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England and Wales High Court (Queen's Bench Division) Decisions |
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You are here: BAILII >> Databases >> England and Wales High Court (Queen's Bench Division) Decisions >> Farnham-Oliver v RM Educational Resources Ltd [2021] EWHC 2418 (QB) (31 August 2021) URL: http://www.bailii.org/ew/cases/EWHC/QB/2021/2418.html Cite as: [2021] EWHC 2418 (QB) |
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QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL |
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B e f o r e :
____________________
| MARCUS FARNHAM-OLIVER |
Claimant |
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| - and - |
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| RM EDUCATIONAL RESOURCES LIMITED |
Defendant |
____________________
Jonathan Grace (instructed by Weightmans LLP) for the Defendant
Hearing dates: 16 July and 5 August 2021
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Crown Copyright ©
MASTER DAGNALL :
Introduction
History
i) The claimant's employment to cease on 26 February 2015 (clause 2)
ii) It being a condition that the Tribunal proceedings would be withdrawn with an email to such effect being sent to the Tribunal by DAS within 2 days (clause 3)
iii) A payment being made of £12,000 by the defendant to the claimant (clause 4)
iv) By clause 6 "Subject to the exclusion at clause 7 below…" a full and final settlement of all claims the claimant had or might have against the defendant arising from the employment
v) By clause 7: "The Claimant is not prevented from pursuing his potential claim for damages arising from a personal injury allegedly suffered as a result of work related stress which is currently being handed handled by Norrie Waite and Slater Solicitors on behalf of the Claimant which was raised with the Respondent [the defendant] by way of solicitors' letter dated 28 January 2015 ("the PI claim")."
vi) By clause 9 that the claimant would keep the Agreement and the history confidential
vii) By clause 11 that the claimant would not disparage the defendant but that "For the avoidance of doubt the claimant is not precluded from disclosing such information as outlined in clause 9 for the purpose of the PI claim and the same will not be construed as a breach of this Agreement."
"52. Where a claim, or part of it, has been withdrawn under rule 51, the Tribunal shall issue a judgment dismissing it (which means that the claimant may not commence a further claim against the respondent raising the same, or substantially the same, complaint) unless—(a) the claimant has expressed at the time of withdrawal a wish to reserve the right to bring such a further claim and the Tribunal is satisfied that there would be legitimate reason for doing so; or(b) the Tribunal believes that to issue such a judgment would not be in the interests of justice."
The Claim Form and Particulars of Claim
The Case-Law
Abuse of Process Jurisdiction
"24. I do not accept this. The principle in Henderson v Henderson has always been thought to be directed against the abuse of process involved in seeking to raise in subsequent litigation points which could and should have been raised before. There was nothing controversial or new about this notion when it was expressed by Lord Kilbrandon in Yat Tung. The point has been taken up in a large number of subsequent decisions, but for present purposes it is enough to refer to the most important of them, Johnson v Gore-Wood & Co [2002] 2 AC 1, in which the House of Lords considered their effect. This appeal arose out of an application to strike out proceedings on the ground that the plaintiff's claim should have been made in an earlier action on the same subject-matter brought by a company under his control. Lord Bingham took up the earlier suggestion of Lord Hailsham of St. Marylebone LC in Vervaeke v Smith [1983] 1 AC 145, 157 that that the principle in Henderson v Henderson was "both a rule of public policy and an application of the law of res judicata". He expressed his own view of the relationship between the two at p 31 as follows:"Henderson v Henderson abuse of process, as now understood, although separate and distinct from cause of action estoppel and issue estoppel, has much in common with them. The underlying public interest is the same: that there should be finality in litigation and that a party should not be twice vexed in the same matter. This public interest is reinforced by the current emphasis on efficiency and economy in the conduct of litigation, in the interests of the parties and the public as a whole. The bringing of a claim or the raising of a defence in later proceedings may, without more, amount to abuse if the court is satisfied (the onus being on the party alleging abuse) that the claim or defence should have been raised in the earlier proceedings if it was to be raised at all. I would not accept that it is necessary, before abuse may be found, to identify any additional element such as a collateral attack on a previous decision or some dishonesty, but where those elements are present the later proceedings will be much more obviously abusive, and there will rarely be a finding of abuse unless the later proceeding involves what the court regards as unjust harassment of a party. It is, however, wrong to hold that because a matter could have been raised in earlier proceedings it should have been, so as to render the raising of it in later proceedings necessarily abusive. That is to adopt too dogmatic an approach to what should in my opinion be a broad, merits-based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focusing attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before."The rest of the Committee, apart from Lord Millett, agreed in terms with Lord Bingham's speech on this issue. Lord Millett agreed in substance in a concurring speech. He dealt with the relationship between res judicata and the Henderson v Henderson principle at pp 58H-59B as follows:
"Later decisions have doubted the correctness of treating the principle as an application of the doctrine of res judicata, while describing it as an extension of the doctrine or analogous to it. In Barrow v Bankside Members Agency Ltd [1996] 1 WLR 257, Sir Thomas Bingham MR explained that it is not based on the doctrine in a narrow sense, nor on the strict doctrines of issue or cause of action estoppel. As May LJ observed in Manson v Vooght [1999] BPIR 376, 387, it is not concerned with cases where a court has decided the matter, but rather cases where the court has not decided the matter. But these various defences are all designed to serve the same purpose: to bring finality to litigation and avoid the oppression of subjecting a defendant unnecessarily to successive actions. While the exact relationship between the principle expounded by Sir James Wigram V-C and the defences of res judicata and cause of action and issue estoppel may be obscure, I am inclined to regard it as primarily an ancillary and salutary principle necessary to protect the integrity of those defences and prevent them from being deliberately or inadvertently circumvented."
