Newman v Polytechnic Of Wales Students Union [1993] UKEAT 756_92_1706

EAT
Newman v Polytechnic Of Wales Students Union
[1993] UKEAT 756_92_1706 · 1993-05-13

JUDGE HAGUE QC :

The Appellant, Mr Newman was formerly employed as a Bar Manager by the Respondents, the Polytechnic of Wales Students Union (which we will refer to as "the Union"). Under the Rules of the Union, its Executive Committee has the power to employ and dismiss the staff of the Union. At a meeting of the Executive Committee held on 26 February 1992, the decision was taken to dismiss Mr Newman summarily on the grounds of redundancy. It is not necessary for us to consider the reasons for the redundancy. The Executive Committee's decision to dismiss was communicated orally by three of its members to Mr Newman at a so-called "Redundancy Meeting" on 28 February 1992. Mr Newman thereupon on that date handed over the Union's keys in his possession and left. On the same date, he was sent a cheque in respect of his redundancy entitlement plus pay and other remuneration in lieu of notice, calculated as at that date.Although he had Solicitors acting for him, Mr Newman's Originating Application claiming unfair dismissal (IT1) was not received at the Cardiff Regional Office of Industrial Tribunals until 28 May 1992. Mr Bowers, Counsel for the Union, accepted the claim was presented on that date, rather than the following day when the claim was received by the Central Office (which the Tribunal apparently considered to be the relevant date), but nothing turns on the difference. On the footing that the "effective date of termination" of Mr Newman's employment, as defined by section 55(4) of the Employment Protection (Consolidation) Act 1978 was 28 February 1992, both dates are outside the 3 month period commencing on the "effective date of termination" prescribed by section 62 of the Act.The question of whether Mr Newman's claim was out of time, which depended on what was the "effective date of termination" of his employment, was heard as a preliminary point by an Industrial Tribunal sitting at Cardiff. The main argument advanced on behalf of Mr Newman was that the meeting of the Executive Committee held on 26 February 1992 had not been properly convened in accordance with the Union's Rules and so was invalidly constituted, and that his dismissal accordingly did not take place until (at the earliest) the receipt of a letter dated 5 March 1992, i.e. within 3 months before the making of his claim. The Tribunal by its decision entered in the Register on 8 October 1992 determined the preliminary point in favour of the Union, holding that the Executive Council meeting had been properly convened within the Union's Rules. Mr Newman appealed against that finding. He did not appeal against the Tribunal's finding in favour of the Union on another point.It was previously held that, although there was a quorum at the Executive Committee meeting of 26 February 1992, it had not been properly convened under Rule 6(d) of the Union's Rules, differing from the Industrial Tribunal on that point. However that did not by any means conclude the question of the "effective day of termination" of Mr Newman's employment. Mr Bowers put forward a number of arguments for saying that, on the facts, the "effective date of termination" remained unaffected by the irregularity in the convening of the meeting.Mr Bowers' primary submission was that the "effective date of termination" is a statutory concept which focuses on the actual dismissal. It is settled that this takes place when the decision to dismiss is communicated to the employee ( Brown v Southall & Knight [1980] ICR 617) and that it is immaterial that the dismissal was wrongful or even that it may have constituted a repudiatory breach of contract by the employers ( Stapp v The Shaftesbury Society [1982] IRLR 320, paragraph 32, and Octavius Atkinson & Sons Ltd v Morris [1989] ICR 158). The "effective date of termination" has to be decided in a practical and commonsense manner, having regard particularly to what the parties understood at the time of dismissal. In the present case, not only did Mr Newman hand over the keys and leave on 28 February 1992, and also accept a redundancy payment calculated as at that date, but his solicitors in the solicitors' correspondence referred to that date as the date of dismissal, and in his Originating Application his employment is stated to have ended on that date. It was not until the Tribunal hearing that any suggestion was made that Mr Newman's employment had not ended on that date. Any finding that his employment continued after that date would be highly artificial and contrary to the understanding of both parties and to commonsense.Mr Geraint Jones, on behalf of Mr Newman, submitted that the "effective date of termination" could be ascertained only by looking at the facts and the law applicable in this particular case. As a matter of law, he argued, the Executive Committee meeting of 26 February 1992 was a nullity, so its decision to dismiss was a nullity, and that it was contrary to law and commonsense to say that the communication to Mr Newman of a decision which was a nullity was effective to terminate his contract. He said that the proper analysis of the facts was that the contract was only terminated by the letter of 5 March 1992, to which we will refer in more detail shortly.In support of his submissions, Mr Jones referred us to and placed a good deal of reliance on Warnes v Trustees of Cheriton Odd Fellows Social Club [1993] IRLR 