Arab Republic Of Egypt Embassy v Gamal-Eldin & Anor [1995] UKEAT 482_94_0203

EAT
Arab Republic Of Egypt Embassy v Gamal-Eldin & Anor
[1995] UKEAT 482_94_0203 · 1995-03-02
MR JUSTICE MUMMERY (PRESIDENT) Mr Gamal-Eldin and Mr Mohammed El-Abiary are Egyptian nationals resident in London at the material time. Until they were dismissed on 15th January 1993 they were both employed under contracts made in the United Kingdom as drivers at the Medical Office of the Embassy of the Arab Republic of Egypt at 47 Longridge Road, London SW5. The preliminary question for decision is whether the Industrial Tribunal has jurisdiction to determine the claims for unfair dismissal made by both applicants in Originating Applications presented on 13th April 1993.The Industrial Tribunal held at London (North) on 10th March 1994 decided that, having regard to S.4(2)(a) of the State Immunity Act 1978 ("the 1978 Act"), it had jurisdiction to consider the complaints and rejected the plea of state immunity. After it had been notified of the extended Reasons for the decision on 7th April 1994, the Arab Republic of Egypt appealed against that decision by a Notice of Appeal served on 27th May 1994, subsequently amended with leave to take a point under S.16 of the 1978 Act to the effect that the two Applicants were members of the Diplomatic Mission.

The Issues

The arguments advanced by Ms Walden-Smith for the Arab Republic of Egypt and Mr Bibby for the two Applicants on the issue of state immunity raised the following questions on the interpretation and application of the 1978 Act:(1) Has the Arab Republic of Egypt submitted to the jurisdiction of the Industrial Tribunal? If not,(2) Does the Medical Office form part of the Mission of the Arab Republic of Egypt? If so,(3) Were the two Applicants members of the Mission? If so,(4) Is the Medical Mission maintained by the Arab Republic of Egypt in the United Kingdom for "commercial purposes"?Before we deal with those issues we must first decide a preliminary point taken by Mr Bibby on the jurisdiction of this Tribunal to entertain this appeal.

The preliminary point on jurisdiction

Mr Bibby argued that this appeal does not raise any question of law. Therefore the Appeal Tribunal has no jurisdiction to determine it. The appeal is an impermissible late attempt to introduce evidence available at the time of the hearing before the Industrial Tribunal, but not put before it. The purpose of introducing that evidence is to persuade this Tribunal to do something which it has no power to do, that is to make new findings of fact contrary to facts correctly found by the Industrial Tribunal on the evidence before it.The correctness of that submission must be tested against the history of the proceedings, the provisions of the 1978 Act and the powers of this Tribunal to admit evidence on appeal to challenge findings of fact made by the Industrial Tribunal.