"The question is whether the parties to the settlement of WWH's action (relevantly, Mr Johnson and GW) proceeded on the basis of an underlying assumption that a further proceeding by Mr Johnson would not be an abuse of process and whether, if they did, it would be unfair or unjust to allow GW to go back on that assumption. In my judgment both these conditions were met on the present facts. Mr Johnson was willing in principle to try to negotiate an overall settlement of his and the company's claims but this was not possible in the time available and it was GW's solicitor who said that the personal claim "would be a separate claim and it would really be a matter for separate negotiation in due course". It is noteworthy that Mr Johnson personally was party to the settlement agreement, and that the agreement contained terms designed to preclude (in one instance) and limit (in another) personal claims by him. Those provisions only made sense on the assumption that Mr Johnson was likely to make a personal claim. GW did not, of course, agree to forgo any defence the firm might have to Mr Johnson's claim if brought, and the documents show that GW's solicitor was alert to issues of remoteness and duplication. Had Mr Johnson delayed unduly before proceeding, a limitation defence would have become available. But an application to strike out for abuse of process is not a defence; it is an objection to an action being brought at all. The terms of the settlement agreement and the exchanges which preceded it in my view point strongly towards acceptance by both parties that it was open to Mr Johnson to issue proceedings to enforce a personal claim, which could then be tried or settled on its merits, and I consider that it would be unjust to permit GW to resile from that assumption.If, contrary to my view, GW is not estopped by convention from seeking to strike out Mr Johnson's action, its failure to take action to strike out over a long period of time is potent evidence not only that the action was not seen as abusive at the time but also that, on the facts, it was not abusive. The indicia of true abuse are not so obscure that an experienced professional party, advised by leading counsel (not, at that stage, Mr Steinfeld), will fail to recognise them. It is accepted that Mr Johnson had reasons which he regarded as compelling to defer prosecution of his personal claim. If, as he contended, the urgency of obtaining an early and favourable decision in the company's action was itself a result of GW's breach of duty to the company and to him, it would seem to me wrong to stigmatise as abusive what was, in practical terms, unavoidable. I agree with GW that it would certainly have been preferable if the judge who tried the company's action, and thereby became familiar with much of the relevant detail and evidence, had been able at the same time or shortly thereafter to rule on the personal claim. That would have been efficient and economical. But there were reasons accepted at least implicitly by both parties at the time for not proceeding in that way, and GW could, if it wishes, limit the extent to which issues extensively canvassed in the earlier action are to be reopened. It is far-fetched to suggest that this action involves a collateral attack on GW's non-admission of liability in the first action when that action was settled by insurers on terms quite inconsistent with any realistic expectation that GW would not be found liable.
In my opinion, based on the facts of this case, the bringing of this action was not an abuse of process. The Court of Appeal adopted too mechanical an approach, giving little or no weight to the considerations which led Mr Johnson to act as he did and failing to weigh the overall balance of justice. I would allow Mr Johnson's appeal."
(1) the Henderson principle can operate where one claim has been the subject of compromised proceedings so as to make the bringing of a second claim, which could have been brought in those proceedings but was not, an abuse even if it was not settled by the compromise and even if it is made by a different person; but
(2) the settlement and its process may themselves prevent an application contending abuse of process being made on the basis that the relevant party is estopped by agreement or convention from taking the point; and in any event
(3) whether there is an abuse of process sufficient to justify the relevant party being prevented from pursuing the second claim involves the conducting of a "broad merits based judgment" test considering all the circumstances and including whether there has been "undue harassment" of the other party, and asking whether the process of the court is being misused and/or abused (and see also the citations from the Akay judgment below).
Srivatsa v SoS
Dattani v Trio
Sheriff v Klyne
"22. But is the present claim one to which paragraph 4 of the agreement applies? Mr. Buchan submits that it is not, because the cause of action is different. The claim in the action is based upon the tort of negligence. The claimant will have to prove not only the conduct of the master, but that it was reasonably foreseeable to a reasonable employer that this might cause psychiatric injury. I merely comment in passing that this might in any event prove a difficult hurdle to surmount. One can reasonably appreciate that such harassment may cause injury to feelings; but psychiatric injury is a different matter. The advantage of the statutory tort, from the claimant's point of view, is that this requirement does not need to be established; all that needs to be established is the causal link. But in any event, in my judgment, the claim does fall within paragraph 4 of the compromise *1180 agreement. It is a claim for compensation for injury sustained by the employee arising out of his employment with the respondent employers (i.e., through the master's conduct) and in respect of which the employment tribunal has jurisdiction."
