Thompson v Teasdale Bakers Ltd [1993] UKEAT 302_91_2701

EAT

Thompson v Teasdale Bakers Ltd

[1993] UKEAT 302_91_2701 · 1993-01-27

JUDGE HICKS QC:

Mrs Thompson had worked since March 1983 for the respondent employers, Teasdale Bakers Limited and was found by the Industrial Tribunal to have been a good and - well trusted employee. She worked at one of their shops in Pasture Road, Goole, and was in charge of that shop.

On 4th October 1990 a man came into the shop and defrauded the employers of £85; he was a professional confidence trickster but Mr Atkinson, the Managing Director of the employers, was cross about it, seems to have regarded Mrs Thompson as being at fault and telephoned her at the shop, where the telephone, as he must have known, was in the public part of the shop and Mrs Thompson had to answer it in the presence of customers, that being a matter that we think the Tribunal found by inference quite clearly he ought to have been aware of.

The Tribunal in their findings of fact deal with that conversation in paragraph 5, sections (g) and (h) as follows:

"When she did speak to Mr Atkinson he insisted she tell him what had happened. That was inconvenient because the telephone was in the middle of the shop and it meant keeping customers waiting and people could overhear her conversation. He was upset and, on her evidence, said that he was going to get his money one way or another and that he would take it out of her wages. His version is that he did not say he would get his money one way or the other but he did say that he would take it out of the commission. There is agreement that, whatever he said about that, Mrs Thompson said `You can't do that John it's wrong. I'd rather you sack me.'

Mr Atkinson says that he then said he would get it from the insurers. Mrs Thompson says in reply to that the simple response was `Fair enough' and that he put the telephone down and that from that action she thought she had been dismissed."

That last sentence may be ambiguous but it is clear that the effect of Mrs Thompson's evidence was that the reply "Fair enough" by Mr Atkinson was a direct response to her saying "You can't do that John it's wrong. I'd rather you sack me."

There was therefore a clear conflict of evidence as to a vital feature of that conversation, whether in response to her statement "I'd rather you sack me" he resiled from his threat by saying he would get it from the insurers or whether he simply said "Fair enough". That issue of fact the Tribunal did not resolve; they dealt with the matter in this way in paragraph 6 of their Reasons:

"The tribunal has to be convinced by Mrs Thompson that she was dismissed. Clearly walking out because she was told that the money would be deducted from her wages or commission was not sufficient to create a ground for constructive dismissal. She had her rights in law which, if that was done, was to come to an industrial tribunal and make a claim for unlawful deduction for wages under the Wages Act 1986. There was no right in her contract for that deduction to be made or any notice in writing to authorise such a deduction so clearly that was her right, to go to a tribunal, and that was the way to deal with it not to treat herself as dismissed. But, what she is saying is that she was told that she had been dismissed, in effect, by the suggestion made by her that she would rather be sacked and by the reply `Fair enough'. Even if we accept her account of that conversation,. . . "

(I interpose that that is the failure to resolve the issue of fact)

". . . the tribunal is unanimously of the opinion that the words uttered, in context, in no way amounted to a dismissal of Mrs Thompson by Mr Atkinson on behalf of the respondent company and there was nothing in subsequent telephone conversations and events which would in themselves amount to a dismissal."

The most favourable construction of that paragraph, that is to say the most favourable to the Industrial Tribunal, in our view (since Mrs Thompson was, as we understand it, clearly advancing a case of constructive dismissal and they themselves referred to those words in the second sentence of the paragraph), is to assume that they were asking themselves the question, was Mr Atkinson's conduct on that basis a fundamental or repudiatory breach of contract such as would entitle Mrs Thompson to leave without giving notice? Mrs Cleave for the Appellant concedes that it would be not an immediate breach but an anticipatory breach, a threat of a breach, but she says that on the assumption made by the Tribunal as to the way the conversation went it was never withdrawn, or at least was never withdrawn before Mrs Thompson accepted it, and therefore was still operative.

