Staffordshire County Council v Barber [1995] UKEAT 1165_94_2010

EAT
Staffordshire County Council v Barber
[1995] UKEAT 1165_94_2010 · 1995-10-20
MR JUSTICE MUMMERY (PRESIDENT) This appeal raises yet another point of law on the rights of part-time workers following the decision of the House of Lords in R. Secretary of State for Employment Ex Parte Equal Opportunities Commission (The EOC case) [1994] IRLR 176 .The point in this appeal was foreshadowed in recent decisions of this Tribunal in Methilhill Bowling Club v. Hunter [1995] IRLR 232 and Biggs v. Somerset County Council [1995] IRLR 452 . We have been informed by counsel in this case that the Court of Appeal will hear the appeal in Biggs on 6th and 7th November. Although this appeal is not concerned with the relevant time limits for a claim by a part-time worker for redundancy or unfair dismissal, the reasoning in Biggs and Methilhill Bowling Club about the nature of a claim brought by a part-time worker impacts directly on the arguments in this appeal on cause of action and issue estoppel. It will, therefore, be relevant for the attention of the Court of Appeal to be drawn to the problem in this case.

The Facts

The facts in the relevant documents and in the extended Reasons of the Industrial Tribunal have never been seriously in dispute. They may be summarised as follows:-(1) Mrs Barber was employed as a part-time teacher by the Staffordshire County Council ("the Council") under three separate contracts of employment at three schools: (a) Manifold Primary School Mrs Barber was employed to work at this School from 1st September 1984 until she was dismissed under her contract of employment on 31st August 1992. At the time of her dismissal she was required to work 3 hours per week. (b) St Leonards Primary School, Ipstones From 1st September 1989 until her dismissal under this contract on 31st August 1992 Mrs Barber was employed to work about 3.5 hours per week. (c) St Bartholomews Primary School, Longor Mrs Barber was required to work about 7 hours per week under this contract which was terminated on her dismissal on 31st August 1993.(2) This case is concerned with claims made by Mrs Barber in respect of the two dismissals on 31st August 1992. The third contract, which was not terminated until 31st August 1993, is not relevant.(3) On 2nd November 1992, Mrs Barber presented an Originating Application to the Industrial Tribunal through her Union representative, Mr Gareth Rees of the National Union of Teachers. Her complaint was that she had been dismissed from her posts in two schools on 31st August 1992 by reason of redundancy. She had sought, but not received, a redundancy payment. She did not claim unfair dismissal.(4) The Council resisted the claim and referred in the detailed grounds to the posts held under three separate contracts and contended -
"Under the principle established in Lewis v. Surrey County Council , Mrs Barber's entitlement to redundancy payments for the two posts lost in 1992 must be examined by reference to the two contracts considered separately. Each of these contracts was for fewer than eight hours per week. Accordingly neither could carry any entitlement to a redundancy payment."
(It is common ground that the decision in Lewis prevented the aggregation of hours under separate contracts to bring an employee within Schedule 13 to the 1978 Act)(5) The hearing of Mrs Barber's application was fixed for 5th May 1993. Shortly before the hearing there were discussions between Mr Rees of the NUT, on behalf of Mrs Barber, and a representative of the Council. As evidenced by letter dated 4th May 1993 and sent on behalf of the Council to the Regional Office of the Industrial Tribunal in Birmingham, Mr Rees indicated in the discussions -

"...his intention to withdraw the application due to be heard tomorrow."

and the Council's representative " in turn ... indicated [that he] would have no application to make on behalf of the Staffordshire County Council." The letter concluded -
"...Therefore on the understanding that in these circumstances the application will now be dismissed I do not propose to attend tomorrow's hearing."
(6) On 5th May 1993 the case was listed for hearing before a Chairman and two lay members. Mr Rees attended on behalf of Mrs Barber and withdrew the application. No evidence was heard. The Tribunal reached a decision, signed by the Chairman in accordance with the Industrial Tribunal Rules. The decision was entered in the Register and copies were sent to the parties on 18th May 1993. The decision consisted of one sentence.
"The unanimous decision of the Tribunal is that this application is dismissed on withdrawal by the applicant."
(7) On 3rd March 1994 the House of Lords promulgated their decision in the EOC case. On 3rd May 1994 Mrs Barber presented to the Industrial Tribunal an Originating Application containing a complaint of

"... redundancy/unfair dismissal."

