MR G DALITIS T/A SHANKLIN MOTOR CO v MR A K PLISSI [2008] UKEAT 0127_08_1606

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2008] UKEAT 0127_08_1606Case No Appeal No. UKEAT/0127/08Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
MR G DALITIS T/A SHANKLIN MOTOR COAPPELLANTMR A K PLISSIRESPONDENT
Before
His Honour Judge BurkeDate 16 June 2008
[1]APPEARANCES For the Appellant MR C BAYLIS (of Counsel) Instructed by: Messrs Pascalides & Co Solicitors 243 Gray's Inn Road London WC1X 8RB For the Respondent MR O BRITTON (Solicitor) 16, Billy Lows Lane Potters Bar Hertfordshire, EN6 1XN SUMMARY UNFAIR DISMISSAL: Dismissal/ambiguous resignation After an argument in the workplace between the employer and the employee's wife, the employer and employee had a minor fight, after which there were spoken what were said to be words of dismissal. According to the former, the latter said, "Get out, leave and don't come back". According to the latter he said, "Get out, this argument has got nothing to do with you". The ET did not make a finding as to what was said but proceeded on the basis of "get out". They found those words to be ambiguous and, after looking at surrounding circumstances such as the employer not thereafter contacting the employee and asking for the return of work fuel cards, held that there had been a dismissal. Held:(1) The ET did not find that only "get out" had been said. It was common ground that on either version there was no ambiguity. It was therefore the ET's duty to make a finding as to which version was correct. The results would inevitably follow.(2) In any event the ET had erred in its consideration of the circumstances. The factors relied upon were equally consistent with the employer's view that the employee, by not returning to work, had resigned.(3) Remit to new Tribunal. HIS HONOUR JUDGE BURKE QC The History This is an appeal by Mr Dalitis trading as Shanklin Motor Company against the judgment of the Employment Tribunal sitting at Watford and chaired by Employment Judge Manley sent to the parties with written reasons on 18 October 2007.[2]By that judgment the Tribunal found that the claimant before them, Mr Plissi, had been unfairly dismissed. The Tribunal further found that Mr Plissi had contributed by his conduct to that dismissal to the extent of 20 per cent.[3]Before hearing the unfair dismissal claim the Tribunal rejected arguments put forward on behalf of Mr Dalitis that the unfair dismissal claim should be struck out; and, after deciding that claim, the Tribunal decided that Mr Plissi had, in his employment by Mr Dalitis, not been paid in accordance with the Minimum Wages Regulations .[4]The Tribunal's decisions on those two issues were originally attacked in the Notice of Appeal; but at an oral hearing under Rule 3(10) of the Employment Appeal Tribunal's Rules on 4 March 2008, HHJ Clark dismissed the appeal on those two issues; and they have played no further part. However, for the reasons set out in his judgment, he allowed Mr Dalitis' appeal against the finding of unfair dismissal to proceed to a full hearing; and it is that aspect of his appeal which has been debated before us today.[5]Mr Dalitis has been represented by Mr Baylis of counsel, who appeared for him before the Tribunal. Mr Plissi has been represented by his solicitor, Mr Britton. We are grateful to both of them for their submissions, both oral and written. The Facts[6]The facts, taken from the Tribunal's findings, can be succinctly set out. Mr Plissi was employed by Mr Dalitis at the latter's garage from about 2005. His principal role involved delivering and collecting cars for the business, which was small, employing only six to eight people. Mr Plissi's wife ran a café as a separate business from part of the garage premises.[7]On 4 January 2007 Mrs Plissi and Mr Dalitis had an argument in the latter's office, apparently about a change of attitude on Mr Dalitis' part towards Mr and Mrs Plissi. Mr Dalitis said that he was not happy about them because they had been, to use HHJ Clark's pithy expression "bad mouthing him in the Greek community". Voices were raised. Mrs Plissi asked Mr Dalitis if he wanted her to leave; he said he did; and they began to discuss and argue about what Mr Dalitis might pay to secure her departure from the café.