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	United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Martin v Secretary Of State For Trade & Industry [1996] UKEAT 843_96_1511 (15 November 1996) URL: http://www.bailii.org/uk/cases/UKEAT/1996/843_96_1511.html Cite as: [1996] UKEAT 843_96_1511

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APPEARANCES

 

For the Appellant	MR B KORN (E.L.A.A.S.)


 


JUDGE PETER CLARK: The facts of this case may be shortly stated. Mr Martin, together with Mr Crossley, formed a building firm some years ago. It traded through a limited company, Oakleywood Developments Ltd, in which both men held a 50% shareholding.

In due course that company became insolvent. Both men sought redundancy payments, statutory notice pay, holiday pay and unpaid wages from the fund administered by the Secretary of State. Their claims were refused on the grounds that they were not employees of the company. Accordingly they made application to an Industrial Tribunal for an order requiring the Secretary of State to make such payment under section 124 of the Employment Protection (Consolidation) Act 1978, now section 188 of the Employment Rights Act 1996.

Those applications came before the Bury St Edmunds Industrial Tribunal (Chairman sitting alone, by consent of the parties) on 29th March 1996. He dismissed the applications on the basis that he found they were not employees as defined in what was then section 153(1) of the 1978 Act. Extended reasons for that decision are dated 22nd April 1996.

Against that decision Mr Martin now appeals. This is a preliminary hearing held to determine whether or not the appeal discloses any arguable point or points of law which ought to go to a full appeal hearing.

The tribunal Chairman concluded that the applicants were in reality partners, trading through the medium of a limited company. Although they paid tax through the PAYE system they were not subject to any control. Looked at overall they not employees.

In the course of his reasons the Chairman referred to the judgment of this tribunal in Eaton & Robert Eaton Ltd v Secretary of State for Employment [1988] ICR 302. That was a case of a managing director who claimed he was an employee when the company became insolvent. The Industrial Tribunal rejected that contention. The Employment Appeal Tribunal upheld the decision, concluding that it was a decision which was open to the Industrial Tribunal.

That approach reflects the earlier Court of Appeal decision in O'Kelly v Trust House Forte [1983] ICR 728, where the court held that the question as to whether a person worked under a contract of service or a contract for services was essentially a question of fact for the tribunal; a different result may be achieved in the same case by different tribunals without either having misdirected itself in law.

In this case the appellant relies in his notice of appeal on a decision of Mr Andrew Bano sitting at the Stratford Industrial Tribunal on 10th March 1995 in the case of Crane & Careford v Secretary of State [Case Nos. 42564 & 43756 of 1994]. In those cases the tribunal held that the two men, who joined a company which later became insolvent, worked on defined duties and later became shareholders and directors of that company, having commenced work as employees and having not lost that status after they became directors and acquired interests in the company. They were paid on a PAYE basis throughout.

We have three observations to make about that case. First, we are not bound by decisions of the Industrial Tribunal. Secondly, the facts were different in those cases. The applicants did not set up the company, as in the instant case. But thirdly, applying the principle in O'Kelly, the different results in the two decisions, that of Mr Bano and Mr Ash in the instant case, does not mean that one was right and the other wrong. Both decisions, it seems to us, were permissible findings open to each tribunal.

Today, Mr Martin has not attended the hearing, but has asked for representation under the ELAAS pro bono scheme. Mr Korn is here under that scheme. He makes this additional submission.

In paragraph 5 of the reasons the Chairman adopts the arguments advanced before him by way of written submissions on behalf of the Secretary of State. We have not seen those submissions. Nor has Mr Korn. He argues that in these circumstances the Chairman has provided insufficient or inadequate reasons for his decision. See Meek v City of Birmingham [1987] IRLR 250. He invites us to adjourn this preliminary hearing so that the written submissions may be put before us.

We are not minded to do so. It is unfortunate that such submissions are not before us, but we do not feel unable to adjudicate on the appeal for that reason. It is open to an Industrial Tribunal to adopt written submissions as part of its reasons. It is clear from paragraph 5 that those submissions took the form of reviewing the factors material to the tribunal's overall conclusion. The Chairman adopted and accepted the submission.

In the light of our approach to this case on the merits of the appeal we have decided that this appeal discloses no arguable point of law. In these circumstances the appeal must be dismissed.