THE INDUSTRIAL TRIBUNALS

CASE REF:	811/07

CLAIMANT:			Michael Gutulan

RESPONDENT:		Rainbow Telecom

DECISION ON A PRE-HEARING REVIEW
The decision of the tribunal is that:-

1(i)	The ‘stay’ of the claimant’s claim of unfair dismissal, the subject-matter of the decision, registered and issued to the parties on 20 September 2007, is removed.

(ii)	The agreement which was entered into between the parties in or about September 2007 (‘the September Agreement’), as a result of conciliation action by the Labour Relations Agency , was an agreement that the claimant would refrain from continuing these proceedings and thereby complied with the provisions of Article 245(2)(e) of the Employment Rights (Northern Ireland) Order 1996 and Article 20 of the Industrial Tribunals (Northern Ireland) Order 1996; and the said agreement is therefore not void.

(iii)	The September Agreement was not entered into in circumstances which rendered it voidable at common law.

2.	The tribunal therefore does not have jurisdiction to determine the claimant’s claim of unfair dismissal; and the claimant’s claim of unfair dismissal is therefore dismissed.

3.	The respondent’s application for an Order for Costs is not granted.

Constitution of Tribunal:
Chairman (sitting alone):		Mr N Drennan QC

Appearances:
The claimant appeared in person and was unrepresented.
The respondent was represented by Ms R Best, Barrister-at-Law, instructed by Patterson Donnelly, Solicitors.

Reasons

1.1	This pre-hearing review was arranged to determine the following issues:-

(i)	Whether the ‘stay’ of this claim, the subject-matter of the decision registered and issued to the parties on 20 September 2007, should be removed and/or set aside.

(ii)	Whether the September Agreement entered into between the parties as a result of conciliation action by the Labour Relations Agency satisfied the provisions of Article 245 of the Employment Rights (Northern Ireland) Order 1996.

(iii)	Whether the September Agreement made between the parties as a result of conciliation action by the Labour Relations Agency was voidable at common law.

(iv)	Subject to the determination by the tribunal of the issues set out in the preceding paragraphs, whether the tribunal has any jurisdiction to hear the claimant’s claim of unfair dismissal and, if not, whether the said claim should be dismissed by the tribunal.

1.2	The claimant and his former wife, Mrs Estella Gutulan, gave oral evidence to the tribunal.  The respondent did not give oral evidence in connection with the determination of the issues, the subject-matter of these proceedings.  In addition, the tribunal was provided, by both the claimant and the respondent, with documents which the tribunal has considered, insofar as relevant and material to the said issues, before reaching its decision.

2.1	The claimant presented a claim to the tribunal on 11 April 2007, in which he claimed unfair (constructive) dismissal.  The claim form stated, inter alia, that the claimant’s representative was Dean Morris of Morris Legal (Solicitors) Limited, a firm of solicitors practising in Solihull, West Midlands, England, and the claim form was signed, on behalf of the claimant, by the said firm of solicitors.  The claim form included an attachment setting out the grounds of the claimant’s application, which included a detailed history of the claimant’s employment relationship with the respondent and the facts relied upon by the claimant relating to his claim of unfair dismissal.  The respondent presented a response form to the tribunal on 25 May 2007 in which it denied liability and set out a detailed response to the matters set out in the claimant’s claim form.  The response form was presented on behalf of the respondent by its then representative, Abbey Legal Services of 17 Lansdowne Road, Croyden, England.  Notice of Hearing was issued on 1 August 2007 for a substantive hearing to be held on 25 – 26 September 2007.

2.2	Following discussions between the parties, to which I shall make further reference later in this decision, an agreement (the September Agreement) was drawn up,    and was signed by the claimant on 17 September 2007 and the respondent on 24 September 2007.  

The September Agreement is headed ‘Agreement in respect of a claim made to the industrial tribunal’ and refers to the tribunal case number of 811/07 and to the claimant as Michael Gutulan and the respondent as Rainbow Telecom.  It further states:-

	“Settlement reached as the result of conciliation action.

	We the undersigned have agreed:-

(1)	The respondent shall pay and the claimant shall accept the sum of £3,500.00 (three thousand five hundred pounds) in full and final settlement of these proceedings (and any other proceedings contemplated or pending before the industrial tribunal) and all claims arising from the claimant’s employment with the respondent or the termination thereof.

(2)	The respondent makes no admission of liability.

(3)	It is agreed between the parties that the terms and the fact of this settlement shall remain confidential and shall not be publicised by either party or their representatives save as may be required to be disclosed by law.  However, this clause shall not prohibit the claimant from disclosing the fact of this settlement to a perspective employer.

(4)	The respondent agrees to make payment of the above sum within 14 days of receipt of this agreement, duly signed by the claimant, by cheque paid to him made payable to Morris Legal (Solicitors) Limited.”

Following the signing of the September Agreement by the parties, as aforesaid, the Labour Relations Agency sent the following document (Form TN1) to the tribunal on 4 September 2007, which stated:-

“A settlement has been concluded between the parties as a result of conciliation action by the Labour Relations Agency.”

On receipt of the said document from the Labour Relations Agency, in accordance with the tribunal’s then normal practice, a decision was registered and issued to the parties on 20 September 2007 which stated:-

“The claim is ‘stayed’ until further order.  The parties reached an agreement in settlement of the claim with the assistance of the Labour Relations Agency.”

The claimant is now seeking to challenge the validity of the September Agreement and, if successful, to have his claim of unfair dismissal determined by the tribunal at a substantive hearing on the merits.

