Case - Fraser v. HLMAD Ltd (Court of Appeal)

[2007] 1 All ER 383 : [2006] ICR 1395, Court of Appeal - Simon Cheetham QC
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Once a cause of action for wrongful dismissal had been adjudicated upon by an employment tribunal it was not possible to make a further claim on the same grounds either before the tribunal or the High Court. The cause of action for wrongful dismissal could not be split into two causes of action, one for damage up to the statutory limit of the tribunal's jurisdiction, and another for the balance.

 

The appellant (F) appealed against an order striking out his claim form and dismissing his wrongful dismissal action against the respondent (H). F had been dismissed from his position by administrative receivers of H. F had commenced proceedings in the employment tribunal for unfair dismissal and wrongful dismissal. In his ET1 F had stated that he reserved the right to pursue an action in the High Court in order to recover damages for wrongful dismissal in excess of £25,000, the maximum amount recoverable in the tribunal under the Employment Tribunals Extension of Jurisdiction (England and Wales) Order 1994 . F had later started an action for wrongful dismissal in the High Court but had not withdrawn his wrongful dismissal claim from the tribunal proceedings. The tribunal, which had adjudicated on issues of liability and remedy relating to both of F's claims, had found that F had been unfairly and wrongfully dismissed. The tribunal had limited its award for breach of contract to the capped amount of £25,000 even though it found that F had suffered far greater loss. H, relying on the doctrine of merger of causes of action, had successfully applied to strike out the High Court action on the basis that F’s wrongful dismissal claim had merged into the judgment of the tribunal and ceased to exist independently of that judgment. F submitted that it would be an unjust and improper use of the doctrine of estoppel and abuse of process to prevent him from recovering, by way of a claim limited to the excess over the statutory cap applicable in the tribunal, the sum already found due to him by the tribunal.

HELD: (1) The cause of action pleaded by F in the High Court was identical to the cause of action adjudicated by the employment tribunal. F could have withdrawn his claim for wrongful dismissal from the tribunal without giving rise to an estoppel, but he never did so. The instant was clearly a case of merger of F’s cause of action for wrongful dismissal in the final judgment of the tribunal on the claim for wrongful dismissal as between the same parties as in the High Court proceedings. Merger was not prevented from taking place by an express statement in the ET1 form that F reserved his right to bring High Court proceedings for the excess. The merger arose from the fact that the cause of action had been the subject of a final judgment of the tribunal. Once it had merged F no longer had any cause of action that he could pursue in the High Court, even for the excess over £25,000. The claim for the excess was not a separate cause of action as the cause of action for wrongful dismissal could not be split into two causes of action, one for damage up to £25,000 and another for the balance. Sajid v Sussex Muslim Society (2001) EWCA Civ 1684 , (2002) IRLR 113 distinguished on the facts, India v India Steamship Co Ltd (1993) AC 410 , Soteriou v Ultrachem Ltd (2004) EWHC 983 (QB) , (2004) IRLR 870 and Enfield LBC v Sivanandan (2005) EWCA Civ 10 , Times, January 25, 2005 considered.(2) Where a claimant expected to recover over £25,000 for wrongful dismissal, that claim should only be made in High Court proceedings. The findings of a tribunal in its judgment on an unfair dismissal claim would give rise to an issue estoppel in subsequent High Court proceedings for wrongful dismissal, but there would be no merger of causes of action and the claimant would not be prevented by success in the tribunal claim for unfair dismissal from pursuing an action for wrongful dismissal.

Appeal dismissed.

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