It is submitted on behalf of Mrs Thompson that in approaching the matter in the way they did the Industrial Tribunal misdirected themselves and erred in law because the only test they applied as to whether such a breach was fundamental or repudiatory was to refer to the fact that Mrs Thompson had a means of redress in the form of an application to the Industrial Tribunal for a determination that that would be an unlawful deduction from wages. We have come to the conclusion that that submission is well founded and that, giving the Industrial Tribunal's Reasons the fair approach which this Tribunal should, it still is not possible to draw any conclusion but that the Industrial Tribunal did regard that one fact as being determinative of the question whether the breach was fundamental or not. In our view that is much too narrow an approach. Whether a breach - and the Industrial Tribunal, rightly, accepted that such a threat is an anticipatory breach - whether a breach is fundamental and repudiatory must be decided having regard to all the relevant circumstances and among the relevant circumstances, at least, without going any further, were the situation in which this conversation took place and the embarrassment which it must have caused Mrs Thompson, to the knowledge of Mr Atkinson. Other considerations might be whether it was realistic to suppose that an employee's reaction to such a threat would, in the heat of the moment, be to consider the right to go to an industrial tribunal under the Wages Act or whether a reasonable reaction might be to accept that threat as repudiatory and to leave the employment. By addressing only the one, somewhat technical, fact that this was a threat which could have been met by an application to an industrial tribunal, in our view the Industrial Tribunal misdirected itself in law, and on that ground we consider that the appeal must be allowed and that the application must be remitted for further consideration. I shall come back to the question in a moment on what terms it should be remitted and whether to the original Tribunal or to a different tribunal.

There were other criticisms made by Mrs Cleave, I will refer to them briefly, not because they are necessary for the decision that we have reached but because a reference to them may help the tribunal which will have to deal with the matter afresh.

First, Mrs Cleave says that it was unsatisfactory that the crucial dispute of fact about the terms of the conversation was not resolved, notwithstanding, of course, that the hypothesis on which the Tribunal acted was the more favourable to Mrs Thompson, namely that her version of the conversation was correct. That is not a point on which we think we should give any directions to a tribunal which re-hears the matter, except to observe that in general it is desirable that conflicts of evidence on matters of central importance should be resolved, even if it is possible and sometimes proper for a tribunal to deal with the matter by simply making an assumption in favour of the party against whom their decision goes.

Secondly, Mrs Cleave suggests that this Tribunal, in fact, was approaching the question not as one of constructive dismissal but as one of "positive" dismissal. In paragraph 3 of their Reasons she points out they say this:

She [Mrs Thompson] put in her application to the tribunal that that was an unfair constructive dismissal but from what she wrote at section 10 of that document it became clear that what she was saying was that it was, what we may call, a positive dismissal."

and although in the second sentence of paragraph 6 they deal with the matter in terms of constructive dismissal towards the end of that paragraph 6 they say:

"that the words uttered in no way amounted to a dismissal"

which might suggest that they had reverted to the question of "positive dismissal", to use the phrase that they themselves used. It is, of course, highly desirable that an industrial tribunal makes it clear whether they are addressing the question of positive dismissal or of constructive dismissal and if both issues potentially arise that they deal with each separately and apply to each the test relevant to that question. But since we are, in any event, allowing the appeal we do not need to reach any decision as to whether that alone would have vitiated the decision of this Tribunal.

Thirdly, Mrs Cleave submits that in addition to the relevance of the circumstances of the telephone conversation to the question whether what Mr Atkinson said then amounted to a fundamental breach, that conversation and the circumstances in which it was conducted also raised a different issue which the Tribunal did not address at all but which as we understand it Mrs Cleave says was advanced to them, namely, that the circumstances of the conversation amounted to a breach of the implied term that an employer will not break the relationship of trust and confidence that exists between employer and employee, and if that issue is raised on any re-hearing then clearly it is an issue which will be dealt with in the Reasons of the Tribunal.

I rehearse those matters, not just for the assistance of the Industrial Tribunal, but also because they are themselves germane to the question whether we should send this matter back to the original Tribunal or to a differently constituted one. Taking those considerations into account as well as the point upon which we have allowed the appeal we have come to the conclusion that the most satisfactory course would be to have a re-hearing before a differently constituted tribunal, and that is the direction which we give.