Canadian Imperial Bank of Commerce v Beck
| Jurisdiction | England & Wales |
| Judge | Lord Justice Wall |
| Judgment Date | 26 June 2009 |
| Neutral Citation | [2009] EWCA Civ 619 |
| Docket Number | Case No: A2/2009/0449 |
| Court | Court of Appeal (Civil Division) |
| Date | 26 June 2009 |
[2009] EWCA Civ 619
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM
His Honour Judge Mcmullen QC, Sitting alone in the Employment Appeal Tribunal (Eat) On 2 March 2009
Royal Courts of Justice
Strand, London, WC2A 2LL
Lady Justice Smith
Lord Justice Wall
Case No: A2/2009/0449
Daniel Oudkerk (instructed by Messrs Allen & Overy—Solicitors) for the Appellant
Danile Stilitz (instructed by Messrs Lewis Silkin—Solicitors) for the Respondent
Hearing date: 11th June 2009
Lord Justice Wall:
This is the judgment of the Court, to which both of its members have contributed.
The questions in this appeal are: (1) whether or not the judge in the Employment Tribunal (ET) made an error of law in refusing an application by the claimant, Mr. Achim Beck, for discovery against his former employers, Canadian Imperial Bank of Commerce (the Bank) and, if so, (2) whether or not His Honour Judge McMullen QC, sitting alone in the Employment Appeal Tribunal (EAT) on 2 March 2009, was right to allow Mr. Beck's appeal and to make an order for specific disclosure against the Bank.
On 9 March 2009, Pill LJ directed that the Bank's application for permission to appeal to this court should be adjourned to be listed on notice to Mr Beck, with the appeal to follow if permission was granted. Pill LJ granted a stay on the EAT's order for discovery until the determination of the Bank's application. His reasons for taking that course were succinctly expressed: “The EAT has reversed a case management decision. It is appropriate to hear both sides”.
Although Pill LJ allowed one and a half hours for the application, it raised a number of issues of importance and, despite being extremely well argued on both sides, comfortably exceeded the time set aside for it. As will also be apparent, the issues raised were such that we reserved judgment at the conclusion of the argument. We would accordingly grant permission to appeal.
The facts: how the application for disclosure arose
As the case is still at an interlocutory stage, we propose to record only those facts which are necessary for the proper determination of the appeal. Nothing in this judgment should, therefore, be taken as an indication of the merits of Mr Beck's claims.
By his Form ET1 dated 7 August 2008, Mr. Beck makes a number of claims against the Bank, by which he was employed from 15 January 2007 to 8 May 2008, when his employment was terminated by reason of redundancy. Mr. Beck was the Head of Marketing for the Bank's Debt Capital Markets and Equity and Commodity Structured Products Divisions, at the level of a Managing Director. Amongst his claims was one of race discrimination. That claim is pleaded in Mr. Beck's amended particulars of claim in the following way:—
35. In the light of the matters cited above, it is the claimant's belief that he may have been the subject of race discrimination in contravention of section 1 of the Race Relations Act 1976.
36. In particular, it is clear to the claimant that when looking at the people who have had their employment terminated and those who have been allowed to remain in employment during this and previous waves of redundancy, there is a sharp distinction between how those people of Canadian nationality and/or national origin and/or who were hired in Canada have been treated by the Respondent compared to those who were not Canadian and/or were not hired in Canada. (The claimant is German and was hired in London). Had the claimant been of Canadian nationality and/or national origin and/or hired in Canada, he believes he would not have been dismissed.
37. To the extent that the claimant has been treated less favourably on the grounds of his non-Canadian nationality and/or national origin, such action is contrary to section 1(b) and/or 1A of the Race Relations Act 1976.
38. To the extent that the place where an employee is hired was treated as a provision criterion or practice affecting treatment of employees, such provision criterion or practice put the claimant and other employees of non-Canadian nationality and/or national origins at a disadvantage and could not be justified contrary to section 1(b) and/or 1A of the Race Relations Act 1976.
