Appeal No. EAT/69/93

	EMPLOYMENT APPEAL TRIBUNAL
	58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

		At the Tribunal
		On 28 June 1993

	Before

	HIS HONOUR JUDGE J HULL QC

	MR J R CROSBY

	MISS A W MADDOCKS OBE

LONDIS (HOLDINGS) LTD	APPELLANTS

MR M WANDLESS	RESPONDENT

	Transcript of Proceedings

	JUDGMENT

Revised

	APPEARANCES

For the Appellants	MR C J HEAD
(CONSULTANT)
Irenicon Ltd
April Court
Sybran Way
Crowborough
East Sussex 
TN6 3DZ

For the Respondent	NO APPEARANCE BY OR
REPRESENTATION ON
BEHALF OF THE
RESPONDENT

	JUDGE HULL QC:   In this case the Appellants appear by Mr Head and the Respondent, Mr Wandless, is not present and is not represented.  We are told he was represented before the Industrial Tribunal by his union, the Transport and General Workers' Union and we are informed by the Employment Appeal Tribunal's Office that the Respondent's union was duly notified, first of all by telephone, of today's date and the secretary who took that phone call diarised it for the benefit of the gentleman who was going to represent the Respondent before us.  We have also been shown the Notice of the hearing date which was on the face of it sent to both parties.  In those circumstances we decided to continue with the hearing, as Mr Head asked us to.  If it should emerge that there has been some muddle or other and there is some valid excuse for the non-attendance of the Respondent, or his representative, then of course it will be necessary for us to hear that and Mr Head entirely accepts that, but asks us nonetheless to proceed.  He is entitled to have us proceed because he is present and ready to continue.  

	The dismissal of the Respondent (the ground given was redundancy) was by a letter of 13 February (page 13 of the bundle) and in that the Appellants wrote to the Respondent saying:

		"..following a major review of our operational requirements, it has been decided to close the smallest Londis Depot at Bristol with immediate effect.

		Regrettably, I must therefore ask you to treat this letter as formal notification of redundancy, and I confirm your employment with Londis (Holdings) Limited will be terminated on the 6th March, 1992."

Accompanying that letter was a calculation headed Employee Payment Calculator which read as follows:

		NAME:				MR. M. WANDLESS

		DATE OF TERMINATION:	6TH MARCH, 1992

		DATE OF NOTICE:		14 FEBRUARY 1992

		A.	NOTICE CALCULATION

			ENTITLEMENT:		12 WEEKS

			AVERAGE EARNINGS:	12 WEEKS @ £367.61

			PAYMENT:			£4,411.32 (IN LIEU OF NOTICE)

		B.	REDUNDANCY PAYMENT CALCULATION

			ENTITLEMENT:		18 WEEKS

			AVERAGE PAY:		£198 PER WEEK (STATUTORY MAX. £198)

			PAYMENT:			£3,564.00

		C.	HOLIDAY PAYMENT CALCULATION

			OUTSTANDING:		NIL DAYS

			PAYMENT:			£ NIL

		D.	TOTAL AMOUNT PAYABLE  :  £7,975.32  (A + B + C)

		NOTE:  A & C WILL BE SUBJECT TO TAX AND NATIONAL INSURANCE DEDUCTIONS"

Importance was attached by the Industrial Tribunal to the Note at the end of the calculation.  
	If, as stated in that letter and in the calculation form which accompanied it the effective date of calculation was 6 March, then Mr Wandless had until 5 June to make a complaint, if he wished to make one, of unfair dismissal to the Industrial Tribunal under Section 67 of the Act.  In fact his application was dated 30 May 1992 but it was not presented until it arrived at the Bristol Tribunal on 9 June and the Central Office on 10 June, so that on any view it was not presented until more than three months after what was said to be the effective date of termination, namely 6 March 1992.

