EAT/895/01 ALLIED DUNBAR ASSURANCE PLC v (1) MR R A HUGHES & OTHERS (2) ABBEY LIFE ASSURANCE CO LTD [2002] UKEAT 895_01_2802

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2002] UKEAT 895_01_2802Case No Appeal No. EAT/895/01 EAT/896/01 EAT/897/01Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
EAT/895/01 ALLIED DUNBAR ASSURANCE PLCAPPELLANT(1) MR R A HUGHES & OTHERS (2) ABBEY LIFE ASSURANCE CO LTDRESPONDENTSEAT/896/01 ABBEY LIFE ASSURANCE CO LTDAPPELLANT(1) MR R A HUGHES & OTHERS (2) ALLIED DUNBAR ASSURANCE PLCRESPONDENTSEAT/897/01 MR R A HUGHES & OTHERSAPPELLANT(1) ABBEY LIFE ASSURANCE CO LTD (2) ALLIED DUNBAR ASSURANCE PLCRESPONDENTS
Before
Mr Justice LindsayDate 28 February 2002
[1]APPEARANCES FOR ALLIED DUNBAR ASSURANCE PLC MR PAUL KEY (of Counsel) Instructed By: Messrs DMH Solicitors 40 High Street Crawley West Sussex RH10 1BW FOR ABBEY LIFE ASSURANCE CO LTD FOR MR R A HUGHES AND OTHERS MR MARTIN GRIFFITHS (of Counsel) Instructed By: Messrs Simmons and Simmons Solicitors City Point One Ropemaker St London EC2Y 9SS MISS MELANIE TETHER (of Counsel) Instructed By: Messrs Lester Aldridge Solicitors Russell House Oxford Road Bournemouth BH8 8EX MR JUSTICE LINDSAY (PRESIDENT) : We have before us an appeal in the matter Mr R.A. Hughes and Others against, firstly, Abbey Life Assurance Co Ltd and, secondly, Allied Dunbar Assurance Plc. The matter comes before us on appeal from the Tribunal at Southampton and is unusual in the sense that there is no contest whatsoever between the parties before us who are represented as follows, namely Mr Hughes and a considerable number of colleagues of his in a similar position are represented by Miss Tether and they are, either exclusively or largely, members of the Union, UNIFI. Abbey Life Assurance Co, the First Respondent below, is represented by Mr Martin Griffiths and the Second Respondent, Allied Dunbar Assurance Co Ltd is represented today by Mr Paul Key.[2]The matter arises in an unusual way and we do not wish to say very much about it because, as will become apparent, we are sending it back to the same Tribunal that heard it before. Briefly speaking, Mr Hughes and a considerable number of colleagues claim that on a transfer from Abbey Life to Allied Dunbar there was inadequate consultation under the provisions of TUPE and that that entitles them to compensation.[3]Abbey Life will be the body which, if compensation is to be payable, will have to pay it. That transpires because, whether or not in law the liability would be transferred to Allied Dunbar, by reason of private arrangements between them, we are told, it would be Abbey Life that would pick up the tab.[4]The number of complainants has at earlier stages been larger but, by the time the matter came before the Tribunal in 2001, the number of complainants or applicants had been reduced to about 482; nonetheless a large number.[5]The nature of the Abbey Life defence and the Allied Dunbar defence was either wholly or chiefly a reliance upon special circumstances, as is permitted under the TUPE Regulations. Evidence was given over a period of three days in full and was completed. It was given only by the Respondents below. No material evidence needed to be given by the individual Applicants.[6]However, in the course of the third day it was announced by the Chairman, on behalf of Ms A. Cutting, one of the two lay Members who were sitting with the Chairman, Mr D.N. Cowling, that Ms Cutting had remembered that she had inherited some 50 shares in Lloyds TSB Plc, which was the holding company of Abbey Life Assurance Co Ltd, and the parties before the Tribunal and the Tribunal itself then set about wondering how best to respond to this position of there being, conceivably, a situation leading to the automatic disqualification of the Tribunal that had thus far heard the case.[7]Unfortunately there were a number of misunderstandings between the advocates, on the one hand, and the Tribunal on the other, as it would seem; it does not seem necessary to us to investigate what those were but they had the ultimate consequence that on 4 April 2001 an Interlocutory Order was made by the Tribunal that said this:
"Upon hearing counsel for the parties, IT IS ORDERED that:- 1. This hearing is postponed to a date to be fixed with a time estimate of five days at Southampton before a differently constituted Tribunal. 2. The parties have identified one issue common to all cases, namely whether there are any special circumstances to be shown by the Respondents for their failure to consult with the Applicants and four lead cases have been agreed. 3. It has been agreed between the parties that the First Respondent will open the hearing because the burden of proof is on the First Respondent to establish special circumstances. The Second Respondent will follow and the Applicants, if any, will give evidence thereafter."
[8]The only reason for that adjournment which, of course, had the effect that all the costs of and incidental to that hearing over three days would be wasted, and that evidence and argument would have to be repeated in the face of the newly constituted Tribunal, was the holding of the 50 shares; all that was said to flow from Ms Cutting's indication that she had 50 shares in Lloyds TSB.[9]Submissions were made over a period to the Tribunal and the Tribunal had before it, before it came to that decision, the well known cases of, inter alia, Pinochet and Locabail and, most particularly, its attention was drawn to a recent case in the Court of Appeal, Weatherill . In Weatherill , during the course of a case that had already run for some while, Wright J, sitting alone, was embarrassed to find that he had a small shareholding in, as it transpires, the very same company as Ms Cutting, namely Lloyds TSB. He had a shareholding of 570 shares, more than eleven times greater than Ms Cutting's holding. Objection was taken by Mr Weatherill in that Weatherill case and the matter went to the Court of Appeal, where the judgment given by Nourse LJ, with whom Mummery and Rix LJ agreed, dealt with the position of so small a holding in so large a company. At paragraph 9, having looked at Locabail , Nourse LJ said:
"So there is clearly established a de minimis exception. The holding of the judge in this case of shares in the defendant company was 570 out of a total of 5.5 billion shares in issue. It appears to me that that makes this clearly a case of de minimis within the principle I have stated. On that ground, in so far as this application is made on the basis of automatic disqualification, the appeal fails."
