Cavaciuti v London Borough Of Hammersmith & Fulham [1992] UKEAT 246_91_1905

EAT
Cavaciuti v London Borough Of Hammersmith & Fulham
[1992] UKEAT 246_91_1905 · 1992-05-19

JUDGE HAGUE QC:

This is an appeal by the appellant, Mr Cavaciuti, against the decision of an Industrial Tribunal sitting at London (South) sent to the parties on 16 April 1991. By their decision, the Tribunal dismissed Mr Cavaciuti's claim for unfair dismissal, on the grounds that his application had not been presented to the Tribunal within 3 months of the "effective date of termination" of his employment by the respondents, the London Borough of Hammersmith and Fulham ("the Council"), and that it was reasonably practicable for the application to be so presented. As a result, the Tribunal held they had no jurisdiction to entertain the application.The relevant statutory provisions are sections 67(2) and 55(4) of the Employment Protection (Consolidation) Act 1978, which read as far as material as follows:
"67(2) ... an industrial tribunal shall not consider a complaint under this section [ie for unfair dismissal] unless it is presented to the tribunal before the end of the period of three months beginning with the effective date of termination or within such further period as the tribunal considers reasonable in a case where it is satisfied that it was not reasonably practicable for the complaint to be presented before the end of the period of three months."
"55(4) In this part "the effective date of termination" - (a) in relation to an employee whose contract is terminated by notice ... means the date on which that notice expires ..."
Mr Cavaciuti was dismissed by the Council from their employment following a disciplinary hearing under the chairmanship of Mr Paul Bennett and held on 4th July 1990. It is unnecessary to go into the facts giving rise to that hearing. By a letter dated 6th July 1990, Mr Bennett informed Mr Cavaciuti of the result of the hearing, and the only paragraph material to this appeal reads as follows:
"My decision is that you should be dismissed from your employment with Hammersmith and Fulham Council. You will be paid during your normal period of notice but you are not required to attend work from today."
Pausing there, it is clear that this was not a case of summary dismissal with a payment in lieu of notice. Mr Cavaciuti remained employed during the period of notice, but he was not required to attend work during that period. We deal below with what was meant by "your normal period of notice."The next event was a letter dated 13th July 1990 to Mr Cavaciuti from Mr Gerry Trill, the Council's Housing Personnel Manager. That commences:
"Further to Paul Bennett's letter of 6 July 1990, I am writing to clarify and confirm the arrangements in respect of final salary payment."
It is not necessary to read the rest of that letter, for it was repeated in the same words, with only figures and dates changed, by a later letter from Mr Trill dated 19th July 1990, which the parties accept is the critical letter. In the meantime there had been a discussion between Mr Trill and Mr Cavaciuti, and the letter of 19th July 1990 reads:

"Dear Tony

Further to my letter of 13 July 1990, and our conversation on July 18 I am writing to clarify and confirm the arrangements in respect of final salary payment.Your period of paid notice ends on 5 August 1990. You are also entitled to payment for three days in lieu of public holidays that you have worked and, as agreed, a total of 9 days annual leave.This means that you will be paid up to and including 22 August 1990 and this money will be credited to your Bank on 15 August 1990. I expect that Payroll will send your P45 to you shortly after that.

Yours sincerely

Gerry Trill

Housing Personnel Manager"