[8]There came a point at which Mr Dalitis swore at Mrs Plissi. This happened when Mr Plissi was at the door of the office; and the result was a fight between the two men, albeit one of no great seriousness. The Tribunal found that each acted aggressively towards the other and that each was holding the other's lapel close to their throats. The Tribunal said that it was not clear who did this first. Mrs Plissi shouted for help; and another employee, Mr Varvarites, came into the office and separated the two men.[9]At this point were spoken the words which have led to this litigation. Mr and Mrs Plissi's evidence was that Mr Dalitis said, "Get out, leave and don't come back". Mr Dalitis' evidence was that he said, "Get out, this argument has got nothing to do with you". Mrs Plissi told her husband that she could sort things out; he left not only the room but also the garage and did not return, then or at any other time, to work. It was Mr Dalitis' case that he believed Mr Plissi had resigned, particularly in the context of the subsequent agreement he made with Mrs Plissi which involved handing over to her a cheque for £25,000 soon after the events which we have just described occurred. It was Mr Plissi's case that he had been dismissed.[10]We have just described how, that very same day, Mr Dalitis and Mrs Plissi reached agreement about the café. Mr Dalitis asked her to ask Mr Plissi for the return of his fuel cards; and they were returned; but Mr Dalitis and Mr Plissi had no further contact with each other. Neither attempted to get in touch with the other at all. Subsequently, both instructed solicitors who exchanged letters respectively asserting and denying that Mr Dalitis had dismissed Mr Plissi. The Tribunal's Judgment[11]The Tribunal, at paragraph 8(1) in the part of their judgment in which they dealt with the law, said:
"We therefore have to decide what words were used and, consider those with the surrounding circumstances, any documentation, any evidence about steps taken by either the employee or the employer to decide whether the employer's actions amounted to a termination of the contract."
[12]Their conclusions, insofar as they are relevant to the dismissal issue, are to be found in paragraph 10 of their judgment, in these terms:
" Conclusions It is always a difficult situation when a Tribunal has conflicting oral evidence and very little documentary or other evidence to support either position. Clearly, this was a situation where the people involved had previously been very friendly and a considerable part of their agreement, both in relation to the business of the café and the employment of the Claimant, was done on an informal basis. However, we have to apply the legal questions and test to that situation. We considered with some care what was said and done on 4 January. We are satisfied, and it was accepted that Mr Dalitis told the Claimant to get out. Whether he meant that to mean the office or the work place is not entirely clear. We therefore have to look at the surrounding circumstances. Of course, we were aware that the Respondent was in the process of severing the business relationship with the Claimant's wife when this argument occurred. We take into account particularly that Mr Dalitis asked for the return of the petrol cards and made no attempt to contact the Claimant until he heard from solicitors and it was then some two weeks before he replied to their letter. Balanced against that, is the fact that the Claimant left the work place and made no attempt to contact his employer, but we accept that he believed his employment was at an end. Given the enormous difficulties of coming to a conclusion of these facts, we have considered the duties that fall on an employer, even where the arrangements he has come to are those which are relatively informal. We accept that the words and actions of Mr Dalitis did indeed amount to a dismissal and that was what was understood by the Claimant. That being the case, it follows that it must also be automatically unfair because there was obviously no attempt to follow any statutory dismissal and disciplinary procedures."
[13]It is necessary to refer to the Tribunal's conclusions as to contributory fault at paragraph 13, in these terms:
"We consider whether it could be said that he Claimant contributed to his dismissal. We are satisfied that he did make such a contribution by leaving the workplace and failing to check with Mr Dalitis what the position was. That contribution is assessed by us at 20%."
