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	United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Moores v. Bude-Stratton Town Council [2000] EAT 313_99_2703 (27 March 2000) URL: http://www.bailii.org/uk/cases/UKEAT/2000/313_99_2703.html Cite as: [2000] IRLR 676, (2001) 3 LGLR 17, [2001] BLGR 129, [2000] EAT 313_99_2703, [2001] ICR 271

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APPEARANCES

 

For the Appellant	MR A EATON-HART (of Counsel) Peter Peter & Wright Solicitors 1 Queen Street Bude Cornwall EX23 8AZ
For the Respondents	MR R PAYNE (Representative) South West Provincial Employers Association Dennett House 11 Middle Street Taunton Somerset TA1 1SH


 


MR JUSTICE LINDSAY (PRESIDENT):

1. Mr P.J. Moores was an employee of Bude-Stratton Town Council. He had begun work for the Council in 1984. By April 1986 his title was Technician and Gardener. He was one of 4 outside staff employed by the Council. He reported to the Clerk. He was de facto foreman of the outside staff. A member of that Council, Mrs Parsons, who was not an officer of the Council nor a person to whom any of the Council's relevant powers had been delegated, was abusive to him, as we will have to explain in more detail below. She had been intermittently hostile to him previously. Mr Moores was no long prepared to work in an environment in which he was subjected, he said, to allegations of dishonesty and abuse. He resigned, saying he would be treating his resignation as constructive dismissal. The Mayor, hearing of these events, was shocked and told other staff and Mr Moores that Councillor Mrs Parsons was out of order and that the matter would be dealt with at the first available Council meeting, which it was. That meeting strongly censured Mrs Parsons and Mr Moores was asked to reconsider his resignation and to revert to his job. He chose not to do so but instead presented an IT1 claiming (so far as now relevant) unfair dismissal and wrongful dismissal. There was a 3 day hearing at Exeter under the Chairmanship of Mr P.R. Anderson in January 1999. The decision, sent to the parties on 21st January, was unanimous; Mr Moores' application was dismissed. Mr Moores, for whom Mr Eaton-Hart appears, appeals; the appeal raises novel and potentially important questions as to vicarious liability as between a local authority and its Councillors in relation to the Council's employees. Unfortunately we are divided on the answers we would give to the questions raised and so we shall first set out the minority views and conclusion and follow it with the view of the majority.

A. THE MINORITY VIEW

2. The minority view shall deal with the appeal under 8 headings namely (1) the facts as found; (2) the obligations of trust and confidence between employer and employee; (3) verbal abuse as a breach of such obligations, even when not emanating directly from the employer; (4) vicarious liability; assuming a Councillor is, as such, both under and in breach of a legally enforceable duty, enforceable other than by the Council, not seriously to harm the relationship of trust and confidence between the Council and its employees, what are the factors generally to be taken into account in determining whether a Council is vicariously liable for that Councillor's breach; (5) An application of those factors to the question of whether Bude-Stratton Council was here vicariously responsible for the consequences of Councillor Mrs Parsons' verbal abuse; (6) Whether the assumption, thus far made, that Mrs Parsons was herself under the alleged duty is justified; (7) the Tribunal's reasoning and (8) the minority's conclusion.

(1) The facts

3. Mr Moores gave evidence that Mrs Parsons had disliked him as an employee of the Council for a number of years for reasons which he believed were beyond his control and were unconnected with his work. Thus as early as April or May 1995 there was an incident concerning an allegation by her as to the use of the Council's central heating diesel fuel in the Council's Land Rover or in Mr Moores' own car. There were incidents in July 1996 and June 1997. In July 1997 Mrs Parsons had raised questions in the Council in connection with some travel expenses which had been paid to Mr Moores. Most, but perhaps not every one, of these incidents were known to the Council but there is no finding that in 1998 the Council had any reason to foresee some improper attack by Mrs Parsons on Mr Moores' behaviour nor any finding that it had failed adequately to respond to those complaints which Mr Moores had previously made to it as to earlier incidents involving Mrs Parsons. There are indications in the earlier correspondence in 1995 that a Chairman would take steps to remind Councillors that they must not give orders to Council staff or make direct criticisms to them and there was no evidence, and the Tribunal held there was none, to believe that such steps were not taken. The Employment Tribunal held that it had been made clear to Mr Moores in correspondence in 1995 that the Council rather than individual Councillors was the employer. There is no finding that the Council had been lax in reminding Mrs Parsons as to where her duties as a Councillor lay or had simply tolerated any bad behaviour of hers.
4. In August 1998 Mrs Parsons instigated a Council investigation into some particular alleged wrongdoing of Mr Moores. The allegations appeared sufficiently serious to justify his suspension from work on the 5th August 1998. A disciplinary hearing was conducted on the 3rd September 1998 at which Mr Moores, although not found to have attempted to defraud the Council, was held to have been guilty of a serious lack of judgment and was given a written warning that he must exercise more care in the future. His suspension was then lifted. He returned to work. The incident shows that whether Mrs Parsons' motives were or were not suspect, she could unearth shortcomings in Mr Moores' conduct and that he was not invariably blameless. The incident thus provided the Council with no occasion to warn Mrs Parsons as to any criticism she might wish to level against Mr Moores.
5. On the Tuesday 8th September 1998 there was the chief incident of which he complains. It is worth citing in full his evidence of the incident, which was not in dispute at the Tribunal. Thus:-

