Appeal No. UKEAT/0542/06/MAA

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 22 March 2007

Before
THE HONOURABLE MR JUSTICE UNDERHILL
MR P GAMMON MBE
MR P R A JACQUES CBE

MR R WIGGAN	APPELLANT

R N WOOLER AND COMPANY LIMITED	RESPONDENTS

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For the Appellant	MR JOEL DONOVAN
(Of Counsel)
On behalf of the Appellant	
For the Respondents	MR DAN NORTHALL
(Of Counsel)
Instructed by:
Messrs Milners
Solicitors
Crown House 
Great George Street
Leeds
LS1 3BR	

SUMMARY

PRACTICE AND PROCEDURE

Striking-out/dismissal 

No case to answer

Tribunal erred in acceding to application to strike out at close of Claimant’s evidence – the restrictive attitude to ‘no case to answer’ applications endorsed by the Court of Appeal in Logan [2007] ICR 1 applies equally to strike-out applications under the 2004 Rules made in similar circumstances.

THE HONOURABLE MR JUSTICE UNDERHILL

1.	This appeal concerns the vexed question of whether and in what circumstances it is right for an Employment Tribunal to dismiss a case at half time.

2.	The detailed facts are not important for the purpose of the appeal, and we can summarise them briefly.  The Appellant was employed by the Respondents, who are a family firm of building contractors.  On 1 October 2005 he wrote to the Respondents giving one week’s notice of resignation in response to various incidents which he said had occurred over the previous few weeks.  He brought proceedings for unfair dismissal and also made various other claims with which we need not be concerned for present purposes.  The essence of his case was that he was the victim of a campaign of victimisation as a result of one of the members of the family disapproving of his proposed sale of his house to one of the other members.  The case came on for hearing before a Tribunal in Leeds on 21 April 2006.  The Appellant gave his evidence in the morning.  In the afternoon, once his case had been concluded and before the start of the Respondents’ case, the Respondents’ Counsel, Mr Northall, who also appears before us, applied under rule 18(7)(b) of the Employment Tribunal Rules of Procedure 2004 for the claim to be struck out on the basis that it had no reasonable prospect of success.  The Tribunal heard no submissions as to the appropriateness of this course and was not referred to the various authorities which we will shortly be considering; but it did hear submissions from Mr Northall on the substantive issue of the Appellant’s prospect of success and from the Appellant’s wife on his behalf.  It accepted that the unfair dismissal claim had no reasonable prospect of success, and it was duly dismissed.  The Tribunal subsequently gave its reasons in a written judgment dated 21 April 2006.

3.	As we have said, the issue raised by the appeal, namely whether the Tribunal was entitled to dismiss the case at half time in the way that it did, has been the subject of a fair amount of authority, and we have had helpful submissions from Mr Northall and from Mr Joel Donovan for the Appellant.  The previous authorities are essentially concerned with the dismissal of a claimant’s case on the basis that his evidence has shown no case to answer.  The effect of those authorities was helpfully summarised in the judgment of Judge Clark in Clark v Watford Borough Council, EAT/43/99, at paragraph 19, in the following terms:

“(1)	There is no inflexible rule of law and practice that a tribunal must always hear both sides, although that should normally be done. Ridley v GEC Machines Ltd [1977] 13 ITR 195 (Phillips J), a case of constructive dismissal.
(2)	The power to stop a case at “half-time” must be exercised with caution. Coral Squash Clubs v Matthews [1979] ICR 607, 611H (Slynn J).
(3)	It may be a complete waste of time to call upon the other party to give evidence in a hopeless case. Ridley 197B-C.
(4)	Even where the onus of proof lies on the applicant, as in discrimination cases, it will only be in exceptional or frivolous cases that it would be right to take such a course. Oxford v Department of Health and Social Security [1977] ICR 884, 887 A-B (Phillips J). Owen & Briggs v James [1981] ICR 377 (Slynn J). British Gas PLC v Sharma [1991] IRLR 101, 106 (Wood J).
(5)	Where there is no burden of proof, as under s.98(4) of the Employment Rights Act 1996, it will be difficult to envisage arguable cases where it is appropriate to terminate the proceedings at the end of the first party’s case, as I said in Hackney LBC v Usher [1997] ICR 705, 713C.”

That summary was expressly approved by Ward LJ in the Court of Appeal in Logan v Commissioners of Customs and Excise [2004] IRLR 63: see paragraph 18.  Ward LJ spelt out at paragraph 19 that Judge Clark’s point (4)

“… applies not only in discrimination cases, but in cases like this of constructive dismissal”.

