Mountjoy v Lister-Petter Ltd [1994] UKEAT 996_93_1312

EAT
Mountjoy v Lister-Petter Ltd
[1994] UKEAT 996_93_1312 · 1994-12-13

JUDGE J HULL, QC :

Mr Mountjoy, who is a gentleman now aged 58, was employed by the Respondents, Lister-Petter Limited, at their works at Dursley, Gloucestershire as a General Machine Operator. He was skilled and became more skilled and was eventually able to work with all their machines.He was first employed on 10 April 1989 and thereafter there was some unhappiness, because he was concerned about the condition of some of the equipment and machinery. He made complaints about the safety of certain pieces of equipment. Not all those complaints were received in a very friendly and satisfactory way by his employers and in December 1992 there was at least one altercation on the subject of safety, and his orders to run particular machines. Nothing much turns on that.On 23 December 1992, he had bursitis in one arm and he began to take sick-leave (he was unfit for work) and send in notes in accordance with his employer's requirements, certifying his state of health or ill health, and so matters went on until March. There were one or two letters in the intervening period, but in March there was an exchange of correspondence. On the 9 March, the employers apparently heard some rumour that Mr Mountjoy did not intend to return to their employment and they wrote a letter which is at page 20:

"... Dear Mr Mountjoy

Your last medical certificate ran out on 7 March 1993. To date we have not received a follow up certificate.We would like to remind you of the Company rules which states that you must regularly provide medical evidence of continuing absence from work.If we do not hear from you or receive the necessary certificate for your continued absence by Monday, 15 March 1993, we shall conclude that you no longer wish to be employed by us..."That was signed by the Personnel Manager. Now that is a letter of which there could be two possible constructions at least. One is the literal construction, that that will simply cause the employers to think that he no longer wishes to be employed by them (that is their statement). It could be construed in a more Draconian sense that this is a mere euphemism for saying "We shall then terminate your employment". To go forward a long way, the Industrial Tribunal which in due course heard this matter, decided that that was not a letter of dismissal.On 15 March, Mr Mountjoy replied to that letter (that is at page 21 of our bundle):
"... Dear Sir,
Please find enclosed the necessary sick note covering the period to 15.3.93. I would be grateful if you would forward any sick pay, holiday pay through your usual channels, and any documentation to the above address.As I did not attend for work on the 15.3.93 my employment with Lister Petter was terminated.

Yours sincerely..."

That was received the next day. Now that letter was found by the Industrial Tribunal to be a resignation.It may be convenient now if I state the remaining facts more shortly. On 14 June 1993, Mr Mountjoy presented his application to the Industrial Tribunal. He complained of unfair dismissal and he said that he had been constructively dismissed. If one looks at his form (page 13 of our bundle), he says he complains of the safety situation at the factory, amongst other things he says that matters were not put right:
"... The employer failed to take reasonable steps to ensure my safety by requiring me to work machines which were not safe. This was a fundamental breach of the implied term in my contract of employment that the employer would take reasonable steps to ensure my safety and/or a breach of the implied term that the employer would observe the law.
