New Trinity Community Association v James [1997] UKEAT 1128_96_1104

EAT
New Trinity Community Association v James
[1997] UKEAT 1128_96_1104 · 1997-04-11

JUDGE PETER CLARK :

The respondent employee, Mr James, was employed by the appellant Association as Activities Officer from 5th October 1993 until his dismissal effective on 21st March 1996. Following notice of dismissal being given the respondent presented a complaint of unfair dismissal to the Central Office of Industrial Tribunals on 29th February 1996, which complaint was heard by an Industrial Tribunal sitting at Bristol on 9th May and 27th June 1996. The tribunal upheld the complaint, but found that the respondent had contributed to his dismissal by his own conduct to the extent of 75%. After applying that reduction it awarded compensation totalling £942.03, consisting of a reduced basic award of £157.50, and the balance of £784.53 by way of a compensatory award. The recoupment provisions applied to that award. Extended reasons for the tribunal's decision are dated 16th August 1996.In short, on 11th January 1996 the respondent was suspended by letter of that date, which enclosed a list of disciplinary charges. The complaints made against him were numerous, but for present purposes it is necessary only to set out the following:(1) He entered into a hire agreement in respect of certain two-way radios without authority, causing an expense to the appellant of £2,237.20.(2) He granted to a promoter a reduction in the cost of hall hire amounting to £1,140.(3) He took certain money deposits totalling £205 which were not accounted for, although £340 in cash was found in his drawer.(4) He took a bottle of champagne from the bar stock without paying for it.The total cost of these matters to the appellant was said to be £3,607.20.In a subsequent letter dated 15th January the appellant's Centre Manager, Mr McGrath, made it clear that the employer's complaint related to the respondent's accounting practices, not to his honesty.The tribunal held that the subsequent disciplinary procedures followed by the appellant were defective, and rendered the dismissal unfair. However, the respondent had contributed to his dismissal by his mistakes over financial procedures.In this appeal, brought by the Association, no challenge is made to the Industrial Tribunal's substantive finding of unfair dismissal. The attack is directed to the award of compensation. What is said by Mr McGrath, who appears on behalf of the Association before us today, is that the tribunal erred in not setting off against the compensatory award the cost to the Association of the respondent's shortcomings earlier identified and amounting to £3,607.20; a sum which would extinguish the compensatory award made by the tribunal. He places reliance on s.123(1) of the Employment Rights Act 1996 .S.123(1) provides:
"Subject to the provisions of this section and sections 124 and 126, the amount of the compensatory award shall be such amount as the tribunal considers just and equitable in all the circumstances having regard to the loss sustained by the complainant in consequence of the dismissal in so far as that loss is attributable to action taken by the employer."
It follows, in our judgment, that the award of compensation under s.123(1) is concerned with the loss to the complainant consequent upon his dismissal; it does not provide for a set-off in favour of the employer in respect of his losses, if any, occasioned by the acts or omissions of the complainant during his employment.However, since the Industrial Tribunal Extension of Jurisdiction Order 1994, by Article 4, it is now open to an employer to counter-claim in unfair dismissal proceedings brought by a former employee following termination of employment for damages for breach of the contract of employment by the employee.In this case, without expressing any view on the merits of such a claim, it would have been open to the appellant to counter-claim for damages for breach of the respondent's implied contractual duty to discharge his responsibilities with competence and due care. Lister v Romford Ice [1957] AC 555 .That was not done in this case. It is now too late to do so. Kumchyk v Derby County Council [1978] ICR 1116 .Accordingly, there is no arguable point of law raised in this appeal and it must be dismissed at this preliminary hearing stage.Having done so, we should make clear that our decision in this appeal does not prevent the appellant from pursuing a claim for breach of contract in the civil courts. That will be a matter for them.