[10]It is difficult to see how the Tribunal could have escaped the binding nature of Weatherill but, unhappily, they do not mention it at all, nor do they mention Locabail or Pinochet . What they do say in their short extended reasons, inter alia, is this:
"The Tribunal was acutely conscious of the important principle that once it is shown that a judge is himself a party to the action, or has a relevant interest in its subject matter, he is disqualified without any investigation into whether there was likelihood or suspicion of bias. The mere fact of his interest is sufficient to disqualify him unless he had made sufficient disclosure."
[11]In the first of those sentences the word to concentrate on is the word "relevant". Has the Tribunal Member (none of whom, of course, was here, is a party to the action) a relevant interest in its subject matter? Given that there is a de minimis principle and given that the Court of Appeal has indictated that even a holding eleven times greater is within that de minimis principle it is, as it seems to us, impossible to conclude other than that Ms Cutting's holding gave rise to no relevant interest whatsoever. In other words, the Tribunal erred in law in regarding a relevant interest as shown in the facts before them. No Tribunal, properly instructing itself could have so concluded as it did and the decision, to that extent, was a perverse decision and accordingly in error of law.[12]We come to that conclusion having been carefully taken through a number of relevant authorities by Mr Griffiths, with whose argument Miss Tether and Mr Key have concurred, and we mention the argument briefly in this respect. First of all, we are satisfied that there is a de minimis exception: see Locabail at p. 473 A – C and E – G and the passage from Weatherill which we have already cited. Secondly, waiver is always possible and can be either implied or express: see Locabail at p.481 B: see Pinochet at p.141 B. Thirdly, when one is dealing with a case of automatic disqualification one has to be aware that it is, as Mr Griffiths described it, a blunt instrument and one to be wielded somewhat cautiously; its application needs to be limited to truly appropriate cases: see Locabail as p.481 D, 475 A – C, 479 paras. 22 to 24. The Locabail case also makes the point that one of the factors that has to be borne in mind, in looking to see what view the public might have of a given situation, is the public's view of the waste of costs and of court time and the prolongation of parties' anxieties that can be involved if a case is too readily dropped by one Tribunal and too readily passed to another. It is wrong, as the most recent of the authorities we have been taken to, Bennett v The London Borough of Southwark shews, for a Tribunal, as Sedley LJ put it in that case, to retreat prematurely from the field.[13]Having concluded that no Tribunal, properly instructing itself, could have regarded the holding of the 50 shares as comprising a relevant interest in the case, we see it as appropriate to set aside the Tribunal's decision. The parties are agreed that if we do that then there are certain directions that would be appropriate to be given.[14]In his carefully considered Skeleton Argument (paragraph 35, page 14) Mr Griffiths sets out some directions, which all parties are agreed should be given, but there is an amendment which we will come on to. The first direction Mr Griffiths seeks is that the Tribunal's Order should be overturned; that we do. Then he asked for an Order whereby Applicants not represented by UNIFI (and there are a number who are not), are written to by the Tribunal and informed in a particular manner; I do not need to read it out, but his paragraphs (a), (b) and (c) will be incorporated in the Order that we now make: (c) runs on into (d). The first words of (d) and the letter (d) should be crossed out. Cross out "That the respondents and the represented applicants" and make it so that it runs:
"UNIFI, who have instructed solicitors and counsel, have concluded that this shareholding does not suggest or create any prejudice or conflict of interest and there is no reason why the hearing should not proceed to a conclusion and that they wish it to do so in order to avoid unnecessary delay and cost"
. Then, at what is now the new (d) but was the old (e) we strike out the particular proposal that Mr Griffiths initially drafted and say instead this:
"The Employment Appeal Tribunal has held in the light of authorities and, in particular, Locabail and Weatherill (giving the references to them) that Ms Cutting's shareholding could not possibly give rise to automatic disqualification or to any question of apparent bias adding, as to apparent bias, see: Porter v Magill at p.84 B"
. And then the letter should indicate that if, notwithstanding the indications given in the letter to the unrepresented Applicants, any such person wishes nonetheless to persist with some objection to the hearing going ahead with the original Tribunal, then he or she must raise that objection, in writing, by indicating it in writing to the Employment Tribunal within 21 days after the sending out by the Employment Tribunal of the letter.[15]The Employment Tribunal is then, on receipt of any objection of that character, to notify the solicitors of the represented parties and any other unrepresented parties of the objections raised and it is to be indicated in the letter that if an objection is raised within time and in writing, as we have stipulated, and is to be persisted in, it is to be ruled upon at the substantive hearing at the outset.[16]It may be that there will need to be some minor refinements to the outline that we have given. What we suggest is that Mr Griffiths draws a minute of Order, which he can agree with other counsel involved, to embody in the neatest language the indications that we have given.[17]Finally, the Order that we make will commend to the Regional Chairman that after the unnecessary time that has been lost in the conduct of this case, it would be appropriate, if at all possible, for the substantive hearing to be expedited; we are told an estimate of one day would be appropriate.[18]That is all we propose to say, subject to any further refinements or directions which have occurred to counsel involved in the course of the judgment.