Because of this fundamental breach I was entitled to terminate my employment and such termination amounted to a constructive dismissal. I have therefore been unfairly dismissed."One should observe that at that stage Mr Mountjoy was apparently represented by solicitors and had been advised by solicitors and he way saying there in terms (if he meant what was said about constructive dismissal, which clearly he did) "I resigned in such circumstances that I was entitled to do so by reason of my employer's conduct".So that was his application. The employers a month later put in their Notice of Appearance which is at page 15 of our papers and they made their averments which the Industrial Tribunal in due course described as "bizarre". They said that they had written dismissing him and they said that his dismissal was for failing to supply any medical certificates and they said that it was a dismissal by them and not a resignation by Mr Mountjoy. So that was the situation as presented to the Industrial Tribunal.It was of course for them to say what they made of these facts, to look at the correspondence which they have referred to and to reach a just conclusion. Mr Prichard, for the Appellant Mr Mountjoy today, has made a number of submissions of law to us for which we are very grateful. Amongst other things, he complains that the Industrial Tribunal was not entitled in all the circumstances to find that Mr Mountjoy had resigned, because although he had said so, his employers had said the contrary and said that they dismissed him and he referred to the application as a "pleading". With all respect, that is a submission which we cannot accept. It can justly be said that an application should and must state the case as it appears to be to the applicant. Equally the answer should of course state what the employers' case is. It does not follow that these are pleadings from which the Tribunal cannot depart. They are normally settled by people who are not skilled in the law, and it is the duty of the Industrial Tribunal to inquire if it suspects that the case is quite different from that which is put down in the application or in the answer; it may have to take various steps, it may have to give an opportunity to one party or both to collect further evidence and return to the Tribunal. It may have to ask for further argument. It may have to call for further documents, But to describe the application and the appearance as being pleadings is in our belief wrong.The decision begins at page 9 of our bundle. The Tribunal set out in rather more detail than I have the facts which led up to all this. They refer to a letter of 19 February which is not, I think, with our bundle. They refer to a solicitors' letter written on behalf of Mr Mountjoy:
"... stating that he was extremely reluctant to return to work in the conditions which he had been subjected to for some time..."
And they set out examples of what he was complaining about. They recall there was no reference in his solicitors' letter to the unpleasant events on 22 December which was his last day at work. Then they say:
"... The respondents carried out an investigation. When the Personnel Department received that report they then wrote the letter of 4 March which says that "most of the points you raised have already been considered", that they are "very sensitive to Health and Safety problems..."
That again is a letter which we have not looked at. Then they come to the essence of it. They say:"... 7. He then did not submit a sick note for the period beginning 15 March 1993. The Personnel Officer heard rumours that he was not going to return to work. That is the only explanation for the respondent's letter of 9 March. It reminds him of the need to provide medical evidence, and adds "if we do not hear from you, or receive the necessary certificate for your continued absence by Monday 15 March, we shall conclude you no longer wish to be employed by us". This elicited a letter from the applicant dated 15 March enclosing his sick note for the period 15 March and adding:
"I would be grateful if you would forward any sick pay, holiday pay through your usual channels, and any documentation to the above address.
As I did not attend for work on 15.3.93 my employment with Lister Petter was terminated."This was followed by a further letter from the respondents dated 16 March saying:-
"We have not terminated your employment. Will you please confirm with us by Friday, 19 March whether you have done so.
When that period came to an end without the respondents hearing from the applicant they wrote to him by a letter of 22 March 1993 saying:-
"...we assume that you have decided to terminate your employment with the Company."
8. The application as originally drafted claims "constructive dismissal". This produced bizarre Notice of Appearance which alleged that the termination of the applicant's employment on 22 March resulted from a dismissal by the respondent and not a resignation. This understandably prompted the applicant to amend his application to allege a direct unfair dismissal. We have to reach our decision on the facts and not on the pleadings..."That is the passage of which Mr Prichard complains. We reject that complaint. We think that the Tribunal was fully entitled to direct itself to reach a decision on the facts, including the evidence which they had heard, and not on the "pleadings". Of course if that were to result in an application for an adjournment or an application to make further contentions, then that would be a matter for the Tribunal to deal with. It goes on:
"... 9. It is true that the respondents' letter of 9 March is a strange one and seems to imply that if they do not hear from him by 15 March they will dismiss him. However, the applicant's letter of 15 March, despite its odd terms which are explained by the earlier peculiar letter from the respondents, seems to us to indicate that he intended to terminate his employment at that time. That is in accordance with the evidence he gave to us. Our conclusion therefore is that he terminated his employment by the letter of 15 March 1993 and accordingly no subsequent letters could amount to dismissal. Our conclusion therefore is that there was no direct dismissal by the respondents..."
