by asking that the COT3 itself is initialled or signed by the party and then countersigned by the representative. Mr Marsden has conceded - and we think rightly - that no distinction can be drawn in those cases before Industrial Tribunals between representation by counsel or solicitor or by a member of the Citizens' Advice Bureau or indeed by a member of some Law Centre. For the reasons which we have given therefore this appeal must be dismissed.