2.3	There was no dispute that the terms of the September Agreement were fully implemented and, in particular, the sum of £3,500.00 was paid by the respondent to the claimant’s solicitors, who, after deduction of their costs and charges, paid the balance to the claimant.  The claimant at no time sought to refuse to accept the monies payable to him upon foot of the agreement or to return any of the sums paid to him on foot of the said agreement.  

At a Case Management Discussion held on 27 June 2008, the claimant confirmed that, in seeking to challenge the validity of the September Agreement, he was not raising any issue that the relevant Conciliation Officer of the Labour Relations Agency, who acted in this matter, failed to act properly in accordance with her statutory powers and duties.  Indeed, at this hearing, the claimant confirmed the foregoing and that this had been a conscious decision taken by him and which he was not intending to change.  In any event, no evidence was presented to the tribunal, at this pre-hearing review, raising any issue to suggest the Conciliation Officer had acted contrary to her statutory powers and duties.  

2.4	The Labour Relations Agency sent a further document (Form TN1) to the tribunal on 15 May 2008, which stated:-

“A settlement has been concluded between the parties as a result of conciliation action by the Labour Relations Agency.  In entering into this agreement the claimant agreed to refrain from continuing these proceedings and agreed to refrain from instituting any further proceedings.”

I was not satisfied that this further Form TN1 sent on 15 May 2008, whatever its terms, was relevant, in the circumstances, to the issue to be determined at this   pre-hearing review.  The issue to be determined by the tribunal was whether the September Agreement, the subject-matter of the conciliation action by the Labour Relations Agency, which had resulted in the Labour Relations Agency sending the document, Form TN1, to the tribunal on 4 September 2007, satisfied the relevant statutory procedures, and which subsequently resulted in the decision of the tribunal issued to the parties on 20 September 2007 ‘staying’ the proceedings.  This further document provided by the Labour Relations Agency is not therefore the relevant document which resulted in the tribunal in making its decision dated 20 September 2007; and, in my judgment, was of no assistance or relevance in determining the issues, the subject-matter of this pre-hearing review.  

2.5	Following the said decision, registered and issued to the parties on 20 September 2007 by the tribunal, the claimant’s claim of unfair dismissal was ‘stayed’.  Both parties recognised at this pre-hearing review that such a ‘stay’ was unsatisfactory, as it did not provide the necessary finality to the proceedings.  The claimant, in the circumstances, sought to have the ‘stay’ removed to enable the tribunal to determine the validity or otherwise of the September Agreement, so that he would know whether he was in a position to have his claim of unfair dismissal determined at a substantive hearing.  The respondent did not consent to the removal of the ‘stay’.  Ms Best contended that the claim had been ‘stayed’ pending the implementation of the settlement terms.  The said terms having been implemented, she submitted the claim should now be dismissed.  I am not satisfied that is a correct interpretation of the decision of the tribunal or the terms of the September Agreement itself.  The September Agreement made no reference to the making of a ‘stay’, which was an action by the tribunal, in accordance with its then normal practice following receipt of the relevant documentation from the Labour Relations Agency.  The September Agreement did not contain any express terms relating to the granting of a ‘stay’ by consent or indeed contain any terms in relation to the withdrawal of the claim and/or dismissal of the claim, pending implementation of the terms of the September Agreement.

2.6	In any event, regardless of the foregoing, both the claimant and the respondent’s representative did not dispute that it was necessary for the tribunal to bring finality to these proceedings, which they agreed was not possible whilst the said ‘stay’ remained.  They further agreed that, if the tribunal found that the September Agreement was valid and binding, the claim now required to be dismissed as the tribunal would not have any jurisdiction to determine it; but, if the tribunal found the September Agreement was not valid or binding, then the claimant’s claim would now require to be re-listed for determination by the tribunal at a substantive hearing.

In these circumstances, I was satisfied, however the said ‘stay’ had come to be made, that the said ‘stay’ should be removed, in order to enable the tribunal to determine the validity of the September Agreement at this pre-hearing review.  For the purposes of determining the validity or otherwise of the September Agreement and the tribunal’s jurisdiction, if any, to determine the claimant’s claim of unfair dismissal, I therefore decided, and I so ordered, that the said ‘stay’ should be removed.

2.7	The claimant informed the tribunal that he had had difficulty in obtaining representation in relation to his claim of unfair dismissal, because of his then financial situation.  He informed the tribunal that he had obtained the services of Mr Morris of Morris Legal (Solicitors) Limited, having seen an advertisement on the internet by the said firm of solicitors.  Crucially, given his financial situation, the claimant ascertained that Mr Morris was prepared to take on the claimant’s representation on the basis of a contingency fee agreement, commonly known as ‘no win no fee’, ie the solicitor’s charges would be based on an agreed percentage plus VAT, of any damages recovered on the claimant’s behalf.  This is, I understand, a common basis under which solicitors are prepared to represent clients in England, though it is not so for solicitors in Northern Ireland.  However, there is nothing to prevent a solicitor from England representing a client in Northern Ireland in tribunal proceedings.  From correspondence presented by the claimant to the tribunal, the claimant was sent by Mr Morris a copy of the terms and conditions under which Mr Morris agreed to represent the claimant; and which terms the claimant accepted and agreed.  It was not for this tribunal, in my judgment, to consider the appropriateness of such terms and conditions, which were a matter between the claimant and his former solicitor.  Following receipt of instructions by the claimant, the claimant’s solicitor, Mr Morris, presented to the tribunal the said claim form on behalf of the claimant.  The claimant suggested, in evidence, that he did not receive a copy of the said claim form, as presented on his behalf by his solicitor, and that he had subsequently had to obtain a copy from the tribunal.  Again, in my judgment, for the purpose of determining the issues at this pre-hearing review, even if correct, this is a matter between the claimant and his former solicitor.  The tribunal did not hear any evidence from Mr Morris; and it was not necessary for the tribunal, in any event, to come to any conclusion, in relation to such allegations by the claimant, for the purposes of determining the said issues.  However, the claimant accepted that he did obtain a copy of the respondent’s response form presented on the respondent’s behalf by Abbey Legal Services.  He stated he strongly contested the contents of the response form to his solicitor and provided to his solicitor his detailed comments on the said response form.  No doubt, if this matter had proceeded to a substantive hearing, the claimant’s comments in relation to the matters set out in the respondent’s response form would have been very relevant and material to the determination of his claim.  

