Appeal No. UKEAT/0111/08/JOJ

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal
On 23 June 2008
Judgment handed down on 2 July 2008

Before
THE HONOURABLE MR JUSTICE ELIAS (PRESIDENT)
MRS A GALLICO
MR H SINGH

1) JOHN LAMB PARTNERSHIP LTD	APPELLANTS
2) MS P STEELE

MR D PARFETT	RESPONDENT

Transcript of Proceedings

JUDGMENT No. 1

	APPEARANCES

For the Appellant	MS ELEENA MISRA 
(of Counsel)
Instructed by:
Messrs Schofield Sweeney LLP
Solicitors
St James House 
28 Park Place
LEEDS
LS1 2SP
	
For the Respondent	MS JENNIFER NICOL
(Solicitor)
Instructed by:
Messrs Doyle Clayton
Solicitors
1 Crown Court
Cheapside
LONDON
EC2V 6LP	

SUMMARY

PRACTICE AND PROCEDURE:  Chairman alone

The employer was debarred from participating in the proceedings for failing to lodge a response in time.  The subsequent case was heard before an employment judge alone.  The issue arose whether she had jurisdiction to hear it, or whether a full panel should have been provided.  The EAT held that she did have jurisdiction.

THE HONOURABLE MR JUSTICE ELIAS (PRESIDENT)

1.	This is an appeal against the decision of the Employment Tribunal which held that the claimant had been unfairly dismissed and had suffered age discrimination.  The employers had not put in their response in time.  Subsequently they did present one out of time.  The employment judge treated this as an application for review.  She rejected the review, and as a consequence the respondents were automatically barred from taking part in the proceedings pursuant to rule 9 of the Employment Tribunal Rules.  There are certain exceptions to that principle, but they did not apply here and therefore the employers were not permitted to participate in the hearing before the employment judge.

2.	The employment judge then heard evidence from the claimant, made findings of fact and reached legal conclusions in his favour on both liability and remedies.  

3.	We were due to hear this appeal against certain of the Tribunal’s findings.  The basis of the challenge is that even on the facts found by the Tribunal, the Tribunal reached conclusions which it could not properly reach as a matter of law.  However, Mrs Gallico, one of the lay members, raised the question whether the employment judge was empowered to hear the case on her own.  If the employment judge did indeed hear a case which by statute required the participation of lay members then the decision would be outwith the jurisdiction of the Tribunal and could not stand.  The answer did not appear to be self-evident simply from reading the relevant statutory provision alone, and so we adjourned the case for a short period to hear argument about that.  This is our judgment on this point.

The legislation.
4.	The circumstances in which an employment judge may hear cases alone and without the assistance of lay members is laid down in section 4(3) of the Employment Tribunals Act 1996.  The only relevant provision in the context of this case is section 4(3)(g) which provides that the case can be heard by a judge alone in: 
“proceedings in which the person (or, where more than one, each of the persons) against whom the proceedings are brought does not, or has ceased to, contest  the case.”

5.	Is an employer barred from participating properly to be described as “not contesting the claim”?   The claimant submits that he is.  Reliance is placed upon an unreported decision of the EAT (HHJ McMullen QC presiding) in The Basingstoke Press Ltd v Clarke UKEAT/0375/06. This very point arose for determination. HHJ McMullen QC said this (para 25): 
“We can see the force in Mr Hodge’s point - which he put, but in due course did not take to its conclusion - that Mr Bunyan was indeed resisting within the meaning of rule 9.  However, in our judgment, resisting must come from the right to resist; it does not here include a situation where a party has been ordered to take no part in the proceedings. True it is that he may stand on the sidelines and complain, but none of that is of any relevance.  The hearing will go ahead;  the party will be debarred from taking any part and this (within the meaning of these regulations) includes a person who in a colloquial sense resists but in a legal sense does not resist because he has been ordered to take no part in the proceedings.  There is no error of law in this approach.  Thus, the contention that the Tribunal Chairman lacked jurisdiction must fail. This was a case where there was no legal resistance.  We need not resolve the interesting point about what would happen when the matter comes back for a remedy (but reference should be made to Terry Ballard v Stonestreet.” (UKEAT/0568/06)).

6.	We think the learned judge must have meant “contesting” within the meaning of section 4(3)(g) of the Employment Tribunal Act rather than “resisting” under rule 9 of the Tribunal rules, but it does not alter the fundamental analysis.  The point is that someone who is prevented from participating is thereby deprived of the right to contest the case, whether or not he would like to do so, and accordingly section 4(3)(g) is triggered.
7.	The claimant submits that Basingstoke is correct and that we should follow it.  In order to contest a claim it is necessary to appear in court and adduce evidence and advance argument in opposition to it.  Merely being unwilling to concede the case is not enough.