The complaint was in respect of her dismissal from employment under contracts at the two schools on 31st August 1992 and at the third school on 31st August 1993. The details of the complaint, as subsequently amended, refer to the contractual arrangements between her and the Council, to her dismissal on 31st August 1992, to the statutory provisions in S.64 of the Employment Protection (Consolidation) Act 1978 and in Schedule 13 to that Act, to the House of Lords decision in the EOC case and to the provisions of Article 119 of the Treaty of Rome, the Equal Treatment Directive and certain decisions of the European Court of Justice. On the basis of those contentions Mrs Barber claimed compensation for unfair dismissal and a redundancy payment. The contention in the IT1 is that she has direct claims under European law in respect of those matters and that the time limits for the presentation of claims to the Industrial Tribunal have no application to those claims, so that the Industrial Tribunal has jurisdiction to hear her claims both under S.67(1) and S.91(1) of the 1978 Act.(8) On 22nd June 1994 the Council submitted a Notice of Appearance resisting the claim and stating that Mrs Barber was fairly dismissed on the ground of redundancy. A plea of res judicata is framed in the following terms:-
"2. The application relates to the same termination of employment as was dealt with in application 61096/92, an application that was dismissed on withdrawal by the applicant.
3. It assumed that the current application is founded on the case of R. v. Secretary of State for Employment Ex parte EOC. However that decision has no bearing on the issue of res judicata. It is impossible for the applicant to argue that she was unaware of her ability to make a claim when a claim was actually made (and only withdrawn the day before the hearing)."(9) There has been no application by Mrs Barber to the Industrial Tribunal to exercise its powers to review its own decision "in the interests of justice".

Decision of the Industrial Tribunal

As appears from the extended Reasons notified to the parties on 10th November 1994 the Industrial Tribunal, the Chairman sitting alone, held an interlocutory hearing on 24th August 1994 for the purpose of identifying the issues and giving directions for the future conduct of the application. A number of issues were identified: questions of issue estoppel and res judicata by virtue of the withdrawal and subsequent dismissal of the earlier case; the effect of the EOC case ; the real nature of the claim having regard to the decision in the EOC case and questions of time limits and continuity of employment. The Industrial Tribunal received written submissions from the parties dealing only with the question of res judicata and issue estoppel. In paragraph 6 of the extended Reasons the Tribunal Chairman identified the issue which he had to decide in the following terms:
"I have to decide whether the applicant is now entitled to pursue her present claims concerning the termination of her contract of employment at Manifold Primary School and St Leonard's Primary School, Ipstones on 31st August 1992 and which were the subject of the first application, claiming a redundancy payment, before the Industrial Tribunal."
In a decision, which is to be commended for its clarity and helpful reference to authority, the Chairman concluded that no questions of cause of action or issue estoppel arose and that Mrs Barber was entitled to proceed with her claims for unfair dismissal and redundancy payment. The basis of his decision, as appears from paragraph 12 and 13 of the extended Reasons, was that Mrs Barber had no claim directly under the provisions of the 1978 Act for unfair dismissal or a redundancy payment and that the claims advanced by her in her second application were under Article 119 of the EEC Treaty and under the two relevant Directives (the Equal Treatment Directive and the Equal Pay Directive). The Chairman concluded that that was a"...separate claim unrelated to the previous claims for redundancy payments".No decision has been made at this stage as to whether Mrs Barber's second application is out of time and, if so, whether time should be extended.