"The next day on Tuesday the 8th September I was at the Castle moving chairs from the Council Chamber to the waiting room with Terry Gliddon when Councillor Parsons came in through the front door of the Castle. She saw Terry going into the waiting room and said "Good morning Terry, how are you?" to which Terry replied "I'm O.K.". Councillor Parsons then said to Terry "Where's the lying toe-rag? He's not in there is he?" (meaning the Council Chamber). I came out of the Council Chamber with some chairs and said "Good morning Councillor Parsons, what did you just call me?". She said "You're a lying toe-rag, that's all you are". I said "Well the Panel didn't think so, did they?". She said "No wonder, they're your protection racket along with the 5 girls in the office and the clerk, they are all your protection racket. Do you realise what you've done? You've made this Council a laughing stock". I said to her "Maybe you should put all this in writing". Councillor Parsons then went into the office. I followed her shortly afterwards and said to her "I think you should repeat what you have just said to me outside". She then said in front of the office "You're a lying toe-rag with your protection racket, you've got the girls in the office, the clerk and 5 Councillors on your side". She then pointed at me and said "What are you doing in the office, you're not allowed in here - Get Out!", ushering me to the door and then said "You're not allowed in here, you're not to be trusted". As I was leaving she said to the girls in the office "The sooner we get rid of that bloke the better, then we can all settle down". A few moments later while Councillors Parsons was on the way out of the building she said to Terry Gliddon "I shouldn't talk to that lying toe-rag, he's not worth it". She then turned to me and said "If you do anything to Terry I'll have you".

6. Mr Moores returned to work on Wednesday the 9th September and was then due to have two days off for holiday, the Thursday and the Friday of that week. When he returned to work on Monday the 14th September he handed in a letter to the Clerk of the Council which said, so far as relevant, as follows:-

"Following an incident on Tuesday 8th September 1998 when Councillor Brenda Parsons called me a "lying toe-rag" both to my face and in front of other Council employees, I have decided that I have no option but to resign from my employment with the Town Council with immediate effect. This is the last in a series of such incidents. Councillor Parsons has made it clear that she has no trust and confidence in me as an employee and I am not prepared to work in an environment where I am subjected to allegations of dishonour and abuse. I will be treating my resignation as constructive dismissal."

7. It may be noted that it is not there suggested that he had lost trust and confidence in the Council nor that the Council had lost it in him.
8. At some point the Mayor not only told staff members that Councillor Parsons had been out of order in doing what she had done and that the matter would be reported to the Council to deal with but also told Mr Moores the same. The Tribunal said that this took place "Immediately following the incident". The Tribunal also held that on the same evening, presumably the 8th September, a censure motion was drafted by the Mayor; arrangements were made for the early convening of a Council meeting to deal with the issue.
9. On the 17th September the Council met. There is no suggestion that a meeting having this incident on its agenda could have been arranged any earlier than it was. The motion passed began:-

"The Town Council censures Councillor Mrs Parsons in the strongest possible terms for the comments which it is reported she made to Peter Moores on the morning of the 8th September 1998. The Town Council does not agree with those comments. The Town Council has no formal means to discipline any Councillor. However, in this case Mrs Parsons is requested not to attend the Council offices except to attend meetings for a period of one month. The staff are instructed not to provide her with any information if she does not comply with this request. If any information is required by her to conduct her duties as a Councillor, she may make application to the staff in writing, any request will be dealt with by them in a reasonable time. It is hoped that Mr Moores will immediately rescind his decision to resign over the incident. If this does occur and he returns to work by 8.30 on Monday the 28th September the period of absence will be regarded as additional paid leave. The Clerk is instructed to inform Mr Moores and all other staff that it is the Council which is their employer. It is only officers of the Town Council who are permitted to make the directions to any member of staff. Individual Councillors are not their employer, and have no say over their employment except in the normal democratic decision making processes of the Council. If any Councillor makes any inappropriate comment to an employee or conducts themselves in a manner which falls below that expected of a Councillor, they should immediately report to the matter to the Clerk, the Mayor, or the Deputy Mayor."

10. On the next day, the 18th September, the Clerk to the Council wrote to Mr Moores indicating the discussion that had taken place at the meeting on the night before. The letter emphasised that the Council wished to make it clear to Mr Moores that the actions of an individual Councillor were not necessarily those of the whole Council and a copy of the resolutions that had been passed the night before were sent to Mr Moores. The letter continued:-

"The Town Council's grievance procedures having now been exercised regarding the incident on the 8th September the Town Council request that you reconsider your decision to resign. The Town Council hope that you will following reconsideration return to work on Monday the 28th September following a period of additional paid leave. I look forward to hearing your response to this request in due course. If you would like to discuss the matter further with me and/or the Mayor that could easily be arranged following a telephone call to this office."

