The Employment Appeal Tribunal (EAT) has held in the case of Ebury Partners UK Ltd v Mr M Acton Davis: [2023] EAT 40 that a judge cannot embark upon a reconsideration of a decision on the basis of arguments which a party themselves has not presented at the original hearing.
Background
The case concerned whether an alteration made to the Claimant's bonus / commission represented a repudiatory breach of the express terms of his contract of employment, or a breach of the implied terms of mutual trust and confidence, to the extent that the Claimant was entitled to resign on the basis of a fundamental breach of contract and claim constructive dismissal.
The judge held at first instance that there had been no fundamental breach of contract, ruling that the Claimant's commission entitlement ended after 12 months under the provisions of a side letter, and the case was therefore dismissed
Reconsideration
Rather than appeal to the EAT, the Claimant instead applied for a reconsideration under rule 70 of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 on the issue of the manner in which the express terms of the employment contract had been interpreted.
Nevertheless, in proceeding with a reconsideration of the decision, the judge not only rejected the Claimant's position in relation to the express terms, but decided on his own initiative to rule that there had been a fundamental breach of the implied term of mutual trust and confidence on the basis upon which the Respondent had varied the terms relating to the bonus / commission
EAT Appeal
The Respondent appealed to the EAT arguing that there should have been no reconsideration, and certainly no reconsideration of the implied term of mutual trust and confidence arguments. The Claimant cross-appealed on the issue of the rejection of the issues relating to the express terms
The EAT upheld the appeal and the Claimant's cross-appeal was rejected.
Rule 71
The EAT held that under rule 71 of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013, that a reconsideration should only be conducted where it is in the interests of justice to do so, and in this instance that was not the case as the issue was one of whether there had been an error of law in a situation where both parties had had a fair opportunity to present their cases. Instead of applying for a reconsideration, the correct approach would have been to appeal to the EAT.
Moreover, the EAT held that "it is clear that the basis for the application for reconsideration was the contention that the [judge] had decided the main contractual issue against [the Claimant] on a basis (namely that any entitlement to commission given by para 4e of the side letter was limited to one year) which had not been pleaded or argued for by either party."
The EAT Judgment adds: "It was for [the Claimant] to prove his case and it seems to me that in so far as that case was based on para 4e of the side letter, it was for him to put forward any arguments he relied on in relation to the proper interpretation of the paragraph, given that it included words which on the face of it could plainly be construed as limiting any entitlement to one year; and I can see nothing wrong with the judge reaching his own view on the proper interpretation of the contractual documents presented to him in the absence of such arguments."
No Reconsideration Where Party Fails To Present Arguments At Original Hearing
In sum, therefore, the EAT concluded that there should be no reconsideration of a decision on the basis of arguments which a party has failed to present at the original hearing. It held that "the proper way to have challenged the decision on the interpretation of the contract would have been by way of a timeous appeal to the EAT on a point of law. On that appeal it would have been open to the EAT to consider the proper interpretation of the contractual documents in the light of the factual matrix as found by the judge and to reach a firm conclusion on the interpretation issue."