The Appeal

This appeal has been extremely well argued by Ms Connolly, on behalf of the Council, and by Miss Bates, on behalf of Mrs Barber. The arguments deployed on the appeal were not identical to those advanced to the Chairman of the Industrial Tribunal. This change of emphasis was the result of cases decided by this Tribunal since the Chairman notified his decision to the parties on 10th November 1994. In the light of the legal position currently stated in Biggs v. Somerset County Council [1995] IRLR 453 , Miss Bates did not seek to argue that the claims of unfair dismissal and redundancy made by Mrs Barber in her second application were a cause of action under Article 119 and the Directives, separate from the cause of action in the first application to the Industrial Tribunal. On that aspect of the case Miss Bates reserved her position, so that that point can be taken if the Court of Appeal disagree with the legal analysis of the inter-relation between domestic law and Community law in the judgment in Biggs .

On this appeal the arguments of each side have focussed on two questions -

(1) Whether the principles of cause of action estoppel and issue estoppel are applicable to a case where an application has been withdrawn and dismissed without any argument or reasoned decision on the merits of the case; and(2) If those principles are applicable, whether, on the particular facts of this case, Mrs Barber can rely on an exception which would otherwise preclude her from continuing with her second application.

Mrs Barber's Submissions

The broad basis of the submissions made by Miss Bates, in seeking to uphold the decision of the Industrial Tribunal, was that the principles of cause of action and issue estoppel have no application to this case because -(1) There was no judicial decision or determination on the facts or law of the case capable of raising an estoppel. The Tribunal did not carry out any investigation into the merits or facts and did not, therefore, decide on any conditions necessary for establishing a cause of action.(2) The Order of the Industrial Tribunal registered on 18th May 1993 was merely an administrative or procedural act, not done in the exercise of any judicial function. Nothing was decided judicially.(3) The case was dismissed solely in consequence of the voluntary withdrawal of Mrs Barber's case which rendered it unnecessary for the Tribunal to make any adjudication on any issue. The withdrawal by Mrs Barber's case on the ground that she could not comply with a statutory requirement concerning hours of work or continuity of employment did not result in any judicial decision. The position was analogous to a discontinuance of a case which could not give rise to an estoppel preventing the presentation of her claims for unfair dismissal and redundancy in the light of the EOC case. (See Land v. Land [1949] 2 All ER 218, a case of a mere withdrawal of proceedings on a preliminary point, not giving rise to any estoppel).Miss Bates supported her arguments by reference to judicial decisions which define the scope and illustrate the application of the principles of cause of action and issue estoppel.

Conclusions

In our view, Mrs Barber is prevented by the rules against re-litigation from proceeding with her application for unfair dismissal and redundancy payment in the Originating Application presented on 3rd May 1994. The appeal is therefore allowed and Mrs Barber's claim is dismissed. It will not be necessary for the Industrial Tribunal to deal with the other questions which otherwise might arise in connection with the application of time limits and extensions of time.

Our reasons for this conclusion are as follows:-

A. General Principles

There is no significant disagreement between Ms Connolly and Miss Bates about the purpose and scope of the relevant legal principles.(1) The policy behind the rules against re-litigation is finality in the resolution of disputes. The rules exist not only to protect society and its citizens from the obsessions and frivolities of serial suers, but also to ensure that, even for those who litigate disputes in good faith, all cases must come to an end. The general rule is that, if a court of competent jurisdiction has reached a final and conclusive decision on the merits of a case, it is against public policy to allow it to be re-opened (save on an appeal), even if that decision appears to be wrong in the light of the law as then understood or as subsequently evolved and clarified by judicial decision. The injustice and inconvenience which would flow from allowing re-litigation usually outweigh the injustice of leaving even an erroneous decision undisturbed.(2) Lord Diplock's discussion of the principles of estoppel in Thoday v. Thoday [1964] P.181 at 197 and 198 provided the basis for the principal submissions on appeal.