The submissions for Mr Dalitis[14]The submissions put before us on behalf of Mr Dalitis by Mr Baylis can, we hope without disrespect, be summarised in this way.(1) Neither party claimed that all that had been said was, "Get out". It was common ground that those words had been used but not alone. On Mr Plissi's version of what had been said, "Get out, leave and don't come back" there was unambiguously a dismissal. On Mr Dalitis' version of what had been said, "Get out, the argument is nothing to do with you" the words were unambiguously not words of dismissal and, by leaving work and not returning to it, Mr Plissi must be taken to have resigned It was, in those circumstances, the duty of the Tribunal to resolve the conflict in the evidence upon which the result of the unfair dismissal claim should have turned; but the Tribunal did not resolve that conflict but instead proceeded on the basis of the words "get out" alone, which words were ambiguous. Thus, they considered the issue of whether there had or had not been a dismissal on that basis, unnecessarily and in error of law.(2) If the Tribunal were entitled to reach their decision without resolving that conflict, they nevertheless erred in law in that (i) they did not set out any concise statement of the legal principles which applied, contrary to the requirement of paragraph 36(d) of Schedule 1 of the Employment Tribunal (Constitution and Rules of Procedure) Regulations 2004 (ii) the applicable principles required the Tribunal to consider the surrounding circumstances and reach an objective assessment as to whether the words amounted to a dismissal; but the Tribunal had, in paragraph 10 of their judgment, set out factors as leading to their conclusion that there had been a dismissal which did not logically lead to that conclusion, which wrongly included references to what Mr Plissi believed the position to be and which omitted to consider Mr Dalitis' understanding that there had been a resignation; (iii) paragraph 13 confirmed the confusion in paragraph 10. It was not logical for the Tribunal to conclude that, by leaving the workplace and failing to contact Mr Dalitis, Mr Plissi had been guilty of contributory fault, when on the Tribunal's finding he had been dismissed before he left the workplace and before he could take any steps to check with Mr Dalitis what the position was. The submissions for Mr Plissi[15]Mr Britton's submissions, similarly we hope without disrespect, summarised were:(1) The Tribunal had sufficiently stated the law at paragraph 8(1) of their judgment. It was not necessary for them to refer expressly either to any authorities (in any event none had been cited to them) and/or to the passage in Harvey on Industrial Relations and Employment Law which deals with this topic.(2) Where words said to amount to dismissal were used in the heat of the moment the Tribunal were entitled to make such findings as they could; and if those findings were that the words were ambiguous, to consider all the surrounding circumstances, including subsequent events and subsequent conduct of the parties.(3) The Tribunal had undertaken that task. They had considered a number of factors; the weight they gave to those factors was a matter for them as the fact finding Tribunal.(4) The Tribunal were entitled to take into account, in considering the surrounding circumstances, the state of mind of the parties and did so.(5) In paragraph 13 of the Tribunal's judgment, the Tribunal should, in fairness, be regarded as considering only matters of compensation and remedy; they had, by this time, put their decision as to dismissal behind them. Our conclusions[16]The issue as to whether words used in the heat of the moment by an employer amount to words of dismissal and whether the words used in a similar situation by an employee amount to a resignation is one which regularly arises for decision by Employment Tribunals. The parties before us are, for present purposes, agreed as to the principles of law which apply to the resolution of such an issue. They have been considered from time to time by the Employment Appeal Tribunal and once in the Court of Appeal, in Southern v Frank Charlesly & Co [1981] IRLR 278.[17]The Employment Appeal Tribunal decisions in which this issue has been considered starting with Tanner v Kean [1978] IRLR 110 and thereafter include Gale Limited v Gilbert [1978] IRLR 453, Martin v Yeoman Aggregates Limited [1983] IRLR 49, Stern v Simpson [1983] IRLR 52 and Barclays v City of Glasgow District Council [1983] IRLR 313. It is not necessary for us to go through those decisions or any other decisions for the purposes of this judgment because Mr Baylis and Mr Britton agree that the authorities have been correctly and appropriately discussed and distilled by the learned editors of Harvey at volume 1, paragraphs D1 225 to 249.[18]We take from the authorities and those paragraphs in Harvey the following applicable principles:(1) the intention of the speaker of the relevant words is not the relevant test;(2) if the words are unambiguous then they must be given effect to by the Tribunal (subject to any issue of subsequent withdrawal, which does not arise for the present purposes);(3) if the words are ambiguous, then the Employment Tribunal must consider all the surrounding circumstances and decide, on the basis of an objective test, what the words would have meant to a reasonable listener.