4.	Ward LJ also said this, at paragraph 20:

“Mr Stilitz advances a further submission.  Since the matter was before the employment tribunal, the Employment Tribunals (Constitutions Rules of Procedure) Regulations 2001 came into force on 18 April 2001 which, pursuant to reg 10, introduced the overriding objective into the practice of the employment tribunal.  This opens the way, submits Mr Stilitz, to a more robust stance being taken in the interest of saving expense in dealing with cases expeditiously and fairly. He submits that respondents ought not to have endure days of hearing at their own expense if the case has no realistic prospect of success.  The question does not truly arise before us because we are considering the exercise of discretion by the employment tribunal before the new rules are binding upon them.  Nonetheless I would urge some caution.  In paragraph 12 of his judgment in Miller (t/a Waterloo Plant) v Cawley [2002] EWCA Civ 1100, Mance LJ was careful to distinguish between the submission of no case to answer and an application for summary judgment.  In paragraph 13 he said:
‘… considerable caution is necessary before a judge entertains such a submission [of no case to answer] or undertakes such determination without requiring an election [by the defendant not to call evidence].  The trial is now in progress, and although the test (no real prospect) differs from that applicable after hearing all possible evidence (balance of probability) caution is dictated … The submission interrupts the ordinary trial process, and it is not desirable that, during that process the judge of fact should be put in a position where he may find himself having to express first an initial view on the basis of taking the claimant’s evidence alone and then (if he allows the claim to proceed) a further final view after taking into account further evidence, even though he does so by reference to different tests.’”

That passage is strictly obiter but it gives a fairly clear indication, after argument, that the introduction of the 2001 Rules and the change of philosophy which they were intending to bring in cannot be taken as undermining the very cautious approach to submissions of no case to answer enjoined by the previous case law.  We respectfully agree.  The considerations underlying the previous approach remain applicable in the new climate.  We will not attempt an exhaustive statement of those considerations, which are reviewed in several of the cases referred to by Judge Clark.  But they include:

(a)	the fact that even in a case where the burden of proof is on the claimant it may well be legitimate for him to expect to be able to extract useful evidence from the defendant’s witnesses;

(b)	the importance of the claimant feeling that the tribunal has heard the entirety of the story before reaching a conclusion - this may be a matter of perception, but it is important to the appearance of justice;

(c)	the point made by Mance LJ in the passage from his judgment in Miller quoted by Ward LJ in Logan; and 

(d)	the danger that a half-time strike-out will prove a false economy, both because it will take up time which could more profitably have been devoted to hearing the defendant’s evidence and because of the risk that it will simply encourage an appeal.  

All those points seem to us to remain good points under the post-2001 regime just as much as under the pre-2001 regime.  Indeed, their force is if anything increased because of the greater availability under the new regime of other procedures for weeding out hopeless claims before they get to a hearing.

5.	Of course the applicable rules now are not the 2001 but the 2004 Rules, which introduced further changes intended to promote active and effective case management on the part of Tribunals, including the discouragement of unmeritorious cases.  The introduction of these rules raises one particular point which we consider in paragraph 6 below; but, subject to that, we believe that the approach set out by Judge Clark and approved in Logan should remain the correct approach for tribunals considering whether to dismiss a case on the basis of no case to answer or otherwise at half time.  We do however make the point, as did Judge Clark, that “hardly ever” is not the same as “never”.  There will still be some cases where a submission of no case can properly be entertained and should succeed; and in the modern climate tribunals should remain fully prepared to consider such a course provided they are really convinced that it will further the overriding objective notwithstanding the considerations which we have identified.

6.	On that basis the issue for us would appear to be whether this case was – or, perhaps more accurately, was reasonably judged by the Tribunal to be - one which fell into Judge Clark’s exceptional category 4.  However, Mr Northall submits that none of the jurisprudence which we have so far been considering has any reference to the application which he made, and which the Tribunal accepted, in this case because that was not a submission of no case to answer but was, rather, an application to strike out under rule 18(7)(b).  He points out that this is an entirely separate power, newly introduced in 2004, and that the rules make clear that it can be properly exercised at any “hearing”, which includes a final hearing (see rule 26).  He submits that the exercise of that power should not be trammelled by any of the old case law.  We do not agree.  No doubt in principle the power to strike out under rule 18(7)(b) is available at a final hearing, and indeed at any stage in that hearing including at the close of the claimant’s case.  But the substantive reasons which we have tried to enumerate above as to why it is normally a bad idea to seek to dismiss the case at half time are equally applicable whether the power being exercised is a power to dismiss on the basis of no case to answer or a power to strike out on the basis that there is no reasonable prospect of success.  The difference of label makes no difference to the substantive question.
 
7.	We return therefore to the question of whether the present case was sufficiently exceptional to justify departure from the normal practice.  We cannot see that it was.  We need not attempt an elaborate analysis of the issues and the evidence: indeed it is desirable that we should not do so, so as not to prejudice the re-hearing.  It is sufficient to say that this is a case where it could not safely be said that nothing useful or relevant to the Claimant’s case could have been extracted from the Respondents’ witnesses, and where, given the nature of the allegations against the Respondents, it might have been thought particularly important for the Claimant to have the chance to cross-examine and for the Tribunal to have had the whole picture presented to it.  

8.	We must accordingly allow the appeal and remit the case for re-hearing by a fresh Tribunal.  It should be clearly understood that we are expressing no views about the ultimate strength of the Appellant’s case.  The Tribunal was plainly unimpressed by it for reasons which may well turn out to be cogent.  If the claim is reheard and if the Respondents are again successful, this time after a full hearing, they may understandably feel aggrieved; but that consideration has to come second to the Appellant being afforded the opportunity of a fair hearing.  Short cuts sometimes make for long delays.