"23. Mr. Pleming also argues that the action should be struck out as an abuse of process on the basis of res judicata; he relies on the decision of the industrial tribunal dismissing the application. I do not think this is a case of res judicata in the strict sense, because the cause of action is not the same in both proceedings. However, the principle applies to matters which could have been raised in previous proceedings, but were not. In Henderson v. Henderson (1843) 3 Hare 100 , 114–115 Wigram V.-C. said:"In trying this question, I believe I state the rule of the court correctly, when I say, that where a given matter becomes the subject of litigation in, and of adjudication by, a court of competent jurisdiction, the court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only to points upon which the court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time."This principle was applied in Talbot v. Berkshire County Council [1994] Q.B. 290 . After citing it, I said, at p. 296 c :
"The rule is thus in two parts. The first relates to those points which were actually decided by the court; this is res judicata in the strict sense. Secondly, those which might have been brought forward at the time, but were not. The second is not a true case of res judicata but rather is founded on the principle of public policy in preventing multiplicity of actions, it being in the public interest that there should be an end to litigation; the court will stay or strike out the subsequent action as an abuse of process: per Lord Wilberforce in Brisbane City Council v. Attorney-General for Queensland [1979] AC 411 , 425 g ."And, at p. 297 e , I said:
"In my judgment there is no reason why the rule in Henderson's case should not apply in personal injury actions. Indeed there is every reason why it should. It is a salutary rule. It avoids unnecessary proceedings involving expense to the parties and waste of court time which could be available to others; it prevents stale claims being brought long after the event, which is the bane of this type of litigation; it enables the defendant to know the extent of his potential liability in respect of any one event; this is important for insurance companies who have to make provision for claims and it may also affect their conduct of negotiations, their defence and any question of appeal."24. The principle applies in this case. The same issue of the conduct of the master of the employers' vessel lies at the heart of both the proceedings in the industrial tribunal and the county court action, although in the latter the employee assumes the additional burden of proving negligence. For the reasons I have already given, the employee could have brought forward his whole claim for compensation in the tribunal. He did not do so.
25. There is an exception to the rule in Henderson's case where there are special circumstances. The special circumstances must afford an adequate explanation of why the claim now made was not made in the earlier proceedings. As I said in Talbot's case, at p. 299 d , "The court has to consider why the claim was not brought in the earlier proceedings."
26. Mr. Buchan submitted that there were a number of special circumstances here. He listed the following: (a) the different limitation period and in particular the very short period in the employment tribunal; (b) different cost provisions: an applicant in the employment tribunal is not usually awarded costs, and this may be a disadvantage to a claimant with a heavy claim; (c) the procedure in the court is more suitable for trying a complex personal injury claim; (d) there is no facility for interim payments or provisional damages in the employment tribunal; (e) the expertise of the employment tribunal does not lie in the field of adjudication on perhaps difficult questions of psychiatric injury.
27. In my opinion these considerations cannot be regarded as special circumstances; they are inherent in the two different forms of jurisdiction. The principle of public policy is that claims that have been or could have been litigated in one tribunal, should not be allowed to be litigated in another.
28. What might be a special reason would be if the claimant's condition had not come to light at the time the earlier proceedings were concluded. That is not the position here. Although the employee's condition may not have been formally diagnosed as post traumatic stress disorder by October 1995, it is clear that he was complaining of anxiety and depression from February 1995 and continuing. This was not mere injury to feelings, but was the essence of his psychiatric injury.
29. For these reasons I would dismiss this appeal, both on the grounds that the claim in the county court action is one that falls within paragraph 4 of the agreement and on the principle in Henderson v. Henderson ."
Akay v Newcastle
"The Claimant confirms that he is aware of no other cause of action which he has made against the Respondent (save for the personal injury claim referred to in clause 7) …The Claimant is not precluded by this agreement from bringing any personal injury claim against the Respondent where he is not and could not reasonably have been, aware of any such claim at the date of this Agreement. For the avoidance of doubt nothing in this Agreement prevents the Claimant from pursuing the personal injury claim that he has already made. The making and pursuing of this claim is not a breach of this agreement."
"The Judge also quoted paragraph 34 of Chadwick LJ's judgment in Securum Finance Ltd v Ashton (No 1) [2001] Ch 291 :"For my part, I think that the time has come for this court to hold that the "change of culture" which has taken place in the last three years - and, in particular, the advent of the Civil Procedure Rules - has led to a position in which it is no longer open to a litigant whose action has been struck out on the grounds of inordinate and inexcusable delay to rely on the principle that a second action commenced within the limitation period will not be struck out save in exceptional cases. The position, now, is that the court must address the application to strike out the second action with the overriding objective of the Civil Procedure Rules in mind - and must consider whether the claimant's wish to have "a second bite at the cherry" outweighs the need to allot its own limited resources to other cases. The courts should now follow the guidance given by this court in the Arbuthnot Latham case [1998] 1 WLR 1426 , 1436-1437:"The question whether a fresh action can be commenced will then be a matter for the discretion of the court when considering any application to strike out that action, and any excuse given for the misconduct of the previous action: see Janov v Morris [1981] 1 WLR 1389 . The position is the same as it is under the first limb of Birkett v James . In exercising its discretion as to whether to strike out the second action, that court should start with the assumption that if a party has had one action struck out for abuse of process some special reason has to be identified to justify a second action being allowed to proceed."
"23. The judge also cited the summary in paragraph 3.4.3.2 of the White Book of the guidance given by Morris J in his judgment in Davies v Carillion Energy Services Ltd [2018] 1 WLR 1734 . That guidance included the following, in subparagraphs 52(1) & (2):"(1) Where a first action has been struck out as itself being an abuse of process, a second action covering the same subject matter will be struck out as an abuse of process, unless there is special reason: the Securum case, para 34, citing the Arbuthnot Latham case, and Aktas v Adepta [2011] QB 894 , paras 48 and 52.(2) In this context abuse of process in the first action comprises: intentional and contumelious conduct; or want of prosecution; or wholesale disregard of rules of court: Aktas v Adepta , paras 72 and 90."