58. In that case, Mr Warnes and his wife were employed as the Club's steward and stewardess, and Mr Warnes also carried out the duties of club secretary. At the Club's annual general meeting, a resolution was passed removing the secretarial duties from Mr Warnes. Mr and Mrs Warnes then resigned, claiming constructive dismissal. An Industrial Tribunal found that the removal of Mr Warnes' secretarial duties was capable of amounting to a fundamental breach of contract such as to entitle him to resign and claim constructive dismissal. However, the resolution at the annual general meeting was invalid under the Club's rules, and the Tribunal held that in consequence Mr Warnes' secretarial duties had not in fact been removed, so that his claim to constructive dismissal failed. In giving the judgment of this Appeal Tribunal, Knox J said (at paragraph 7):
"In our view this [ie the conclusion that the secretarial duties had not been removed] is too narrow a view of the effect of the resolution upon the contractual relationship between the club and Mr Warnes. An employer is not entitled to rely upon the lack of power under the constitution of an officer or organ of the employer in acting in a way which if valid would constitute a dismissal. We exclude any case where it is appreciated on both sides that what is done is of no practical effect or significance... There are doubtless occasions when a superior officer of an employer organisation dismisses his inferior where, so far as that superior officer's powers as a matter of contract between him and the employer are concerned, he is not entitled to dismiss. It is not in general open to the employer to rely on that abuse of power. Regard has to be had to the nature of the act of dismissal on the contract between the employer and the employee thus dismissed in breach of contract by the dismissing officer."
In our view, the Warnes case is, at least in one important respect, contrary to Mr Jones' argument, for it illustrates that a dismissal pursuant to a void resolution is not a nullity, but may well affect the contract between employer and employee: see particularly the first and last sentences of the passage cited above. Mr Jones sought to extract from the case authority for two propositions:(1) that an employer cannot deny his own wrongdoing if it has been relied on by the employee; and(2) that an employer cannot rely on his own wrongdoing if such reliance would result in prejudice to the employee. We do not think that failing to convene a meeting properly or passing resolutions invalidly can properly be stigmatised as "wrongdoing", and we would prefer to use Knox J's phrase "lack of power under its constitution"; but subject to that we would accept that the Warnes case is authority for proposition (1). We cannot however agree that it affords any authority for proposition (2), which is in our view far too wide a proposition.There is, in our view, a problem facing Mr Jones in his contention that Mr Newman's employment did not terminate on 28 February 1992, because it is difficult to see what other date could have been the "effective date of termination". Mr Jones suggested that it would be the date of receipt of a letter dated 5 March 1992 sent on behalf of the Executive Committee. But the opening paragraph of that letter reads:
"I refer to the meeting you had on Friday, 28th February '92 with three members of the Students' Union Executive Committee and write to confirm the decision of the Committee conveyed to you at the time, that your employment was to be terminated with immediate effect on the grounds of redundancy."
That paragraph confirms that the dismissal took place on 28 February 1992 and is totally inconsistent with any other date. The letter cannot itself be read as a letter of dismissal. Moreover, there had been no further meeting of the Executive Committee in the meantime. The writer of the letter had no more authority than the three members of the Executive Committee at the Redundancy Meeting on 28 February 1992.Mr Bowers said that Mr Jones' arguments sought to introduce subtle considerations of law into the ascertainment of the "effective date of termination", which was essentially a matter of fact to be decided in a practical and commonsense way by the Industrial Tribunal. We agree. As both parties at the time understood, the actions of the three Executive Committee members at the Redundancy Meeting (whether or not they were properly authorised) terminated Mr Newman's employment with immediate effect.There is a further ground on which we consider that 28 February 1992 was the "effective date of termination". On the assumption that the meeting of 28 February 1992 did not make a valid decision to dismiss Mr Newman, in our view it necessarily follows that the three members of the Executive Committee at the Redundancy Meeting of 28 February were acting as unauthorised agents of the Executive Committee in terminating Mr Newman's employment. Mr Bowers argued that their actions as such on that date were subsequently ratified by the Executive Committee and that the ratification operated retrospectively to validate their actions with effect from that date.The matter on which Mr Bowers relied on in support of his ratification argument was a meeting of the Executive Committee which was held on 9 March 1992 and was admittedly a properly convened and valid meeting. The Minutes of that meeting included the following:
"Minutes of the Emergency Executive Meeting, held on 26th February '92 were ACCEPTED as true and correct.
