Davis v Freeman Dawson & Co Ltd [1995] UKEAT 543_94_1205

EAT
Davis v Freeman Dawson & Co Ltd
[1995] UKEAT 543_94_1205 · 1995-05-12

JUDGE SMITH QC :

I am going to give this judgment extempore because I think it is important this matter should be resolved. Therefore it may not be so elegantly phrased as it otherwise perhaps might have been. However, I think it is the right course to get on and give the judgment, which is a unanimous judgment of this Appeal Tribunal. We are all quite agreed about everything that I have to say.This is an appeal by Mr Davis who was the employee applicant against the decision of an Industrial Tribunal sitting at Reading on 9th February 1994, when it granted a review of its decision originally made on 16th July 1993 at the suit of the respondent employers, Freeman Dawson & Co Ltd. Who were by then represented by Mr Sutcliffe of Peninsula. They granted a review of their original decision pursuant to Rule 11(1)(e) of the 1993 Regulations. Rule 11(1) is of course in the following terms under the heading " Review of tribunal's decision " Rule 11(1):
"11.-(1) Subject to the provisions of this rule, a tribunal shall have power, on the application of a party or of its own motion, to review any decision on the grounds that-[ I will read (d) and (e) ] (d) new evidence has become available since the conclusion of the hearing to which the decision relates, provided that its existence could not have been reasonably known of or foreseen at the time of the hearing; or (e) [ which is the one under which this tribunal acted in granting the review ] the interests of justice require such a review."
In consequence of the granting of the review and then the review itself, the Industrial Tribunal substituted a compensatory award of £799.64 for its previous award of £8,519.22. By its original decision, which I will turn to later on in rather more detail, the Industrial Tribunal had found the applicant to be unfairly dismissed on the grounds of redundancy due to a failure by the respondents to consult properly. The Respondents are a small company, having at the material time, which was November 1992, a total of seven employees, and the applicant had been employed as a remedial technician specialising in timber proofing and damp proofing treatment from 14th July 1989 until his dismissal by reason of redundancy on 25th November 1992.The issue which we have to decide today is whether the Industrial Tribunal erred in law, in granting the review. The Appellant, represented by Mr Kibling of Counsel, submits that the Industrial Tribunal misdirected itself in law in holding that it was, in all the circumstances, in the interests of justice within the Regulation 11(1)(e) (which I have read) to grant the review.In outline, although I do not purport to cite directly, and exactly, from his very clear submissions to us. Mr Kibling submits that the effect of granting the review was to allow the Respondent employers to put forward a case on the issue of compensation which they could and should have put forward at the original hearing on 16th July 1993, which as I say resulted in the award that I have mentioned. He submits that the effect of the grant of the review was to allow a second bite at the cherry. Mr Kibling submits that the Tribunal erred in not paying sufficient regard to the case law on the question, and to the principle of the finality of litigation as it applies particularly to Industrial Tribunals. He submits that it was clear that it was not in the interests of justice to allow the employers to have a second bite of the cherry. In other words, summarising his submission, if through incompetence or a misunderstanding of the issue involved or just because it does not chose so to do, a party fails to call available evidence in support of its case, it should not be able to re-open the self-same issue after it has received an adverse decision. Otherwise, it is submitted, it would very often be open to a disappointed litigant before an Industrial Tribunal to invoke the power of review by relying on the wide words "the interests of justice" and in this way cause additional delay and expense and also, obtain, what is in effect, a re-hearing, rather than a review. He reminded us that the correct approach, in his submission, is shown by the authorities, particularly the case of Flint which I will come to shortly. That is to say Flint v Eastern Electricity Board [1975] ICR 895. He reminded us of the importance of the whole of that judgment as including the important principle that the interests of justice should be construed so as to embrace not only the interests of the party who happens to be seeking the review but also the interests of the other party, and the interests of the general public in business before industrial tribunals being conducted straightforwardly, speedily and efficiently, and with the necessary attention to finality, in respect of litigants, many of whom are unrepresented, and who are anxious to get their cases heard and disposed of. Those were the submissions he made, which he then of course proceeded to apply to this particular decision, and I will come on to that aspect of the matter shortly.The Respondents, who are represented by Mr Sutcliffe from Peninsula, on the other hand make the submission that the Industrial Tribunal here was entirely justified in granting the review in the circumstances which arose in this particular case, since it is the submission made on behalf of the Respondents that there was a failure on the part of the Industrial Tribunal here to bring to the attention of the parties an issue of law relating to the correct approach to compensation once they had decided that the redundancy was unfair due to lack of consultation by the employers. Indeed, the application for review was founded on the same argument which was then presented to the Industrial Tribunal. Namely that the Industrial Tribunal, once it had found that there was no proper consultation, should have gone on to consider what the likely outcome would have been had the applicant been consulted about his abilities.The Industrial Tribunal dealt with the application in paragraphs 2 to 5 of its decision granting a review. In paragraph 5 it concluded that the interests of