" 26. The Judge then dealt with abuse of process in paragraphs 85 to 105 of his judgment. In the light of the guidance in Davies v Carillion , he started by asking himself whether the 2013 Harassment Claims were struck out as an abuse of process. He held that they were. He then said as follows in paragraph 96 (which Mr Buchan, acting for the Claimant, accepted was correct):"Therefore, the County Court action should be struck out unless there is some special reason why I should not do so. However, when carrying out that exercise I must give effect to the overriding objective (see: Securum §34) and the need to do justice (see the fourth guideline in Davies (above)). Further, I should take a broad merits-based approach to the matter (see: Johnson per Lord Bingham)."
"46. Lord Bingham used the expression "broad, merits-based judgment" in contrast with what he called "too dogmatic an approach", namely holding that, because a matter could have been raised in earlier proceedings, it should have been. The judge in this case certainly did not adopt that too dogmatic approach.47. Lord Bingham went on to explain what he meant by a "broad, merits-based judgment" in the remainder of the sentence in which he used that phrase. A "broad, merits-based judgment" is one which:
(1) takes account of the public and private interests involved;(2) takes account of all the facts of the case; and
(3) focuses attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before."
"53. I do not accept Mr Buchan's submission that the judge misconstrued the Compromise Agreement. The meaning of clause 7 is quite clear: the Compromise Agreement itself did not prevent the Claimant from pursuing the personal injury claim. However, there was no agreement, express or implied, that the claim was not an abuse of process.54. Mr Buchan also submitted that the circumstances in which the Compromise Agreement was made gave rise to an estoppel by convention. He relied on the following passage from Lord Bingham's speech in Johnson v Gore Wood & Co (No 1) (at 33G-34C):
"The question is whether the parties to the settlement of WWH's action (relevantly, Mr Johnson and GW) proceeded on the basis of an underlying assumption that a further proceeding by Mr Johnson would not be an abuse of process and whether, if they did, it would be unfair or unjust to allow GW to go back on that assumption. In my judgment both these conditions were met on the present facts. Mr Johnson was willing in principle to try to negotiate an overall settlement of his and the company's claims but this was not possible in the time available and it was GW's solicitor who said that the personal claim "would be a separate claim and it would really be a matter for separate negotiation in due course". It is noteworthy that Mr Johnson personally was party to the settlement agreement, and that the agreement contained terms designed to preclude (in one instance) and limit (in another) personal claims by him. Those provisions only made sense on the assumption that Mr Johnson was likely to make a personal claim. GW did not, of course, agree to forgo any defence the firm might have to Mr Johnson's claim if brought, and the documents show that GW's solicitor was alert to issues of remoteness and duplication. Had Mr Johnson delayed unduly before proceeding, a limitation defence would have become available. But an application to strike out for abuse of process is not a defence; it is an objection to an action being brought at all. The terms of the settlement agreement and the exchanges which preceded it in my view point strongly towards acceptance by both parties that it was open to Mr Johnson to issue proceedings to enforce a personal claim, which could then be tried or settled on its merits, and I consider that it would be unjust to permit GW to resile from that assumption."55. This was an application on the particular facts of that case of the doctrine of estoppel by convention as stated by Lord Denning MR in Amalgamated Investment and Property Co Ltd v Texas Commerce International Bank Ltd [1982] QB 84 , 122:
"When the parties to a transaction proceed on the basis of an underlying assumption - either of fact or of law - whether due to misrepresentation or mistake makes no difference - on which they have conducted the dealings between them - neither of them will be allowed to go back on that assumption when it would be unfair or unjust to allow him to do so. If one of them does seek to go back on it, the courts will give the other such remedy as the equity of the case demands."56. However, the judge in the present case found that there was no such common assumption. That was the effect of his conclusion in paragraph 84 of his judgment that there was nothing in the material to which he was referred which supported an argument that the Claimant believed that (i) the Defendant was giving up a potential defence to the personal injury action by entering into the Compromise Agreement and/or (ii) the Compromise Agreement would improve, rather than preserve, his position in the personal injury claim.
57. The judge was wrong (in this paragraph and others) to refer to an application to strike out the claim on the grounds of abuse of process as a potential defence. As Lord Bingham explained in Johnson v Gore Wood & Co (No 1) , it was not a defence, but an objection to the action being brought at all. However, it does not seem to me that that error detracts from the Judge's finding that there was no common understanding (because even the Claimant did not believe) that the Compromise Agreement would improve, rather than preserve, his position in the present claim.
58. It is relevant to note that the facts of this case are significantly different from those of Johnson v Gore Wood & Co (No 1) . Neither Mr Johnson nor his company, Westway Homes Ltd, had brought a claim which had been struck out as an abuse of process. Moreover, the settlement agreement in that case was a settlement of the very action in which the defendant subsequently contended that Mr Johnson should have brought his claim. In the present case, the Compromise Agreement only settled the Dismissal Claims, since the 2013 Harassment Claims (which should have included the Claimant's personal injury claim) had already been struck out. The Defendant having applied once before for those claims to be struck out, it was to be expected that the Defendant would apply again for any claim based on the same facts to be struck out.
59. Moreover, the Claimant's evidence as to what was said and what he believed when he entered into the Compromise Agreement, and the documents exhibited to his witness statement, are not inconsistent with the judge's finding. I conclude that the judge was entitled to make that finding and, as I have said, it is inconsistent with any estoppel by convention."