	So far as Mr Wandless himself was concerned as Applicant before the Tribunal, he stated that his employment had ended on 8 March, and it is said very plausibly by Mr Head that that was a mistake for 6 March, so he himself stated that the date of termination was 8th (or perhaps 6th) March.  He had been employed since 10 August 1978 as a heavy goods vehicle driver.  On those facts, if the effective date of termination were 6 or 8 March then that would mean that the complaint was out of time and that the Tribunal was without jurisdiction unless time could be extended on the basis, which was not alleged, that it was impracticable to present it within time.

	However, before the Tribunal an argument was advanced based upon the documents to which I have referred, the letter of 13 February and the document which accompanied it.  It was said that here the payments which were calculated for notice, for the twelve weeks, were stated to be subject to tax and national insurance deductions which evidently were in fact duly made and accounted for to the appropriate authorities and it is said that that was inappropriate and the Learned Chairman of the Tribunal referred to the practice of the Revenue.  "If" he said (I hope I am paraphrasing this justly) "If this were a payment made in accordance with a contractual obligation or entitlement to pay in lieu of notice, then the Revenue would regard it as a sum from which payments should be deducted.  If, on the other hand, it was paid without that entitlement (either by contract or by custom), then it should not have suffered deductions".   On this basis it was suggested to the Tribunal, and the Tribunal accepted, that there was an ambiguity here, and that it should be taken that the effective date of termination was not 6 March.  The date of termination was later because in fact the termination was to be at the end of the period of notice.  That argument was accepted by the Tribunal and so it was held that the complaint was in time.

	There are various bases on which money may be deducted.  It may be that, if the employer were simply exercising a contractual right to pay in lieu of notice, the money would be deducted on the ordinary basis that this was a taxable emolument.  It may be that if an employer was saying - "Well, I realise I am doing something wrong in sacking you without the proper notice and dismissing you, but I propose to treat your claims against me as being for damages and to make deductions for income tax and National Insurance under the Gourley principle", (British Transport Commission v Gourley [1956] AC 185), then again the tax and insurance might be deducted.

	These are interesting considerations and a good deal could be said about them and the basis of the extra-statutory concession which the Revenue make, which is that where there is no justification in the contract or in custom for payment, then the Revenue treats the payment made by the employer to the employee as being an ex gratia one and therefore not taxable.  If the notice were wholly ambiguous about the effective date of termination then, of course, it would be necessary to look elsewhere, possibly to surrounding circumstances so far as one can construe documents from surrounding circumstances, or perhaps to other matters such as these calculations which are set out here, in order to discover what the effective date of termination was.  But in our view, and here we accept the argument of the Appellants, if it is stated unambiguously in two places that the date of termination is the 6 March 1992 and if indeed (this is a subsidiary matter) the employee himself has no doubt that that is what is being said to him and so states in his application (subject to the typing mistake which is made), then to go to matters which might be used to resolve an ambiguity seems to us to be entirely out of place.  There is no ambiguity and the rule of construction which the Tribunal referred to, the Contra Proferentem rule as it is called conveniently, has no application.  It is just as unambiguous as if the employee had said "I am now leaving and my employment is at an end.  I realise that I am breaking my contract but nonetheless I am going now".  Or the employee might say, "Your behaviour has been such that I am entitled to end my contract now".  If an employer or an employee announces that the contract is at an end then subject to a very few exceptions (which are truly exceptional) the contract is at an end.  Either party is entitled to end the contract.  It may be a breach of the contract, it may be unfair, it may be that the other party will have complaints of various sorts but the contract is nonetheless at an end.

	In our view the effective date of termination was 6 March because it was so stated without ambiguity in two places and was so understood.  In those circumstances the considerations which the Industrial Tribunal embarked upon are irrelevant in the legal sense and carefully as the Tribunal considered the matter, we are all of the opinion that they were wrong to embark on that enquiry and their conclusion was mistaken as a result.  In our view his employment did end on 6 March and accordingly it follows inevitably that the application was not presented until after the 3 months and the Tribunal did not have jurisdiction to consider it.  The appeal must be allowed.