A1/01/2710
Neutral Citation Number: [2002] EWCA Civ 318
IN THE SUPREME COURT OF JUDICATURE                            
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL  

Royal Courts of Justice
                                    Strand
                                    London WC2

                          Monday, 25th February 2002
B e f o r e :

LORD JUSTICE SEDLEY

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STATUS SCIENTIFIC CONTROLS LIMITED
Applicant

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ROLAND OLIVER

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(Computer Aided Transcript of the Stenograph Notes
of Smith Bernal Reporting Limited
190 Fleet Street, London EC4A 2AG
Telephone No: 0207-421 4040
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Official Shorthand Writers to the Court)
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MR. C. SAMEK (instructed by Messrs Ashton Bond Gigg, Nottingham) appeared on behalf of the Applicant.

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J U D G M E N T
1.	LORD JUSTICE SEDLEY: This is a renewed application for permission to appeal made persuasively by Mr. Samek. The Employment Tribunal found in favour of Mr. Oliver on a preliminary issue, holding that he had been employed continuously by Mr. Samek's client, the present applicant company, in spite of the fact that he had for a significant period been working for an associated company run by the same man, Mr. Baxter, in the United States.
2.	On appeal to the Employment Appeal Tribunal against this decision, the case was dismissed as unsustainable on the Employment Appeal Tribunal's ex parte preliminary procedure. While Mr. Samek has taken on in his skeleton argument even more than he need in assuming that section 55 of the Access to Justice Act 1999 applies, this is not a second appeal within that provision. He does, however, realistically accept that he faces the equally daunting objection that this was a judgment of a unanimous tribunal specializing both on the ground and in legal terms in employment law, and unanimously upheld, without needing to call on the other side, by an equally high powered specialist appellate tribunal. On the other hand, Mr Samek is fully entitled to come before the court (and he would not be the first to do so) and show that there is at least an arguable case that the Tribunal below has made an error of law.
3.	Mr Samek's skeleton argument summarizes in a short paragraph the factual background:
“The main feature of the case was that the respondent, having previously worked in the United Kingdom for the appellant, in fact worked over the relevant period and was employed not in the UK but in the USA by an associated company of the appellant ... controlled by Mr Baxter (who also controlled the appellant).” 
4.	It can readily be seen that this, baldly stated, was an arrangement as consistent in principle with a secondment as it was with termination, with potential re-employment at the end. If that is so, then everything turned on context and detail, so long (and this is at the heart of Mr Samek's case) as these were approached within the correct framework of law. Mr. Samek has paid a handsome tribute, which I endorse, to the quality of the Employment Tribunal's decision. It is full on fact. It is accurate in its self direction on law. Where he submits that they have gone wrong is in applying the law to the facts.
5.	In essence, Mr. Samek's argument is that, while Mr. Oliver was working in the United States for Mr. Baxter's American company he was replaced in the United Kingdom, and his work in the United States was such that there was no effective possibility of his working during that time for the United Kingdom company. So it is argued that his post with the applicant company was both in law and in fact for the time being at an end. In that situation, says Mr. Samek, there was no continuing mutuality of obligation such as on first principles is essential for a contract of employment (see the classic decision of MacKenna J in Ready Mixed Concrete Limited v Minister of Pensions and National Insurance [1968] 2 QB 497). Mr. Samek has also relied upon the decision of this court in Clark v Oxfordshire Health Authority. The principle that Clark adopts is no different from the Ready Mixed Concrete principle but, like many other reported cases, is an illustration of working out in practice which side of the dividing line - contract of service or contract for services - a particular relationship falls. Mr Samek cites at paragraph 41 an illustration given by Sir Christopher Slade. It includes this passage:
“To take one obvious example, an obligation by one party to accept and do the work if offered, and an obligation on the other party to pay a retainer during such period as work was not offered, would, in my opinion, be likely to suffice.” 
6.	This is a classic example of the misuse of authority. All Sir Christopher Slade is giving is a single hypothetical instance of one of many situations in which a contract of employment could be found outside the usual factual framework.
7.	The relevant part of the Employment Tribunal's reasons is set out by the Employment Appeal Tribunal, presided over by Maurice Kay J, in a careful judgment which explains why, in the Employment Appeal Tribunal's view, there is no error of law in the Employment Tribunal's conclusion. There is no point in my reading it out in an application of this kind. It is sufficient to quote paragraph 8 of the decision:
“However, it is our judgment that on the entirety of the findings of fact in this case it was open to the Employment Tribunal to find a mutuality of obligations in the form in which they expressed it. We do not consider the contrary to be arguable. In our judgment the Employment Tribunal reached tenable conclusions as to the presumed intentions of parties and took into account facts which they were satisfied as having been established in such a way as to justify their conclusion.”
8.	If that was right (and I have to say that nothing that Mr. Samek has shown me has shaken my initial view that it was), then the decision of the Employment Tribunal can be left to speak for itself. The Employment Appeal Tribunal themselves quote this key paragraph of the Employment Tribunal's decision:
“We believe that, in the context of two companies that are so closely related as these, this is an artificial and unreal distinction. It is certainly one that it never crossed the mind of Mr Baxter at the time to seek to draw. If either he or Mr Oliver had been asked the question at the time, both would have assumed that Mr Baxter as substantial owner of both companies was entitled to control the activities of Mr Oliver for the benefit of them both. We direct ourselves in the light of the passage from Motorola Ltd v Davidson & Melville Craig that whatever may have been the precise legal analysis, the reality of control was present.”
9.	If I can paraphrase Mr Samek's attack, it is that the Employment Tribunal have gone the wrong way about it. They should not have set on one side the precise legal analysis and proceeded directly to the reality of control. They should, on the contrary, have made a precise legal analysis which would have shown that there was not a sufficient continuation of mutuality of obligation to sustain a contract of employment.
10.	The problem with Mr Samek's approach is that he takes the law as fixed and seeks to show that the situation in this particular case did not fit into any of the slots so far established by law. While I accept that you cannot ignore the law in deciding what the true relationship was, the right approach, in my judgment, is incontestably that which the Employment Tribunal took, namely to look at the reality on the ground and to ask what it amounts to both in fact and in law. Here it was manifest to them, and on their findings manifest to anybody else, that if Mr. Baxter decided to recall Mr Oliver from the United States at any point, he would have expected and been expected to come back. Equally, if the United States company had failed for some reason, both Mr. Baxter and Mr Oliver would have expected work to be waiting for Mr. Oliver back in England or, if it were not, some recognition that this represented a breach of obligation on the part of Mr. Baxter's English company. That is a simple reality on the basis of which the Employment Tribunal were amply justified in concluding that there was a continuing contract of service. The Employment Appeal Tribunal so found. I see no realistic hope whatever that in this situation this court would, if I gave permission to appeal, differ from those conclusions. In those circumstances, notwithstanding a helpful and astute submission by Mr. Samek, permission to appeal is refused.
Order: Application refused.