That on the face of it is a finding or findings of fact which the Industrial Tribunal were perfectly entitled to reach. The letter of 9 March, though intimating an intention possibly to dismiss in the future, was not a letter of dismissal. The letter of 15 March was, as stated by its writer in evidence, which they accepted, a resignation.They then turned to constructive dismissal and they say having looked at the alleged breaches, that they found that there were no serious breaches which amounted to a fundamental breach of the contract; that of course was not strictly necessary, but they inquired into that matter which had been laid before them and they so found.So there is a clear finding. He was not dismissed, he resigned; his letter of 15 March was his resignation letter. Now Mr Prichard makes what he says is a very narrow point to us. "The Industrial Tribunal found that the Appellant resigned and I cannot appeal that point. The sole point is the Respondents' response given that it was a resignation" says Mr Prichard. And then he makes the following proposition of law "A resignation is something that has to be accepted by the employer. It does not by itself bring a contract of employment to an end" and he referred us to case.Before we say what we feel about that, it might be helpful if I say what, in our view, are at least four separate phenomena which are covered by the layman's term "resignation". One is the ordinary consensual termination of employment. Perhaps the employee says "I should like to resign". The employers say "We are content that you should" and there may be a conversation about terms. "How long would you like to go on working? Are you asking for payments in respect of this or that? Would you like to buy the car which you are allowed to use on favourable terms?" Eventually the parties may actually put it in writing. That is a consensual resignation in the ordinary use of the language. Then the second sort of resignation is the one which is not consensual, but in which the employment is terminated in accordance with the contract. The employee gives lawful notice to terminate his contract. There may be other terms of the contract which entitle him to terminate it in particular circumstances. That is another type of lawful resignation, but it is not consensual. It is one in which the employee is unilaterally exercising a right. Then there is a third type of resignation, much closer to this type of case or at any rate, what Mr Prichard says is this type of case, the employee ends his employment in breach of contract. For example, one month's notice is required, but the employee says "I am not going to give notice. I have had enough, I am simply walking out." "Goodbye" he says to the employer "I am resigning" or he writes him a letter which arrives unexpectedly one day saying "Please treat this letter as my resignation, I shall not be attending work in future". There he is in breach of contract. This might be called the "unlawful unilateral resignation". It is a situation which has given rise to a great deal of difficulty in particular circumstances, particularly in cases where there is a statutory background to the employment and in particular, cases of teachers and local government officers who are employed very much against a statutory background. I will refer to what Mr Prichard has said to us about these matters in a moment.And then to go on a fourth type of resignation as it is often called (rightly so in layman's language at any rate); that re the employer is guilty of a repudiatory breach. The employer does something which is quite intolerable. For example he may say to the employee "As from next week, I am going to pay you £50.00 a week less. I don't care what the contract says, that is what I am going to do". The employee can of course simply knuckle under and not treat the breach as terminating the contract, but he can say "Very well, I am not prepared to accept this, I accept your repudiatory breach as terminating the contract and therefore the contract is at an end". Those are at least four quite different phenomena in law, each of which can rightly be described as resignation, so that it is not a very simple concept."This is example 3" says Mr Prichard. "This is a case where the employee simply sends a letter which the Tribunal has construed as being a letter of resignation, and therefore" says he "it is a wrongful repudiation of the contract, because notice was required and therefore in accordance with the ordinary rules of contract, the contract will continue unless the other party says "I accept your repudiation"". So that is this submission about that and he cited to us two cases. The first is Dietman v. London Borough of Brent [1987] IRLR 259 which was a case of a social worker against a social worker, against whom allegations were made, employed by the local authority; and he refers to the review by Mr Justice Hodgson of the conflict of view which there is between various eminent judges as to whether it is right to say that a wrongful dismissal must be accepted to become effective. That starts at page 266 and the learned Judge there goes through the conflict in the cases. He concluded at paragraph 59:
"... that the 'acceptance view' is the correct view and that in a proper case, the court can, where there has been a wrongful dismissal, prevent, by injunction, the implementation of that dismissal until, for instance, the proper procedures laid down in the contract have been followed.
