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	United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Evans v Prudential Assurance Company Ltd [1997] UKEAT 1334_96_0702 (7 February 1997) URL: http://www.bailii.org/uk/cases/UKEAT/1997/1334_96_0702.html Cite as: [1997] UKEAT 1334_96_0702, [1997] UKEAT 1334_96_702

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APPEARANCES

 

For the Appellant	MR S CORDLE (Financial Adviser)


 


MR JUSTICE MORISON (PRESIDENT): This is a hearing to determine whether there is an arguable point of law in an appeal against a decision of an Industrial Tribunal held at Sheffield. By that decision the Applicant's complaint of unfair dismissal was dismissed. The decision of the Tribunal was sent to the parties on 24 October 1996, and had followed two days of evidence and a third day of consideration by the Tribunal.

The brief facts giving rise to the complaint may be set out as follows. The complainant, Mr Evans, had been employed by the Respondents, Prudential Assurance Co Ltd, from 27 June 1983 until he was dismissed as from 3 December 1995, that is a period of some 12½ years of service, during which, subject to the points which I am about to refer to, was an exemplary period of service with a good work record.

As a result of information which became available to the Prudential they became aware of a substantial amount of switching of business occurring through the Sheffield branch, where Mr Evans worked. The whole branch came under investigation as a result of the company's own Compliance Unit deciding that the matter needed to be looked into. The investigation occurred over a substantial period of time and involved a large number of the Prudential's customers being seen and interviewed.

In relation to Mr Evans, an investigation showed according to the employers, that some seven clients had switched their investments from Prufund to Prudential Savings Account and that investigation also revealed, in the employer's judgment, that the high standards which are set by the SIB had not been met in certain instances. Mr Evans was a licensed adviser and, as such, owed duties not just to his employer, but to the SIB by whom he was licensed, to conduct his business in accordance with the proper regulations laid down and to a high standard. Clients who are persuaded to switch their investments are entitled to be told, in terms, what charges are going to be levied on their funds as a result of the switch, because there is a risk that the clients are persuaded to switch their investment, not for their benefit, but for the benefit for the company which is so advising them.

The allegations relating to Mr Evans were that specific elderly, small investor clients had been targeted by the branch and visited by branch members, including Mr Evans; that although the clients were told that there would be charges involved, they were not given sufficient specific information by Mr Evans as to what those were to be and when he completed their personal financial reviews or PFRs, they did not set out in proper detail the advice which had been given to the individual clients, but rather the PFRs contained what appeared to be pro forma words showing a pattern, which was inconsistent with the objective of the requirements of the SIB that each individual client should be given individual best advice.

Following their investigation and their belief that those matters had occurred, the concerns were canvassed at a disciplinary hearing conducted before a Mr Nelson on 2 November 1996, when the Applicant was represented by Mr Cordle who represented him at the Industrial Tribunal and has argued, with capability, his prospective appeal in this case.

The Tribunal found that the notes of the disciplinary interview indicated that Mr Evans had an opportunity to fully answer everything, and that they recorded his replies. On the basis of the investigation and that disciplinary interview, the Tribunal was clear, and I quote, "that Mr Nelson was entitled to come to the conclusion that he did that Mr Evans had been fraudulently selling insurance". There was an appeal hearing where the Tribunal were satisfied that again the matters were gone into fully by the employers. The Tribunal refer to the fact that Mr Cordle himself had reinvestigated one of the clients who had been persuaded to switch his investments and he contended that, as a result of his personal investigation, it would have been unfair for the employers to have concluded that Mr Evans had been guilty of fraudulently selling insurance.

At paragraph 3(g) they say this:

"In all such cases the employer has a choice either to believe or not to believe an employee, to take into account some evidence to discount other evidence and to come to a view at the end on the balance of probabilities. It is not required of the employer to come to a view as in a criminal proceedings that an offence has been committed beyond reasonable doubt. In this case there was ample evidence to conclude that Mr Evans had committed the offences which are referred to by Mr Nelson in the notes of the disciplinary hearing and in the letter confirming the dismissal."

The purpose of this hearing, as we have indicated, is to see whether there is an arguable point of law in the prospective appeal against that decision. There are four grounds put forward by Mr Cordle. The first was that the Tribunal misunderstood the facts. We have to say that we do not accept that the Tribunal misunderstood the facts. Their decision seems to us to demonstrate a clear awareness of the standards to be expected of a licensed adviser such as Mr Evans, and a recognition of the issues which confronted the employer. It is said that had the Industrial Tribunal granted the request for a witness order against the head of the Compliance Unit, which stamped and approved the PFRs in question, then the decision which they arrived at in paragraph 3(d)(iv) would not have been made.