(1) the claims which were the subject-matter of the Civil Claim were, or at least should have been, included in those harassment claims which were advanced in the Tribunal Claim but which had been struck out in the Tribunal Claim (including for contumelious non-compliance with an order of the Tribunal) – see Paragraph 58 and other paragraphs cited above
(2) an argument that the compromise agreement provided that the Civil Claim could proceed failed on the basis that it was held that that compromise agreement only provided that it "itself" did not prevent the Civil Claim being pursued, and did not prevent the Civil Claim being challenged on any other basis including abuse of process – Paragraph 53
(3) an argument that the compromise agreement and the compromise negotiations gave rise to an estoppel by convention barring the defendant from relying on abuse of process failed for two reasons, relating to the absence of anything giving rise to a convention that the defendant would lose a potential defence (or rather ground to resist) the Civil Claim and the absence of any belief on the part of the claimant that the defendant was giving up such an existing potential defence (or rather ground to resist) rather than merely preserving whatever the situation otherwise was – Paragraphs 56 and 57. However, those Paragraphs need to be seen in the context of Paragraph 58 which makes clear that this compromise agreement only settled other claims (than the Civil Claim) in a factual context which indicated that the defendant would (presumably) seek to strike-out the Civil Claim on the same basis (non-compliance with orders of the Tribunal) that the relevant previous elements of the Tribunal Claim had been struck out.
Manda v UBS
The defendant's submissions
(1) the subject matter of the Civil Claim could have been brought as part of the Tribunal Claim and there is no special reason justifying its not having been
(2) the Tribunal Settlement Agreement, as in Akay, did not deprive the defendant of any right to contest the Civil Claim but merely prevented the defendant relying on the fact that the Tribunal Claim had been compromised as being a defence
(3) it is undue harassment of the defendant to bring a Civil Claim where the claimant had chosen to bring the Tribunal Claim and then compromised it; essentially a claimant who could (as was the case here) bring all their claims in the Tribunal and who has chosen to issue proceedings in the Tribunal is stuck (in the absence of an express agreement or similar (giving rise to an estoppel by convention)) with that i.e. they simply have to proceed down the Tribunal route, and by bringing separate proceedings in the county court, even with the benefit of clause 7 of Tribunal Settlement Agreement, they are guilty of undue harassment and misuse of the court system
(4) Akay effectively held the above and is binding upon me. In any event, applying the "broad merits based judgment" approach, I should come to the same decision here as HHJ Gargan did in Akay.
(1) Akay was distinguishable on two grounds being (i) that the terms of the Tribunal Settlement Agreement and the surrounding circumstances were not limited to preserving whatever was the then position regarding the bringing of the Civil Claims but prevented the defendant from relying upon abuse of process and (ii) there was no preceding strike-out in this case which rendered bringing the Civil Claim an abuse of process
(2) the circumstances of the Tribunal Claim having been compromised at a very early stage and where it was brought only under the 2010 Act (and which required that claim to be brought in the Tribunal) meant (with the Tribunal Settlement Agreement) that there was no undue harassment and no misuse or abuse of process in bringing the separate and later Civil Claim.
Discussion and Conclusions
The Compromise Agreement
(1) the Tribunal Settlement Agreement may amount to a contract that the claimant is to be permitted to pursue the Civil Claim without any application being made to strike-out for abuse of process – if so then the defendant is barred by way of contract from making this Application – this is simply a matter of orthodox contractual analysis
(2) the Tribunal Settlement Agreement together with the negotiations and other circumstances may give rise to an estoppel by convention preventing the defendant from making this Application
(3) the Tribunal Settlement Agreement together with the negotiations and other circumstances may be relevant matters in applying the "broad-based merits/judgment" test.
(1) to consider the words used in the factual matrix of matters known or reasonably available to the parties and the commercial purpose of the agreement, and using commercial common-sense, but ignoring the underlying negotiations (where they do not form part of the agreement) and subjective intentions of the parties. This involves giving the language used its proper importance as expressing the parties' agreement, and not penalising an astute party or assisting an imprudent party when the words used may appear to have a (possibly) unfortunate effect
(2) to consider the various possible constructions of the agreement and come to that which the reasonable reader would consider to be the most appropriate as reflecting the expressed common intention of the parties (this being an holistic exercise of considering the possible constructions altogether to reach the most appropriate rather than rejecting various constructions individually leaving a residual construction to be adopted).