The course of the proceedings

These proceedings took the following course.(1) The Originating Applications presented on 13th April 1993 were served on the Arab Republic of Egypt under cover of letters via the Foreign and Commonwealth Office dated 5th May 1993.(2) At that time the Medical Counsellor at the Mission was Dr El-Dieb. He was appointed on 8th April 1992 and remained in office until May 1994. He had previously dealt with another application for unfair dismissal brought against the Arab Republic of Egypt by a Mr Younnis. In that case an Industrial Tribunal had upheld a claim to State Immunity without any attendance on behalf of the Arab Republic.(3) No Notice of Appearance (IT3) was served. Dr El-Dieb wrote two letters to the Industrial Tribunal concerning the applications. The first letter dated 28th June 1993 related to Mr El-Abiary's application. The second letter dated 16th August 1993 related to Mr Gamal Eldin's application. It is not necessary at this stage to examine the contents of the letters.(4) The Chairman of the Industrial Tribunal notified the Arab Republic of Egypt by a Notice of the 20th July 1993 that there would be a preliminary hearing to determine the issue of jurisdiction to consider the case. A hearing date was fixed for 4th October 1993. That hearing was adjourned until 10th March 1994. The Arab Republic of Egypt were not represented at either hearing. Mr Bibby represented the Applicants at both hearings. At the hearing on 10th March evidence was given by both Applicants. A written statement from Mr Younnis, formerly employed by the Arab Republic of Egypt as an accountant, was also admitted.(5) The Industrial Tribunal, in its extended reasons notified to the parties on 7th April 1994, made the following crucial findings of fact. Both Applicants were Egyptian nationals employed by the Medical Office as drivers. The Medical Office, which is physically separate from the Embassy and had little day-to-day contact with it, is concerned with the provision of medical services in the following circumstances:(Paragraph (2)(b)) "The medical office was situated some four miles away from the Embassy and was managed by Dr M El-Dieb. It was an office agency or establishment maintained by the Egyptian state in the UK for commercial purposes. The office was concerned with the procurement of medical services in the UK to treat Egyptian nationals who generally travelled to London by air to become patients in London hospitals and to receive treatment which was not otherwise available within the Egyptian Health Service. The Applicants collected these patients from the airports and drove them either to hospitals where they were to receive their treatment or otherwise to hotels where they would await admission into hospital. They also translated for the patients at the hospitals. The Office did not charge for this service. (c) The Medical Office was responsible for transactions of a commercial or professional nature in that it procured and paid for the services provided and these transactions were those into which a state entered or engaged otherwise than in the exercise of sovereign authority."

(6) The Tribunal concluded in paragraph 4 of the extended reasons that -

"... the Medical Office were engaged "within an area of activity trading or commercial, or otherwise of a private law character, in which the state had chosen to engage." We accordingly find that in the particular circumstances of these cases Section 4 gives jurisdiction to a Tribunal to consider the complaints of the Applicants."
(7) The Tribunal also concluded that the Applicants were not part of the Arab Republic of Egypt's Diplomatic Mission within the meaning of the Vienna Convention. There was no evidence that they were members of the Mission, which they denied.(8) Finally, the Tribunal concluded that Dr El-Dieb, on behalf of the Medical Office, had in the two letters canvassed the merits of each case before raising the issue of immunity in November 1993 and had therefore taken steps in the proceedings.(9) Following notification of the decision the Arab Republic of Egypt requested a review, but that was refused and there was no appeal against the refusal.(10) An appeal was served on 27th May 1994 shortly after solicitors had been instructed. The grounds of the appeal were that the Tribunal had erred in law in concluding that it had jurisdiction to consider the Applicants' claims of unfair dismissal. The particular grounds canvassed in the Notice of Appeal were, first, that the Tribunal's findings of fact did not justify the conclusion that the work formerly undertaken by the Applicants in relation to their contracts of employment was work for an office agency or establishment maintained by the State of Egypt in the United Kingdom for commercial purposes (S.4(2)(a). Secondly, the Tribunal erred in concluding that the Arab Republic of Egypt or its Medical Office were engaged in an area of activity, trading or commercial or otherwise, of a private law character. Rather it was in the sphere of governmental or sovereign activity. Thirdly, and finally, the Tribunal erred in concluding from the correspondence before it that Dr El-Dieb had taken steps in the proceedings relating to the merits of the applications such that the Arab Republic of Egypt was precluded from raising the issue of immunity under the 1978 Act. The Applicants took the point in their Answers that the Appeal Tribunal had no jurisdiction because of the grounds of appeal revealed no point of law.(11) The appeal first came before this Tribunal on 14th October 1994 when the Arab Republic of Egypt asked for an adjournment in circumstances described in the judgment given on that application. The adjournment was opposed, but granted on terms. Those terms included directions that the Arab Republic of Egypt file and serve Affidavit evidence relevant to the questions of state immunity, waiver of immunity and non-attendance at the earlier hearings. Affidavits were duly served on behalf of the Arab Republic of Egypt. The Affidavits were sworn by Dr El-Dieb, Mr Mahmoud Abdou and Mr David Burchnall. The Affidavit by Mr Burchnall was relevant to the question whether the Medical Office form part of the Arab Republic of Egypt's Mission. No evidence was served in response to those Affidavits, though leave had been granted for that to be done. No notice was given of intention to cross-examine the deponents of the Affidavits.