11. On the same day Councillor Mrs Parsons herself wrote to Mr Moores indicating that when the Council's meeting had taken place on the evening of the 17th September she had volunteered to it that she had been out of order to say what she did, when she did and where she did. She continued:-

"I concur with the proposal and decision of the Council and voted for it myself."

12. Mr Moores did not reconsider his resignation. On the 23rd October 1998 he lodged his IT1.
13. Mr Moores had, at the Employment Tribunal, relied also on matters other than the behaviour of Mrs Parsons as justifying his treating himself as constructively dismissed. He claimed he had been effectively demoted and he complained also of a lack of confidence in him and his work on behalf of the Mayor, Councillor Rogers. Both those claims failed and, as to them, there is no appeal. The appeal has been argued solely in relation to the conduct of Councillor Mrs Parson and its alleged consequences. Moreover, even in relation to Mrs Parsons there are features found which are not in issue on the appeal. Thus the Tribunal found that Mrs Parsons had neither actual or ostensible authority to bind the Council as employer, that she was one only of 18 elected Councillors, that it was the Mayor who acted as the Council's agent in its capacity as employer and that Mr Moores was well aware of that; and that it had been made clear to Mr Moores earlier (in 1995, as we have mentioned) that it was the Council rather than individual Councillors which was the employer. The Tribunal also held that in relation to the chief incident he complained of Mr Moores knew or ought to have known that Mrs Parsons was not acting as his employer. There is nowhere any hint that in the course of that chief incident Mr Moores thought Mrs Parsons was speaking or acting on behalf of the Council. Nor is it disputed but that Mrs Parsons was merely a "back-bench" Councillor, a convenient term used at the hearing before us to denote a Councillor who had had no relevant powers (for example, as Chairman of some relevant committee) delegated to him or her and no especial office but was merely a Councillor. We were not told whether Mrs Parsons was a member of any majority party in the Council.
14. In such circumstances the appeal has focused, as the minority explains, on vicarious liability; if Mr Moores fails on that he fails altogether in his appeal.

(2) Trust and Confidence

15. Mr Eaton-Hart relies on recent high authority for the existence of that implied obligation upon an employer which, in Malik -v- BCCI [1997] IRLR 462 H.L., Lord Nicholls describes as a " portmanteau, general obligation", namely:-

"... not to engage in conduct likely to undermine the trust and confidence required if the employment relationship is to continue in the manner the employment contract implicitly envisages."

see para 13. In Lord Steyn's speech at para 54 the same, in relation to an employer, is expressed as an obligation not:-

"... without reasonable and proper cause, [to] conduct itself in a manner calculated and likely to destroy or seriously damage the relationship of confidence and trust between employer and employee."

The emergence over recent years of such a term is described by Lord Steyn as a "sound development" - para 56. As for a breach of that term as entitling an employee to regard himself as constructively dismissed, as Lord Nicholls points out at para 12:-

"the innocent employee's entitlement to leave at once must derive from [the employer's] being in breach of a term of the contract of employment which the employee is entitled to treat as a repudiation by the [employer] of its contractual obligations. That is the source of his right to step away from the contract forthwith."

It will not be every breach of the implied obligation that will enable an employee "to step away from the contract forthwith". It will thus generally be for the Employment Tribunal to establish, as a matter of fact, whether a breach is serious enough to "destroy or seriously damage the relationship ....." - see also Western Excavating (ECC) Ltd -v- Sharp [1978] ICR 221.

16. It will be noted, though, that in every analysis of this duty, the obligation is seen as a matter of contract and as arising between employer and employee. One can hardly have an implied contractual term between parties who do not contract, nor is it to be expected that a term proper to be implied between employer and employee will be implied as between persons not in that relationship. Mr Eaton-Hart, recognising, as he has to, that here there is no contract between Mrs Parsons and Mr Moores, argues that there is a duty upon every Local Government Councillor, arising, without more being needed, simply out of his or her position as a Councillor, not to do anything calculated and likely to destroy or damage the relationship of confidence and trust between the Council and the Council's employees. That duty, and even its breach, would not, of itself, assist him, as Mr Moores is not suing the person in breach of that alleged duty, Mrs Parsons, but is suing the Council itself. Therefore Mr Eaton-Hart then adds that the Council is vicariously liable for a Councillor's breach of that duty. No authority is cited in support of the existence either of such a duty upon a Councillor or of the Council's vicarious liability. So far as concerns case law and any available analogies, we have been left to fend for ourselves.
17. We shall in the first place assume, without deciding, that there is such a duty on every Councillor and that it is not only legally enforceable but legally enforceable other than by the Council. That assumption will require us to look carefully at vicarious liability, but first we shall look at verbal abuse as an occasion of breach of the implied term as to trust and confidence.