justice required a review,:

"... as the lack of adequate evidence on this issue [ namely the issue that the Respondents had raised, as they put it ] ... meant that the Tribunal's findings could well be unsafe."
Before we look in detail at the original decision and the review decision, which we consider it very important to do, we should say straight away that we have found a great deal of assistance from the decision of Flint v Eastern Electricity Board , Phillips's J. decision in 1975.In the first place, we adopt and entirely agree with the learned judges approach to the interrelationship between paragraphs (d) and (e) of what was then Rule 12(1) of the relevant Regulations but which is now expressed in almost exactly similar terms in Regulation 11(1)(d) and (e) of the current 1993 Regulations. To the effect that as is stated in the head note,:-
"... paragraphs (d) and (e) ... were not mutually exclusive but that, in practice, paragraph (e) should be applied with some regard to the kind of case which was intended to come within paragraph (d) , and ordinarily a case which failed under that paragraph, would fail under paragraph (e) also."
We entirely agree with that approach. We thinks that it is the correct approach. In addition we also entirely agree with the second proposition for which this case is cited as summarised in paragraph (2) of the `head note', applying to the particular facts in that case, in these terms:
"That the application to review did not fall within rule 12 (1) (d) because the evidence sought to be adduced in support of the application had been within the knowledge of the employee at the time of the original hearing and was not introduced at that stage."
For reasons which will appear we consider that to be exactly the same position as applied in the instant case. And the head note goes on:
"... and the application did not fall within rule 12 (1) (e) because the decisions of industrial tribunals should, in the interests of justice and the general public, be as final as possible and only in unusual circumstances, which were not present in the instant case, should the parties be allowed to invoke that paragraph."
We agree entirely with that principle as well.We find the greatest assistance from what Phillips J. said at page 404 of the judgment in Flint when he says at B:
"I have not forgotten that at this stage it is right to pray in aid the point which is made that the employee did not have any legal advisers. But, of course, these tribunals are intended to be informal. Many people think that if lawyers are introduced into them in great numbers the procedure becomes over-complicated and rigid and that informality and simplicity are lost. There was nothing in the least difficult to understand about the issues in this case."
We entirely agree, even though it is twenty years, on with that approach to the purpose of Industrial Tribunals.Then of course he deals a little lower down on that page with the inter-relationship, as he finds it to be, between sub-paragraph (d) and (e), which is already, I think correctly summarised in the `head note'. Then he defines in the interests of

justice when he is considering whether there is another circumstance or:

"... some mitigating factor, to make it such that the interests of justice require such a review." [ He turns to consider what is meant by the interest of justice. He deals with it in this way: ] What are they? [ The interests of justice ] First of all, they are the interests of the employee. ... [ But then he goes on ] One also has to consider the interests of the employers, ... [ Then he goes on lower down ]
" But over and above all that, the interests of the general public have to be considered too. It seems to me that it is very much in the interest of the general public that proceedings of this kind should be as final as possible; that it should only be in unusual cases that the employee, the applicant before the tribunal, [ Here it is the Employer ] is able to have a second bite at the cherry. [ Obviously exactly the same principles apply to the position of an employer. Then he goes on to say. ] It certainly seems to me, hard though it may seem in the instant case, that it would not be right that he should be allowed to have a second bite at the cherry in cases which are perfectly simple, perfectly straightforward, where the issues are perfectly clear and where the information that he now seeks leave at a further hearing to put before the tribunal has been in his possession and in his mind the whole time. It really seems to me to be a classic case where it is undesirable that there should be a review."
I have made that lengthy citation from that particular case because, perhaps rather unusually, it does seem to all of us to apply so very strongly indeed to the circumstances of the particular issue, which we have to decide, and we find the utmost guidance from that eloquent decision. We may say and we are not suggesting that there was any blame at all to be attached to anybody for this, that Flint was not cited to the Industrial Tribunal when they granted the review.It is in the light of that citation of legal principle, that we come to look at the original decision in order to see whether there was any justification for granting the review, and we will also have to look at what happened upon the review, to an extent.But before we even look at that, we deem it appropriate shortly to look at the IT1, which of course is the form upon which the originating application is made to an Industrial Tribunal. It is in very straightforward terms, and it is at page 26 of the bundle. It includes the following three sentences at paragraph 10:
"On 2/11/92 I went on sick leave for two weeks. During this period a new employee joined the company as a labourer.
On 26/11/92 I was called into the office, told that work was slow and that I would have to be made redundant.

The person employed whilst I was away sick is now doing my job."

So that was the way the matter was being put in very straightforward and simple terms. One then looks, and it is appropriate, we think to look at the response to that on the IT3 (which is contained in an attachment to the Notice of Appearance), and in particular at what the Respondents had to say, having, we should mention in passing, on page 30 set out at the top of the page by way of a list of all the people they currently employed, amongst whom are the names of all those who ultimately gave evidence on the review hearing, the Respondents make this comment at the foot of page 30:
"Mr Davis' special complaints relate to the employment of a labourer to replace him whilst he was off sick in November."
It is quite clear therefore that the Respondents specifically address the very point which was being made in the originating application, and they join issue with it, over the page, at page 31:
"As has already been explained self employed or short term contracts are always being agreed depending upon the amount of renovation work in progress at any one time. ... The only new contract agreed in November was with a Mr C Patrick who had just been made redundant and required labouring/carpentry work. ... [ And then they go on to say, having said that ] his skills are varied and useful."
They then go on to say:
"This work unfortunately could not be undertaken by Mr Davis who although a good remedial technician is physically unable to undertake heavy labouring work or unsupervised carpentry work. Hence Mr Davis' position as a remedial technician is still vacant as the required level of contracts to maintain this position do not exist at present."
So, in our judgment, it is quite apparent that the Respondents were there and then joining issue with what the applicant was saying in the originating application. It was quite clear to them that he was going to be saying, by necessary implication, that he was able to do the job that Mr Patrick had been given, and that he should have been given that job. It is perfectly clear that that was going to be an issue before the Industrial Tribunal, whereas the employers were saying, no, he could not do it, he has not got such a wide range of skills and he is not physically able to do it. So it is clear that that was going to be an issue before the Tribunal. Of course there were other issues for example as to whether there was a redundancy situation at all, and as to whether there had been proper consultation. There would be other issues. There would be issues as to compensation. But there would be this issue as well, which of course, straddles in a way, both liability and compensation.So we consider it right to turn from that to look at the decision itself.Just before I go directly to that, we repeat that in our judgment, it is quite clear that part of the case the applicant was going to make was that somebody, a specific person, namely Mr Colin Patrick, had been put into the applicants job, a job which necessary implication he was saying that he could do, and that the employers were well aware that that was going to be said, and actually dealt with the matter in their Notice of Appearance. In our judgment, they could and should have prepared their case accordingly.The matter then came before the Industrial Tribunal on 16th July 1993, as I have already said. Their decision was described by Mr Kibling as "a model decision", and having considered it, we are of the same view. Obviously it is not appropriate or necessary for me to go anything like through this decision, in any detail. It is quite clear from sub-paragraph 4(k), at page 12 of the bundle, that the position of Mr Colin Patrick was considered and the Tribunal found that:
"He continued to work on a regular basis from the beginning of December, being laid off for only one or two days in that period. From the beginning of January 1993, Mr Colin Patrick was taken on by the company as a full-time employee. In his evidence, Mr Sands described Mr Colin Patrick as a "Remedial Technician"; this was the same description as the respondents used of Mr Davis' work."
Then going to (l), it is clear, in our judgment, from sub-paragraph (l) and from sub-paragraph (n), that there was disputed evidence before the Tribunal as to whether or not Mr Davis could do the job that Mr Colin Patrick had been taken on to do every bit as well as Mr Colin Patrick. It is clear that issue was being joined at the original hearing before the Industrial Tribunal in relation to that matter.