The jurisdictional issue

Mr Bibby made the following submissions objecting to the to the jurisdiction of the Appeal Tribunal.(1) The Affidavit evidence filed on behalf of the Arab Republic of Egypt is inadmissible, because it does not satisfy the requirements of Ladd v. Marshall [1954] 1 WLR 1489 , which apply as much to appeals to the Employment Appeal Tribunal as to the appeals to the Court of Appeal: Kingston v. British Railways Board [1984] IRLR 146 at 155 and Wileman v. Minilec Engineering Ltd [1988] IRLR 144 . No attempt was made by Ms Walden-Smith to show that the evidence could not have been obtained with reasonable diligence for use at the hearing. It was either available for use at the hearing or could have been obtained with reasonable diligence. This requirement of Ladd v. Marshall is similar to the ground on which a review may be sought under Rule 11(1)(d) and (e) of the Industrial Tribunal Rules. An application for a review was made, refused and was not appealed. The Appellant should not be in any better position on an appeal than it had been on its unsuccessful application for a review.(2) No new point of law is taken on the appeal to which the evidence is directed. The fact that the new evidence goes to jurisdiction does not make admissible in relation to an appeal on a point of law determined by the Industrial Tribunal. It was decided in McLeod v. Hellyer Bros [1987] ICR 526 that it was not permissible to take a new point of law on appeal which required new evidence, unless there were special or exceptional circumstances.(3) The facts relevant to jurisdiction have been determined by the Tribunal. They cannot be reversed or redetermined by an Appeal Tribunal on appeal. There is no relevant distinction between facts which go to the jurisdiction and other facts against which a party may wish to appeal, any more than there is a distinction between errors of law that go to the jurisdiction and errors of law that do not. It is within the jurisdiction of the Industrial Tribunal to find facts which go to the jurisdiction. As long as it has applied the law correctly to the facts found by it, there is no ground of appeal. On this aspect of the appeal Mr Bibby referred us to decisions on public law which we do not find it necessary to examine for the purpose of deciding this appeal.The essence of Mr Bibby's argument is that it is for the Industrial Tribunal to determine the facts on which a claim to immunity is based. The Tribunal has done that. There is no scope for review of those findings of fact by the Appeal Tribunal. The fact that the Arab Republic of Egypt is a sovereign state does not justify departure from established principles or practice.

Conclusion on the jurisdictional question

We agree with Ms Walden-Smith that the Appeal Tribunal is not precluded from admitting and considering the new evidence. No evidence was presented to the Tribunal by the Arab Republic of Egypt at either hearing as a result of a misunderstanding by Dr El-Dieb, the Medical Counsellor. He thought that in these matters (and his evidence was not challenged in cross-examination) it was unnecessary for anyone to attend the Industrial Tribunal on behalf of the Arab Republic of Egypt and, indeed, that it would not be correct for anyone to attend. This explanation has to be considered in the context of immunity cases to which special considerations apply. There is a discussion of those considerations, in particular the role of the court under S.1(2) of the 1978 Act, in the recent decision of this Tribunal in United Arab Emirates v. Abdelghafar [1995] ICR 65 . Section 1(2) provides:
"A court shall give effect to the immunity conferred by this section even though the State does not appear in proceedings in question."
If the Industrial Tribunal fails to give effect to an immunity in fact enjoyed by the Arab Republic of Egypt as a result of not having all the relevant evidence, it is, in our view, the duty of the Appeal Tribunal to correct this error and give effect to this immunity, even if that means departing from the rules which normally apply to the admission of new evidence on appeal.In any event, so far as this Tribunal is concerned, the admission of evidence has already been determined by the Order made on 14th October when the case was adjourned with directions for Affidavit evidence on each side. That Order was not appealed.When Ms Walden-Smith took this point, Mr Bibby asked us to review our earlier decision under Rule 33 of the Employment Appeal Tribunal Rules or for leave to appeal against that decision out of time. He argued that those directions were only given by the Tribunal on an application for an adjournment. In those circumstances the evidence filed pursuant to those directions should be treated only as "de bene esse". The directions did not pre-judge the question of admissibility. We have not been persuaded by Mr Bibby that we should grant a review, but we grant an extension of time for appealing against that decision to the date when the time for appealing against this decision expires.

