Appeal No.	EAT/0504/03/SM

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 11 July 2003

Before
HIS HONOUR JUDGE PETER CLARK
(SITTING ALONE)

MR T B NICHOLLS	APPELLANT

C L I  LTD	RESPONDENTS

Transcript of Proceedings

JUDGMENT

Revised

	APPEARANCES

For the Appellant	THE APPELLANT IN PERSON	
For the Respondents	NO APPEARANCE OR REPRESENTATION
BY OR ON BEHALF OF THE RESPONDENTS

HIS HONOUR JUDGE PETER CLARK

1	In this case, presently proceeding before the Southampton Employment Tribunal, chaired by Mr J Simpson, there is before me the fourth interim appeal brought by the Applicant, Mr Nicholls.  The previous appeals were as follows:
(1) EAT/629/02.  Heard before a division presided over by Mr Justice Nelson sitting on 9 July 2002.  The appeal succeeded and certain disclosure orders were made by the EAT.  
(2) EAT 92/03.  His Honour Judge McMullen QC, sitting alone on 7 March 2003.  That appeal succeeded in part.  A witness order, through the Employment Tribunal, was made for the attendance of a witness, Mr Lindsay.  The Respondent was ordered to disclose a specific document.  The remainder of the appeal was dismissed.  
(3) EAT 327/03.  Again before His Honour Judge McMullen QC sitting alone on 6 May 2003.  On that occasion the EAT ordered further disclosure by the Respondent, including disclosure of the Respondents’ monthly financial reports issued to its bankers, Lloyds Bank, for September, October and November 2001, that material to be disclosed by 4 pm on 7 May.  A direction was also given as to further cross-examination by the Applicant, who appears in person, of the Respondents’ officers on the new material disclosed.  

2	That chronology should be set against:
(1) the three days of hearing of the substantive complaints brought by the Applicant against the Respondents, his former employer CLI Ltd which have now taken place on 23 January, 14 March and 8 May 2003.  A fourth day of hearing has been fixed for next Monday, 14 July 2003.  
(2) Various interlocutory orders and directions made by the Employment Tribunal, including, for present purposes:
(a) an order by the Chairman, Mr Simpson, made on 8 May 2003, time-tabling the hearing to be held on 14 July;

(b) by a letter dated 12 May 2003 to the Tribunal the Applicant complained of the conduct of the Chairman, Mr Simpson, over the first three days of hearing.  He submitted that the Chairman had given the appearance of bias.  On 19 May the Regional Chairman, Mr Edwards, replied through the Tribunal Secretariat.  He concluded in that letter:
“If, at the conclusion of the case, you consider that the hearing has not been conducted properly by the Chairman, it is of course, open to you to appeal to the Employment Appeal Tribunal.  However, the Regional Chairman cannot interfere in the proceedings.”

(c) The Appellant made a subsequent application to the Chairman, Mr Simpson, for further disclosure.  That application is dated 19 May.  It requests disclosure of the following documents:
(i) that the Respondents’ bankers, Lloyds disclose the full financial report that the Respondent Company issued to their bankers for the relevant months of September, October and November 2001;
(ii)  that the Respondents disclose their company bank statements for the relevant period of 1 September to 31 December 2001.  

3	On 24 May the Applicant made a further application to the Tribunal to lodge before the Tribunal what he described as relevant documents.  They were
(i) The Regional Chairman’s interlocutory order dated 13 December 2002;
(ii) Judge McMullen’s order dated 6 May 2003;
(iii) a letter from the Respondents’ representative, Mr Cater, dated 9 September 2002;
(iv) 2001 calendar;
(v) a list of orders appearing at pages 285-287 of the ET trial bundle;
(vi) an up-date, prepared by him, of page 245 of that bundle;

Those applications were considered ex parte on paper by Mr Simpson on 7 June.  By an order promulgated with reasons on 12 June, the Chairman refused these applications.  

4	Before dealing with the grounds raised in the present appeal (EAT/0504/03) I should say something about the substantive issues in the case.  The Applicant was employed by the Respondents as Systems Controller from 17 May 1999 until his dismissal effective on 5 December 2001.  He was off sick from 1 April 2001 until the termination of his employment.  By his Originating Application presented to the Tribunal on 18 December 2001, he raised three complaints:
(1) Ordinary unfair dismissal by reason of ill-health.
(2) Automatically unfair dismissal for asserting a statutory right, that is, his asking for but not receiving a contract of employment or a statement of terms and conditions of employment.
(3) Pay in lieu of notice.

5	By their Notice of Appearance the Respondent joined issue with the Applicant on their reason for dismissal.  It is said to be some other substantial reason falling within section 98(1)(b) of the Employment Rights Act 1996.  Their case is set out in Further and Better Particulars of the Grounds of Resistance dated 10 May 2002 in this way:

“2.  The respondents submit that the reason was, that there was a sound and genuine reason for a business reorganisation due to economic factors, which dislodged the Applicant who could not be fitted into the organisation.
3.  The reason for the reorganisation was that of economic necessity, in particular the need for economy due to the financial situation of the company.”