(n) Because in sub-paragraph (l) the Tribunal say:-

"(l) In his evidence, Mr Sands said that Mr Colin Patrick had different skills to Mr Davis. He was better able to cope with the re-fitting work and was also capable of undertaking light building work. Mr Davis [ again, this is per Mr Sands ] had never undertaken anything other than the timber and damp proofing work. Mr Sands did not think that Mr Davis was capable to such work. Mr Sands claimed that Mr David had told him that he could not do heavy labouring work because of a bad back and a bad knee; but Mr Davis disputed this. ..."
So there is the clearest evidence that there was a dispute of fact.

(n) it becomes even clearer:-

"(n) Mr Davis told the Tribunal that he had undertaken a range of general building tasks in a previous employment, had undertaken carpentry and such like work at home, and considered himself capable of undertaking the work which Mr Colin Patrick was undertaking at present. ..."
So, it is apparent that that was an issue which was ventilated before the Tribunal. However, the Respondent employers did not choose to call any evidence corroborative or confirmatory of Mr Sands' evidence, in relation to the matter when they perfectly well could have done. There was nothing to stop them from so doing and they had been forewarned by the way in which the issues were raised, admittedly briefly, in the originating application and their own response to it. Then going on, through this original decision which we have already described as a "model decision", having found in paragraph 9, that there was a failure to consult, and that:-

"There was not a shred of consultation ..."