(1) the factual matrix context (all of which effectively appears within the Tribunal Settlement Agreement itself) is that (i) the Tribunal Proceedings are being brought and are being compromised (ii) the personal injury claim has been intimated, but is a matter which is not being compromised, and which it is envisaged is to be pursued by way of a Civil Claim (iii) nothing has happened in the Tribunal Proceedings (i.e. nothing such as a strike-out for contumelious disregard of a court order) or otherwise which would prevent the personal injury claim being pursued (if it has substantive validity) i.e. there is no (and no arguable) existing procedural bar to the actual pursuit of the personal injury claim. The factual matrix in Akay was very different as there something had already happened (the strike-out) which gave rise to a free-standing right in the defendant to prevent the claimant from pursuing that personal injury claim, and which right it would seem unlikely (without express words) that the defendant would simply give up
(2) the commercial purpose of the Tribunal Settlement Agreement is thus seemingly to compromise the 2010 Act and all other claims apart from the personal injury claim, which personal injury claim is to be pursued (if the claimant so chooses) by way of the Civil Claim. While it can be said that there is no indication of any commercial purpose of destroying any way of defeating the personal injury claim which already (i.e. immediately prior to the Tribunal Settlement Agreement) exists, there was no freestanding way of defeating the personal injury claim then in existence (as unlike in Akay, or in Manda, there has not already been a strike-out of such a claim or related claim)
(3) the language used is simply "The claimant is not to be prevented from pursuing the personal injury claim…". As to this:
(i) the language used has no limiting words. It is unqualified but the abuse of process argument which is not employed is designed to and if successful would do exactly that i.e. prevent the claimant from pursuing the personal injury claim. As stated in Akay at paragraph 57, it is not a defence but a means of preventing the claim being pursued
(ii) however, I accept that the language must have some limitation as it cannot have been intended to remove existing substantive defences or contests to the personal injury claim. On the other hand, as stated above, abuse of process is not a substantive defence or contest, rather it is simply a way of preventing a claim (however meritorious) from being pursued. Moreover, the language used gives rise to the question of "prevented by what?". Although the language is unqualified, I do not think it right to interpret it as meaning simply "prevented by the terms of the Tribunal Settlement Agreement". Clause 7 simply does not say that; and is to be contrasted with the wording in Akay of "by this agreement". That wording was interpreted in Akay as meaning exactly what it said i.e. the exception was only to prevention (actually on the wording used in Akay to "preclusion" which again seems directed to the compromise agreement rather than anything already existing outside it) by reason of the agreement "itself" (see paragraph 53 of that judgment) so that it could not be said that the fact of the compromise prevented that personal injury claim being brought. However, if that limited effect was intended, then in my judgment the Akay wording "by this agreement" should have been inserted. The unqualified wording strongly suggests that the "not prevented" extends to the entirety of what has gone before which is the subject of the Tribunal Settlement Agreement i.e. not just the compromise but the Tribunal Claim and proceedings themselves
(4) returning to the factual matrix and the commercial purpose, it seems to me that it would be odd if the indirect effect of the Tribunal Settlement Agreement would be that the claimant would be prevented from pursuing the personal injury claim. Without the Tribunal Settlement Agreement, the claimant could pursue it by way of amendment to the Tribunal Claim, but with the Tribunal Settlement Agreement, if the defendant is correct, the claimant would be prevented, as a Rule 52 dismissal (which the Tribunal Settlement Agreement required by way of the claimant having to make a Rule 51 withdrawal) would prevent it being brought in the Tribunal and the Henderson abuse of process would prevent it a Civil Claim being brought. Thus, on the defendant's construction, and notwithstanding the unqualified language used in clause 7, the Tribunal Settlement Agreement would cause exactly what clause 7 says was not going to happen. The wording in Akay was, of course, very different, stating that it the non-preclusion was (only) "by this agreement" which implied that other free-standing preclusions could exist
(5) The situation is generally very different from that Akay (which itself is only a decision of the meaning of the individual compromise contract in that individual case) of an existing (prior to the making of the compromise) right in the defendant to seek to contest (by way of abuse of process argument) any attempt by the claimant to raise the personal injury claim in any jurisdiction (whether the Tribunal or the court). In Akay, as held in the judgment, it would be unusual for the defendant to give up such an existing right and clear words would be required. This case, it seems to me, is very different. It seems to me that it is a situation analogous to that considered in Dattani in that it would be last thing that parties seeking to preserve the right to bring a claim would intend (and would require clear words to achieve the result) that by making an agreement seeking not to prevent a claim being pursued, and where there was nothing then extant to prevent it being pursued, they had actually succeeded in preventing it being pursued.
(1) Johnson v Gore Wood is binding upon me and on the courts which decided those decisions, and both I should seek to find reasons why those decisions can be justified on their own individual facts (where otherwise potentially inconsistent with it) and, in any event, follow it
(2) Sheriff is distinguishable as there was no compromise or other matter on which an estoppel by convention could be based
(3) Manda is distinguishable as there was no compromise and there was already a strike-out and then simply a withdrawal
(4) Akay is more problematic as the estoppel by convention argument was rejected on grounds both of (i) no convention and also of (ii) no reliance as there was no evidence in the belief in the existence of the conventional matter, and as to which a similar point can be made here as the claimant does not actually say in terms that he believed that it was being agreed that an abuse of process argument could not be advanced but only that he could proceed with the Civil Claim (which is effectively the same evidence as the claimant in Akay gave). However, I think that it is distinguishable as:
(i) Akay's analysis of estoppel by convention starts from the position that (a) the defendant had a known existing free-standing basis (the strike-out for contumelious disregard of the Tribunal's orders) for saying that the pursuit of the personal injury claim in any jurisdiction, including the Civil Claim, was an abuse of process (b) there was no reason to suppose that the defendant was intending to give up such a right and (c) the words actually used made clear that the non-preclusion was limited to "by reason of this agreement" and thus that other (free-standing and whether or not existing) preventions/preclusions would continue to exist
(ii) in such circumstances, there was no convention. However, no such or analogous circumstances existed here and the situation was, rather, similar and analogous to that in Johnson v Gore Wood in terms of a mutual conventional understanding that the Civil Claim could proceed to a substantive determination
(iii) those Akay circumstances also gave rise to the "absence of belief" point. The relevant belief which was not evidenced, and so was held not to exist, in Akay was that the defendant would not rely upon the previous strike-out and its circumstances to advance an abuse of process argument. For the same reasons as to there being no convention, the mere fact that that claimant said he believed that he could bring and pursue the Civil Claim was not enough; rather (per HHJ Gargan and Lavender J at least) he would have had to have said that he believed specifically that he could bring and pursue it notwithstanding the previous strike-out. However, in this case (and in Johnson v Gore Wood) the convention and circumstances and statements of belief were general and obviously directed to both the first set of proceedings and their compromise (because there was nothing else (such as a previous strike-out) as to which the relevant person, here the claimant and there Mr Johnson, could be concerned). Further, here the claimant has said that he would never have compromised had he thought that the effect of the Tribunal Settlement Agreement (which, of course, required the Rule 51 withdrawal) would be to prevent him bringing and pursuing (obviously to judgment) the personal injury claim. Further, here clause 7 was unqualified while the clause in Akay was limited to the compromise agreement itself. In any event, it seems to me that Akay on this point is distinguishable because of its above-mentioned circumstances which do not exist here and if that is wrong then I should still follow Johnson v Gore Wood.
