MR M FOWLER v FR AVIATION LTD [1999] UKEAT 1086_99_1412

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [1999] UKEAT 1086_99_1412Case No Appeal No. EAT/1086/99Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
MR M FOWLERAPPELLANTFR AVIATION LTDRESPONDENT
Before
His Honour Judge Peter Clark Mrs D M Palmer Mr G H WrightDate 14 December 1999
[1]APPEARANCES For the Appellant MR A J HOWS (Solicitor) HIS HONOUR JUDGE PETER CLARK This case raises once more the difficult question of whether and if so when a contract of employment was terminated by a frustrating event rather than by dismissal. The Appellant, Mr Fowler was employed by the Respondent as a pilot. Following a routine health check carried out in November 1997 he was found to be suffering from coronary artery disease and had earlier suffered a heart attack. He was temporarily grounded and on the 16 th January 1998 the Civil Aviation Authority, as the regulatory authority wrote to him stating that in view of his condition he was assessed, "long term, unfit" , subject to his undergoing surgery. He chose not to take that course and indeed never returned to work for the Respondent. On the 15 th June 1998, the Respondent's personnel manager, Rachel Cass wrote to the Applicant, informing him that his sick pay would be exhausted on 26 th August 1998 at which time his contract of employment would end due to frustration. Correspondence then followed concerning ill-health retirement pension arrangements for the Appellant. On the 21 st August 1998, Mr Wallis, the Respondent's administration director wrote to the Appellant. That letter concluded; "I am however, aware that your formal employment with FR Aviation Ltd will cease once your company sickness benefits are exhausted on 26 th August. As we may be unable to resolve this matter before that date, I can confirm that you will be maintained on the payroll, without pay, as an employee until we are able to conclude this matter satisfactorily. Your position will not, therefore, be prejudiced by any passing of the 26 August date".[2]On the 7 th November 1998, Ms Cass wrote to the Appellant's solicitors asserting that his employment had been frustrated due to the loss of his pilot's license and that:
"For administration purposes only we have continued to maintain Mr Fowler's name on our payroll and as we did not want to do anything that might lose his entitlement to claim a disability pension, we are currently awaiting confirmation of the eligibility for your client to either an ill-health early retirement pension or disability pension."
[3]The pension position was finally resolved and on the 18 th February 1999, Ms Cass wrote to the Appellant's solicitors in these terms. "Further to your letter of 8 th January and 10 th February 1999 we would confirm that Mr Fowler is now in receipt of an ill-health early retirement pension arising out of a common pension plan. The pension was payable from 18 th January 1999 and therefore Mr Fowler's employment was terminated accordingly on 17 th January 1999". On the 8 th April 1999 the Appellant presented a complaint to the Employment Tribunal for unfair dismissal, disability discrimination and breach of contract. The Respondent took the point that the claim was out of time, contending that the employment terminated due to frustration of contract on 26 th August 1998. It was the Applicant's case that his employment was terminated by the Respondent in circumstances amounting to a dismissal on 17 th January 1999. On his case the claim was presented within the primary three month limitation period.[4]That preliminary issue came before a chairman Mr N Jenkinson, sitting alone at Southampton on 30 th June 1999. By a decision promulgated with extended reasons on 13 th July, the Chairman held that the contract was frustrated at a time between the 16 th –26 th January 1998 when the CAA removed the Appellant's qualifying certificate. Accordingly, he held the claims were out of time, no argument being advanced on behalf of the Appellant for an extension of time under the relevant statutory provisions. Against that decision, the Appellant now appeals.[5]The particular point which concerns us at this preliminary hearing is the effect of an employer's conscious decision to keep an employee "on the books", as appears to have happened on the facts of this particular case. How that fits in with the common law doctrine of frustration of contract in the Employment Law context is a matter which has taxed these Courts in the past. We need not rehearse the authorities for the purpose of this judgment. Put shortly, it seems to us that this is a matter which ought to be revisited at a full inter partes hearing. For that purpose we shall direct that the case be listed for one day, Category B. There will be exchanges of skeleton arguments between the parties not less than 14 days before the dated fixed for a full appeal hearing, copies of those skeleton arguments to be lodged at this Court at the same time. There are no further directions.