[19]In this case there is no doubt that each of the parties put forward a different version of the crucial words used by Mr Dalitis. While it is true that each version included the words "get out" it was not suggested on behalf of either party that that was all that was said; and the Tribunal did not find that that was all that was said.[20]We agree with Mr Baylis' analysis of the effect of the words which Mr Dalitis was said to have used on either version, an analysis with which Mr Britton did not suggest he disagreed. On Mr Plissi's account, the words used, "Get out, leave and don't come back" were not and could not be seen as ambiguous. They were plainly words of dismissal. On Mr Dalitis' account, "Get out, this argument has got nothing to do with you" are equally unambiguous, although to the opposite effect.[21]If the Tribunal had found that both parties' recollection was erroneous and all that had been said was "get out", the Tribunal would, in our judgment, have been entitled to proceed on that basis and to consider objectively the effect of those words, having regard to the surrounding circumstances; but the Tribunal did not so find. Instead the Tribunal did not make a finding as to what was the essential issue before them.[22]In Levy v Marrable [1984] ICR 583, the employee had been dismissed for misconduct which consisted of carrying out welding in a store where it was dangerous to do so. His response was that he had done the same thing before in the same place to his employers' knowledge and no one had ever said that it was wrong for him to do so. The employers denied that that had happened. The Tribunal failed to make a finding on that central issue, namely whether the employee had or had not, to the employers' knowledge, done the same thing in the same place before.[23]The Employment Appeal Tribunal, Waite J presiding, said at page 586 F to H:
"The criticism made before us today by Mr Allfrey, who now appears for the employee, is concentrated upon the first head of claim, upon which the industrial tribunal made no express finding at all. That is a little surprising, says Mr Allfrey, when one bears in mind that the alleged condonation by the employers was in the forefront of the employee's case, both on the evidence he led and in his written statement of original grounds. It becomes the more surprising, he adds, when one looks at the extent to which the industrial tribunal were faced with the most acute conflict possible of evidence on the two sides. But that failure to express a finding, Mr Allfrey concedes, is not necessarily fatal if, on a fair reading of the decision as a whole, the reader is left in no doubt as to the attitude towards such evidence taken by the tribunal. Nevertheless he submits that on this vital point the most diligent reader of the tribunal's language is left as much in the dark as to their attitude when he has finished reading as when he began." and continued at paragraph 587 D to G: "
What is our duty in those circumstances? We think the principle involved is the following: where there has been a conflict of evidence at the hearing before an industrial tribunal on a significant issue of fact, then the industrial tribunal's finding (i.e. their acceptance or rejection of such evidence) must be made plain one way or the other. Express words are not necessary. That is clear from Union of Construction, Allied Trades and Technicians v Brain [1981] ICR 542, and in particular the judgment of Donaldson LJ at p.551. But the language must be sufficiently full and clear to make it possible for anyone to tell from a reading of the decision as a whole whether the members have believed the relevant witnesses or not. Failure by the industrial tribunal to provide that indication, expressly or by reasonably clear implication from the overall language of their decision, amounts to an error of law: see Alexander Machinery (Dudley) Ltd v Crabtree [1974] ICR 120, 122. This principle has not, we think, been affected by – indeed it derives implicit support from – the recent decision of the Court of Appeal in Varndell v Kearney & Trecker Marwin Ltd [1983] ICR 683. Application of that principle to the circumstances of the present case ahs driven us to the conclusion, on the grounds already indicated, that the industrial tribunal failed to make it sufficiently clear, on a plain reading of their decision as a whole, whether they accepted (and if so to what extent) or whether they rejected the evidence on the one side or the other. Thereby they fell into an error of law which it is our duty redress"[24]In our judgment that principle applies to the present case. The Tribunal were under a duty to resolve the crucial issue before them as to what was said and then proceed on the basis of the words which they found to have been said, rather than to proceed on the basis of words which did not represent either parties' case and which the Tribunal did not find to be all that was said. We have concluded that, in these circumstances, the Tribunal failed in their primary duty to make the necessary finding of fact on the principal issue before them on the question of dismissal, namely what were the relevant words, and in so doing erred in law.