Abuse of Process and Res Judicata
(1) the claimant knew throughout of the (alleged) facts underlying the Civil Claim and there is no suggestion that the claimant could not, as a matter of law (as confirmed by both Sheriff (decided many years before the Tribunal Claim was commenced) and Akay; and I note also that the Tribunal is a fit place for the assessment of tort (and thus personal injury) damages as is confirmed by its specific statutory jurisdiction to do so in discrimination claims – see section 119 of the 2010 Act), have advanced the personal injury claim in the Tribunal Claim. It would thus also have been open to the claimant not only to have done that but to have resolved all other issues in the Tribunal Claim by a compromise whilst leaving the personal injury claim to be pursued in the Tribunal. Thus, there could have been just one set of proceedings and I can see (especially in the light of the matters which I go through below) any special reason why the personal injury claim was not or could not have been included in the Tribunal Claim
(2) the factual basis of the Tribunal Claim had little overlap with the factual basis of the Civil Claim; while both related to the employment and to how the defendant had not adjusted matters to protect the claimant from adverse consequences regarding his condition, the only specific matter of complaint which appeared in both proceedings was with regard to the comparative siting of the claimant's chair and a drinks machine, and the vast majority of the complaints which are said in the Civil Claim to amount to wrongful and actionable harassment of the claimant by V did not appear in the Tribunal Particulars of Claim. That is correct, but it is also clear that the personal injury claim matters both arose from the employment and could have been raised in the Tribunal Claim. The Henderson principle itself in its original form (i.e. where the first set of proceedings have been resolved substantively rather than dealt with by way of compromise and stay/withdrawal) applies to claims which could have been but were not raised in the first set of proceedings and the various abuse of process cases all use that language when describing the extent of the abuse jurisdiction and which reflects the Latin maxims which I have set out above. Thus, while this could be said to be a point in the claimant's favour, it is of little weight and I disregard it as such (although it flows into the some of the following points)
(3) the compromise and resolution of the Tribunal Claim took place at a very early stage within it and before any substantial judicial (or, it would seem likely, party) expense of time or cost upon it had occurred. That goes (at least) some way towards balancing against the previous point as the fact that the Tribunal Claim was brought and then compromised seems (especially in the circumstances of the Tribunal Settlement Agreement and its clause 7) to have made very little difference to the practical process of pursuing the personal injury claim and there is no suggestion that any particular waste or prejudice has been caused to either the defendant or the tribunal/court system as a result
(4) the 2010 Act claim, being one for discrimination in employment, could only have been brought in the Tribunal and not in the court. This is common-ground, and flows from the provisions of section 117 and 120 of the 2010 Act. Thus, if the defendant is correct (i.e. it is an abuse to bring cases in both the Tribunal and the Court), the claimant could only go to court in relation to the personal injury claim if the claimant was prepared to abandon the 2010 Act claim. At first sight, this seems contrary to Article 6, and especially where claims in the Tribunal are subject to various provisions (in particular in relation to limits on recovery of legal costs) which could be highly prejudicial (although also some perhaps beneficial) to a claimant. On the other hand, an argument to the effect that this would justify bringing proceedings in both jurisdictions was rejected expressly in Sheriff (see paragraph 27 of that judgment) and that is binding upon me and so it seems to me that I should not regard this as being a matter in any way in the claimant's favour
(5) the claimant's evidence is that DAS would only deal with the employment (including discrimination) claims and not the personal injury claim which had to be dealt with by separate solicitors and where NWS (at least) would not deal with the employment aspect (at least in a way desired by the claimant, and although I suspect, in view of the involvement of DAS, that there was some insurance point I have no evidence as to this and cannot proceed on that basis). While I accept that evidence, which is not controverted, it seems to me that (a) this is no concern of and should not prejudice the defendant and (b) is in any event something which the reasoning in paragraphs 26 and 27 of the Sheriff judgment again requires me to disregard.