Submission to the jurisdiction

Mr Bibby argued on behalf of the Applicants that the Industrial Tribunal had found as a fact that the Arab Republic of Egypt had irrevocably submitted to the jurisdiction by taking steps in the proceedings.

(b) of the 1978 Act which provide:

"2(1) A State is not immune as respect proceedings in respect of which it has submitted to the jurisdiction of the courts of the United Kingdom

(3) A State is deemed to have submitted -

(a) ...(b) subject to subsections (4) and (5) below, if it has intervened or taken any step in the proceedings."Subsection (4) provides that subsection (3)(b) does not apply to intervention or any step taken for the purpose only of claiming immunity.

(b) does not apply

"... to any step taken by the State in ignorance of facts entitling it to immunity if those facts could not reasonably have been ascertained and immunity is claimed as soon as reasonably practicable."
Mr Bibby also referred to Article 3 of the European Convention on State immunity.

"Article 3

1. A contracting State cannot claim immunity from the jurisdiction of a court of a contracting State if, before claiming immunity, it takes any step in the proceedings relating to the merits."It was argued that the Arab Republic of Egypt had taken steps in these proceedings by entering notices of appearance which engaged in the case on the merits without making any express claim to immunity. The Industrial Tribunal properly treated the letters referred to above as notices of appearance. Section 2(5) of the 1978 Act could not be relied upon as it was not raised in the notice of appeal. In any case, there were no facts of the kind referred to in that section.We do not accept Mr Bibby's arguments on this point. We agree with Ms Walden-Smith that the Tribunal erred in law in holding that there was a submission to the jurisdiction under S.2. Our reasons for this conclusion are

(1) It is provided in S.2(7) that

"The head of a state's diplomatic mission in the United Kingdom, or the person for the time being performing his functions, shall be deemed to have authority to submit on behalf of the State in respect of any proceedings: and any person who has entered into a contract on behalf of and with the authority of a State shall be deemed to have authority to submit on its behalf in respect of proceedings arising out of the contract."
The letters held by the Industrial Tribunal to be a notice of appearance and to constitute a submission to the jurisdiction were written by Dr El-Dieb. He was the Director of the Medical Office at that time, but he did not occupy the position of the head of the Diplomatic Mission of the Arab Republic of Egypt in the United Kingdom. He is not, therefore, deemed to have authority to submit to the jurisdiction on behalf of his state. There was no evidence that he had express authority to submit to the jurisdiction. Nor was he the person who had entered into the contract of employment with either of the Applicants. Mr Bibby sought to avoid the application of these provisions by arguing , first, that they only applied to a " deemed submission " for the purposes of S.2(3) and that this was a case of an express submission on behalf of a state; secondly, that the "person" who had entered into the contract of employment refers not to the individual who entered into the contract but to the official persona by whom the contract had been entered into (ie the Director of the Medical Office). In our view, neither contention is a correct construction of S.2(7) of the 1978 Act.(2) We also agree with Ms Walden-Smith that the Tribunal erred in law in holding that a step was taken in these proceedings by the entering of a notice of appearance. The position is that a letter was sent to the Industrial Tribunal by Dr El-Dieb on 28th June 1993 in respect of Mr El-Abiary's application. It was explained in the letter that Mr El-Abiary was an Egyptian national subject only to Egyptian law. A further letter was sent on 16th August 1994 in respect of Mr Gamal-Eldin clarifying that he was an Egyptian citizen. In the meantime on 1st July 1993 the Industrial Tribunal wrote to the Arab Republic of Egypt seeking a notice of appearance in respect of both applications. The response on the 2nd July was to request that all correspondence be sent to the Foreign and Commonwealth Office. In these circumstances, it is our view that neither of the letters constitutes a notice of appearance within the meaning of the Regulations governing procedure in the Industrial Tribunals. Neither letter states an intention to resist the claims. Therefore no step was taken in the proceedings within the meaning of S.2(4) of the 1978 Act.(3) Finally, we are of the view that neither the sending of the letters nor the contents of them constituted a submission to the jurisdiction of the Industrial Tribunal within the meaning of S.2(1). Each letter seeks to explain what happened. The assertion of Egyptian nationality in relation to the Applicants is more indicative of a claim to an immunity than of an intention to submit to the jurisdiction. Nothing in either letter states that there is an intention to resist the proceedings. The Chairman's notice of a hearing on a preliminary issue of immunity is more consistent with the view that there was no submission to the jurisdiction than that there was one. In our view, neither letter evidences an intention to waive immunity or to submit to the jurisdiction nor could they be reasonably understood to be so.