Minutes of the Redundancy Meeting, held on 28th February '92 were ACCEPTED as true and accurate after amending E.G.M. to read Emergency Executive Meeting, where appropriate."It was argued by Mr Jones that this was insufficient to ratify the decision and the dismissal, being merely approval of Minutes. In our judgment, this is a far too narrow and legalistic view of the matter, particularly as ratification may be implied by the conduct or even the mere acquiescence of the principal: see Bowstead on Agency (15th Edition) Article 17(3). We consider that the Executive Committee on 9 March was plainly accepting and approving the decision and the dismissal of Mr Newman. Further, we accept the argument of Mr Bowers that ratification is retroactive, and relates back to and validates the act ratified. A good illustration of this is to be found in Harper v Kerr Stuart Ltd (1901) 83 LT 729. In that case, the secretary of a company had, without authority, sent out a notice convening an extraordinary general meeting of the company, but the board of directors subsequently ratified his action. Cozens-Hardy J said:"The question is whether, although the notice was not authorised beforehand, it has been so ratified now as to make it a good and valid notice. In my opinion, it has. The principle of the case, which I do not propose to go through, is that the ratification of an act purporting to be done by an agent on your behalf dates back to the performance of the act".Mr Jones also argued that ratification could apply only to the actions of agents acting beyond their authority, and that the invalid resolution on 26 February 1992 was incapable of ratification. It is not necessary to consider that matter, because the ratification related also to the actions of the three Executive Committee members at the Redundancy Meeting, and as we have pointed out, they were undoubtedly acting as agents on behalf of the Committee itself.Mr Jones also argued that there could be no ratification if the principal was unaware that the agent had acted without authority. At the time, nobody realised that the meeting of 26 February 1992 had not been properly convened or that the three Executive Committee members of the Redundancy Meeting had no authority. So, said Mr Jones, there could be no ratification of the Executive Committee meeting of 9 March 1992. This point only arose in the course of argument, and neither Counsel were in a position to argue it fully. We therefore allowed further written submissions on the point. Mr Jones in support of his argument referred us to passages in Halsbury's Laws of England (4th Edition) Vol 1(2) paragraphs 81 and 82, and two authorities, Marsh v Joseph [1897] 1 Ch 213 and Savery v King (1858) 5 HL Cas 624. We have carefully considered these, but in our judgment they do not support Mr Jones' argument. They show that the party ratifying must be aware of all the relevant facts concerning the action to be ratified, but do not go as far as establishing that the principal must appreciate the legal consequence that the acts were unauthorised. In the present case, as Mr Bowers has pointed out, the Executive Committee was well aware of all the relevant facts, including the fact that three clear days notice of the meeting of 26 February 1992 had not been given, that Mr Newman had been dismissed and that another candidate had been appointed to the new post then created. In our judgment, that knowledge was sufficient for the Executive Committee to make a valid and effective ratification, and we reject Mr Jones' argument.Mr Bowers also put forward further grounds for upholding the Tribunal's decision, in particular that there had only been an irregularity in the meeting of the Executive Committee of 26 February 1992 which did not affect the validity of its decision, and that, although Mr Newman was an Associate Member of the Union, the decision only related to his status as an employee and that he was not entitled to challenge it. We were referred to several authorities on these matters. However, in view of our findings on the other points discussed above, it is unnecessary for us to express any view on these further grounds advanced by Mr Bowers and we prefer not to do so.In the result, the appeal is dismissed.