London Borough of Enfield v Sivanandan

A repudiation of an employment contract does not terminate it automatically. Termination requires conscious acceptance, or conduct objectively inconsistent with continuation of the contract. The employee’s subjective intention is immaterial where conduct is objectively inconsistent.

Claims brought before an Employment Tribunal may objectively amount to acceptance where the Tribunal’s jurisdiction depends on the employment having terminated. A finding made without jurisdiction cannot found res judicata. A contractual claim withdrawn from Tribunal proceedings is not thereby finally determined or abusive when pursued in the civil courts, provided the withdrawal and its scope are clear.

The London Borough of Enfield appealed against Master Leslie’s refusal to strike out the respondent’s contractual action as an abuse of process or res judicata. The respondent cross-appealed against the striking out of claims for continuing loss of earnings, pension rights and injury to mental health.

The respondent had been employed by Enfield but was dismissed by the Enfield Racial Equality Council. Earlier Employment Tribunal proceedings established that Enfield was her employer. The central issues were whether her conduct had accepted any repudiation of the employment contract, whether the contractual claims were barred by the earlier proceedings, and whether a contractual claim withdrawn before the Tribunal could be pursued in the High Court.

1. Appeal and cross-appeal dismissed. The court upheld the striking out of the claims based on a continuing contract, but rejected Enfield’s wider abuse of process and res judicata arguments.
2. Following Gunton v London Borough of Richmond [1980] 1 IRLR 321 and Boyo v London Borough of Lambeth [1995] IRLR 50, dismissal constituted repudiation rather than automatic termination. Acceptance required either a conscious intention to bring the contract to an end or conduct objectively inconsistent with its continuation. It was wrong to approach acceptance on the basis that it should ordinarily be easily inferred.
3. The respondent’s Employment Tribunal application, which alleged unfair dismissal and breach of contract and gave employment dates ending on 11 December 1996, was objectively inconsistent with a continuing contract. Her subsequent proposed claims for wrongful dismissal and reference to herself as an ex-employee reinforced that conclusion. The repudiation was therefore accepted by 11 December 1996 or, at the latest, 11 January 1997.
4. Because the contract had ended before the alleged injury to mental health, there was no continuing contractual duty of mutual trust and confidence capable of supporting that claim. Loss of earnings and pension rights could proceed only on the narrower basis applicable after termination.
5. The Tribunal’s initial finding that the respondent had been dismissed could not create res judicata because the Tribunal later ruled that it had no jurisdiction over the unfair-dismissal claim. A finding made without jurisdiction could not be relied upon for that purpose.
6. The contractual claim had been clearly withdrawn from the Tribunal proceedings. Applying Sajid v Sussex Muslim Society [2002] IRLR 113, pursuing it in civil proceedings was not an abuse. The claim had not been litigated and finally determined, and its withdrawal was clear in both intention and scope.
7. The limitation issue should not have been determined without notice. Enfield had deliberately chosen not to raise it before the Master, and the respondent had not been equipped to address it.

• High Court (Queen’s Bench Division): on appeal from Master Leslie’s order dated 13 November 2003, both the appeal and cross-appeal were dismissed.