Appeal No.	 EAT/363/99

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 9 July 1999

Before
HIS HONOUR JUDGE PETER CLARK
MR S M SPRINGER MBE
MR B M WARMAN

MRS BOLA ADETONA	APPELLANT

MISS M PORTER	RESPONDENT

Transcript of Proceedings

JUDGMENT

PRELIMINARY HEARING

Revised

	APPEARANCES

For the Appellant	MR M SUTTON
(OF COUNSEL)
APPEARING UNDER THE 
EMPLOYMENT LAW APPEAL 
ADVICE SCHEME 
(ELAAS)	

	JUDGE PETER CLARK:	The Respondent Miss Porter commenced employment as a Senior Nursery Officer at the Garden of Eden Day Nursery on 8th November 1996.  The proprietors of the Nursery were Mr & Mrs Adetona.  On 18th November 1996 she signed a contract of employment in writing.  It was signed by Mr or Mrs Adetona as employer.  That contract provided for 4 weeks notice of termination on either side.  Unhappily, the Nursery encountered financial difficulties due to a falling roll and Mr & Mrs Adetona found themselves unable to pay the rent on the premises and the staff’s wages.  It was decided to close the Nursery and dismiss the staff.

1	However, due to their financial circumstances Mr & Mrs Adetona dismissed the Respondent but with only 1 week’s notice instead of the 4 weeks’ notice to which she was contractually entitled.

2	Following her dismissal on 25th September 1998 she presented an Originating Application to the Employment Tribunal claiming damages for breach of contract.  In addition to the outstanding 3 weeks’ notice pay, she claimed 9 days outstanding holiday pay.  By a Notice of Appearance entered by Mrs Adetona she related the financial demise of her Nursery business.  The matter came before an Employment Tribunal sitting at London (South) under the Chairmanship of Mr A Bano, on 14th January 1999.  The title of the Respondents was amended to “Mr & Mrs Adetona T/A Garden of Eden Day Nursery”.  

3	By a decision with extended reasons dated 22nd January 1999 the Employment Tribunal upheld the Applicant’s complaint in part.  They found that the Respondents’ impecuniosity was no defence.  They awarded damages of £578 for outstanding notice monies and 6 days holiday pay, a further £204, making a total of £782.

4	In this Appeal Mr & Mrs Adetona are represented by Mr Sutton under the ELAAS pro bono scheme.  He tells us that the Appellants have no argument with the reasoning of the Tribunal nor do they take any point on the computation of the award made in favour of the Applicant.  It is simply that they are unable to satisfy the award of compensation.  Mrs Adetona added that following the decision of the Employment Tribunal in this case she took advice from a Citizen's Advice Bureau and was told to pursue this Appeal on the basis that the business was insolvent.  Whatever the advice may have been a distinction was drawn in law between a limited company which becomes insolvent and individual proprietors of a business.  In the former case, there will be no liability for the shareholders or directors of the company following the insolvency and any arrears of wages and holiday pay within statutory limits is recoverable by the employee from the State Fund.  However, that does not apply in the present case to solvent individual proprietors.

5	In these circumstances, we can find no arguable point of law raised in the Appeal and accordingly it must be dismissed.