2.8	By e-mail dated 28 May 2007 to the claimant from Mr Morris, Mr Morris stated to the claimant:-

“I can confirm that I will only continue to act for you in your constructive dismissal claim upon your agreement to the following:-

(1)	You will not yourself contact the Office of the Industrial Tribunal.

(2)	You will not yourself contact Labour Relations Agency.

(3)	You will not yourself contact the solicitors appointed by the company.

(4)	You will not yourself contact the respondent.

(5)	Agreement to enter conciliation in relation to the constructive dismissal claim through ACAS.

Upon your agreement to these terms and adherence to them, we will continue to act, in default of which we will cease acting and will render for the work carried out to date.

I hope we now understand each other.”

I do not know the circumstances in which this e-mail letter came to be written; but again, such matters, which relate to the relationship between the claimant and his former solicitor, are not matters for this tribunal.  However, it is normal, in my experience, where a party is represented that all relevant correspondence between the parties and/or the tribunal is conducted through the parties but, where represented, through their representatives alone.  Clearly the reference to ACAS is wrong and should have been to the Labour Relations Agency, the Northern Ireland equivalent to ACAS.

2.9	The claim of the claimant had been due to be determined by the tribunal at a substantive hearing to commence on 25 – 26 September 2008.  In the period prior to the date for hearing, I am satisfied that Mr Morris, on the claimant’s behalf, entered into conciliation negotiations with the respondent, using the services of the Conciliation Officer of the Labour Relations Agency, in an attempt to settle the matter prior to hearing.  The claimant presented to the tribunal some correspondence/e-mails passing between himself and his former solicitor relating to these negotiations, which culminated in the signing, by him, of the September Agreement.  Whether this is all the correspondence/e-mails which passed between the claimant and his former solicitor I do not know, or indeed require to know, for the purposes of determining the issues, the subject-matter of this pre-hearing review.  I note that in a letter dated 29 October 2007, whenever Mr Morris sent to the claimant a cheque for £1,855.00, representing the agreed settlement - £3,500.00 less his charges in accordance with the terms of the ‘no win no fee agreement’, he enclosed a copy of the September Agreement and he also reminded the claimant – the agreement was entered into on the claimant’s behalf and in accordance with his instructions.

2.10	As I reminded the parties at this hearing, it is not for this tribunal to determine whether the agreement entered into by the parties was a ‘good’ or a ‘bad‘ agreement, having regard to the various interests of each party.

The claimant at this hearing submitted that Mr Morris took no account of his detailed response nor consulted with him properly in relation to the settlement terms and, in essence, presented him with the terms of the settlement agreement to sign; and said that; if the claimant did not do so, he would cease to act for him and the claimant would be responsible for Mr Morris’ costs to date.  Again, whether or not such allegations are true, these are matters between the claimant and his former solicitors and are not relevant to the determination of the issues the subject-matter of this pre-hearing review.  

2.11	It was not disputed the claimant had signed the September Agreement on 17 September 2007, which was then sent by Mr Morris to the Conciliation Officer of the Labour Relations Agency to obtain the signature of the respondent, who signed the September Agreement on 24 September 2007.

The claimant submitted his former solicitors had at all time acted wrongfully and/or had acted without his authority and had forced him/blackmailed him into signing the agreement his former solicitors had drawn up on his behalf, as set out above.  As I made clear throughout the course of these proceedings, the tribunal is not in a position to come to any conclusion on the allegations made by the claimant in relation to the conduct of his former solicitors in relation to the drawing-up and/or signing of the September Agreement and does not, in my judgment, require to do so.  (See further Paragraph 6 of this decision.)

There was no dispute that, at the material time, both the respondent and/or its then representatives and the Conciliation Officer were dealing with Mr Morris, a Solicitor, of Morris Legal (Solicitors) Limited as the representative of the claimant in relation to these proceedings and the drawing-up and signing of the September Agreement; and that Mr Morris at all times, represented himself as having all the appropriate authority of such a solicitor in taking such action on behalf of the claimant.  The claimant accepted, in evidence, that neither the respondent or its then representatives and/or the Conciliation Officer would have been aware of any of the difficulties in his relationship with his former solicitor, Mr Morris, as referred to above; nor were they put on notice, by him, of any of these said difficulties in his relationship with Mr Morris.  Indeed, the claimant emphasised that, following the    e-mail dated 18 May 2007, Mr Morris had made it clear that the claimant was not to contact, either the Labour Relations Agency or the respondent or any representative of the respondent.  

2.12	The claimant’s former wife, Mrs Estella Gutulan, gave oral evidence to the tribunal.  She denied that she had had any involvement in the drawing-up and/or signing of the September Agreement and emphasised she was therefore not in a position to provide any relevant evidence to assist the tribunal in determining the issues, the      subject-matter of this pre-hearing review.