6	The nature of the case was summarised by Mr West, then appearing on behalf of the Respondents before Mr Justice Nelson’s division of the EAT on 9 July 2002, and recorded in the judgment delivered on that day (transcript paragraph 11) in this way:
“Mr West, on behalf of the Respondents, has confirmed before us today that economic necessity for disposing of the services of Mr Nicholls is, in fact, their sole defence to the proceedings.  When they served those Further and Better Particulars, the Respondents said that they would be adducing evidence from the Directors of the company and in the form of documentation, demonstrating the precarious financial situation that the company was in, during the relevant period.”

Thus there was and remains a live issue as to the Respondents’ reason for dismissal.  

7	I turn now to the present grounds of appeal.  Although set out in seven numbered paragraphs, there seem to me to be five grounds.  I shall deal with each in turn, bearing in mind that an appeal to the EAT, even where the appeal lies against interlocutory orders made below, limits my powers to interfere with such orders to correcting errors of law.  I am not permitted simply to review those orders de novo.  See, for example, Noorani -v- Merseyside TEC Ltd [1999] IRLR 184 CA).  

8	(1)  Bias The Applicant complains that the Chairman, Mr Simpson, has in a number of respects given the appearance of bias such that he should recuse himself and the case begin again before a fresh Employment Tribunal.  Without ruling on the merits of the Applicant’s complaint of bias or the appearance of bias at this stage, I uphold that Regional Chairman’s observation in his letter dated 19 May, set out above.  That approach, it seems to me, accords with the observation made by Mr Justice Peter Gibson, as he then was, in Peter Simper -v- Cooke [1986] IRLR 19, where he said, at paragraph 21:
“We think it right to stress the highly unusual facts of this case.  Save in extraordinary circumstances, it cannot be right for a litigant, unhappy with what he believes to be the indications from the Tribunal as to how the case is progressing, to apply, in the middle of the case, for a re-hearing before another Tribunal.  It is, in our view, undesirable that the Tribunal accused of giving the opinion [sic ? appearance] of bias should be asked itself to adjudicate on that matter.  The dissatisfied litigant should ordinarily await the decision and then, if he thinks it appropriate, he should make his dissatisfaction with the conduct of the case by the Tribunal, a ground of appeal.”

9	One of the main complaints made by Mr Nicholls is that on day two of the substantive hearing, the Chairman said “Mr Taylor is an honest witness”.  Mr Nicholls submits that not having heard from the Applicant, it was far too early for the Chairman to express a concluded view as to the veracity of a witness.  My difficulty today in this interim appeal is that there is no affidavit from the Appellant setting out his detailed allegations of bias against the Chairman.  Consequently, the Chairman has not been given an opportunity, nor have his lay colleagues, of commenting on such allegations.  Nor, indeed, have the Respondents been given an opportunity to respond by way of affidavit evidence.  Should that become necessary, it may be in due course that witnesses will have to be heard at the EAT to determine precisely what was said, in order to form a judgment as to whether or not the Chairman did exhibit the appearance of bias.  

10	In these circumstances, it would be wrong for me to attempt to adjudicate one way or another on the bias issue as a matter of fact.  I shall therefore follow the usual practice described by Mr Justice Peter Gibson in Peter Simper -v- Cooke and confine myself to saying that if, in due course, the Applicant fails before the Employment Tribunal and launches an appeal against that Tribunal’s eventual substantive decision, then it will be open to him in that appeal to raise such complaints of bias as he wishes.  I shall not, therefore, grant the relief which he seeks today; that is an order discharging the present Tribunal and an order that the case be re-heard by a fresh Tribunal.  

11	 (2) The Directions order made on 8 May.  It seems to me, particularly in view of the overriding objective which is now incorporated by way of Regulation 10 of the 2001 procedure Regulations, that it is open to a Tribunal to direct that the parties be time limited, particularly in circumstances where this case, originally listed for one day, is now about to enter its fourth day.  I shall not interfere with the orders made on that occasion.  

12	(3) Recalling witnesses. I draw attention to His Honour Judge McMullen’s order made on 6 May, permitting the Applicant to further cross-examine officers of the Respondent on the new material which was to be disclosed as a result of the Judge’s order made on that day, in particular in relation to the monthly financial reports issued by the Respondents to their bankers, Lloyds Bank, for September, October and November 2001.  Mr Nicholls complains before me today that the Chairman has not complied with the terms of that order.  I need hardly say that it is a requirement that the Employment Tribunal should follow the directions of the Employment Appeal Tribunal.  The opportunity to further cross-examine the Respondents’ officers will arise in relation to further documents, to which I shall now turn.  

13	(4) The Chairman, Mr Simpson’s refusal to order further disclosure on 12 June
The Chairman’s reasons for refusing the disclosure application made by the Applicant is really summarised at paragraph 4(j) of his reasons given on that occasion.  Those reasons are as follows: 

“I refuse the Applicant’s request for discovery of further documents on the grounds (a) they go principally to the issue of credibility and the Applicant has not shown any proper basis for those documents now to be disclosed save for his own unsubstantiated assertions; (b) if they are relevant they should have been put in cross-examination to the Respondent’s witnesses and the Respondent’s case is now closed; (c) the expense in procuring the documents from a source who is not a party to these proceedings is disproportionate; and (d) an order for disclosure pursuant to rule 5(b)[sic] of the 2001 Rules can be made only against a party and Lloyds TSB are not a party to this litigation.”

