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	United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Abbey v Associated Foreign Exchange Ltd & Anor [2009] UKEAT 1518_08_1303 (13 March 2009) URL: http://www.bailii.org/uk/cases/UKEAT/2009/1518_08_1303.html Cite as: [2009] UKEAT 1518_8_1303, [2009] UKEAT 1518_08_1303

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APPEARANCES

 

For the Appellant

MR O OGUNNAIKE (Solicitor) Messrs Leicester Williams Solicitors Craven House 121 Kingsway Holborn London WC2B 6PA


 


SUMMARY

JURISDICTIONAL POINTS: Claim in time and effective date of termination

A contract of employment provided for notice in writing. The Employment Judge did not err when he found the effective date of termination for Employment Rights Act 1996 s 111 was on the day oral communication of dismissal was given and received. Statement of the law in Harvey approved.

HIS HONOUR JUDGE McMULLEN QC

Introduction

1. This case is about the effective date of termination under section 97(1)(b) of the Employment Rights Act 1996. I will refer to the parties as the Claimant and the Respondent. It is an appeal by the Claimant in those proceedings against the judgment of Employment Judge Russell sitting alone at London (Central) with reasons given on 15 October 2008. The Claimant as today was represented by Mr Ogunnaike, a solicitor, and the Respondent by Counsel.
2. The preliminary issue was the effective date of termination of the Claimant's employment and the contenders were 29 January 2008 and some later date. The issue arose because the claim based upon a dismissal on 29 January had to have been presented on 28 April 2008 or before: see Employment Rights Act 1996 section 111. It was presented on 7 May 2008.
3. Section 111 gives a further extension where it is not reasonably practicable to comply but the Claimant was at relevant times in the hands of solicitors and no point is taken. The essential question therefore was to determine what occurred to bring about the effective termination. The judge found that it occurred orally on 29 January 2008.

The appeal

4. The Claimant appeals. In Haritaki v South East England Development Agency EATPA/0006/08/DA, paragraphs 1 to 13, I set out my approach to Rule 3 which should be read with this Judgment. The sift in this case was conducted by HHJ Peter Clark who formed the following opinion:

"The Employment Judge found as fact (Reasons paragraph 9), based on the oral evidence which he heard, that the Appellant was summarily dismissed on 29 January 2008 with pay in lieu of notice. Even if the Respondents were in breach of clause 10 of the contract that would not alter the Effective Date of Termination on the Judge's finding. Appeals to the EAT are limited to points of law. None arises on the facts of this case."

The facts

5. The Employment Judge made the following findings:

"8 The Claimant was employed under a contract of employment which he signed on 14 March 2006. I find this was a binding contract of employment between the parties which provided for him to get one month's written notice in the event of the termination of his contract under clause 10.1 of his contract. There was also a right for the employer to make a payment in lieu of notice under clause 10.4 of the contract and there was a reference to a probationary period of three months under clause 2.2 which was particularly relevant in respect of remuneration, as under clause 4.1 the Claimant's basic salary of £25,000 was to increase to £32,000 'after successful completion of the probationary period'. Whilst this issue is before the civil courts, I have heard evidence as to the review meeting in June 2006 from the Respondent who suggested that the probationary period had not been successfully completed although this seems to be at odds with the wording of clause 10.1 where he is entitled to one month's written notice 'after the successful completion of the probationary period' (and this is the notice that the Respondent says that he was given). Clearly, he was employed after the initial three months for just less than or slightly more than two years, depending on the effective date of termination of the contract.