2.13	The claimant’s claim of unfair dismissal included allegations in relation to an improper relationship between Mrs Gutulan and a senior employee of the respondent.  It is clear that, prior to the institution of these proceedings, the claimant had made such allegations and that the said senior employee had decided to instruct his own solicitor to write to the claimant to prevent the claimant from continuing to make these allegations.  It should also be noted that, in the course of her evidence to this tribunal, Mrs Gutulan expressly denied any improper relationship between her and the said senior employee.  By letter dated 6 February 2007, Mr Mark Jefferson, Solicitor, of Patterson Donnelly & Company, Solicitors, and the solicitor acting on behalf of the said senior employee, wrote to the claimant in the following terms:-

“We act on behalf of the above-named client.

We have been instructed to write to you with regard to your allegations of an improper relationship between our client and your wife.  There is no substance whatsoever to these allegations.  They are totally fabricated and have no basis in fact.  Indeed we would formally request that you forward evidential proof of your allegations by return.  

Your allegations have undoubtedly resulted in our client’s reputation being tarnished and are clearly defamatory of our client.  In the circumstances we require an immediate retraction of the allegations and a full written apology by return.

If we do not receive an appropriate reply within 14 days of the date of this letter, consideration will be given to issuing High Court proceedings against you without further notice.”

The claimant replied to the said letter contesting and/or denying many of the matters set out in Mr Jefferson’s letter.  Mr Jefferson sent a further reply dated 26 February 2007, which was in the following terms:-

“We refer to our letter dated 6 February 2007, a further copy enclosed.  We write to remind you that we are not acting for Rainbow Telecom and are only acting for [our client] in a personal capacity.  We are not instructed to deal with your grievance.

We note that you have not provided any evidential proof of your allegations of an improper relationship between our client and your wife.  We would be grateful if you could provide such evidence without delay.”

The claimant submitted that the letters sent by Mr Jefferson were of a threatening, intimidatory nature and were sent in an attempt to deter him from taking these tribunal proceedings; and that he was further entitled to rely upon them in order to set aside the September Agreement.  Firstly, it has to be said that the letters were not sent on behalf of the respondent but were sent on behalf of the senior employee of the respondent in relation to a potential claim he, in his personal capacity, considered he might have against the claimant.  Secondly, and more importantly, the said correspondence took place prior to the issuing by the claimant of the said tribunal proceedings and at a time in which the claimant had his own solicitor to represent him in connection with those tribunal proceedings and which proceedings were issued, as set out above, some months later.  The said letters therefore did not prevent the claimant from commencing these tribunal proceedings.  Further, I am not satisfied that the contents of the solicitor’s letters were in any way improper or threatening or intimidatory; but were merely written in formal legal terms, as is normal, in my experience, prior to the institution of any such legal proceedings.  

3.1	Insofar as relevant, Article 245 of the Employment Rights (Northern Ireland) Order 1996 provides as follows:-

“Restrictions on contracting out –

(1)	any provision in an agreement (whether a contract of employment or not) is void insofar as it purports –
(a)	to exclude or limit the operation of any provision of this Order, or

(b)	to preclude a person from bringing any proceedings under this Order before an industrial tribunal.

(2)	Paragraph (1) –

…

(e)	does not apply to any agreement to refrain from instituting or continuing proceedings where the agency has taken action under Article 20 of the Industrial Tribunals (Northern Ireland) Order 1996, and

(f)	does not apply to any agreement to refrain from instituting or continuing any proceedings with Article 20(1)(c) (proceedings under this Order where conciliation is available) of the Industrial Tribunals (Northern Ireland) Order 1996 if the condition regulating compromise agreements under this Order are satisfied in relation to the agreement.

… .”

It was not disputed by the claimant or the respondent’s representative that the September Agreement was entered into as a result of action taken by the Conciliation Officer of the Labour Relations Agency, and was therefore a ‘conciliation agreement’, pursuant to Article 20 of the Industrial Tribunals (Northern Ireland) Order 1996.  However, it was also agreed by the parties the September Agreement was not a compromise agreement entered into pursuant to Article 245(2)(f) of the 1996 Order.  If such a compromise agreement does not satisfy the specific detailed requirements as set out in Article 245(2)(f) and 245(3)(a – f) of the 1996 Order, then such an agreement will also be found to be void.

3.2	To satisfy the provisions of Article 245(2)(e) of the 1996 Order and thereby prevent the provisions of Article 245(1) of the 1996 Order from applying, the September Agreement, a ‘conciliation agreement’, had to be an agreement between the parties to refrain from instituting or continuing proceedings.  If it was not such an agreement, it would be held to be void.  This has to be contrasted with the position in relation to a compromise agreement.  For example, there is no requirement, in Article 245(2)(e), that a conciliation agreement needs to be in writing.  Whenever agreement to the terms has been indicated by both sides to the Labour Relations Agency Officer, a conciliation agreement is binding on both parties (see Gilbert  v  Cambridge Fibres Limited [1984] ICR 188).  In that case, the employee’s subsequent refusal to sign a written agreement which recorded the terms agreed orally, did not affect the validity of the settlement agreement that had been reached for the purposes of the conciliation settlement.  In this particular case, of course, as set out above, the claimant and the respondent did enter the agreement in writing and it was signed by both parties.  In contrast to a conciliation agreement, a compromise agreement to be effective, for example, requires the claimant, inter alia, to have received advice from a relevant independent legal adviser as to the terms and effect of the proposed agreement and, in particular, its effect on his ability to pursue his rights before an industrial tribunal. Thus, if the September Agreement had been a compromise agreement, pursuant to Article 245(2)(f) of the 1996 Order, the allegations made by the claimant, in the course of this hearing, against his former solicitor, would have had to have been considered further.  However, for the purposes of the conciliation agreement, whilst I have no doubt that it would be a matter of good practice for a claimant and his solicitor to normally consider and discuss such matters and to receive appropriate advice in relation to them, these were not requirements of Article 245(2)(e) of the 1996 Order and therefore were not matters which were relevant for the determination of this matter, since the September Agreement was such a conciliation agreement.  