with regard to Mr Davis' redundancy.The Industrial Tribunal then had to deal and did deal with this conflict of evidence between Mr Sands on the one hand, and Mr Davis on the other, in relation to the crucial matter, as to whether Mr Davis was able to do the job that Mr Patrick had been given in January. And they deal with it, in this way, in the second sentence of paragraph 11:-
"Although Mr Sands had made a series of assumptions about Mr Davis' capabilities, and the relative abilities of Mr Davis and his colleagues (and Mr Colin Patrick in particular), he was not able to produce any objective evidence to justify those conclusions."
We interpose to say that that was entirely Mr Sands' own fault. The evidence was available to him and for some reason he did not call it. Then the Tribunal continues as follows:
"His failure to undertake proper consultation meant that Mr Sands was not able to answer Mr Davis' basic point, that in Mr Davis' view, he was capable of undertaking the wider range of work that was now being undertaken by Mr Colin Patrick and which was clearly available at the time of Mr Davis's dismissal."
So there is the reasoning of the Tribunal on its original hearing, and so it was that the Tribunal held that the dismissal was unfair. But in our judgment their decision, properly and reasonably construed, clearly involved two separate strands. I am not dealing at the moment with the quantum of compensation, which they deal with separately in paragraph 13. Their decision, in our judgment, clearly involved two separate strands, two separate elements, namely, firstly, that there had not been any consultation, so that there was a serious procedural defect in the decision-making process in relation to the dismissal. But secondly, in our judgment, the decision also incorporated a finding, that Mr Davis was able and willing to do the job which carried the same job description and the same rate of pay, although admittedly an extended range of skills, which the Respondents had given to and taken on Mr Colin Patrick as a full-time employee to do in January 1993. It is important, in our judgment, for that to be recognised. We detected from the way in which the matter was being put before us by Mr Sutcliffe, a view that in some way or another an Industrial Tribunal must put different labels on bottles and proceed in a very regimented manner from one of these matters to another. But, in our judgment, it is quite clear that this decision relating, admittedly, principally to liability included within it a decision that amounted to the adoption of an "all or nothing" approach to compensation, and coming down squarely in favour of "all", that it should be "all", subject of course to mitigation, because they found it to be a situation where there was another job available which had been given to another person, which the applicant on the evidence before the Industrial Tribunal was entirely fitted to perform. So that it was not a "percentage" situation at all, in our judgment.They then went on to consider, in paragraph 13, the quantum of compensation, dealing of course with matters of mitigation and indeed making a discount, against future loss, by reason of the fact that they plainly accepted submissions made to them by the Respondents that the applicant had not been making sufficient effort to get employment, so that they reduced the award they made in respect of future loss to a period of twelve weeks and made their award, totalling £8,546.22 in paragraph 15.Now that is the original decision, which we considered important to look at carefully, which is what we have been attempting to do thus far in this judgment.What happened thereafter was that the Industrial Tribunal, through the Chairman in the usual way, received an application for a review, and I do not think we need go into the precise details of how the application for a review was made. It was made in the proper way. The Tribunal were presented with a very lengthy letter, which is to be found in pages 1 to 4 of the additional documents which were relied upon by the Respondents before us today. It is long letter with a great deal of citation of authority. What it comes down to was a submission that the Tribunal had gone wrong in law, in that they should have gone on to consider, as is set out on the first page of the letter what the likely outcome would have been had the applicant been consulted about his abilities. They should have considered, it is said in the letter:-
"... whether, compared to the abilities of Mr Patrick and others, the Appellant would have been retained in his job, or whether he would have still been selected for redundancy."
Then there is reference made to Polkey and there is reference made to the very important dicta of Browne-Wilkinson J. in the case of Sillifant which we are familiar with. Where the learned Judge says
"There is no need for an all or nothing decision. If the Industrial Tribunal thinks there is a doubt whether or not the employee would have been dismissed, this element can be reflected by reducing the normal amount of compensation by a percentage representing the chance that the employee would have still lost his employment."
So what was being put to the Tribunal was that a situation had arisen where there was a need for the `any difference test' to be looked at by the Tribunal and that since they failed to look at that matter, here the matter should be reviewed in the interests of justice. That is what it really comes down to. The way it was dealt with by the Tribunal appears from paragraphs 2 to 5 of their extended reasons for granting the review. They appear to have accepted, looking at paragraph 5 of their decision to grant a review, that the application could not be properly made under Rule 11(1)(d), that appears to be the case from the way they approach the matter in the first sentence of paragraph 5. What they then go on to say is that they feel that they should grant, the application for a review pursuant to Rule 11(1)(e) on the grounds that the interests of justice require a review, "as the lack of adequate evidence on this issue", which must be, we think, on a proper reading of their decision be the `any difference issue'. Although the matter is confused by the Tribunal's reference to a question of law as to whether the unfairness "had been substantive or merely procedural", which only, in our judgment, really serves to confuse the matter further, ultimately they conclude that their original findings could well be unsafe because of the lack of adequate evidence on this issue at the hearing on 16th July and therefore they granted the review.In our judgment it is also important, in order to see whether that decision was erroneous in point of law, to see what form the review took. The form the review took, in our judgment, is crystal clear, namely what happened was that there was a re-trial or re-hearing of exactly the same issue which the Industrial Tribunal had already determined in favour of the applicant Mr Davis. In the review there was a very detailed comparison made between the respective skills and fitness of Mr Davis on the one hand and Mr Colin Patrick on the other. A whole lot of additional witnesses were called on that issue which the employers could and should have called on the first hearing, but failed so to do. This had the result that, having heard all that evidence, the Tribunal at paragraph 15 of the review decision, accepted "that the Respondents had demonstrated, by their evidence at the review hearing, that a properly conducted redundancy process would have arrived at the same decision to make Mr Davis redundant."It is clear that they did that on the basis of the additional evidence which they had heard. Thus they make remarks like the following, as they do in paragraph 11:-
"The evidence now led on behalf of the respondents shows a whole different story."

