Phipps v. Priory Education Services Ltd [2023] EWCA 652.

Piers Martin recently appeared in the Court of Appeal in the important case of Phipps v. Priory Education Services Ltd [2023] EWCA 652.

The case involved claims which had been struck out by the Employment Tribunal owing entirely to failings of the Claimant's  representative (who worked for a claims management company and was not a qualified lawyer).  A wasted costs order was also made against the representative.

The Claimant applied for a reconsideration seeking the setting aside of the strike-out order on the basis that it was in the interests of justice to do so given her lack of culpability and the fact that all correspondence from the Tribunal had gone to her representatives and not to her.

First the Employment Tribunal and then the EAT both refused to set aside the strike out, applying the longstanding EAT authorities  that the failings of a party’s representative will generally not constitute grounds for reconsidering a judgment.  The EAT placed particular weight on the fact that the Employment Tribunal’s reasons had provided the Claimant with the basis for a strong remedy  in negligence against her representative.

The Court of Appeal disagreed and found that this was an exceptional case where in weighing the interests of justice, the fact that the Claimant had not been at fault and had not had an opportunity to present her substantive case substantially outweighed the public interest in finality of litigation and the prejudice to the employer in having a stale case restored having wasted significant costs and management time.

Despite several EAT authorities alluding to the possibility of a claimant having an alternative remedy against their representative as a factor justifying not setting aside orders that arose as the a consequence of that representative’s fault, the Court of Appeal took a different view and described such a possibility  as “wholly unrealistic” at least where the representative was not a lawyer, trade union official or employee of a litigation insurer.  In future the Court of Appeal found that where the availability of an alternative remedy of a claim for damages for professional negligence is put forward as a factor weighing against reconsideration in such a case, it should be “treated with scepticism.”

While substituting its own decision to set aside the strike out the Court of Appeal also invited the President of Employment Tribunals for England and Wales to consider a ‘modest change in practice’, namely that any warning letter issued under rule 37(2) of the Tribunal Rules should be sent to the party personally, at whatever email or postal address has been provided, as well as to the representative.

Approved judgment: https://caselaw.nationalarchives.gov.uk/ewca/civ/2023/652

If you want to instruct Piers or any of the other employment specialists at 4KBW then do not hesitate to contact Hilary Foster or Jason Roukin on 020 7822 7000