9 In any event, I find that there was a clear dismissal on 29 January 2008, being a verbal dismissal by Mr Holmes. It was understood by both Respondents, as is clear from the documentary evidence and from their oral evidence today and also by the Claimant, that this was a dismissal. It was accepted as such by the Claimant who was getting advice at this time from his solicitors. The date on the P45, although this is not determinative, also reflects the effective date of termination as being the end of January 2008 (although it refers to 31 January rather than 29 January); and I make a clear finding that, however unfair the conversation with the Claimant on 29 January, it was clear that it was communicated to him that he was being dismissed with immediate effect. I accept the Claimant was confused by the logistics including the fact that the Australia job option was perhaps still available and the delay in getting a written confirmation of the dismissal, which is inexcusable, but I also accept that the possibility of reopening the Australian job option was and is a separate matter from the employment with the Respondent and accept the delay in sending off the letter of dismissal was an oversight.

10 I make no finding as to when the P45 and (perhaps separate from the P45) the dismissal letter was received by the Claimant, but it is clear that the P45 was received by him in due course as was the letter dated 10 February 2008, being the dismissal letter from the Respondent, and this confirmed the dismissal of 29 January 2008 (albeit it confusingly also referred to 31 January, presumably as a convenient date being the month end). I find that the Respondent belatedly made a payment in lieu of notice. This was not paid as expected as the Claimant only got a late notification that the Respondent was relying upon clause 10.4 of the contract of employment and the payment was not made until the end of February through payroll, but it was paid. It is accepted that the Respondent's intention was to end the contract on 29 January 2008 and pay him for the notice that he was not going to work.

11 The Claimant had had legal advice by the dismissal date and subsequently, and indeed I accept, his solicitors had sent a draft of the Claimant's proposed claim to the Respondent's solicitors on 10 April 2008. Clearly, the unfair dismissal claim could have been presented in time but, based on the effective date of termination of 29 January, was out of time when lodged on 7 May 2008 because it should have been presented on or before 28 April 2008. The Claimant relied on solicitors' advice in this respect but had no other reason for the delay other than confusion as to his employment status and that they wished to try and settle matters before going to the Employment Tribunal. I accept the Respondent's evidence that the meetings on 31 January were by way of an exit interview and that the calls from the Respondent to the Claimant leading up to that were not to review the actual dismissal that had happened on 29 January. The Australian position may still have been a live one, but the meeting was to remind the employee of his restrictive covenant though, in view of the Respondent's interpretation of the contract of employment and lack of any procedure in leading up to the Claimant's dismissal, it seems somewhat ironic to call the Claimant in to discuss post-termination obligations under his contract of employment."

Submissions and conclusions

6. In my judgment the Claimant's submissions based upon a contractual approach are incorrect. It is submitted that the approach to this statutory construct is regulated by authorities deciding issues of contract. For example, in BMK Limited v Logue [1993] ICR 601 Knox J and Members dealing with the predecessor of this section said this:

"Whether the termination had taken effect in each case does not, in our view, turn on whether the applicant understood that that was what had happened. It turns, in our view, on what their legal relationship actually was on 17 March 1992 and, if one has the effective removal of directorship and thereby of chairmanship, it seems to us that that inevitably involves the effective termination of a contractual relationship that consisted of an appointment to the post of chairman and chief executive, if one applies what Winn L.J. said in  Marriott v. Oxford and District Co-operative Society Ltd. (No. 2)  [1970] 1 Q.B. 186, 193, which was quoted by Browne-Wilkinson J. in  Robert Cort & Son Ltd. v. Charman  [1981] I.C.R. 816, 821: the contracts were then so broken that no further full performance of their terms would occur.

It does not, in our view, necessarily follow that this will by any means always be the case in constructive dismissal cases.

We can well imagine that there might be circumstances where there was what amounted, at the end of the day, to a repudiatory breach on one side or the other which did not when analysed bring about the termination, effectively, of the relationship of employer and employee. We are therefore not seeking to lay down a hard and fast rule applicable across the spectrum of all constructive dismissal cases, but in this constructive dismissal case it does seem to us that, on the facts as found by the industrial tribunal, there is only one tenable interpretation as a matter of law and that is that the termination of these two contracts had taken effect on or before 17 March 1992.

