Sajid v Sussex Muslim Society

A dismissal following the withdrawal of an Employment Tribunal claim does not invariably create a cause of action estoppel. Its legal effect depends on the factual context and purpose of the order.

Where a common law claim exceeding the tribunal’s financial jurisdiction is withdrawn so that it can be determined in the ordinary courts, and the merits have never been adjudicated, subsequent proceedings are not impermissible re-litigation. Applying estoppel in those circumstances would undermine the doctrines of finality and prevention of multiplicity by turning them into instruments of injustice.

An employee claimed breach of contract, redundancy pay and unfair dismissal before an Employment Tribunal. His common law damages claim exceeded the tribunal’s £25,000 jurisdictional limit. He commenced proceedings for the same breach of contract in the High Court and obtained the dismissal of the tribunal claim upon withdrawal, while the remaining tribunal claims were later settled.

The employer pleaded in the ordinary court proceedings that the contractual claim was an abuse of process or barred by res judicata, issue estoppel or cause of action estoppel. His Honour Judge Anthony struck out those paragraphs of the defence.

The employer appealed, contending that the tribunal’s dismissal order finally extinguished the cause of action. The central issue was whether the context and purpose of the withdrawal prevented that order from creating a cause of action estoppel.

1. Appeal dismissed unanimously. Mummery LJ, with whom Laws LJ agreed, held that the County Court judge had correctly struck out the pleas of abuse of process, res judicata and issue estoppel.

2. Cause of action estoppel and related doctrines serve finality in litigation and prevent multiplicity of proceedings. They also embody a principle of justice. Ordinarily, a party who has obtained a final determination should not face fresh proceedings seeking to re-litigate the same cause of action or issue. The doctrine nevertheless depends upon the circumstances and purpose of the earlier disposition.

3. The Employment Tribunal’s dismissal of the contractual claim upon withdrawal was not intended to be a final determination of its merits. From the outset, the employee had disclosed that his damages claim exceeded the tribunal’s £25,000 limit and that proceedings in another forum might be necessary. He later commenced the ordinary court proceedings and withdrew the tribunal claim expressly because that claim was being pursued there.

4. The employee had therefore preserved, rather than abandoned, the contractual claim. The dismissal avoided simultaneous proceedings and enabled the claim to be determined in a court possessing sufficient jurisdiction. The later action was not an attempt to re-litigate a claim already litigated and finally determined.

5. Staffordshire County Council v Barber [1996] ICR 379 was distinguished. There, the claimant had abandoned a redundancy claim because it was then thought legally unsustainable and had no contemporaneous intention of pursuing it elsewhere. The later claim repeated the abandoned proceedings after the law was understood differently. Those circumstances differed materially from a withdrawal undertaken to preserve an existing claim in the proper forum.

6. Laws LJ added that applying estoppel would undermine its own policy. It would permanently prevent adjudication of a claim exceeding the tribunal’s limit, even though withdrawal had avoided multiplicity. Salutary procedural principles could not properly be converted into instruments of injustice. The appeal was dismissed, with costs subject to detailed assessment.

1. Court of Appeal (Civil Division): The employer’s appeal was dismissed. The order striking out the estoppel and abuse-of-process pleas was upheld, with costs subject to detailed assessment.

2. Brighton County Court: His Honour Judge Anthony struck out the first two paragraphs of the defence, which alleged abuse of process, res judicata and issue estoppel. He refused permission to appeal, which was subsequently granted by the Court of Appeal.