3.3	The terms of the September Agreement, a conciliation agreement made following action taken by the Conciliation Officer of the Labour Relations Agency, pursuant to Article 20 of the Industrial Tribunals (Northern Ireland) Order 1996, had to be considered further to see if the terms of the agreement entered into between the parties satisfied the statutory provisions and was thereby valid and binding on the parties and not void; in particular, to determine whether:-

(1)	the terms of the agreement covered the claimant’s claim of unfair dismissal; but also 

(2)	contained an agreement to refrain from continuing these proceedings.  

To determine such matters, in my judgment, is a matter of normal contractual interpretation in accordance with general contractual principles summarised in Investors Compensation Scheme  v  West Bromwich Building Society [1998] 1W.L.R 896, as confirmed in BCCI  v  Ali [2001] UKHL 8.

There was no dispute between the parties that the agreement covered the claimant’s claim of unfair dismissal.  Since this was the only claim, the          subject-matter of these proceedings, it is not necessary to consider that issue further.  There is equally no doubt that the more clearly the terms are set out in an conciliation agreement the less room there will be for uncertainty.  In my judgment, the inclusion of clear express terms would mean that the parties would be in no doubt what had been agreed and it would avoid the need to have a tribunal hearing, such as this, to determine the proper interpretation of the agreement entered into between the parties.  It is unfortunate that in the September Agreement there was no such express term.  In my judgment, if the terms of every conciliation agreement expressly provided that it is was an agreement to refrain from instituting or continuing proceedings, where the agency has taken action under Article 20 of the Industrial Tribunals (Northern Ireland) Order 1996, a hearing such as this could normally be avoided, with the advantage of finality and the saving of additional costs for the parties.  However, despite these obvious advantages to the parties, by the inclusion of such an express term, I am not satisfied that it is necessary in order to comply with the said statutory provisions that such an express term has to be included in a conciliation agreement – provided the terms which are included in the agreement, as a matter of contractual interpretation, comply with the said statutory provision.

The September Agreement provided, in particular:-

“That the respondent shall pay and the claimant shall accept the sum of £3,500.00 in full and final settlement of these proceedings (and any other proceedings contemplated or pending before the industrial tribunal) and all claims arising from the claimant’s employment with the respondent or the termination thereof.”

As indicated previously, and which was not disputed, this covered the claimant’s claim of unfair dismissal.  The issue for this tribunal to decide was whether the terms of the conciliation agreement satisfied the statutory requirement to be an agreement to refrain from continuing such proceedings.  I note that in the case of Royal National Orthopaedic Trust  v  Howard [2002] IRLR 849, and other decisions of the appeal courts referred to therein, similar wording, as seen in this case, under which settlement payments were to be made on foot of a conciliation agreement, has been accepted, in the various decisions, as satisfying the said statutory requirements of such an conciliation agreement.  These decisions were concerned, for the most part, with the issue relating to the identity of the claims, which were the subject-matter of the conciliation agreement; and it was not an issue to be determined that the said wording did not satisfy the said statutory provisions.  (See further Harvey on Industrial Relations and Employment Law, Volume 5, Section T(693 – 693.09).)  Indeed, as set out in his letter dated 29 July 2008, to the respondent’s representative, on foot of the tribunal’s order for him to set out his grounds for challenging the September Agreement, it is apparent that his principal contention is not that the agreement, by its terms, was not to bring the proceedings to an end; but rather that he should not have been ‘forced’ to sign it – to which I shall make further reference elsewhere in this decision.  

In my judgment, by use in the September Agreement of the term – “that the respondent shall pay and the claimant shall accept the sum of £3,500.00 in full and final settlement of these proceedings (and any other proceedings contemplated or pending before the industrial tribunal) and all claims arising from the claimant’s employment with the respondent or the termination thereof” - it is, as a matter of contractual interpretation, an implied term of the contract that the parties to the agreement have agreed to refrain from continuing the claimant’s claim of unfair dismissal.  I am confirmed in my judgment, when I consider the whole agreement; but also when I consider the above term in the context of the other terms of the agreement; where it is implicit, in my judgment, that this agreement was intended to bring these proceedings, to an end.

In these circumstances, I am satisfied the September Agreement complied with the requirements of Article 245(2)(e) of the Employment Rights (Northern Ireland) Order 1996 and the agreement is therefore not void.

4.	As the September Agreement is, as I have concluded above, a valid contracting out agreement concluded through the intervention of a Conciliation Officer, it is very difficult for a party to establish grounds to have it set aside.  As stated above, there was no allegation by the claimant the Conciliation Officer acted other than in accordance with her statutory powers and duties.  It was therefore necessary for the claimant to establish that the September Agreement was voidable at common law.  I am satisfied that the tribunal has jurisdiction to set aside an agreement voidable at common law (see further Hennessy  v  Craigmyle & Company Limited [1986] IRLR 300 and Harvey on Industrial Relations and Employment Law, Volume 5, Section T, Paragraphs 704 – 725).  