7. That of course is a case which is not directly on the issue which is before me. In West v Kneels Ltd [1987] ICR 146 Popplerell P and Members came to this conclusion dealing with effective date of termination:

"We necessarily limit this decision to oral termination. We have not heard argument about the consequences of a written letter of dismissal and the problems that will arise as to the proper date to be considered, and we reserve that matter for argument on another occasion, if and when it arises. Accordingly, we are satisfied that the employee does have the qualifying employment and is entitled to bring her claim."

8. Mr Ogunnaike seeks to support his argument that the contract could only be terminated in writing and thus the effective date of termination did not occur until writing was produced. Reference is made to Latchford Premier Cinemas Ltd v Ennion [1931] 2 Ch 409 where Bennett J said this:

"In my judgment the answer based on article 34 is not a good one. I see no reason in law why the contract of service between the company and its directors should not be terminated by the same means as that by which the contract of service between two individuals may be terminated, and I see no ground in law for saying that where a written contract has been made for service which requires a written notice on either side before it can be terminated, it cannot be terminated by word of mouth by mutual agreement between the parties."

9. He also draws to Afro Shipping Co SA v Pergamon and Fui [1983] 1 WLR 195. The submission is that the judge was wrong to find that there was effective termination pursuant to the statute when due notice pursuant to the contract had not been given.
10. During the course of argument I showed Mr Ogunnaike the passage from Harvey on Industrial Relations and Employment Law which says the following at paragraph Q 721:

"If no notice of dismissal is given the date of termination of employment is immediate and any money in lieu of notice may be taken as compensation for immediate dismissal and does not continue the employment or delay the EDT (see British Building and Engineering Appliances Limited and Deadman [1973] IRLR 370 CA and a number of other authorities."

11. The authors go on:

"The EDT is a wholly statutory concept to be determined by applying the wording of subsection (1). It cannot be altered simply by agreement between the parties. Fitzgerald v University of Kent at Canterbury [2004] IRLR 3 000 … Extrinsic matters such as receipt of the P45 income tax form are not relevant even if in practice they are important.; Newham London Borough v Ward."

12. In my judgment the authors of Harvey are correct. The approach must be entirely focused upon the statute and it is for the Employment Judge to determine whether the terms of the statute have been met. Mr Ogunnaike accepted that his case was brought exclusively under Employment Rights Act 1996 section 97(1)(b). That is a case where no notice has been given. The date on which events happened was 29 January on the judge's finding.
13. What happened was regarded by the Respondent and the Claimant as a dismissal. Now, of course, they cannot agree that between themselves because what the judge must find was what actually happened. Those factors in the minds of the parties are obviously interesting to consider. However, in the light of the findings about what occurred the judge was entitled to find that what actually happened was a dismissal without notice. He made it clear that there would be contractual consequences for the failure to give notice and for the failure to give it in writing. But those are different from the statutory question under section 111(1).
14. I agree that the matter does not turn upon what the Claimant understood (see BMK). But that is not the driving fact in this case. It is what the judge found to have occurred by reason of the oral communication.
15. It also seems to me that since a party can terminate a contract without the other side knowing it by acting completely inconsistently with its terms that might also be of assistance (see my judgment in Atlantic Air Limited v Hof UKEAT/0602/07/ZT seeking to apply the judgment of the Court of Appeal in STC).
16. For those reasons I form my own conclusion which happens to run parallel to that of Judge Clark; this was a matter of fact for the judge to determine as to what actually occurred and from those findings of fact the legal relationship between the parties terminated upon that date.
17. Clearly the judge had a good deal of sympathy for the Claimant's position and it may well be that this matter will proceed in a different forum for the judge was not asked to find that there should be enlargement of time so as to validate the claim.
18. I thank Mr Ogunnaike for his very careful and well-researched arguments before me today, but the principles are clear in relation to this statutory construct which have been determined by the courts now for almost 40 years. The application is dismissed and no further action will be taken on the Notice of Appeal which is effectively dismissed on this date.