(3) Verbal Abuse

18. It cannot be doubted but that even a single incident of verbal abuse may found a claim for constructive and unfair dismissal. Thus in Isle of Wight Tourist Board -v- Coombes [1976] IRLR 413 EAT the director of the Tourist Board, the most senior officer or agent of the Board so far as one can tell from the report of the case, said of and in the presence of his personal secretary, a woman of 58 years of age who had served the Board for some 15 years, "She is an intolerable bitch on a Monday morning". Mrs Coombes indicated there and then that she had "taken enough", gave oral notice to leave, immediately left and drafted a letter of resignation. She was held to have been constructively dismissed, although Bristow J., giving the judgment of the EAT, mentions the possibility that a timely apology might have ended matters. There had, though, been no apology. In Courtaulds Northern Textiles Ltd -v- Anderson [1979] IRLR 84 EAT an Assistant Manager had said to an employee "You can't do the bloody job anyway", although not believing that to be the case. Again, constructive dismissal was established although, again, it was notable that the management had not sought to "jolly" the employee (as it was put) out of his intended reaction of giving notice - see paragraph 8 on page 85. In Robinson -v- Crompton Parkinson [1978] IRLR 61 the employee, Mr Robinson, having been falsely and unfairly accused of theft, first gave his employers an opportunity to apologise for their actions. Only after he had failed to receive an apology over the next week (having been, he said, promised it) did he say "I'm off". The Industrial Tribunal had dismissed his claim for unfair dismissal; the EAT allowed the appeal and remitted the matter to a fresh tribunal.
19. These cases suggest that whilst, as one would expect, even a single incident of verbal abuse, though not coming from the Employer himself or itself, can ground a successful claim for constructive dismissal on the basis of its having been destructive of the mutual obligations of trust and confidence between employer and employee, each incident needs to be examined in the light of its surrounding circumstances. They will include whether the verbal abuse was, so to speak, "authorised" in the sense of coming from some senior person in the employer's organisation and thus seeming to have the authority of the employer behind it and whether a timely retraction or apology was offered by the employer. It will be for the Employment Tribunal, using its good sense and practical experience of the working environment, to adjudge, on the facts of each particular case, whether the verbal abuse in question could fairly be regarded as coming from (or as if from) the employer and whether, if an apology or retraction was promptly offered, the employee was being hyper-sensitive, too thin-skinned or inflexible, in persisting in a view that trust and confidence had been seriously or irremediably wounded. Where verbal abuse has been persisted in and where the employer, knowing of it or having good reason to suspect it, has taken no steps to curb it, a tribunal is, of course, more likely (and, in the minority view, properly more likely) to treat the verbal abuse as "authorised" in the sense explained above, more likely to treat any apology as necessary and more likely to treat the harm done as irremediable than would otherwise be the case. How far a given incident could have been reasonably foreseen and, if so foreseen, avoided, will also properly be a factor likely to weigh with a tribunal.

(4) Vicarious Liability: relevant factors

20. It is to be remembered that the minority is proceeding upon an assumption that a Councillor is as such under a legally enforceable duty as to trust and confidence - see the last two paragraphs under heading A (2) above.
21. Vicarious liability as a notion is encountered in both civil and criminal law and in contexts outside tort, outside the employer-employee relationship and outside also principal and agent. It arises, for example, in partnership law where an innocent partner may be held liable for the misrepresentations of another partner. For all that it is encountered in other areas, it has been most closely studied in the context of tort and of employer and employee, which is the context in which the doctrine emerged in the late seventeenth century. Even there it is not the position nowadays that it suffices, in order to make the employer liable for the torts of his employee, to show only that the employer is employer of the employee. The necessary further component is that (with the minority's emphasis):-

"... the tort must be referable to that relationship in the sense that it must have been committed by the [employer] in the course of his employment."

- see Winfield on Torts p. 592. The bounds of the doctrine are there set by the words "in the course of his employment" and see "the classic test for vicarious liability" cited from an earlier edition of Salmond on Torts quoted recently in ST -v- North Yorkshire County Council [1999] IRLR C.A. as drawn to our attention by the Council. Reference may also be made to the recent case Credit Lyonnais Bank Nederland NV -v- ECGD [1999] 1 All ER 929 HL at 934.

