Employment Appeal Tribunal reinstate claims that have been struck-out

In PP v GG Ltd the EAT overturned a decision to strike-out a claim.

The Respondent made an application to the Employment Tribunal to strike-out the Claimant’s claims on the basis that she had failed to comply with directions, including to provide a witness statement.

This application had not been dealt with by the time the hearing was due to commence, but at the start of the hearing, the Claimant submitted her own 25-page application to strike-out the Respondent’s defence to the claim. The Tribunal refused the Respondent’s initial application to strike-out, and said that it would consider the Claimant’s application. However, it said that if the allegations made in the Claimant’s application were unfounded, the Respondent might apply to strike out the claim on the basis that the Claimant had in her strike-out application conducted proceedings unreasonably, scandalously or vexatiously. The Claimant’s strike-out application was unsuccessful, so the Respondent applied to strike-out the claim and the Tribunal did strike it out.

The Claimant appealed to the EAT against the strike-out of her claim and the EAT upheld her appeal, rescinding the strike-out and ordering that the claim be heard by a different Tribunal.

The Tribunal’s decision to strike-out had been based on the following:

• One of the Claimant’s allegations in her strike-out application was that the Respondent had been involved with the termination of the Claimant’s tenancy (which had nothing to do with her employment relationship) and were “actively trying to harm her and endangering her life”.  The Respondent described this allegation as “nonsense”.  The Claimant had provided a copy of a whatsapp exchange which included a message from someone called Kate stating that the termination of the private tenancy was the Respondent’s responsibility
• Another allegation made by the Claimant was that in 2022, the Respondent has “lured” the Claimant to the Ukraine before the invasion by Russia in order to trap her there
• The Tribunal Judge’s comments on this issue during the hearing were along the lines of “if the Claimant is right that you were involved in terminating her tenancy, then we are in the territory of striking out your defence, but if she has made this up, then that might be turned round on her and we would then be looking at striking out her claim”
• The Tribunal said that whilst not every failed strike-out application should be turned round into a strike-out of the failed party, this was an extreme case in which “even allowing for a degree of rhetorical hyperbole the Claimant has expressed herself in the most extreme terms”. The Tribunal found no proper basis for her accusations. Her behaviour was therefore “unreasonable, scandalous and vexatious” which was the threshold for behaviour to lead to a strike-out
• The Tribunal then had to consider whether a fair trial was still possible and concluded that it was not, not least because extensive unwarranted accusations had been made against the Respondent’s solicitor affecting her personal and professional integrity including that she “had a clear goal to bludgeon the Claimant to death with excessive stress”. The behaviour of the Claimant was “of an entirely different magnitude to the normal friction of litigation” and there was no indication that this would change

The EAT overturned the decision on the following grounds:

• Strike-out is a draconian sanction and must be a proportionate response
• It was wrong of the Tribunal to find that the Claimant had made the allegation in relation to termination of her tenancy with “no proper basis”. The Claimant had produced the whats app message. Whilst it may not, as far as the Tribunal had been concerned, constitute evidence that the Respondent had interfered with the tenancy, the Tribunal had made no finding that it was a forgery.  On that basis, it was evidence that had been provided by the Claimant and it was therefore wrong to conclude there was “no proper basis” for the allegation
• The conclusion that a fair trial was not possible was perverse: litigators have to be broad-shouldered and allegations of the sort made by the Claimant are “unfortunately not uncommon” and whilst there are limits to such behaviour, the EAT considered that a fair trial was still possible
• The Tribunal’s comments that if the Claimant’s strike-out application failed, this might lead to a strike-out application by the Respondent were sufficient to give the appearance of bias against the Claimant. The EAT found that it should be very rare for a Tribunal to suggest to a party, especially a represented party, what applications they might want to make – in doing so, the judge was “descending into the arena” rather than sitting as an impartial judge

In Forrest v Amazon Web Services, the EAT reinstated another claim that had been struck out, and reminded Tribunals of the issues to consider before striking-out.

The Claimant in this case had a deadline extended for providing a list of issues, together with a warning that non-compliance would likely result in the claim being struck-out.

The Claimant did not comply and the claim was struck out. She appealed against this decision to the EAT.

The EAT reminded the parties of the guidance on factors to consider when an application is made for strike-out due to non-compliance with Tribunal orders:

• The magnitude of the non-compliance
• Whether the failure was the responsibility of the party or their representative
• The extent to which the failure causes unfairness, disruption or prejudice
• Whether a fair hearing is still possible
• Whether striking out or some lesser remedy would be an appropriate response to the disobedience in question

The EAT found that in this case:

• The Tribunal had failed to apply sufficient thought to whether a fair trial was still possible
• The Tribunal should first have considered issuing an Unless Order, giving the Claimant an opportunity to comply by a certain date, failing which the claim would be struck out

The EAT were very clear that it was unusual to strike-out for a first non-compliance and it would normally expect an Unless Order to be issued first (which had not happened here).

Both of these cases remind us of the draconian nature of strike-outs and the general principle that: “The business of courts and tribunals is deciding cases on their merits when a fair trial is possible. Sanctions for breaches of orders are designed to secure compliance. They are not punitive.”