Then they say in paragraph 14:-

"The respondents have now demonstrated that Mr Davis' skills were not even as wide as those of Joseph Makrai or Phil Richardson."
In our judgment it is thus clear that they allowed themselves to embark upon a situation where in effect they reheard the issue which they had already dealt with at the original hearing.We consider that if one looks at the original decision on the one hand, and then one looks at the review hearing on the other, and one places them side by side, what is revealed clearly is a classic example of a party being allowed to have a second bite at the cherry. We repeat that all the witnesses who were called on the review were available and should have been called at the original hearing. We are firmly of the view that any application under Rule 11(1)(d) was totally doomed to failure. It is here that we entirely adopt the reasoning of Phillips J., in Flint that ordinarily a case for a review which would have failed under 11(1)(d) should also fail under 11(1)(e). The two sub-paragraphs are not mutually exclusive. We regret to have to conclude that this aspect of the matter was not properly considered by the Industrial Tribunal and this in itself amounted to a misdirection of law on the part of the Industrial Tribunal.Secondly, in our judgment, in the light of the evidence before the Industrial Tribunal and its findings on the original hearing of the matter, there was, in our judgment, nothing to trigger off the application of the Sillifant percentage principle, having regards to the findings of the Industrial Tribunal the first time round. This was an "all or nothing" case, (although it does not need to be as the then President rightly said), it was in fact such a case and was dealt with as such by the Industrial Tribunal. The Industrial Tribunal decided that it should be "all", as far as this particular point was concerned. In our respectful view the Industrial Tribunal should have stuck by its original decision.In our judgment, if there is a submission of the kind here made by Peninsula on behalf of the employers, by reference a lengthy citation of authority, then the proper course, save in an exceptional case, is for the matter to be dealt with by of an appeal to the Appeal Tribunal, and not by way of a review, and let the employers, (as it so happens in this case - it could just as well be an employee), try to establish that there is a point of substantive law upon which the Industrial Tribunal have gone wrong on. In this regard we have had to look carefully at the decision of Trimble v Supertravel Ltd [1982] ICR 440, because it is apparent from that decision that there are circumstances where either a minor or a major error of law can properly be taken up and should properly be taken up on review as distinct from in front of the Employment Appeal Tribunal. But those situations are where there has been a procedural mishap of some kind. That is quite clear from the decision of the then President in that particular case, particularly at page 442 between E and F:
"As it seems to us the fundamental question is whether or not the industrial tribunal's decision that the employee had failed to mitigate her loss was reached after she had had a fair and proper opportunity to present her case on the point, being aware that it was a point which was in issue. We do not think that it is appropriate for an industrial tribunal to review their decision simply because it is said there was an error of law on its face. If the matter has been ventilated and properly argued, then errors of law of that kind fall to be corrected by this appeal tribunal. If, on the other hand, due to an oversight or to some procedural occurrence one or other party can with substance say that he has not had a fair opportunity to present his argument on a point of substance, then that is a procedural shortcoming in the proceedings before the tribunal which, in our view, can be correctly dealt with by a review [ He then refers to the then 1980 regulations ] ... however important the point of law or fact may be. In essence, the review procedure enables errors occurring in the course of the proceedings to be corrected but would not normally be appropriate when the proceedings had given both parties a fair opportunity to present their case and the decision had been reached in the light of all relevant argument."
We are quite sure on which side of the line this particular appeal falls before us. We are quite satisfied here that there was no question of there being any procedural irregularity and there was no question of the Respondent employers not being given a full, fair and proper opportunity to present their case on a point which they should have realised was fundamentally in issue before the Tribunal namely, whether or not Mr Davis could do the job that had been given to Mr Colin Patrick.We may say also that we consider that unfortunately the Industrial Tribunal erred in law in an additional way in that it allowed itself to become somewhat blinkered in its approach to the interests of justice. Here again we go back to the very apt remarks of Phillips J. in Flint to the effect that "the interests of justice involve not only the interests of the party who is seeking the review but also the other party to the review and also importantly the public interest." As one of the members put it while we were debating the matter, "You cannot allow people to go away from an Industrial Tribunal and believe that they can do better next time by getting a re-hearing; that is not an appropriate approach to reviews." Industrial Tribunals are still designed to provide a simple, straightforward procedure for allowing disputes over employment, often between unrepresented parties, to be dealt with efficiently, quickly and once and for all. There is a very important public interest principle of the finality of litigation. We regard it as unfortunate here that this Tribunal, having we repeat, reached a model decision with regard to its original hearing should, in our judgment, have fallen into error in granting a review which would be no more and no less than a second bite of the cherry, based on a supposed point of law which almost certainly did not arise upon the facts.Accordingly, for the reasons I have attempted to state we allow the appeal and set aside the review.