Lord Diplock described cause of action estoppel as

"...that which prevents a party to an action from asserting or denying against the other party the existence of a particular cause of action, the existence or non-existence of which has been determined by a court of competent jurisdiction in previous litigation between the same parties. If a cause of action was determined to exist ie, judgment was given upon it, it is said to be merged in the judgment. If it was determined not to exist the successful plaintiff can no longer assert that it does."

As to issue estoppel , Lord Diplock at p.198 said that it was

"... an extension of the same rule of public policy. There are many causes of action which can only be established by proving that two or more different conditions are fulfilled. Such causes of action involve as many separate issues between parties as there are conditions to be fulfilled by the plaintiff in order to establish his cause of action; and there may be cases where the fulfilment of an identical condition is a requirement common to two or more causes of action. If in litigation upon one such cause of action any of such separate issues as to whether a particular condition has been fulfilled is determined by a court of competent jurisdiction, either upon evidence or upon admission by a party to the litigation, neither party can, in subsequent litigation between one another upon any cause of action which depends upon the fulfilment of the identical condition, assert that the condition was fulfilled if the court has in the first litigation determined that it was not, or deny that it was fulfilled if the court in the first litigation determined that it was."

B. Particular circumstances

(1) It is common ground that

(a) the Industrial Tribunal is a competent court for the adjudication of claims for redundancy pay and unfair dismissal.(b) the principles of cause of action estoppel and issue estoppel are capable of applying in the field of employment law administered by the Industrial Tribunals: Munir v. Jang Publications Ltd [1989] ICR 1 at pp.9H to 10A and 11c.(2) In our view, the Industrial Tribunal made a decision on 5th May 1993 on Mrs Barber's first application which determined her particular cause of action for redundancy pay. It was determined on the basis that she was unable to fulfil a requirement common both to a claim for redundancy pay and a claim for unfair dismissal, namely the requirement as to continuity of employment and the qualifying number of hours contained in the 1978 Act.(3) The critical question is whether the fact that the dismissal of Mrs Barber's claim was on withdrawal by her, rather than after a contested hearing, prevents the application of the principles. In our view, it does not. It is necessary to examine first the powers of the Industrial Tribunal contained in the Industrial Tribunal (Rules of Procedure) Regulations 1985, in force at the time of the decision on 5th May 1993.

