Appeal No.	EAT/1456/00

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 12 December 2001

Before
THE HONOURABLE MR JUSTICE MAURICE KAY
MS J DRAKE
MRS A GALLICO

MR C VARLEY	APPELLANT

MR A S GILL	RESPONDENT

Transcript of Proceedings

JUDGMENT

PRELIMINARY HEARING
Revised

	APPEARANCES

For the Appellant	THE APPELLANT IN PERSON

MR JUSTICE MAURICE KAY
1.	This is the preliminary hearing of an appeal against the decision of an Employment Tribunal sitting in Sheffield on 4th October 2000. 

2.	The history of the matter is somewhat muddled. The original Applicant to the Employment Tribunal, Mr Gill, was found by the Employment Tribunal to be a worker within the meaning of Section 230(3)(b) of the Employment Rights Act 1996. That was at a preliminary hearing, notice of which had indicated that the only issue to be resolved was whether Mr Gill was an employee of the Respondent named as “Chris Varley”. 

3.	In the event Mr Varley did not attend the hearing before the Employment Tribunal. He says that that was because he did not receive the Notice because of the state of his then business which was teetering on the brink and which had vacated the premises which he had identified as being the address for service. We make no further comment about that.

4.	The Employment Tribunal did not decide that Mr Gill was an employee. It decided that he was a worker within the meaning of Section 230 (3)(b). That meant that he was in a position to pursue his breach of contract claim. The Employment Tribunal then decided to go into the merits because they were concerned about delay and future cost. 

5.	The actual dispute related to unpaid invoices in the sum of £3405.40. Mr Gill’s case was that those invoices related to work that he had done trading as Computec Installations, an unincorporated business. The order of the Tribunal was that the Respondent, namely Mr Varley, do pay that sum of £3405.40. However, the Tribunal said that that order was subject to Mr Varley’s right to apply for a review on the basis that there was some challenge to the debt. That, of course, was because the Notice of Hearing simply related to the preliminary issue. 

6.	Mr Varley’s appeal to this Employment Appeal Tribunal seeks to take two points. The first is that Mr Gill was not an employee. There is no mileage in that because that was not what he was found to be and, in our judgment, it is not arguable that the Employment Tribunal fell into legal error when holding that he was a worker within the meaning of Section 230(3)(b). That finding is consistent with his having been a self-employed worker and that is precisely what Mr Varley maintains Mr Gill was. Accordingly that ground is unsustainable. 

7.	More importantly the second ground of appeal is put on the basis that the debt, which Mr Varley admits to being a debt properly quantified, was not the debt of Mr Varley but the debt of Protea Productivity Limited the company which Mr Varley had been running. In other words, his case is that he should never have been the Respondent in the Employment Tribunal. He has never been personally indebted to Mr Gill and the liability is that of a company, which we are told, went into receivership in the summer of 2000 and into liquidation shortly before Christmas, around about 18th December 2000. 

8.	The documents upon which the application to the Employment Tribunal was based are somewhat equivocal. The Originating Application identified “Chris Varley” as the employer but gave the address of the employer as “Protea Personal Productivity, Sessions House, 17 Ewell Road, Surbiton, Company Registration Number 03091653”. When Mr Varley caused a Notice of Appearance to be entered he described the Respondent as follows “Mr C J Varley, Protea Personal Productivity Limited”. He added the same address. In setting out the particulars of the grounds upon which he intended to resist the application he put in issue the status of Mr Gill, namely as to whether he was an employee or had worked on a self-employed basis, but also added “His losses are those which would be incurred as a bad debt to his business”. It could be said that that was an indication both through the naming of the company in Box 1 and the reference to the bad debt in the particulars to the company being the true debtor. 

9.	We have heard Mr Varley on this subject today. On the basis of what he tells us it seems to us that it is arguable that the Employment Tribunal erred in finding that Mr Varley personally owed the money to Mr Gill. There is some evidence before us to the effect that in July and August last year Mr Gill appreciated that the real debtor was the company. He said in an e-mail to the prospective liquidator of the company, Mr Price “Protea Personal Productivity Limited stopped payments to me. These payments total £3405.40.” The invoices were all sent to “Protea Personal Productivity” without the suffix “Limited”. 

10.	All this disposes us to the view that, notwithstanding the procedural laxity that attended the approach to the hearing before the Employment Tribunal, the finding that there was a debt owed by Mr Varley personally is arguably susceptible to challenge by way of appeal. Accordingly we shall permit the appeal to go forward to a full hearing on the sole ground that the true debtor was not Mr Varley but was Protea Personal Productivity Limited. It is material to our decision that the notice of hearing in the Employment Tribunal did not suggest that this issue was on the agenda and, in these circumstances, it is arguably not too late for the Appellant to take the point.

11.	That should be a short matter and we estimate it as being fit for certification at one hour, listing category C. We direct that Mr Varley produces, within 14 days to the Employment Appeal Tribunal and to Mr Gill, a copy of Mr Gill’s contract. The usual directions as to skeleton arguments will apply and the matter may proceed on that basis.