In seeking to set aside the September Agreement on the grounds that it was voidable at common law, the claimant relied principally on two matters.  Firstly, the claimant relied upon the actions of his former solicitor, Mr Morris, in relation to the negotiations carried out by Mr Morris, which resulted in the drawing-up by his solicitor and the signing by the claimant of the September Agreement; which he considered he had been forced to sign by his solicitor, in the circumstances set out in the previous paragraphs of this decision.  Secondly, the claimant replied upon the said correspondence from Mr Jefferson in February 2007, which he contended, because of its intimidating and threatening nature, amounted to                                             undue pressure brought to bear upon him, by Mr Jefferson, in relation to these proceedings. 

He suggested, in the course of his evidence to the tribunal and in his said letter dated 29 July 2008, the then representatives of the respondent in their response presented to the tribunal, on the respondent’s behalf, had lied and misrepresented the facts, which had been ignored by his solicitor, despite his detailed comments on the response sent to the solicitor, when drawing-up the terms of the September Agreement.  Again, whether or not the terms of the response of the respondent were correct, is not a matter for this tribunal in determining the issue, the      subject-matter of this pre-hearing review.  These matters would only be relevant, in the event of the tribunal concluding that the agreement was voidable and should be set aside; and a substantive hearing was required to be arranged to determine the claimant’s claim of unfair dismissal.

Whilst improper pressure applied by a party or its representative to make the other party sign an agreement might, subject to the precise evidence and circumstances, be sufficient grounds to establish the agreement is voidable and should be set aside, I was not satisfied, on the evidence before me, the respondent or the respondent’s representative wrongly applied, in the terms of the respondent’s response, any such improper pressure on the claimant.  Clearly, there were matters in dispute between the parties which required to be referred to, as appropriate by the respondent, in the response.  Such matters could only be resolved, if necessary, at a substantive hearing of the matter.

The correspondence by Mr Jefferson, in my judgment, is of no relevance to the making of the September Agreement, which was entered into by the claimant at a time when he was represented by his solicitor.  It was concluded with the assistance of a Conciliation Officer, whom it was accepted had acted at all times in accordance with her statutory powers and duties.  In any event, the correspondence by Mr Jefferson was on behalf of the senior employee of the respondent and not the respondent itself, albeit it has to be acknowledged that the senior employee was referred to in connection with the issues, which are the subject-matter of the unfair dismissal claim brought by the claimant.  The correspondence however did not relate to these proceedings but to other High Court proceedings which the said senior employee of the respondent was contemplating taking against the claimant.  The claimant, despite the correspondence, subsequently had no difficulty in issuing his unfair dismissal proceedings in the tribunal.  As I have already indicated, the correspondence, in my view, was proper and written in terms which was normal and can be expected to be written between parties and/or their representatives, where such proceedings are contemplated.

5.	In his letter dated 29 July 2008 and in the course of his evidence to this tribunal the principal ground upon which the claimant sought to have the September Agreement set aside was in relation to the actions of his former solicitor.  As I have previously explained, I have reached no conclusions about what the claimant has alleged in relation to how his former solicitor carried out his representation of him in relation to these proceedings.  Indeed, nothing in this decision should be taken to mean I am expressing any view on the truth or otherwise of the allegations made by the claimant against his former solicitor.  However, even if correct, these matters do not provide, in my judgment, grounds for the tribunal to set aside the September Agreement.  It is well recognised that in accordance with normal common law principles, a party’s solicitor has ostensible authority to bind their clients to such a conciliation agreement.  This is so, even where the legal representative has settled the claim without or contrary to the client’s instruction (see Times Newspapers Limited  v  Fitt [1981] ICR 637).  Further, in the case of Freeman  v  Sovereign Chickens Limited [1991] ICR 853, a Citizens Advice Bureau adviser was held to have ostensible authority to negotiate and reach a settlement on behalf of a party, in circumstances where he was named in the originating application as the claimant’s representative.  

6.	There was no doubt in this case, Mr Morris was the claimant’s representative and, in my view, had the necessary ostensible authority.  If the claimant has grounds to challenge the actions of his former solicitor and/or the manner in which he was represented by the former solicitor in relation to these proceedings that is a matter between the claimant and his former solicitor.  If necessary and appropriate these may require to be the subject of proceedings, if appropriate, which might be taken by the claimant against his former solicitor.  However, in stating this, I do not wish it to be considered that I am expressing any view about whether or not the claimant should bring any such proceedings against his former solicitor and/or, if brought, would be successful.  However, what is clear is that this tribunal does not have jurisdiction to determine such matters.  In Paragraph 5.112 in Blackstone’s Employment Law Practice 2008, it is stated:-

“Parties to tribunal proceedings will often have appointed advisers (often, but not always, solicitors) to act for them, including in dealing with a conciliation officer to seek to settle the case.  Where someone, such as a solicitor, is named as a representative and holds himself out as such, the other party is entitled to assume that he does indeed have authority so to act, unless he receives notice indicating to the contrary.  This general principle applies to non-qualified representatives, as it does to legally qualified representatives.”