In its grounds of resistance, the Bank describes the allegation of discrimination as “entirely frivolous and vexatious” and denies that any such discrimination has taken place. A number of other points are taken, which are not material to this appeal. It is not, however, disputed by the Bank – indeed, it forms part of its ground of resistance – that due to what it describes as “the collapse of the credit markets in 2007”, the Bank's senior management “commenced a review of business strategy for its Fixed Income and Currencies (FIC) Division” with the consequence that, at the material time, the Bank was conducting what can be described in shorthand as a “down-sizing exercise”; or, to put the matter in the language of the pleadings:
8. there would likely to be significant reduction in the marketing and structuring roles required and potentially a shift in the skills and experience required of any future roles. Management's assessment was that only a reduced staffing would be required pending finalisation of the revised strategy for FIC and that the remainder of the roles were therefore at risk of redundancy.
Mr. Beck has obtained a witness statement from a Mr. Ian Howard, an unsigned copy of which is in our papers. Mr. Howard had worked for the Bank from 1995 to 2008, ending up as its head of “structured credit run-off” business in Europe. On any view, he had been a senior employee of the Bank.
Mr Howard describes some aspects of the Bank's staff reduction exercise. For present purposes, the relevant paragraphs of his statement are the following:—
14. Altogether I had 5 flow traders, 4–5 sales people, 3 lawyers and Darcy Hall's Correlation team of 3 people to consider. Two of these individuals were Canadian (Darcy Hall and Milton Bonellos). One, Alex Tchernitser, was Russian but had been hired in Canada and had relocated to London. For all intents and purposes, Alex was treated as a Canadian employee.
15. There were several conversations with Sharon Marshall (who was Head of HR for London), Peter Letley (Head of Europe); Wayne Halenda (who was my counterpart based in Toronto) and Ron Lalonde (Vice-President Technology and Operations as well as Head of Run-Off activities). Throughout these conversations I was left with the clear impression that the Bank regarded it to be more important to look after the Canadian employees.
16. I remember, in particular, having a conversation with Ron Lalonde in late March when I was in Toronto talking about this subject. Ron was very senior in the Bank: he reported directly to the Chairman. I said to Ron that I sensed there was more of a moral obligation to look after Canadians based in the UK (i.e. Darcy and Milton) than the others. I cannot remember the exact words he used in response but I recall that he indicated that he agreed.
17. This indeed was reflected in the destiny of those that were retained by the Bank compared with those that were made redundant. Both Darcy and Milton were kept on. Further, Alex would have been offered a job in Canada had he wanted one.
Mr. Howard goes on to say that he “very much felt that looking after the Canadians” was a part of the culture of the Bank.
Also in our papers is a note of a conversation with Mr. Howard on 7 August 2008 prepared by one Steven Gardner, another Bank employee, together with an email from Mr. Howard to Mr Gardner dated 7 August 2008 in which Mr Howard writes: “Also it would be fair to say that Ron (i.e. Ron Lalonde) felt a moral obligation to find jobs for the returning Canadians rather than the rest of us”.
The context of both Mr. Gardner's conversation with Mr Howard and the latter's email was the investigation of a grievance raised by another of the Bank's employees, one Aboud Nsouli, in which differential treatment of Canadians and non-Canadians was alleged. Mr. Nsouli was not Canadian. His grievance was not connected with Mr. Beck's redundancy and the manner in which the documents came into Mr. Beck's possession is unclear. However, Mr. Beck wished both to use the material generated by Mr Nsouli's grievance in support of his discrimination claim and also to ascertain if there was correspondence or other documentation passing between senior employees of the Bank to like effect. He therefore applied to the ET for discovery against the Bank of:—
(1) all documents relating to Mr. Nsouli's grievance and appeal. Including all handwritten interview notes and electronic correspondence between Steve Gardner and any person interviewed as part of Mr. Gardner's investigation (including Ian Howard); and
(2) all correspondence (either handwritten notes or email correspondence) between senior management (including Ron Lalonde) regarding the decision to offer guarantees and/or redeployment opportunities to employees of the Bank since January 2007.
The decision of the ET
Mr. Beck's application for discovery was resisted by the Bank and refused by the ET. We do not have written reasons from the judge in the ET. All we have is the relevant correspondence passing between the parties, which the ET incorporated by reference into its decision. For reasons which will become apparent, we will concentrate on the second of the two requests. The Bank's solicitors wrote on 4 December 2008:—
we would point out that Mr. Beck's claim relates to an...
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