It seems to us, having looked at the correspondence passing between the parties and the Tribunal prior to the hearing, the Tribunal cannot be criticised for the way they dealt with the matter in terms of the witness order and requests for discovery and further particulars. It seems to us that the fact that the Compliance Unit had stamped and approved the financial reviews, does not take away the sting of the finding in paragraph 3(d)(iv) which is that it appeared that, even if the Manager had instructed it, Mr Evans was putting in a pro forma PFR whenever a switch had been made, which would be contrary to the requirements of the Regulatory Authorities that each client should be given separate and specific and particular advice. The fact that the Manager, if this be a fact, had advised him that the form should be filled in in that manner, and the fact that the form had thereafter been stamped by the Compliance Unit, does not seem to us to negate the alleged breach of duty upon which the employers relied in this case. As a licensed adviser Mr Evans was under a personal responsibility, both to his employers and to the Regulatory Authority, by whom he was licensed, to honour best practice conditions.

The second submission that is made to us is that proof was given at the Tribunal that Mr Nelson did know of certain matters at the time of the interviews, through his experience of hearing other disciplinary cases at the Branch. Reference was made to Devis v Atkins. But with respect to Mr Cordle, whilst we fully understand that decision, the point that is really being made, we think in this case, is that a complaint is made that at the disciplinary hearing itself, matters which Mr Nelson knew about and was holding against Mr Evans, had not been put to him during the disciplinary interview. It seems to us that the Industrial Tribunal considered the question of the fairness of the disciplinary hearing and whether Mr Evans knew properly what was being alleged against him; and in those circumstances we reject this ground of appeal.

We also reject the complaint, which is part of this ground of appeal, that one of the issues was the non-availability in the branch, of the branch Compliance Manual. The Industrial Tribunal may have fallen into error in paragraph 3(h) of their decision when they said that the absence of this manual from the branch, or Mr Evans' ignorance of its existence, was not a matter which he had previously raised before. In the light of Mr Cordle's submission to us, it would look as though, in the letter which Mr Evans lodged asking for an appeal, he specifically denied that he had had access to any such manual. We do not regard that point as being of sufficient weight, having regard to the other matters which they found to justify a full hearing of an appeal, although we do consider that there may have been an error of fact in the Tribunal's decision. It was not a material error.

The third point relates to the fact that a report Mr Nelson had used that neither Mr Evans nor his representative had ever seen, nor even discussed either before or during the interview, was ruled as legitimate evidence of dishonesty. It was the only evidence produced at the Tribunal of dishonesty. We reject that complaint. It seems to us that the Industrial Tribunal have properly directed their attention to the matters which were canvassed at the disciplinary hearings.

The next ground gives us some concern. The submission is made in stark terms (if I could say that) namely, that the conduct at the hearing was "appalling". Mr Cordle is not legally qualified, but that does not prevent him from being in a position to judge whether the hearing, which his client is receiving, is fair or not. Indeed, he has represented other clients from the Sheffield branch and is able to compare his experience at other Industrial Tribunals with what occurred on this occasion. In effect, what he is saying is that the Tribunal became somewhat blinkered and looked at the material which the employers had available to them and on which they apparently relied, and asked themselves the question simply whether that was material on which the employers were entitled to rely, rather than going into the facts in any detail. And secondly, he criticises the Tribunal for the way they approached the case generally in terms of not asking him whether witness orders or any other orders should be made, particularly bearing in mind the requests that had been made prior to the hearing and the Tribunal's indication that requests could be repeated at the hearing if so wished.

It seems to us that it is unfortunate that whenever a party has left a Tribunal having lost a case he is of the view that he has not had a fair hearing. Having said that, it does seem to us that the Industrial Tribunal in this case cannot be criticised for not inviting Mr Cordle to renew any application that he had previously made. I hope it will not sound over-harsh if I say that it was for Mr Cordle himself to invite the Tribunal to make any such orders, if he had wished to repeat them on that occasion. Sometimes the manner and demeanour of Industrial Tribunals is not fully understood. Tribunals are comprised of different people who have different personal characteristics.

In so far as this Tribunal was concerned, with what material was before Mr Nelson at the time when he took the decision to dismiss, we believe that the Tribunal were justified in law in taking the view they did; rather than seeking any wider investigation of the truth or otherwise of the allegations which were being made, although that does mean that the finding that was made in this case should be properly understood, namely that it was the employer's belief, based on the information that they had, that Mr Evans had indulged in fraudulent selling of insurance. That is not the same thing as a finding that he had, in fact, been so guilty. It seems to us that we cannot say that the Tribunal has misconducted itself in this case.

The fourth point relates to what was said in the Industrial Tribunal decision at paragraph 3(g) which I have read. Again, if I might respectfully say so, this is a misunderstanding of what the Tribunal are saying. The employers are entitled to discount material, which is presented to them at a disciplinary hearing, if they reasonably think that it should be discounted in the sense of not given any weight. That is what an employer is entitled to do. The Tribunal in paragraph 3(g) are simply describing the task which they were confronted with which distinguishes the decision of an employer, as to their belief, from a position where they are having to adjudicate as to whether their belief was correct as a matter of fact or not.

Accordingly, we are not persuaded that there is a point of law which is arguable, or sufficiently arguable for the full hearing of this Court and we shall dismiss it, but would like to thank Mr Cordle for his assistance.