14	I begin with the last reason first.  The reference there, it seems to me, is to Rule 4(5)(b) of the 2001 Rules which provides:
“A tribunal may, on the application of a party or its own motion -
…
(b) require one party to grant to another such disclosure or inspection (including the taking of copies) of documents as might be granted by a court under rule 31 of the Civil Procedure Rules 1998.”

15	Mr Nicholls is conducting his case in person.  It is clear from his application that he was requesting production by the Respondents’ bankers, Lloyds, of the full financial report that the Respondents issued to those bankers for the relevant months of September, October and November 2001.  The fact that the Applicant used in that application the word “disclose” should not, in my judgment, be taken to exclude the power granted to the Tribunal by Rule 4(5)(a) which provides that:
“A tribunal may, on the application of a party or of its own motion -
(a) require the attendance of any person in Great Britain, including a party, either to give evidence or to produce documents or both and may appoint the time and place at which the persons to attend and, if so required, to produce any document;”
It is plain to me that that was the Rule under which the Applicant was, in fact, proceeding.  

16	The documents concerned are few in number, and it seems to me that no real expense, let alone disproportionate expense will be incurred by Lloyds TSB.  It was not possible for the Applicant to put the documents in cross-examination to the Respondents’ witness, because he did not have them.  Finally, that the documents go to the issue of credibility.  It seems to me that where the Applicant has challenged the genuineness of documents disclosed by the Respondent, he is entitled to have access to the actual reports which were submitted by the Respondents to their bankers in order to determine whether or not there is any difference, as he has alleged before me and did before the Employment Tribunal, between the documents produced by the Respondents and those actually received by their bankers.  

17	In these circumstances I am persuaded that the reasons advanced by the Chairman for refusing this part of the application are misconceived and, in the circumstances, using my powers granted by section 35 of the Employment Tribunals Act 1996, I shall direct that a representative of the Lloyds Bank branch at Bank Court, 10 Manor Road, Verwood, Dorset, attend at the Southampton Employment Tribunal at the resumed hearing of this case at 9.30 am on Monday 14 July, together with the full reports and any covering letters sent by the Respondents to that branch, for the months of September, October and November 2001.  In that way, the issue raised by the Applicant can be resolved one way or another.  

18	As to the second part of the application, that is disclosure by the Respondents of the company’s bank statements for the period 1 September to 31 December 2001, I am unable to see from the Chairman’s reasons why that application was refused.  It seems to me that, contrary to paragraph 4 (d) of the Chairman’s reasons, the case advanced by the Applicant was not to challenge the commercial decision taken by the Directors of the Respondents to dispense with his services, rather to challenge the truth of the reason advanced by the Respondents, namely economic necessity.  In these circumstances, it seems to me that the Respondents’ company’s bank statements are highly material to the prime issue between the parties in this case.  In these circumstances, I shall also allow the appeal on this point and order the Respondents to disclose those bank statements to the Applicant by 4.30 pm today.  I understand that their offices are close by, and arrangements can be made through Mr Cater, the Respondents’ representative, who has not appeared before me today, as he did not before Judge McMullen on the two earlier appeals.  I have his fax transmission dated 10 July, in which he says this: 
“We would ask that should the Judge be minded to grant the Appellant’s appeal for disclosure of documents by the Respondent’s bank, that consideration be given as the time that this will take and what Order or Directions will be necessary to postpone the hearing of this matter at the Tribunal on Monday 14 July as we anticipate that the Bank will be unable to produce the documentation in time for the hearing.”

19	As to that, I do not order that the hearing on 14 July be postponed; it will go ahead.  I can see no reason why the bank should not be able to send a representative with the documents on Monday morning to the Southampton Employment Tribunal.  However, I have not heard from the bank and in fairness to them, I shall give liberty to the bank to apply to the Employment Tribunal to discharge the order for the production of the documents for good cause on Monday morning.  Customer confidentiality will not, in my view, be a good reason in the circumstances where the Respondents have already disclosed their copies, challenged by Mr Nicholls, of the reports made to the bank for September, October and November 2001.  

20	Fifth and finally, the application made by Mr Nicholls to lodge the six documents.  I have heard his submission in relation to that part of the appeal and I am not persuaded that the Chairman’s order in relation to that application is wrong in law.  The first four documents are documents already available to the parties; his main concern is with the sixth document, what he describes as the update of page 245 of the ET bundle, that is some calculations which he has made and added, since that document was first produced, I am told, at the last hearing on 8 May. He will, no doubt, wish to rely on that material when cross-examining Mr Taylor on Monday.  

21	Those are the points raised in the appeal.  It follows that the appeal succeeds in part, namely the appeal against the Chairman’s refusal to order production of the bank documents and disclosure by the Respondents of their bank statements.  To that extent the appeal succeeds; all other grounds are dismissed.