(c) provided that -

"A tribunal may , if it thinks fit - (c) if the applicant shall at any time give notice of the withdrawal of his originating application, dismiss the proceedings."
That confers on the Tribunal a discretion whether or not to dismiss the proceedings. The decision to dismiss is not simply a rubber stamping, administrative act: it involves the exercise of a judicial discretion and an adjudication by a competent tribunal as to whether or not it is "fit" to dismiss proceedings in a case where the applicant has given notice of withdrawal. The fact that a notice of withdrawal will, in most cases, result in the dismissal of the proceedings does not prevent the decision to dismiss from being a judicial act. The judicial nature of the act is reinforced by the provisions of Rule 9. The decision must be that of a tribunal, not, for example, a decision of a member of the tribunal staff. The decision must be recorded in a document signed by the Chairman and must give reasons, in full or summary form. That procedure was followed in this case. Even though the document sent to the parties on 18th May 1993 simply said that the application was dismissed on withdrawal by the applicant, that constitutes a "decision" of a tribunal for the purposes of the 1985 Regulations: see Regulation 2. Although the Tribunal decision does not explain why Mrs Barber was withdrawing her application, it is clear from the issues defined by the IT1 and IT3 that the Council were taking the point that Mrs Barber could not satisfy the requirements as to hours and continuity of employment necessary for the purposes of establishing a redundancy claim.(4) There is nothing in the principles of cause of action or issue estoppel which stipulate that they can only apply in cases where a tribunal has given a reasoned decision on the issues of fact and law in the first litigation. On the contrary, it appears from cases such as SCF Finance Co Ltd v. Masri (No.3) [1987] 1 All ER 194 that an estoppel may arise from an order dismissing proceedings without argument or evidence directed to the merits of the case. In the SCF Finance case, which concerned a question of issue estoppel in subsequent garnishee proceedings, Ralph Gibson LJ. said at p.208E -
"... an order dismissing proceedings is capable of giving rise to issue estoppel even though the court making such order has not heard argument or evidence directed on the merits ... If a party puts forward a positive case, as the basis of asking the court to make the order which that party seeks, and then at trial declines to proceed and accepts that the claim must be dismissed, then that party must, in our view, save in exceptional circumstances, lose the right to use again that case against the other party to those proceedings."
At p.209 E-G Ralph Gibson LJ. concluded the judgment by stating the principle in the following terms -
"A litigant who has had an opportunity of proving a fact in support of his claim or defence and has chosen not to rely on it is not permitted afterwards to put it before another tribunal."
See also Khan v. Goleccha International Ltd [1980] 2 All ER 259 and 266b, 267b, h-j, 268 d-e.In our view, that is the position in this case. Mrs Barber had the opportunity to prove, in support of her claim for redundancy payment, that she had continuity of employment and could satisfy the qualifying hours required by the 1978 Act. She chose not to pursue that matter and Mr Rees, as her representative, acknowledged that her application should be dismissed. In those circumstances Mrs Barber can be in no better position in relation to the principles of estoppel than if she had instructed Mr Rees to argue those points unsuccessfully. In dismissing the appeal in those circumstances the first Tribunal made a decision which involved rejecting an element in Mrs Barber's cause of action both for redundancy payment and unfair dismissal. That decision, adverse to her, prevents her from now raising those causes of action. They are extinguished. The decision resolves an issue which prevents Mrs Barber from contending that she can satisfy the requirements of continuity of employment and hours in relation to her claims.(4) We have reached the conclusion that Mrs Barber is also precluded from pursuing a claim for unfair dismissal in her second application on "the doctrine of res judicata in the wider sense, namely that it would be an abuse of the process of the court to raise in subsequent proceedings matters which could and should have been litigated in earlier proceedings." ( SFC Finance (supra) at p.209 F-G ) Reference was made to a number of authorities on the special circumstances in which the principle does not apply:

Arnold v. National Westminster Bank [1991] 3 All ER 41 at 52 b-d

Henderson v. Henderson (1843) 3 Hare 100 at 115

Talbot v. Berkshire County Council [1993[ 4 All ER 9.We reject the argument advanced by Miss Bates that this case should be regarded as an exception to the application of the principles of issue estoppel in the wider sense. The general rule is that parties to litigation must bring forward the whole of their case. They are not permitted to bring forward a matter in later litigation which might have been brought forward as part of the subject matter in the earlier litigation. It was argued that the "special circumstances" for departing from that general rule were that the claim of unfair dismissal of a part-time worker has only been made possible by the declaration of the House of Lords in the EOC case, subsequent to Mrs Barber's original application and her withdrawal of it. It was also argued that, even "exercising reasonable diligence", Mrs Barber could not have brought forward her claim for unfair dismissal at the time when she presented her application in November 1992. It was not until March 1994 that the House of Lords clarified the legal position of a part-time worker, so that it became possible for Mrs Barber to raise the disparity between the provisions of domestic law in Schedule 13 to the 1978 Act and the requirements of Article 119 of the EEC Treaty and the relevant Directives. In our view, this case does not come within the exception referred to in cases such as Henderson v. Henderson (supra). The position is that Mrs Barber was dismissed from two contracts. Her claim for redundancy pay in the first application was based on the fact of her dismissal for redundancy on 31st August 1992. There is no good reason why she could not have included in her claim presented in November 1992 a complaint of unfair dismissal, as well as a claim for redundancy. The same requirements for continuity of employment and qualifying hours had to be satisfied.For those reasons this appeal is allowed and Mrs Barber's claim is dismissed on the grounds that the principles of res judicata, both cause of action estoppel and issue estoppel, preclude her from proceeding with her second application.