22. If, as is desirable, the law is to be coherent, then one can expect that in cases outside the employer-employee relationship but where vicarious liability needs to be considered some test analogous to "in the course of his employment" will be found useful to provide corresponding bounds. Thus an innocent partner is liable for the misrepresentation of another partner not in every case but only where the misrepresentation is in a matter connected with the ordinary business of the firm. So also criminal vicarious liability in a corporation for an offence committed by an individual generally occurs (where there is no statutory provision otherwise) only where the offence is committed in the course of the corporation's business and by an individual in control of its affairs to a degree specified in the cases. Where, on the facts of a particular case, an employee is engaged on his own business, his employer will not be liable and, correspondingly, vicarious liability in other situations unregulated by Statute should not, in the judgment of the minority, exist when, by analogy, the wrong-doer is "on his own business".
23. As for determining whether a wrong-doer is on his own business, just as no single test is nowadays seen to be determinative of whether a person is an employee (as opposed, for example, to being self-employed or an independent contractor), so also no one test is determinative of a person being on his own business for the purposes of vicarious liability, very commonly a closely related question. Similar questions arise in both cases; was remuneration paid for the doing of what was done; was what was done , done for the benefit of the party sought vicariously to be made liable ("the propositus")? Was the act complained of reasonably incidental to the duties of the wrongdoer as cast upon him by the propositus? Was the propositus in a position of control, not only to order what was to be done but how it was to be done? Was the propositus in a position to select who should do the activity in the course of which the wrongful act occurred? Could the propositus suspend or stop that activity? Was what was done expressly or impliedly authorised by the propositus? Was it an unauthorised way of doing something which was authorised? Was it the performance of an act of a class the wrongdoer was not required to do at all or had been forbidden to do? No single question and answer is likely to be determinative but together the answers should provide a composite from which it can be adjudged whether vicarious liability exists.
24. An instructive case, particularly as it is outside the employer-employee relationship, is to be found in League against Cruel Sports -v- Scott & Ors [1986] 240 per Park J. The League accused the Master of a Hunt of trespass onto the League's land by the Hunt by way of the servants, agents or hounds controlled by the Master. A number of citations from the case point to factors likely to be taken into account in determining vicarious liability. Thus at p. 252 Park J. said:-

"..... When a Master of Staghounds takes out a pack of hounds and deliberately sets them in pursuit of a stag or hind, knowing there is a real risk that in the pursuit hounds may enter or cross prohibited land, the Master will be liable for trespass if he intended to cause hounds to enter such land or if by his failure to exercise proper control over them he caused them to enter such land."

And

"The Master's intention or the intention of those servants or agents or followers of the hunt for whose conduct he is responsible, has to be inferred from his or their conduct .... ."

Did the Master encourage the conduct? Did he merely stand by? It was acknowledged that it was virtually impossible, whatever precautions were taken, to prevent hounds entering specific areas yet it was held that, the Master knowing that to be the case, he had nonetheless persisted in hunting in the vicinity, with the result that there were frequent trespasses. That being so, held the Learned Judge:-

"... then the inference might well be drawn that his indifference to the risk of trespass amounted to an intention that hounds should trespass on the land."

There had been too many trespasses to suppose reasonable precautions had been taken; the will to prevent trespass was held to be absent - p. 255. The Master was recognised to have no control over some followers but considerable control over mounted subscribers to the Hunt. There was no reason why the Master should not be vicariously liable for trespass by such latter category of persons - p. 251. Accordingly injunctions and damages were awarded against the Master.

The case is instructive as it illustrates that:-

(1) The mere fact that mounted subscribers were members of the Hunt did not make the Master liable; he was liable vicariously for their activity because he could be regarded as having invited them to join the Hunt and as having considerable control over them;

(2) Intent can be judged from conduct and in the light of the foreseeability of a wrongdoing occurring;

(3) Persistence in failure to control a foreseeable and avoidable wrongdoing can be taken to amount to an intent to do or to authorise that which had not been controlled;

(4) Whilst the absence of an ability fully to control a class of persons may suggest an absence also of vicarious liability for the foreseeable wrong-doings of those persons, if some attempt at control was possible but, none, over a period, has been made, an inference may be drawn from such prolonged indifference, namely that the foreseeable wrong-doing was intended.

(5) Application of those factors as to vicarious liability to the facts of this case

25. Mrs Parsons was not, of course, an employee of the Council. The Council had not chosen her to be a member of it; it did not select her to be responsible for its conduct to its employees or as to the performance by them of their contracts. She was a backbench Councillor. The Council could not bar her from membership of the Council. It had not authorised her, expressly or impliedly, to speak to Mr Moores about his work or at all. There was no finding, as to her presence on the Council premises on the 8th September 1998, that she had been required or invited then to attend by the Council or was there in the course of any duties falling upon her as a Councillor. The Council had only a limited ability to control her activity or discipline her. As at September 1998 it had no particular reason to foresee any unjustified attack by her on Mr Moores; her last actions concerning him had proved to have had some foundation in that he had been found guilty of a serious lack of judgment and was given a written warning. As at that date the Council was not found to have had any reason to have barred Mrs Parsons from Council premises or from proximity or address to Mr Moores, even assuming it would have had power in such respects. The Council had no reason to think Mr Moores would regard criticism of him emanating from Mrs Parsons as being given with the authority of the Council and, since it had been made to clear in him in 1995 that it was the Council and not individual Councillors which was the employer, the Council had some reason to expect Mr Moores to see that Mrs Parsons would not be speaking for the Council were she to criticise him. There was no evidence that he did believe, when she spoke as she did on the 8th September, that she spoke on behalf of or with the approval of the Council or in any way incidental to any duty falling upon her as a Councillor. Indeed, the very language she then used should itself have suggested that she was speaking in way unauthorised by a Town Council. She was, so to speak, "on her own business". In marked contrast to the case of the Master of Staghounds, there was no finding of persistent indifference by the Council to the risk of wrong-doing, no finding of a chronic failure to try to control it and no finding of the harm that ensued as having been foreseeable or, in consequence, as having been controllable in advance of its happening.
26. We have no guidance but the law as to vicarious liability in other areas by which to judge vicarious liability in this novel area. The minority, applying that law as best it can, is unable to hold the Council vicariously liable for a breach of the (assumed) duty which Councillor Mrs Parsons owed to Mr Moores as an employee of the Council.