That is one view, the other view is that whenever employer or employee chooses either can, however wrongfully, determine the contract the employer by an unlawful unilateral resignation, the employer by an unlawful unilateral dismissal. Indeed, that of course is commonplace. It has certainly, I think, not been accepted that such an unlawful act by employer or employee is invariably without effect, but Mr Prichard's general submission is that it has to be accepted to be effective. As I said, that was a case of dismissal; Mr Prichard's general submission is what might be called a "goose and gander" submission, that what is sauce for the employer is sauce for the employee too. Some very arresting results are likely to arise from this. For example, the employer simply and quite wrongly dismisses the employee one morning and gives him five minutes to get off the premises. The employee as he leaves shouts "I am not accepting this. So far as I am concerned, our relationship as employer and employee continues". Neither party then does anything. The employee goes home, but does not present himself for work, having been told that he must not do so, the employer continues with his business and makes no overtures and takes no action. Presumably, if Mr Prichard is right, after two years or indeed five years, the employee can begin an action for two years or five years' pay. It is pointed out by one of my colleagues that this may be very unrealistic because in fact there are the statutory provisions about his National Insurance and tax documents and so forth, but nonetheless as a matter of law that must follow law from Mr Prichard's submission. Taking it to its limit, the employee will be entitled, since he has decided not to accept this wrongful repudiation, to present himself daily at his place of work and say "I am ready and willing to carry out my side of the contract which is still on foot, please will you carry out your side of the contract. I should like to take my lunch in the works canteen today please" and indeed, I suppose might, if he were ejected, resort to the Court. Those are, apparently, arresting problems and indeed one wonders how if Mr Prichard's general submission is correct, it will tie in with the operation of Section 55 of the Employment Protection (Consolidation) Act [1978] , because Section 55(2) says:
"... (2) Subject to subsection (3), an employee shall be treated as dismissed by his employer if, but only if,- (a) the contract under which he is employed by the employer is terminated by the employer, whether it is so terminated by notice or without notice..."
And it does look as though the draughtsman has overlooked the point which is made to us by Mr Prichard, because if Mr Prichard is right, before the employee can commence any proceedings complaining of unfair dismissal, he will have to intimate that he accepts the act of his employer as terminating the contract, before it can be justly be said that the contract is terminated. He may prefer to go on enjoying what appears to us, if Mr Prichard is right, to abe an irrefragable right to his pay, rather than presenting his IT1 which, as Mr Prichard points out, would almost certainly be an election to accept his employers repudiation.So that is the submission which is made to us by Mr Prichard. It is an important submission. He cites to us also Boyo v. Lambeth Borough Council [1994] IRLR 727, another case involving a local authority. That was a case in which, as he says referring to the headnote:11"... an unlawful repudiation of a contract of service by an employer which was not accepted by the employee did not result in the automatic termination of the contract; but that, in the absence of special circumstances, an employer's liability in damages for wrongful dismissal did not continue beyond the time at which, under the terms of the contract of employment, the employer could lawfully have brought the contract to an end..."That of course is a very well known principal of the law of damages. When an action for damages is brought against a wrongdoer, the wrongdoer is taken to be entitled to say that he would have operated the contract in the way most favourable to him in the matter of damages. So of course, the Court of Appeal is there saying the contract was not at an end, but on a claim for damages it is to be treated in that way. But what if the employee had said "No, I do not claim damages. I say the contract is on foot, I am not entitled to damages at all, I am entitled to my pay". That is a problem with which, as far as we can see, the Courts have not yet wrestled. They may have to. We have noted that at page 736 of Boyo decision, Lord Justice Ralph Gibson cited as one of the grounds of decision of Judge James in the County Court:
"... (ix) Although the plaintiff had not stated any acceptance of his dismissal, the plaintiff had in reality accepted that repudiation, whatever he might say or not say. He was intelligent and had studied the law. He had deliberately formulated his case in a particular way-i.e., as I understand it, to claim arrears of salary and interest thereon-for tactical reasons and he knew it to be contrary to reality. Long ago the plaintiff realised that his employment was at an end and accepted that..."