The Mission and the Medical Office

We heard argument concerning the status of the Medical Office: whether it formed part of the Mission and whether the two Applicants were members of the staff of the Mission. We gave leave to Ms Walden-Smith to amend her Notice of Appeal to raise a point whether the two Applicants were members of the staff of the Mission. That point was raised in the Affidavit evidence served in November 1994. We decided to grant leave to amend since the point was canvassed in the Affidavits and there is no prejudice to the Respondents in granting leave. They have not been taken by surprise.Ms Walden-Smith submitted that the Medical Office form part of the Mission and that the two Applicants were members of the Mission. The evidence establishes that the Medical Office is one of several offices under the jurisdiction of the main Embassy. It occupies a self-contained building at 47 Longridge Road, London SW5, three or four miles from the building occupied by the main Embassy at 26 South Street, London W1. The activities of the Medical Office come under the jurisdiction of the Ambassador. He is ultimately responsible for its activities. As confirmed by a certificate from the Foreign and Commonwealth Office dated 6th October 1994, the Medical Office has been accepted as part of the premises of the Egyptian Embassy for the purposes of the Diplomatic and Consular Premises Act 1987. Such a certificate is granted only for the period for which the diplomatic premises of a State are used for the purposes of its Mission. The functions of the Medical Office are consistent with the non-exhaustive list of functions set out in Article 3 of the Vienna Convention on Diplomatic Relations ratified by the United Kingdom in 1964. Reliance was also place on Article 1 of that Convention which provides that the expression "members of the mission" include, inter alia, "members of the administrative and technical staff".Against that background it is necessary to refer to S.4 and S.16 of the 1978 Act. It does not appear from the extended reasons that the Industrial Tribunal was asked to consider the provisions of S.16. Section 4 of the 1978 Act is concerned with contracts of employment and provides in subsection (1) that
"A State is not immune as respects proceedings relating to a contract of employment between the State and an individual where the contract was made in the United Kingdom or work is to be wholly or partly performed there."

S.16 is concerned with excluded matters and provides that

"This Part of this Act shall not affect any immunity or privilege conferred by the Diplomatic Privileges Act 1964 or the Consular Relations Act 1968; and - (a) Section 4 above does not apply to proceedings concerning the employment of the members of a mission within the meaning of the Convention scheduled to the said Act of 1964 or of the members of a consular post within the meaning of the Convention scheduled to the said Act of 1968."
Article 1 of the first Schedule to the 1964 Act defines various expressions: "the members of the mission" are the head of the mission and the members of the staff of the mission; "members of the staff of the mission" are the members of the diplomatic staff, of the administrative and technical staff and of the service staff of the mission. Finally, in Article 1(f) it is provided that the "members of the administrative and technical staff" are the members of the staff of the mission employed in the administrative and technical service of the mission.In our view, on the facts set out above, the two Applicants were members of the staff of the Mission employed in the administrative and technical service of the Mission. The fact that no certificate has been produced proving that they were members of the Mission does not affect the validity of that conclusion. They were employed as drivers. Drivers form part of the administrative and technical staff. As is clear from the decision in Sengupta v. Republic of India [1983] ICR 221 at 229 the immunity extends to members of staff of the Mission carrying out work of the Mission " in however humble a role".