No such notice, on the evidence before me, was given to the other party or its representative.  The claimant’s former solicitor was named on the claim form as his representative; and was, at all times, acting as his representative in relation to the negotiations which culminated in the signing of the September Agreement by the claimant; and, after it was signed by the claimant, the agreement was sent by the claimant’s former solicitor to the Conciliation Officer of the Labour Relations Agency to be signed by the respondent (see also Harvey on Industrial Relations and Employment Law, Volume 5, Section T, Paragraph 692)

In Chitty on Contracts, Volume 2, Paragraph 31.016) it is stated:-

	“Solicitors and counsel 

	…

As between client and opponent, the former is in general bound by the acts of his solicitor done in the ordinary course of practice.  Solicitors and counsel have a general implied authority to effect a reasonable compromise (unless forbidden) in all matters connected with the suit in question and not merely collateral to it; hence if they act within their apparent authority and the other party has no notice of any limitation on it, the client will be bound … .”

In the recently reported decision of the Employment Appeal Tribunal, Puplampu  v  Pathfinder Mental Health Services NHS Trust [September 2001], (EAT/1006/00) – Mr Recorder Underhill QC, as he then was, referred in                                  relation to this issue of ostensible authority to the principles set out in Paragraph 134 of Halsbury’s Laws, Volume 1(2) which is in the following terms:-

“A principal is not exempt, where he would otherwise be liable in respect of an act done or bound by a contract made by his agent, by reason of the fact that the agent in doing it was acting in fraud of the principal or otherwise to his detriment.  A third party dealing in good faith with an agent who acts within the apparent scope of his authority and purports to act as an agent is not prejudiced by the fact that the agent is using his authority for his own benefit and not that of his principal.”

In my judgment, the above authorities, are relevant to the facts in this case.  In the circumstances, the claimant is unable to set aside the September Agreement arising out of any of the alleged actions of his former solicitor, which he has relied upon, even if they are correct;  At all times in relation to the making of this agreement, his former solicitor had, in my judgment, the necessary ostensible authority to act on the claimant’s behalf in relation to the entering into and making of the September Agreement, and which is therefore binding upon the claimant.  The September Agreement is therefore not voidable at common law and cannot be set aside.

I therefore have concluded that the tribunal does not have jurisdiction to determine the claimant’s claim of unfair dismissal and the claimant’s claim of unfair dismissal is therefore dismissed.

7.	I have referred previously in Paragraph 2.4 of this decision to the further document (TN1) sent to the tribunal by the Labour Relations Agency on 15 May 2008; and which, for the reasons stated, I did not consider to be relevant or of assistance in determining the issues, the subject-matter of this pre-hearing review.  

However, I am satisfied that, where it is relevant and appropriate, in such a document (TN1) sent by the Labour Relations Agency to the tribunal, the agency is able to include the wording seen in the document dated 15 May 2008, namely:-

“in entering into this agreement, the claimant agreed to refrain from continuing these proceedings and agreed to refrain from instituting any further proceedings”;

a consequence for the parties of the inclusion of such wording is that it is clearly set out in the said document what has been agreed between the parties; and the necessity to have a tribunal hearing, such as this, to determine the proper interpretation of the terms of the agreement should be able to be avoided, with a saving of costs and time for the parties.

8.	The respondent’s representative, at the conclusion of the pre-hearing review, made an application to the tribunal for an Order for Costs pursuant to Rule 38 of the Industrial Tribunals Rules of Procedure contained in Schedule 1 of the Industrial Tribunals (Constitution and Rules of Procedure) Regulations (Northern Ireland) 2005.  In making the said application, the respondent’s representative submitted the claimant had ‘behaved vexatiously, abusively, disruptively or otherwise unreasonably in bringing or conducting these proceedings’.  In doing so, she was relying on the provisions of Rule 40(2) and (3) of the said Rules, which allow a tribunal to consider making a Costs Order where in the opinion of the Chairman or the tribunal the claimant has, in conducting the proceedings, acted vexatiously, abusively, disruptively, or otherwise unreasonably, or the bringing or conducting of the proceedings by the claimant has been misconceived (which is defined in the Regulations to include ‘having no reasonable prospect of success’).  The respondent’s representative, in the course of her skeleton argument to the tribunal did not expressly rely on the provision relating to the bringing or conducting of proceedings which are misconceived.  However, it was apparent from her submissions that the application was also based on this provision.  In the case of ET Marler Limited  v  Robertson [1974] ICR72 it was confirmed that ‘vexatiously’ is confined to the bringing of a hopeless case brought without any expectation of receiving compensation or brought out of spite to harass an employer for some other improper motive.  I am not satisfied, on the evidence before me, that the claimant has acted in such a manner; though I do understand that he continues to believe, that he was unfairly dismissed by the respondent and because of his signing of the September Agreement, he has been wrongly prevented from having that claim determined on its merits at a substantive hearing.  In relation to the issue of misconceived, in the case of Lodwick  v  London Borough of Southwark [2004] IRLR 554, it was confirmed that the dictum in the case of ET Marler Limited  v  Robertson [1974] ICR 72 was still relevant – namely:-

“Ordinary experience in life frequently teaches us that what is plain for all to see once the dust of battle has subsided was far from clear to the contestants when they took up arms.”

Equally, it is not appropriate to look at a matter with the benefit of hindsight.  The mere fact that a party loses before a tribunal does not mean the case was misconceived or vexatious.  

There is no requirement for a causal link between a party’s unreasonable behaviour and the costs incurred by the other party (see McPherson  v  BNP Paribas [2004] IRLR 558).

9.	Ms Best relied, in particular, on the fact that the respondent had believed it had concluded this matter, whenever the September Agreement was entered into by the respondent and the sums due under the said agreement had been paid to the claimant; but yet it now had found itself faced with this challenge to the September Agreement which she submitted had no merit; and, in pursuing same, the claimant had acted at least unreasonably.  As a consequence, the respondent had had to obtain further legal representation at both the Case Management Discussion, held on 27 June 2008, and also the hearing of this pre-hearing review.  