So that was the view of Judge James on the facts. One would pause to say there that although the Court of Appeal is entitled to entertain appeals on fact and consider questions of fact, we are not and it can also be said that the majority of plaintiffs have not studied the law; as to whether it can be said the majority of them are intelligent, again, one might not be sure, so it may be that that is a case which was decided on rather particular facts.Now the question of course for us raised by Mr Prichard's submissions is: are we in the circumstances obliged to go on a voyage through decisions of the Court of Appeal and of this Employment Appeal Tribunal and do our humble best to resolve a jurisprudential conflict which is obviously of importance and which must obviously be considred in the future? We have come to the conclusion that we are not obliged to do that. If one looks at the correspondence again, I have already read the first two letters, the letter of 15 March at page 21 construed (and confirmed by the evidence of the Appellant) as being a letter of resignation. "Very well" says Mr Prichard, "it was not accepted"; so we look to see what the reality of that is. He received as we assume the two letters which are written at pages 22 and 23. In the first letter, the employers say:
"... Your letter has confused us...We have not terminated your employment. Will you please confirm with us by Friday...whether you have done so..."
That is doing what any party can do not making a counter offer or anything of that sort, but saying to the offeror, or in this case the employee who is unilaterally and wrongfully resigning, "please say whether that is in fact what you are doing; we are in confusion about that."Then on 22 March they write again. They say:
"... Following-on from your letter of 15th March and having passed the deadline set in our letter dated 16th March, without hearing from you, we assume that you have decided to terminate your employment with the Company..."
"... In view of your decision to leave the company, we will take you off the books with effect from today's date and will forward your documents in the next few days..."
What could be plainer than that as saying "we are accepting this. We will take you off the books. It is clear to us now from your failure to reply that that is what you meant" and of course they were quite right about that, as the Tribunal found. Finally, if anything further was needed, the solicitors write on 1 April at page 24 confirming that it was a resignation:
"... Our client has no alternative but to leave your company due to the unsafe conditions in which he was expected to work. The assurances requested in our letter of 19 February were not forthcoming and accordingly our client will be seeking compensation for constructive dismissal..."
So there he was saying "there is no doubt or difficulty about this. I have resigned" and the employers were saying "It seems to us as plain as a pikestaff; we have accepted your resignation" and indeed he then said when he applied to the Tribunal "I have resigned". If the contract was still on foot, then he had no business to be applying to the Tribunal. So it seems to us that just looking at the facts of this case and the documents and matters which are beyond argument and accepting as of course we must the findings of fact of this Industrial Tribunal, there is only one answer here and that is that if the resignation was in breach of contract and required to be accepted by the employers, then they undoubtedly did so in all the circumstances and it would be quite idle, as it was in Boyo' case , for him to say that the contract was still on foot.Mr Prichard in the course of his submissions did say that the Industrial Tribunal were not entitled to find that he resigned. We reject that; we find for the reasons which I have already given that they were. Eventually Mr Prichard, fielding some of the more ludicrous examples which I am afraid I suggested, made this submission. We do not hold him to it, but it does show the extent to which the considerations which he raised with us could be pushed. He said "a summary dismissal does terminate a contract, but a summary resignation does not". That appears to us to be going too far, in fact it appears to us that it is contrary to what is said in Boyo :
"... that an unlawful repudiation of a contract of service by an employer which was not accepted by the employee did not result in the automatic termination of the contract..."
As we say this is a very doubtful area of the law and clearly it will still have to be developed. We do not think this is a case in which we can usefully add anything to the conflicting decisions, but accepting, for these purposes, Mr Prichard's submission,we find that this resignation was in truth very definitely accepted and that it was not open in the circumstances for Mr Mountjoy to say when he presented himself to the Tribunal, that his resignation had not been accepted.Therefore this Appeal on this very narrow ground, as Mr Prichard rightly says it is, falls to be dismissed.