8.	The respondents say that Basingstoke is wrong and we should depart from it.   First, it is not accurate to say that the respondents are not contesting the proceedings when they are unwilling to accede to the claim.  It may be that they are compelled to sit on the sidelines but nonetheless they are not disinterested parties.  A respondent who has not contested or has ceased to contest the claim in this context means someone who has conceded the claim.  It is only if a respondent is conceding a claim that he can be said not to be contesting it; if he is keeping the issue alive, he is still contesting it. 

9.	Second, there are certain circumstances when a respondent can take part in the proceedings even although he is not allowed to participate in the liability hearing.  For example, he can appeal the decision in an appropriate case, as indeed is the case here.  Moreover, the EAT has now held on a number of occasions that even where a party is debarred from participating in a liability hearing, there may be circumstances where he may still take part in the remedies hearing: see D and H Travel Ltd v Foster [2006] ICR1537 and NMS Music v Leefe [2006] ICR 450.  In such a case it is misleading to say that the respondent is not contesting the proceedings.  The proceedings must include the whole process, not merely that part concerned with liability, and the respondent is on any view contesting part of it.

Conclusion.
10.	We accept the submissions of the claimant.  Furthermore, we would not readily depart from an earlier decision of the EAT on the same point unless clearly satisfied that it was wrong.  In fact, on reflection we think that decision was correct.  Admittedly section 4(3)(g) is not unambiguous, but we have come to the conclusion that if a respondent cannot take part in the proceedings then there is no “contest” between the parties.   The submission of the employer equates a party who is “not contesting” the proceedings with one who is conceding them. We reject that analysis and prefer the argument of the claimant for four reasons in particular.

11.	First, where the case is conceded there is no need for a hearing at all and therefore it is otiose to have a rule which states that the respondent cannot participate in the proceedings.   There is nothing for them to participate in.  All the judge has to do is draw up the order reflecting the concession.  This point has even more force if the word “proceedings” in section 4(3)(g) means the whole of the proceedings, as the employer contends.  It would mean that the respondent would only not be contesting the case where he had conceded every aspect of the claim, including the remedy sought.  Yet if anything it is even more difficult to see why a hearing would be required in those circumstances.

12.	Second, if the intention had been that the provision would apply only in the case of a concession, it would have been very simple for the statute to have said so.
  
13.	A third and related point is this.  We think that there is a clear linguistic distinction between conceding a claim and not contesting it.  An employer might choose not to appear, perhaps because the case is totally hopeless, or the cost of attending is disproportionate to the amounts at stake, and indicate that he is content for the tribunal to determine the matter in his absence.  We think it would be an appropriate use of language to say that he is then not conceding the case, but nor is he contesting it.  The tribunal must still determine whether the claim is made out, but in the absence of any evidence adduced or argument advanced by the respondent.
  
14.	Fourth, there is an obvious rationale in permitting the tribunal to sit without lay members in those circumstances. There is likely to be little difficulty in determining the relevant facts where the claimant’s evidence is not being challenged.  

15.	Exceptionally, such as where the claimant’s evidence appears to contradict the documents, that determination may not be so straightforward, but there is always a discretion for a full tribunal to be empanelled in those circumstances: see section 4(5) of the 1996 Act.  It is not difficult to see why Parliament would have thought that it will often be appropriate for a case to be heard by a judge alone if the respondent is not appearing to dispute the evidence or make submissions.

16.	In our judgment, this conclusion is not invalidated by the fact that a respondent may be heard in a remedies hearing or on appeal even if debarred from taking part in the liability hearing.  In our view, the concept of “proceedings” in section 4(3)(g) means the particular proceedings before the tribunal.  For example, a respondent may choose not to contest liability (without conceding it) but to contest the remedy.  In those circumstances it would in principle be lawful for a judge alone to hear the liability hearing even although a full panel would be necessary to hear the remedy.  (In practice no doubt, in such a case, a full panel would normally be instituted to hear the whole case under section 4(5)).

17.	We should add that in the particular circumstances of this case we would have thought that it was a case where a full panel would have been desirable, notwithstanding the absence of the employer, given the nature and circumstances of the dispute. There was an unusual employment relationship where the views of the lay members may have been valuable. However, there has been no challenge to the exercise of discretion that the employment judge should hear the case herself.  We are only concerned with the jurisdictional question whether she was legally entitled to do so.  For the reasons given, we think she was.

Disposal.
18.	We hold that the employment judge was entitled to hear the case alone, and her decision was valid.  We shall therefore go on to hear the substantive appeal.