(6) there had been no strike-out or contumelious (or, indeed, any) non-compliance in the Tribunal Claim and, in particular, none regarding the personal injury claim or any related issue. This is not a situation where what had happened in the Tribunal Claim had given rise to any procedural (or substantive) bar to the bringing or the pursuit of the personal injury claim. thus nothing to prevent the personal injury claim being advanced. That not only is a major point of distinction between this case and Akay but also raises the question as to why a discontinuance and withdrawal of other claims should result in a bar against proceeding with the personal injury claim (although I do also bear in mind that the effect of Rule 52 is that the withdrawal does expressly bar (absent an exceptive order being made) the further pursuit of the withdrawn claims which is a different, and more dispositive, effect than that provided for by CPR38.7 in relation to Civil Claims withdrawn prior to service of a defence (but where the law of abuse of process remains in point – see White Book notes 38.7.1 and cases there cited)
(7) the Tribunal Settlement Agreement by clause 7 expressly provided that the claimant was not prevented from pursuing the personal injury claim (and which must be taken, in the light of the withdrawal of the Tribunal Claim, to be by way of Civil Claim). On the basis of my previous conclusions as to the construction of that clause 7 and the surrounding negotiations, the situation was one where the parties were agreeing that the Civil Claim would be able to proceed to a substantive resolution, and where the agreement was very different from that in Akay. However, I also should consider the position which would ensue if those previous conclusions were wrong and all the parties were agreeing was (as in Akay) that the mere fact of the compromise would not bar the personal injury claim but that all other possible procedural arguments, including in particular abuse of process, would remain live and in issue. Nevertheless, even on that basis the existence of the clause 7, and the surrounding circumstances including the preceding letter, made clear both that the defendant knew about the intended personal injury claim (i.e. that claim which was not being compromised) and was not intending to compromise it (or being misled as to what were the claimant's intentions to pursue it), and where the defendant could have chosen to insist that the personal injury claim formed part of the compromise
(8) there could be some form of overlap of damages between the compromised claims and the personal injury claims. This, if anything, is a factor pointing to abuse but in my judgment is negated by the existence of clause 7 of the Tribunal Settlement Agreement which must (by excluding the personal injury claim from the compromise) contemplate the court having to grapple with the possibility of overlap and as occurs in many situations where one claim is compromised on the basis that the compromise is only partial and others may proceed.
(1) I agree with HHJ Hand in Manda that each case fell to be decided on its own facts and that the case-law is relevant with regard to setting out matters of principle rather than for what happened in any individual case (and which is only persuasive at most in any event)
(2) The fact that the Court of Appeal did not suggest any "abuse of process" in Sviratsa, even on somewhat analogous facts, is of little weight in view of the fact that the point did not seem to be argued and there were apparently jurisdictional issues in bringing that personal injury claim in the Tribunal
(3) The conclusion in Dattani that it was not an abuse to compromise only the claim which had been brought in the Tribunal and then to bring a different claim by way of Civil Claim seems inconsistent with what seems to be the contrary conclusion in Sheriff. However, both cases pre-date Johnson v Gore Wood and Virgin Atlantic and, in all these circumstances, I do not think that either amounts to binding authority either way on that general point but rather the "broad merits based judgment" approach is now to be applied without such restriction
(4) Akay:
(A) is distinguishable and should be distinguished from this case on two separate (but also cumulative) bases, being:
(i) it is a case where there was already a free-standing procedural defence (or rather right of response) to the relevant personal injury claim being that the relevant claimant has been barred by reason of a contumelious disregard of a judicial (there Tribunal) order from bringing the personal injury claim.. In those circumstances, the primary relevant abuse of process was that developed in the Securum Finance line of authorities, being that absent special circumstances the personal injury claim could no longer be advanced in any jurisdiction. In my judgment, HHJ Gargan decided Akay at first instance on that basis and Lavender J decided that HHJ Gargan was correct and justified in doing so, and neither judge proceeded on any other basis. Since the Civil Claim in that case was brought in a different jurisdiction from the strike-out order, the Henderson principle had to be invoked but what rendered that Civil Claim an abuse was the fact of the previous strike-out arising from a contumelious non-compliance with an order. It is, in fact, difficult to see how the result could have been otherwise as such would have involved an way round the consequence of such a strike-out (i.e. unless a relief from sanction is granted then the sanction i.e. the inability to raise and pursue the claim, should continue to apply), and, further
(ii) the fact that the provisions of that compromise agreement (a) only applied to ensure that the compromise agreement "itself" did not bar the personal injury claim while all other existing bars would continue to exist and could be relied upon and (b) this was due to such a "bar" already existing (i.e. apart from and before the entry into the compromise agreement) due to the strike-out (and which "bar" it was held that the defendant would have not been likely to have wished to give up and which thus supported the conclusion that the wording and effect of the compromise agreement and its exception were so limited)
(B) in relation to this case: the situation in point (A)(i) simply does not apply here, there was no strike-out or similar, but it was crucial to the decisions in Akay; the situation in point (A)(ii) does not apply if my previous conclusions are right as the clause 7 of the Tribunal Settlement Agreement was different from the provision in Akay, but, if they are wrong, then in the absence of the strike-out the reasoning regarding the compromise in Akay is, at best, neutral with regard to this case
(C) I do not, in the light of the reasoning in Akay, see it as being any authority for a general proposition that bringing and then compromising, with a withdrawal of, a Tribunal Claim but with an exception for a particular claim, is an abuse of process. Akay very much depends on the existence of the particular strike-out in that case
(5) Manda is at most persuasive but, like Akay, has the feature of a preceding strike-out (at least in part) of a relevant claim, and also has the feature of the subsequent unilateral (i.e. not in the context of a compromise and in particular not a compromise with an exception) withdrawal. The decision in Manda is also "tainted" (in terms of its persuasiveness) by its application of Rule 52 as giving rise to a dismissal which should be treated as being dispositive in law (and which conclusion was practically overruled in Sviratsa).
31.8.2021