(6) Was Mrs Parsons under a duty as to trust and confidence?

27. The discussion so far has proceeded upon an assumption that a Councillor in Local Government is under a legally enforceable duty (imposed on him or her simply by reason of his or her office as Councillor and hence by his or her membership of the Council) not without reasonable and proper cause to do anything calculated and likely to destroy or seriously damage the relationship of trust and confidence between the Council and its employees, a duty legally enforceable other than by the Council itself. The proposition has an engaging simplicity and a first reaction is likely to be "Fair enough; why not?" It is hard, too, to resist the sentiment that a man in Mr Moores' position should surely have some convenient remedy and that a defamation suit against Mrs Parsons is hardly an effective remedy, given, especially, that Legal Aid is not available for defamation and that the Council's grievance procedure might provide no correction of Mrs Parsons' behaviour. However, the minority sees great difficulties in the way of this assumption being the law.
28. Firstly, if mere membership of an employing body is, without more, to put each member under such a duty, as Mr Eaton-Hart argues, then every shareholder in a company-employer would surely be under a similar duty to the company's employees So also would be every member of a proprietary club to the club's employees. Mr Eaton-Hart, recognising that that might be too extreme, resisted that by saying that shareholders did not have the same degree of control over their companies as Councillors had over Councils. However, once one has to move to defend the universality of a proposition by supposing particular facts, the universality of the proposition is destroyed. Moreover, there will be many cases where a shareholder will have far more control over the conduct of a company than a Councillor (particularly a backbench Councillor or one not in the majority party) has over a Council. In many cases one shareholder alone can remove the existing governing board of directors and appoint a new one of his choosing. No Councillor has any corresponding ability. Further, such a duty, were it to exist, would all too readily lead the Courts into disputes as to party politics, an area which the Courts are normally scrupulous to avoid. A Councillor may, for example, be elected, perhaps against opposition from the leading parties, on a manifesto based on an attack on the existing membership of that Council as wastefully employing incompetents or persons selected on a corrupt or nepotistic basis. Once elected he or she is then enabled, almost required, to urge that Council employee X is overpaid or incompetent and that employee Y's only talent lies in being the majority leader's niece and so on. Such remarks in the Council chamber could well harm that employee's relationship of trust and confidence, so would not the Tribunals and Courts, if the supposed duty existed, then have to rule upon what was likely to be a party political issue, namely whether the Councillor had "reasonable and proper cause" for saying in the Council Chamber what he or she had been elected to say?
29. Such considerations as these lead the minority, with some regret, to the view that no "back-bench" Councillor is, by virtue of nothing more than his or her membership of the Council, under a duty, legally enforceable by someone other than the Council, not without reasonable and proper cause to do anything calculated and likely to destroy or seriously damage the relationship of trust and confidence between the Council and its employees. The officers of the Council no doubt will, and, perhaps, Councillors having particular delegated duties in relation to its employees may, in particular cases, be in a different position. Nor, of course, does the minority mean to encourage such activity, nor does it say that it is free from sanction. The Council itself may, as did Bude-Stratton, take steps against a Councillor. But the broad duty (legally enforceable other than by the Council itself) which the minority has so far assumed does not in its view truly exist.