Mr Cavaciuti was in fact paid thereafter as if he remained an employee. His final wage slip, which was not before the Industrial Tribunal, shows tax, national insurance, pension and union deductions made in the usual way. However, in our view this is not a matter of importance. The critical "date of effective termination" must be determined from the earlier documents, and how thereafter the Council dealt with moneys due to Mr Cavaciuti is not material: see per Browne-Wilkinson J in Chapman v. Letheby & Christopher Ltd [1981] IRLR 440 at para 13 .Mr Cavaciuti's application was presented to the Tribunal on 13th November 1990. This was after the 3-month period permitted by S.67(2) if the effective date of termination was 5th August 1990, the date mentioned in the second paragraph of the 19th July letter (or one calendar month after service of the letter of 6th July 1990). It was within that 3-month period if the effective date of termination was 22nd August 1990, the date mentioned in the third paragraph of the 19th July letter.At the hearing before the Industrial Tribunal on 21st March 1991, both parties were prepared to go into the substantive merits of Mr Cavaciuti's claim. Professor Wallington, who appeared for the Council at that hearing and before us, indicated that although the Council had raised the point that the application had not been made within the permitted 3-month period in their notice of appearance, the Council did not wish to rely on the point. However, the Tribunal considered (rightly) that as the point went to their jurisdiction, they ought to determine it. Professor Wallington therefore called evidence and made submissions on the point.The Council's witness was Mr Sorrel, the Assistant Director of Support Services. His evidence was summarised by the Tribunal in paragraph 3 of their Reasons as follows:
"... He said that the practice of the respondents was that where an employee was dismissed or resigned and who had accrued holidays or days in lieu of public holidays to be taken had that period of time added to his notice period in order to extend the date on which he left. This Mr Sorrel said although he was unable to explain it except as a long standing custom of the respondents was done on advice received from the finance department which was that no money could be paid to the employee unless he remained in the employment of the respondents during the period of payment."
That evidence of course accounts for the somewhat unusual wording of the 19th July letter and the manner in which the moneys due to Mr Cavaciuti were subsequently dealt with. Apparently, someone in the Council's finance department had got it into his head that a person had to remain an employee for moneys to be paid to him. Mr Cavaciuti's witness was Janice Colins, the branch secretary of NALGO. She said that she was aware of the practice mentioned by Mr Sorrel.Professor Wallington submitted that the 6th July letter itself gave proper notice of termination. The "normal period of notice" was the period of one month which had been agreed between the Council and NALGO, even if it was not expressly mentioned in Mr Cavaciuti's contract of employment. So, he said, the notice expired on the 5th August (or perhaps a day or two later, if the letter was not handed to Mr Cavaciuti on the 6th July or if a clear full month's notice had to be given). The 19th July letter, he submitted, had to be construed in the light of that fact, and it did not alter the effect of the 6th July letter or give rise to any ambiguity or difficulty of construction. That approach was not suggested to or considered by the Industrial Tribunal, which regarded the matter as turning solely on the proper interpretation of the 19th July letter and the reference to the 5th August in that letter, and we cannot agree with it. As Miss Eady pointed out, the phrase "normal period of notice" in its context might well include the extra periods added on to the one month in accordance with the "long standing custom" described by Mr Sorrel. We consider that the 6th July letter was itself ambiguous, and that the matter really turns on the proper construction of the 19th July letter.In Chapman v. Letheby & Christopher Ltd [1981] IRLR 440, the question was whether a letter of dismissal operated as an instant dismissal or as a dismissal at the end of a notice period. Browne-Wilkinson J said (at para 13):
"What than is the proper construction of the letter? It is important to remember that the letter was sent to an employee who, if the employers' contention is right, was immediately dismissed on receipt of that letter. In our view two things flow from this. First, the construction to be put on the letter should not be a technical one but should reflect what an ordinary, reasonable employee in Mr Chapman's position would understand by the words used. Secondly, the letter must be construed in the light of the facts known to the employee at the date he received the letter. ..."
The Appeal Tribunal in that case then went on to construe the letter in the employee's favour, but Browne-Wilkinson J added (at para 16):
"Even if we are wrong in this view and the meaning of the letter is truly ambiguous, there is a principle of construction that words are interpreted most strongly against the person who uses them. We think this principle is peculiarly applicable to cases such as the present where an employer, by an ambiguous notice, may mislead the employee as to the effect of the document the responsibility for the wording of which lies entirely in the hands of the employer. It seems to us right that an employer who relies on a notice served by him as having a particular meaning should be required to demonstrate that it unambiguously has that meaning. If the employer can rely on ambiguities being resolved in his favour, the employee may be left in doubt as to where he stands and may lose his statutory rights. ..."
We respectfully agree with those remarks, and consider that they must be applied in the present case. We cannot accept Professor Wallington's submission that they are only applicable to the notice of dismissal of 6th July.In our view, the most natural interpretation of the letter of 19th July is that Mr Cavaciuti was being retained as an employee up to and including 22nd August. His "final salary payment" ran up to that date. That payment contained three elements(1) pay up to 5th August 1990,(2) 3 days' pay for work done on public holidays and(3) 9 days' pay for annual leave. All were to be paid "up to and including 22nd August" as salary, and we do not think it really possible to construe only element (1) as true salary and elements (2) and (3) as being other payments due under Mr Cavaciuti's contract of employment. Even if we are wrong as to the most natural interpretation, in our view the letter is clearly ambiguous and applying the principles stated by Browne-Wilkinson J set out above, we consider that the letter must be construed in favour of Mr Cavaciuti.The Industrial Tribunal referred to S.55(4)(a) of the 1978 Act, and considered that the express reference to the 5th August 1990 as the date of expiry of the notice made it clear that that date was the "effective date of termination". In our view, the reference to the 5th August is, in the context, no more than a reference to the end date of "the period of paid notice" making up one element of the final salary, and cannot be construed as terminating the employment on that date. Moreover, the Industrial Tribunal's decision appears to be based on an assumption that the "effective date of termination" is necessarily the expiry of a notice even if the employment continues thereafter. That assumption ignores the opening words of paragraph (a) of S.55(4) and is not correct.In the final paragraph of their Reasons, the Industrial Tribunal expressed the view that the somewhat confusing practice adopted by the Council should be altered. We were glad to hear from Professor Wallington that the Council has taken heed of that sensible advice and now altered its practice.For these reasons we allow this appeal. We declare that the "effective date of termination" was 22nd August 1990, and remit the case to an Industrial Tribunal (which can, but need not, be the same Tribunal) to be heard on the substantive issues.