Commercial purposes

Even if the Applicants were not part of the staff of the Mission immunity would still, in our view, apply in this case on the true construction of S.4 of the 1978 Act. Subsection (1) disapplies the immunity as respects proceedings relating to a contract of employment between the State and an individual where the contract was made in the United Kingdom or the work is to be wholly or partly performed there. That is prima facie the case here. It is then provided, however, that the section does not apply if
"2(a) At the time when the proceedings are brought the individual is a national of the State concerned; or (b) At the time when the contract was made the individual was neither a national of the United Kingdom nor habitually resident there."
In this case both Applicants are Egyptian nationals. That provision in subsection (2) is however, subject to subsection (3) which provides
"Where the work is for an office, agency or establishment maintained by the State in the United Kingdom for commercial purposes subsections 2(a) and (b) above do not exclude the application of this section, unless the individual was, at the time when the contract was made, habitually resident in that State."
Neither Applicant was habitually resident in Egypt at the relevant time. The question arises whether the Medical Office was maintained by the Arab Republic of Egypt in the United Kingdom "for commercial purposes". It is necessary to refer to other provisions. Section 17(1), which applies for the interpretation of Part 1 of the 1978 Act, stipulates that "commercial purposes" means "purposes of such transactions or activities as are mentioned in S.3(3) above". Section 3(3) states that "commercial transaction" means
"(a) any contract for the supply of goods or services; (b) any loan or other transaction for the provision of finance and any guarantee or idemnity in respect of any transaction or of any other financial obligation; and (c) any other transaction or activity (whether of a commercial, industrial, financial, professional or other similar character) into which a State enters or in which it engages otherwise than in the exercise of sovereign authority."
It was argued by Mr Bibby that the Medical Office was conducting commercial transactions by making contracts for medical services and that their purchase and arrangement was not in the exercise of sovereign authority. Transactions were entered into otherwise than in the exercise of sovereign activity. He relied on the decision in I Congresso del Partido [1983] AC 244 and the distinction between commercial activity and sovereign state activity.As appears from the more recent decision of Lettrill v. USA (No.2) [1995] 1 WLR 82 at pages 89 and 91 the proper approach to the question whether an activity is commercial or in exercise of sovereign authority involves looking at all the circumstances in relation to the activities and their context and then consider all the factors together. No one factor is in itself determinative in characterising the activity as sovereign or non-sovereign. It is relevant to look at the nature of the activity, the identity of those who deal with it, and the place where it takes place in order to resolve this question.On this part of the case we agree with Ms Walden-Smith. The purposes of the Medical Office were not "commercial purposes" within the exception to immunity contained in S.4(3) of the 1978 Act. The purposes and activities of the Medical Office are described in detail in the Affidavit evidence. They are within the sphere of governmental or sovereign activity. The Medical Office was used by the government of the Arab Republic of Egypt to provide guidance, advice and expert care to patients referred by the government of the Arab Republic of Egypt for medical treatment in the United Kingdom. The Medical Office acted throughout as a representative of the Arab Republic of Egypt and its Embassy. The salaries of the Medical Office were paid by the government of the Arab Republic of Egypt and all payments to the Medical Office were made by the government of Egypt.

Conclusion

For all those reasons, we conclude that the Industrial Tribunal erred in law in deciding that the Arab Republic of Egypt could not claim immunity in these proceedings. We allow the appeal. There is no jurisdiction in the Industrial Tribunal to hear these applications.