Stanley Wattam Ltd v Rippin [1998] UKEAT 355_98_0110

EAT
Stanley Wattam Ltd v Rippin
[1998] UKEAT 355_98_0110 · 1998-10-01

JUDGE JOHN BYRT QC:

This is an appeal against a decision promulgated on 14 January 1998 of the Employment Tribunal sitting at Nottingham whereby they held that the employee, Mrs Rippin, had been dismissed by the employers. They took that issue of dismissal as a preliminary point and adjourned those relating to the reason for the dismissal, its fairness and remedy. The employers have appealed the decision that there was a dismissal.The Respondent, Mrs Rippin has intimated to the court that she does not intend to appear today and indeed she has not done so.Coming to the facts of the matter; Mrs Rippin was employed by the Appellants as a chicken sexer. Her function, working at the rate of something like 2,500 to 3,000 chickens per hour, was to determine the sex of day old chicks by looking at the way their feathers went under their wings.She was employed together with a number of other chicken sexers. Their services were hired out by the Respondents to various hatcheries, owned by only a limited number of clients because of course it is a very specialist line of trade. Such hiring out was the Respondents' only business.Mrs Rippin was and had been since 1993 hired out to a big customer of the Respondents called Padleys and in particular to their Grantham Hatchery. They had another hatchery at Soham but that is not directly involved in this matter. There were other customers of the Respondents at Occold and Stanton, but as the Tribunal found they were a substantial distance away, so far indeed they do not really come into this case as a practical consideration.The events relevant to the issue we have to consider occurred on 24 April 1997. On that date when Mrs Rippin was working at the Padley Grantham Hatchery, there was a visit of a national supermarket chain scheduled to take place. They were coming in order to see the hatchery and in particular to see Mrs Rippin at work sorting and grading the chickens according to their sex. Bearing in mind everybody's present day concern about animal welfare, this was quite an important purpose of their visit.It just so happens that because of the proximity of a bank holiday, there were fewer chicks to be sorted that day and it became apparent that if Mrs Rippin worked at her normal pace, she would have completed her days work and processed all the chicks before the visitors arrived. So Padleys made the decision to hold back a trolley of chicks for something like 20 to 30 minutes so that she could still be working when the visitors came round.Now Mrs Rippin was paid at piece work rates and she was paid nothing for dead time. The 20-30 minutes waiting was dead time, and she raised a complaint about this then and there. She wanted to know who was going to pay her for the wasted time, waiting for the visitors. She became vociferous and abusive about the way Padleys treated her. Potentially, this was likely to cause Padleys embarrassment. Their supervisor intervened and very rapidly the problem was referred up to a Mr Reader who was the manager at this particular hatchery. On 28 April he made the decision that Mrs Rippin and her co-worker, a Mr Fletcher were to be excluded from Padleys premises. They were no longer required to do this particular job. He got in touch with Mr Wattam and told him he was going to exclude from his premises the two sexers , hired from the Appellant company.Mr Wattam, appreciating that Padleys was such a big customer and not daring to offend them, did not really challenge the situation but accepted it. On 29 April Mr Reader saw Mrs Rippin and her colleague Mrs Fletcher and informed them that they were being excluded from the hatchery. It is right to observe, as indeed the Employment Tribunal did, that Mr Reader in so informing Mrs Rippin Mr Reader was not acting as the employer. There is only one employer of Mrs Rippin and that of course was the Appellant company.In any event, on 30 April, Mrs Rippin's husband telephoned Mr Wattam, Mr Wattam explained to him there was nothing that he could do, but he offered his wife the chance to work at other places in Norfolk and Suffolk. He had in mind Occold and Stanton.On 1 May, Mrs Rippin would seem to have rejected that offer. She wrote to Mr Wattam asking him for her P45, for wages due to her and the reason for her dismissal. In due course Mr Wattam replied sending her P45 and enclosing the letter sent him by Mr Reader dated 29 April in which the details of his decision was set out and the reasons for it.There was further correspondence thereafter between Mrs Rippin and Mr Wattam about the situation which developed. It is in our view clear that neither had a proper appreciation of the legal situation arising, and in our view it only serves to confuse the picture to go through that correspondence. The Employment Tribunal concluded that it was the Appellants who had terminated the contract of employment and had done so by conduct. The conduct the Tribunal relied upon was the sending of the P45s to Mrs Rippin, the sending of Mr Reader's letter of 29 April, their inactivity in letting matters drift and the intentions of Padley to exclude Mrs Rippin from their premises. They pinpointed the date of termination as being the 29 April and in coming to those findings they expressly excluded submissions made by Mr Watkins on behalf of the employers that the contract had been frustrated. They felt that