(7) The Tribunal's Reasoning

30. The minority has so far said little as to the reasoning of the Tribunal. That is because Mr Eaton-Hart does not challenge but rather seeks to side-step the Tribunal's conclusions that Mrs Parsons had neither actual nor ostensible authority to bind the Council as employer of Mr Moores and that Mr Moores could not reasonably have perceived Mrs Parsons to have been acting as his employer during the incident of the 8th September. Mr Eaton-Hart side steps those conclusions by asserting that it is not authority which is the sole or appropriate test for liability in a case such as this. He has argued, as will have been seen, for vicarious liability on the part of the Council for breach of the duty which he alleges fell upon Mrs Parsons and was broken by her. Mr Payne of the South West Provincial Employers Organisation, the representative acting for the Council, has not submitted that vicarious liability had not been argued below in the manner in which Mr Eaton-Hart now pursues it. Accordingly, it is upon vicarious liability that the minority has concentrated but, it adds, it has had no reason to doubt the Tribunal's conclusion that Mrs Parsons had neither actual nor ostensible authority on the Council's part to act as she did on the 8th September 1998. As the minority has concentrated on vicarious liability (and whilst it has sought to keep the following cases in mind) it has not found any truly relevant and useful guidance in the cases (so far unmentioned) that were cited to us, namely Hilton Hotels -v- Protopapa [1990] IRLR 316, Warnes -v- Trustees of Cheriton Oddfellows Social Club [1993] IRLR 58, R -v- Secretary of State for Education and Science, ex parte Birmingham District Council (1984) 83 L.G.R. 79 and R -v- Secretary of State for the Environment ex parte Hillingdon London Borough Council (1986) 84 L.G.R. 628.
31. As the Tribunal found that there had been no breach of contract by the Council it did not need to go on to consider whether Mr Moores had been too precipitate in resigning as he did. He resigned although the Mayor had told him, immediately following the incident, that Mrs Parsons had had no authority to speak as she had and that the matter would be reported to the Council and he persisted in that resignation although, at a meeting convened as early as could be expected, the Council had censured Mrs Parsons and had not only asked him to reconsider his resignation but had offered him an intervening holiday, perhaps in order that matters should settle down before he finally returned to work. As the Tribunal did not consider this nor shall the minority, but it plainly would have been arguable that Mr Moores would have been better advised first to have demanded an apology from Mrs Parsons and a statement from the Council of its continuing trust and confidence in him and then to have resigned only if at least the latter had not been soon forthcoming - compare Robinson -v- Crompton Parkinson supra. It may also be noted that Mr Moores' contract provided:-

"If you have a problem or grievance which is related to your work or to your conditions of service you are entitled to pursue it through the Clerk to the Council".

At the point at which he handed in his resignation on the 14th September it would seem that Mr Moores had not even approached the Clerk to the Council with his grievance in mind.

(8) The Minority's Conclusion

32. In the light of the conclusions above the minority would dismiss the appeal. It would be far from happy to do so; although the absence of authority on or near the point may suggest that it is very rare for any Councillor to act, in relation to a Council employee, as Mrs Parsons did here, any rarity in such events hardly justifies leaving Council employees to suffer verbal abuse from Councillors without their having any truly effective and available remedy, given the practical unavailability of defamation on costs' grounds. However, whilst the minority would be the first to welcome consideration of the position by a higher court, given that it finds the law in this area to be as indicated above, it would have dismissed the appeal.

B. THE MAJORITY VIEW

33. The preliminary hearing on 13 May 1999 determined that "The question for full argument is whether the Employment Tribunal should have considered the potential liability of the Council as the employer for the actions of councillors towards an employee, acting as councillors in Council premises and during Council office hours".

The appellant submitted, at the full hearing on 2 December 1999 that the issue in this appeal is whether the Tribunal erred in law in ruling that the conduct of Mrs Parsons did not amount to a breach of the Appellant's contract of employment.

It is to this that the majority addresses itself.

Background

34. The conduct of Councillor Parsons towards the Appellant on 8 September 1998 (and previously) is not denied by the Respondent. Councillor Parsons' conduct was described by the Tribunal as "quite reprehensible and totally unacceptable". The appellant's letter of resignation dated 14 September 1998 was linked directly to the conduct of Councillors Parsons and stated "I am not prepared to work in an environment where I am subjected to allegations of dishonesty and abuse".

Decision of the Tribunal

35. The tribunal approached the decision on the basis of "whether Councillor Parsons' was or could reasonably be perceived by the applicant to be acting as his employer on that occasion". The Tribunal held that "a local authority will only be bound by the actions of one of its elected members who has either actual or ostensible authority to bind it as employer".

Appellant's Submissions

36. The Tribunal was wrong in law to approach the issue of breach of contract by reference to the apparent or ostensible authority of Councillor Parsons' to act as employer. The only proper and legal conclusion for the Tribunal based on the agreed facts is that the Appellant was "constructively dismissed" by reason of the conduct of Councillor Parsons' for which the Council as a whole was vicariously liable. The Tribunal's decision was based on the "actual or ostensible authority" of Councillor Parsons' to "bind" the Town Council. The use of such words is only consistent with the Tribunal considering the issue as to whether Councillor Parsons' could enter into consensual contracts which "bound" the Council. The determination of whether a person has authority to bind an employer is a necessary ingredient in a consensual termination of a contract, but the same test does not apply in a case of constructive dismissal by misconduct (Hilton Hotels -v- Protopapa [1990] IRLR 316 at 318 para 11). Whether Councillor Parsons had actual or ostensible authority to dismiss the Appellant is therefore not the correct test in this case. The issue is not, therefore, whether the acts of Councillor Parsons were ultra vires.
37. An employer is, in any event, not entitled to rely on lack of power of an officer or organ of the employer in acting in a way which, if valid, would constitute a dismissal (Warnes -v- Trustees of Cheriton Oddfellows Social Club [1993] IRLR at 59 para 7). The Appellant's employer on his contract of employment was the Town Council. Councillor Parsons' was a member of the Council at the time of the incidents. In Hilton Hotels -v- Protopapa the person whose misconduct caused the employee to resign was a 'supervisory employee' who did not have the power to dismiss other employees. The Employment Tribunal held that:-