[25]We have gone on to consider whether, if the Tribunal were entitled to proceed on the basis of the words "get out" only, there has been demonstrated any of the other errors of law on which Mr Baylis relied. We do not accept that the Tribunal failed to set out sufficiently a concise statement of the relevant principles of law which apply. We have already referred to the words they used in paragraph 8(1), and it can be seen from paragraph 10 that there too, because the words were ambiguous, they directed themselves to look at the surrounding circumstances. There was no need for more. Their self direction was clear.[26]Even if they did not express such a concise statement of principle, the fact that they may not wholly have complied with Rule 36(d) does not, in our judgment of itself, amount to an error of law. But, in any event, there is sufficient statement of the law as we see it.[27]However, when we come to look at the factors which the Tribunal took into account, there is, in our judgment, an error of law which Mr Britton's arguments did not succeed in dispelling. We entirely accept, of course, that the Tribunal were the fact finding Tribunal and that we are not such a Tribunal. However, it is clear that the Tribunal took into account the fact that Mr Dalitis made no attempt to contact Mr Plissi until he heard from his solicitors and, also, that he asked him for the return of the petrol cards.[28]The Tribunal say that balanced against that is the fact that Mr Plissi left the workplace and made no attempt to contact Mr Dalitis; but, they said, they accepted that he, Mr Plissi, believed his employment was at an end. In other words, his conduct in failing to contact Mr Dalitis was explicable.[29]The Tribunal have omitted, as we see it, to build into their consideration of these factors, the fact that it was Mr Dalitis' case that he believed Mr Plissi to have resigned. The reality was, on this approach, that the failure of either man to contact the other could only in any material way be seen as neutral; for Mr Plissi on his case did not contact Mr Dalitis because he thought he had been dismissed and Mr Dalitis did not contact Mr Plissi because he thought Mr Plissi had resigned.[30]Insofar as the Tribunal took this lack of contact into account, as they plainly did, as a factor which pointed towards a dismissal that was, in our view, unsustainable; their error lay in failing to appreciate or to remember that it was Mr Dalitis' case that Mr Plissi had resigned.[31]In these circumstances, it is not necessary for us to go into the argument debated before us, albeit at no great length, as to whether it was right for the Tribunal to consider the state of mind of Mr Plissi. The Tribunal's reasoning cannot be supported for the reasons we have set out.[32]The fact that the Tribunal may have become confused to some extent as to the resolution of the task they have set themselves is, in our judgment, supported by the way in which they express themselves in paragraph 13, for Mr Baylis' submission that paragraph 13 contains a failure of logic, in our judgment, must be right. We do not regard paragraph 13 as capable of being put entirely on one side for the reasons advanced by Mr Britton. Result[33]For these reasons this appeal must be allowed. We have canvassed with the parties what should be the consequence. Mr Britton submitted that if we were to allow the appeal only on the basis of insufficient reasoning in paragraph 10 we should remit to the same Tribunal; but it is clear that we have allowed the appeal on a wider basis; and it was accepted between the parties that if we did the only proper solution was to remit to a fresh Tribunal. The difficulty about a remission to the same Tribunal is that the Tribunal which reached the decision which we have been discussing failed to, and perhaps felt that they could not, determine the vital issue between the parties. It would be quite wrong in those circumstances to send this case back to them for them to determine the vital issue between the parties. Thus, there must be a remission to a fresh Tribunal.[34]However, before ending this judgment we want to say one more thing. It is extremely unfortunate, as we see it, that two members of the Greek community have come to litigation in this way and are now facing a further hearing in the Tribunal, with what consequences and at what expense we know not. We have all thought that there must, perhaps within the Greek community itself, be modes by which this dispute can be resolved, by mediation or without the need to go back to the Tribunal and the further cost and time that that will necessarily require. We simply suggest to the parties that they might like to think about the future along those lines. Of course we have no power to direct them to do anything and are not doing so.