notwithstanding the fact that Mr Reader had taken the course of excluding Mrs Rippin from the hatchery, the contract of employment was still alive between Mrs Rippin and Wattam, for after all it was they who were her employers. It was felt there were other things Mr Wattam might have done to avoid frustration of the contract. They felt that he could have approached Mr Reader again but we are informed, and we accept from Mr Watkins, that Mr Reader in re-examination had given evidence to the effect that there was nothing Mr Wattam could have done to persuade Mr Reader to change his decision.In applying the law, the Employment Tribunal began by asking the right question: who really terminated the contract of employment? Thereafter it is necessary to consider the authorities drawn to our attention by Mr Watkins today. The first is the case of R A Marshall v Harland & Wolff Ltd and The Secretary of Statement for Employment reported in [1972] IRLR at page 90 and in particular paragraph 5 where Sir John Donaldson, the Master of the Rolls at that time, says this:
"Whilst it is true that 'frustration', to a lawyer, can have a technical meaning (although they, too, are often 'frustrated' in the popular sense) there is nothing technical about the idea that a contract should cease to bind the parties if, through no fault of either of them, unprovided for circumstances arise in which a contractual obligation becomes impossible of performance or in which performance of the obligation would be rendered a thing radically different from that which was undertaken by the contract. Yet this is all that the lawyer means by 'frustration' of a contract, and the words which we have just used are not in essence ours but those of that very great lawyer, Lord Radcliffe (see Davies Contractors Ltd. V Fareham Urban District Council [1956] AC 729)."
He then referred us to a second authority, the case of W J Hare v Murphy Brothers Ltd [1974] IRLR 342. The facts of that case are that the employee, who had been a long serving employee of a company, committed some misdemeanour as the result of which he was sentenced to prison for twelve months. During the course of that time, the employers had to get on the best they could and employed somebody else to take his place. On his release the employee had no job to go back to. When considering that situation, Lord Denning, Master of the Rolls at the time said this:
"The next, the sentence of imprisonment for 12 months in June 1971. That, too, was not a breach by him. If he had been given a suspended sentence or put on probation he would not be guilty of any breach of his contract of employment. Nor is it when he is sentenced to 12 months. That was the act of the Court which sentenced him. It was no breach by him. But nevertheless - contrary to the Industrial Relations court - I think there was a frustrating event. The sentence of 12 months' imprisonment frustrated the contract of employment. I know that it was brought about by his own act, namely, the unlawful wounding. In that way it may be said to be 'self-induced'; but still it was a frustrating event."
Next, we were referred to Joseph Constantine Steamship Line v Imperial Smelting Corporation [1942] AC at p.179. In this judgment, Lord Russell says:
"So also here where the man committed an unlawful act and was sentenced to 12 months, the event was so unforeseen and the delay so long that the contract of employment was brought automatically to an end when the sentence was imposed."
Again referring to the case of Davis Construction v Fareham [1956] AC 696 :
"In the case of a contract of employment, you must look at the length of time he has been employed, the position which he held, and, of course, most important of all, the length of time which he is likely to be away from his work and unable to perform it - and the importance of getting someone else to do his job meanwhile."
On the strength of those authorities Mr Watkins submitted that further performance of this contract had become impossible as a result of unforeseen circumstances which were neither the fault of the employers, nor arguably the fault of the employee either. Those circumstances were that Mrs Rippin was excluded from her place of work as a result of the action of a third party, namely Mr Reader.The facts of the case are such that there was no real alternative employment for which Mrs Rippin could be considered. The only other customers who hired chicken sexers were geographically so far removed that they were not suitable alternative places of employment for Mrs Rippin. Further, the chances of Mr Reader changing his mind as a result of Mr Wattam intervening were remote if the evidence given by Mr Reader in re-examination is to be taken into account.In all the circumstances, we think that this is a classic case of a frustrated contract. It led to Mrs Rippin's exclusion from the hatchery, led to a situation where the Respondents were unable to continue to employer her. As I have said it was not Wattam's fault nor arguably was it Mrs Rippin's fault. There were no alternative routes down which the employers were able to go in seeking ways of continuing Mrs Rippin's employment.We are therefore satisfied that in law, the contract was frustrated and in that the Employment Tribunal came to the conclusion that it was not frustrated, they came to a wrong conclusion in law. In those circumstances we will allow this appeal on the basis that the contract is frustrated and there has been no dismissal.