BAE Systems (Operations) Ltd v Konczak

In psychiatric-injury claims involving tortious and non-tortious causes, apportionment concerns the divisibility of the harm, not the relative causative potency of each event. A tribunal must seek a rational basis, however broad, for identifying the part of the suffering attributable to the employer’s wrong. Psychiatric injury may be divisible, but where no rational basis exists it is truly indivisible and full compensation follows, subject to any separate discount for pre-existing vulnerability and future non-tortious risks. The Court endorsed the guidance in Sutherland v Hatton [2002] EWCA Civ 76 and the approach in Thaine. Mitigation depends on the treatment chronology and changing circumstances, rather than refusal of medication considered in isolation.

Marion Konczak brought employment tribunal proceedings against BAE Systems arising from alleged sex discrimination, disability discrimination, victimisation, failures to make reasonable adjustments, and discriminatory dismissal. The liability tribunal upheld some claims, including discrimination arising from a workplace comment, and later findings treated that comment as triggering a psychiatric illness. The compensation proceedings were repeatedly appealed and remitted.

After the Employment Tribunal’s decision in Sherratt 2, which assessed compensation at £360,178.60, the Employment Appeal Tribunal dismissed BAE’s appeal. BAE appealed to the Court of Appeal on the admission of a note recording medical evidence, divisibility and apportionment of the psychiatric injury, and the adequacy of the reasoning on mitigation by medical treatment. The central issues were whether the injury could rationally be divided between lawful and unlawful workplace events, and whether the refusal of medication became unreasonable in July 2010.

1. Appeal dismissed. The award made in Sherratt 2 stood. The Court would not admit the note recording Dr Craig’s earlier evidence. The Hand EAT’s remission deliberately distinguished evidence already heard by the Sherratt tribunal from facts found by the earlier Cook tribunal, and there was no exceptional justification for reopening that basis on appeal.
2. Divisibility and apportionment. Under Rahman v Arearose Ltd [2000] EWCA Civ 190, wrongdoers who together cause a single indivisible injury are liable for the whole injury. An injury is indivisible where there is no rational basis for objectively apportioning the harm. The inquiry concerns the divisibility of the suffering, not the measurable degree to which each cause contributed to it. Psychiatric injury may be divisible, including where medical evidence identifies separate components or a distinct aggravation in severity or duration, but the absence of precise scientific quantification does not itself require or prevent apportionment.
3. The Court followed the apportionment and quantification guidance in Sutherland v Hatton [2002] EWCA Civ 76, although that guidance had been formally obiter. It endorsed Thaine v London School of Economics [2010] UKEAT 0144/10. The observations in Dickins v O2 plc [2008] EWCA Civ 1144 were not followed to the extent that they suggested that psychiatric injury should generally be treated as indivisible.
4. The Tribunal was entitled to find the injury indivisible. It accepted that the Dent comment was the final-straw event, found no rational evidential basis for percentage apportionment, and was not required to find that the claimant already had a diagnosable illness. A separate discount for pre-existing vulnerability and the chance of illness without the tort was conceptually distinct and fell outside the carefully defined remission; it could not be raised as a new case for the first time on appeal.
5. Reasonableness of refusing medical treatment depended on the circumstances and treatment chronology. By July 2010 the litigation was no longer expected to conclude promptly, the community mental health team had ceased involvement, and the claimant had reverted to her GP. The Tribunal was entitled to regard refusal after that change as unreasonable and to select 24 July 2010 as a convenient date for calculation. Lord Justice Irwin additionally emphasised the need for precise expert evidence on vulnerability, diagnostic progression, and the risk of future illness.

• Court of Appeal (Civil Division): dismissed BAE’s appeal in its entirety and allowed the compensation award to stand.
• Employment Appeal Tribunal: HH Judge Clark dismissed BAE’s appeal against Sherratt 2 on 23 October 2015.
• Employment Tribunal, Sherratt 2: found the psychiatric injury indivisible and upheld the finding that failure to take medication became unreasonable from July 2010.
• Employment Appeal Tribunal, Hand: allowed both parties’ appeals in part on 13 January 2014 and remitted divisibility, possible apportionment, and mitigation for reconsideration.