Ms Best sought by way of costs, for both solicitor and counsel, in relation to the Case Management Discussion the sum of £150.00 (inclusive of VAT) and £867.19 (inclusive of VAT) for the pre-hearing review.  

10.	I have considerable sympathy for the respondent, having entered into a conciliation agreement, which I can fully accept the respondent believed had resolved the claimant’s claim against it; but found itself faced with a challenge to that agreement and the necessity to be legally represented.  However, although such challenges to such conciliation agreements are rare and, in addition, rarely successful, the mere fact that such a conciliation agreement has been entered into does not mean, of itself, that such an agreement cannot be the subject of an appropriate challenge to have the agreement set aside and a claim referred to a tribunal for a full hearing on the merits.  Also, the fact that the claimant has brought such a challenge does not mean costs should follow the event, as might happen in High Court proceedings in similar circumstances.  At all times, it has been necessary for me to bear in mind and take into account that the claimant is not legally represented and that these issues, the subject-matter of the pre-hearing review, are complex and not necessarily easy for a layman to fully understand and appreciate the consequences of.

The Court of Appeal in the case of Gee  v  Shell UK Limited [2003] IRLR 52 (see also the case of Lodwick above) made clear that an award of costs in the tribunals is rare/exceptional; albeit Burton J in the case of Royal Mail Group  v  Sharma [February 2005] indicated that Orders for Costs in tribunals are rare because the conduct which can be classified as, for example, unreasonable is fortunately infrequent.

In the case of Griddle  v  Epcot Leisure Limited [2005], even where it is considered by the Chairman or the tribunal that such conduct comes within the circumstances set out in Rule 40, as referred to above, it is necessary for a        two-stage process to be conducted by the Chairman or tribunal.  So, even if the Chairman or tribunal is satisfied that one or other of the said circumstances has been satisfied the Chairman or tribunal must then go onto consider whether it is appropriate to exercise its discretion and make an Order for Costs.

Under Rule 41(2) the tribunal or Chairman also may have regard to the ability of the party, against whom the Order is to be made, to pay, when considering whether to make a Costs Order and the amount of any such Order.  

The claimant informed me he had an approximate nett income of £1,480 per month from his present employment, with outgoings of approximately £1,000 per month together with an unspecified amount of other debt.  The claimant stated that he had no savings.

11.	I came to the conclusion that the claimant, up until the Case Management Discussion, had not conducted the proceedings unreasonably or that the conducting of the proceedings by him had been misconceived.  However, at the Case Management Discussion, the issues which required to be determined at this pre-hearing review were fully considered and discussed and the claimant was provided with the relevant extracts from Harvey on Industrial Relations and Employment, Volume 5, Section T, Paragraphs 676 – 727.  The claimant was unrepresented and, prior to that Case Management Discussion, I am satisfied that he had no proper appreciation of the issues which required to be determined by the tribunal to enable him to set aside the September Agreement and to allow him to contest his unfair dismissal claim on the merits at a substantive hearing.  Therefore, I was not prepared to consider making an Order for Costs in relation to the Case Management Discussion.  However, after that hearing, having regard to the terms of the detailed Record of Proceedings of that hearing, in which the issues to be determined at the pre-hearing review were clearly set out, and the provision to him of the above extracts from Harvey, I considered that the claimant was in a much better position to determine, at that time, whether he should continue to proceed to contest this matter at this pre-hearing review.  However, I am not convinced, despite the foregoing, that the level of appreciation and understanding of the claimant was at such a level that he fully  appreciated that, to continue to pursue the proceedings, he was acting otherwise unreasonably and/or to continue the proceedings was misconceived.  He is not a lawyer, and as he put it during the course of submissions, he continued to have a need to know whether he could proceed with his tribunal proceedings or was required to consider alternative measures.  The proceedings had been ‘stayed’ and not dismissed and he wanted to be sure he had obtained ‘finality’, in relation to these proceedings, before considering what further or other action he ought to take.  In this regard, if the claimant was to consider any proceedings against his former solicitor, it might be argued that, before doing so, he had to mitigate his loss and obtain from the tribunal a final determination, whether of dismissal or otherwise, rather than merely a ‘stay’, in relation to these proceedings.  Equally, in such circumstances it might be argued that any costs incurred in bringing these proceedings, including any Order for Costs, could always be included by him in any claim taken by the claimant against his former solicitor.  Of course, any such issues in relation to any other claim brought by the claimant , whether about liability or quantum, are not a matter for this tribunal; but are for the court and/or other tribunal or body dealing with any other such claim brought by the claimant. 

12.	I therefore came to the conclusion that the claimant in pursuing his claim after the Case Management Discussion, did not act unreasonably and/or conducting such proceedings, after that hearing, had been misconceived.  However, even if I am wrong, I would not have been satisfied, in the exercise of my discretion, that it would have been appropriate to make an award of costs against the claimant in the circumstances.  He is not a lawyer and I have to have regard to the limited appreciation which I consider he had at the relevant time about the weaknesses of his case, as referred to above.  I also have taken into account the limited use of Costs Orders in the tribunals.  Further, I was satisfied the claimant would have had the ability to pay nothing more than a purely nominal amount in respect of any Order for Costs that might have been awarded by the tribunal, in relation to the costs of the pre-hearing review.

In the circumstances, I therefore decided not to grant the respondent’s application for an Order for Costs in this matter.

Chairman:

Date and place of hearing:	28 August 2008, Belfast

Date decision recorded in register and issued to parties: