Bournemouth University Corporation v Buckland

The Court of Appeal held that the question whether an employer has committed a repudiatory breach of the implied term of mutual trust and confidence is to be decided by the conventional objective test derived from Mahmud, not by a separate "range of reasonable responses" test. Reasonableness remains relevant, but for the statutory fairness inquiry under section 98 of the Employment Rights Act 1996 rather than to the existence of a repudiatory breach.

The court also held that there is no general doctrine in contract law (and hence in employment law) that a completed repudiatory breach can be unilaterally "cured" by the wrongdoer so as to deprive the innocent party of the option to accept the breach; affirmation, waiver or acceptance remain the controlling concepts. Applying these principles, the Court allowed the employee's appeal, concluding that the Employment Tribunal's finding that the employer's conduct amounted to a repudiatory breach and that the Vinney inquiry had not cured it was tenable and should be restored.

Background and facts.

• Professor Buckland, a chaired academic, second-marked resit examination papers; a high failure rate led to unauthorised re-marking by colleagues without his or the board chair's authority. He regarded this as an affront to his integrity.
• The University convened an inquiry chaired by Professor Vinney which vindicated Buckland to an extent and made recommendations, but Buckland remained dissatisfied and resigned with deferred effect.

Procedural posture.

• Employment Tribunal (Southampton, June 2008) found a repudiatory breach of the implied term of trust and confidence by the University and that the Vinney inquiry had not cured that breach; it concluded there had been dismissal but did not decide unfairness.
• The Employment Appeal Tribunal ([2009] ICR 1042) allowed the University's appeal, concluding the breach had been cured objectively by the Vinney report and that the tribunal had applied a subjective test.
• The Court of Appeal allowed Buckland's appeal and dismissed the University's cross-appeal, restoring the Employment Tribunal's determination.

Nature of the claim and issues framed.

• The claim was for unfair constructive dismissal, invoking the common law question of whether employer conduct amounted to a fundamental (repudiatory) breach and the statutory unfair dismissal regime (Employment Rights Act 1996, in particular sections 94, 95 and 98).
• The principal issues were: (i) whether the correct test for repudiatory conduct incorporates a "range of reasonable responses" standard or is the unitary Mahmud objective test; (ii) whether a completed repudiatory breach can be "cured" by the employer before the employee accepts it; and (iii) whether, on the facts, the Vinney inquiry cured the breach.

Court's reasoning and conclusions.

• The court endorsed the Employment Appeal Tribunal's return to the unvarnished Mahmud test: a repudiatory breach is objectively established when the proscribed conduct occurs; the tribunal was entitled to find the University had procured and accepted unauthorised re-marking and thereby damaged mutual trust and confidence.
• Reasonableness is a relevant consideration but belongs primarily to the statutory fairness inquiry under s.98(4) (the "range of reasonable responses" test) and not to the separate common law question of whether a repudiatory breach has occurred.
• On the question of cure, the court held there is no established general contract-law doctrine that a completed repudiatory breach can be unilaterally cured so as to preclude acceptance; to introduce such a doctrine across employment law would require changing general contract principles and risk uncertainty. Nevertheless tribunals should scrutinise facts closely for affirmation or waiver where the parties continue performance.
• Applying those principles, Sedley LJ found the tribunal's objective and tenable conclusion that the Vinney report did not afford the necessary vindication to cure the breach was sound and should be restored; Carnwath LJ and Jacob LJ agreed.

Wider context. The judgment emphasises the distinction between common law contract principles and statutory unfair dismissal analysis, warns against importing the "range of reasonable responses" into the determination of repudiation, and notes judicial reluctance to remit issues unnecessarily where appellate courts or the EAT are able to decide them.

Appeal allowed and cross-appeal dismissed. The Court of Appeal held that (i) the test for whether employer conduct amounts to a repudiatory breach is the objective Mahmud test and not the “range of reasonable responses” test, which is reserved for the statutory fairness inquiry under section 98; and (ii) there is no general doctrine that a completed repudiatory breach can be unilaterally cured so as to deprive the innocent party of the option to accept it. Applying these principles, the tribunal's finding that the Vinney inquiry did not cure the breach was tenable and was restored.

Appeal to the Court of Appeal from the Employment Appeal Tribunal decision (UKEAT/0492/08) reported at [2009] ICR 1042, which had allowed the University's appeal against the Employment Tribunal (Southampton, June 2008). The Court of Appeal allowed the employee's appeal and dismissed the University's cross-appeal, restoring the Employment Tribunal's findings.