"If the supervisory employee is doing what he or she is employed by the employer to do and in the course of doing it he or she behaves in a way which, if done by the employer, would constitute a fundamental breach of contract between the employer and the applicant, then in our judgement the employer is bound by the supervisory employee's misdeeds". (p3 para 14)

The effect of the Hilton -v- Protopapa case is that a person who:

(i) is not the employer

(ii) does not have the contractual power to dismiss

may nevertheless cause a constructive dismissal by destroying the relationship of trust and confidence between employee and employer.

38. In the context of a local authority council it is submitted that while individual councillors may not have the power expressly to dismiss or recruit employees, each councillor has an ability to damage or destroy the relationship of trust and confidence between council employees and the Council. Each councillor is therefore under a duty not to engage in conduct likely to undermine the trust and confidence required in employment contracts. A local Council could in some circumstances seek to avoid liability for the misconduct of a councillor if the facts showed that the misconduct could not be related to the employment relationship. In this case the Appellant was verbally abused, by Councillor Parsons, on council premises during office hours and in the course of the Appellant's work duties.

Majority Reasoning

39. The majority accepts the submissions made by the Appellant and adds on its own behalf the following.

A. Trust and Confidence

Trust and confidence is an implied term in the contract of employment and need to consider whether the conduct of the party whose behaviour is challenged amounts to a repudiation of the contract. It should be determined by whether it is such that its effect judged reasonably and sensibly, is to disable the other party from properly carrying out his or her obligation.

We believe that the Appellant's case in this respect is made out in the submission above. Further, it is an implied term of every contract that the employer will provide and maintain a working environment, which is reasonably tolerable to all employees. Such term must apply to protection from unacceptable treatment and behaviour and unauthorised interference in work duties.

We are assisted in this view by Waltons & Morse -v- Dorrington [1997] IRLR 488 and Burton & Rhule -v- De Vere Hotels [1996] IRLR 596. While neither of these cases is identical to this case, the principles apply.

B. Vicarious Liability

40. Our attention has been drawn to the case law on vicarious liability, but we have found that to be of limited assistance since none of the cases cited dealt with the situation in this case - the vicarious liability of a Council for the actions of a councillor. The Councillors are not employees of the Council.

All councillors have responsibilities either as officers, Chairs of committees or simply as members of a committee where they are individually and jointly responsible for its remit. No individual councillor is a free agent operating on his/her own behalf.

Councillors can be individually and jointly surcharged in respect of improper/illegal financial dealings. Where they fail to rectify bad faith they are jointly and severally liable. We submit that this applies also in the case of bad treatment of employees.

41. Councillors are an integral part of the Council. They do not operate on their own behalf. They establish policy and agree expenditure through the committee structure. They are also involved in employment matters. They sit on appointments and disciplinary panels and are an integral part of many employment procedures. They agree to dismiss senior officers, when the situation demands such action and are the last stage of appeal for a dismissed employee. To a large extent they are the Council in operation at senior level and they expect a service from employees. If there is an analogy with a company structure they are akin to a non-executive director, whereas a shareholder in a company is akin to the local authority constituents who vote to elect or remove councillors.
42. Common sense demands that Councillors cannot be held to have responsibilities for recruitment and dismissal but not for the employment contract. It is not possible therefore for a Council to detach itself from the actions of councillors in the workplace, which impact on the ability of an employee to execute his contract of employment. They are a significant part of the working environment and must be under a duty of trust and confidence. If that duty has been breached then the Council must be liable. Another analogy would be where an employee is abused by a senior member of staff, but one who is outside the employee's operating division and where the senior member of staff has no managerial responsibility or authority over the employee whom he/she verbally abuses.
43. We are aided in this view by the following extract, from Arden Text Book - Sweet and Maxwell 1999 on Local Government Constitution and Administration at page 676 para 8.2.82.

(ii) Tort - Vicarious Liability

As an authority can only act through their officers and members, whenever the authority suffers direct liability, they will in practice be taking liability for the neglect or omissions of officers or members, which compromise the breach of the authority's duty. This will be the case irrespective of whether or not the officer or member in question was in breach of any separate duty, which he owed personally to the plaintiff.

Conclusion

44. The majority view is, firstly the Council was vicariously liable for the actions of Councillor Parsons and secondly that the actions of Councillor Parsons could amount to a breach by the Council of the implied contractual obligations to provide a reasonable congenial working environment. Therefore the appeal should be allowed and the case remitted back to the Employment Tribunal for the Constructive Dismissal Case against the Council to be heard by a fresh Tribunal.