Clyde & Company LLP v Bates van Winkelhof
| Jurisdiction | England & Wales |
| Judge | THE HONOURABLE MRS JUSTICE SLADE DBE,Mrs Justice Slade |
| Judgment Date | 22 March 2011 |
| Neutral Citation | [2011] EWHC 668 (QB) |
| Docket Number | Case No: IHQ/11/0147 |
| Court | Queen's Bench Division |
| Date | 22 March 2011 |
[2011] EWHC 668 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
The Honourable Mrs Justice Slade DBE
Case No: IHQ/11/0147
Chris Quinn (instructed by Clyde & Co LLP) for the Claimants
David Craig (instructed by Mishcon de Reya) for the Defendant
Hearing date: 11 th March 2011
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Mrs Justice Slade:
The Claimants applied for a mandatory injunction requiring the Defendant, a solicitor and former Member of the First Claimant, to
"forthwith either apply for a stay of her claim in the Employment Tribunal (Case No 2200549/2011) or… to consent to an application for such a stay by the Claimants so as to allow for an arbitration to take place between the parties before any further steps are taken in respect of that claim."
In circumstances which I will outline below, during the course of the hearing Mr Quinn, counsel for the Claimants, applied for and was granted leave to amend the Claim Form and Order sought. The relief now claimed is an Order that the Defendant apply for or consent to an application for a stay of her proceedings before the Employment Tribunal
"so as to allow for compliance with the Dispute Resolution Procedure set out in Article 41 of the Members Agreement which the Defendant entered into on 1 st February 2010 as amended and restated on 25 th June 2010."
The hearing before me is for determination both of the application for a mandatory injunction and the Claimants' Part 8 claim in which the only relief sought is such an injunction. The wording of the Claim Form and that of the Application Notice is similar. The basis of the claim and the application is the same. The arguments of the parties and the reasons for the judgment are applicable to both the application and the claim.
The First Claimant is a firm of solicitors operating as a limited liability partnership. The Second Claimant is a Senior Equity Partner of the First Claimant. The Defendant commenced employment as a solicitor with the First Claimant on 1 st February 2010 when it acquired the team of another firm in which she was a partner. The First Claimant also acquired the firm's corporate practice and the continuation of a joint venture agreement with a law firm in Tanzania. On 1 st February 2010 the Defendant entered into a Deed of Adherence to the First Claimant's Members Agreement dated 28 th June 2008 which was subsequently amended and restated on 25 th June 2010 ('the Agreement'). Clause 41 of the Agreement provided as follows:
"41.1 If at any time there is a dispute, difference or question that shall arise between the Members or between the LLP and the Members (including any Outgoing Member or his personal representatives), or any of them, touching the membership of the LLP…or the rights and liabilities of the Members…(together 'Referred Matters'), then the Member or Members involved in such dispute, difference or question ('parties') shall deal with it as provided in this clause and clause 41.2 below. The matter shall be immediately referred by any of the parties to the Management Board requiring it to meet and to make a decision on the relevant matter within 28 days of the matter being so referred to the Management Board ("Decision Period"). The Management Board shall meet and discuss the relevant matter with a view to resolving the issue in a sensible and fair manner. If the Management Board reaches agreement with the parties within the Decision Period the Members agree that such agreement be promptly implemented. If the Management Board fails to agree on any matter within the Decision Period or if the dispute is with the Management Board itself then clause 41.2 below shall apply.
41.2 If a dispute still remains after the application of 41.1 above, including any question regarding the Referred Matters or the application of this dispute resolution procedure, then the parties agree first to refer the matter to the Centre for Dispute Resolution (CEDR) in an attempt to settle the dispute in good faith by Alternative Dispute Resolution (ADR). If the dispute is not settled within 30 days of the request to CEDR by one of the parties, or such further period as the parties shall agree in writing, either party may require that the dispute be referred to and finally resolved under the Rules of the London Court of International Arbitration, which Rules are deemed to be incorporated by reference into this clause 41.2, save that the parties preserve the right to appeal or to refer to the English Courts on questions of law which shall have jurisdiction in such circumstances. The Members and the LLP reserve all their respective rights in the event that no agreed resolution shall be reached in the ADR procedure and none of them shall be deemed to be precluded from taking such interim formal steps as may be considered necessary to protect such person's position while the ADR procedure is pending."
The Defendant worked for the First Claimant in Tanzania and in London. On 13 th January 2011 the Defendant was expelled from Membership of the First Claimant.
On 11 th February 2011 the Defendant presented a claim to an Employment Tribunal ('the ET1') in which she claimed that she had been discriminated against by the First and Second Claimants on grounds of her sex and/or pregnancy. She also claimed that she had been subjected to a number of detriments, including being expelled from the First Claimant, because in November 2010 she had made a number of protected disclosures within the meaning of Section 43A of the Employment Rights Act 1996 (' ERA').
The Claimants sought and obtained from the Employment Tribunal an extension of time in which to serve their grounds of resistance to the claim ('the ET3'). On 7 th March 2011 the Claim Form and Application Notice were issued in these High Court proceedings.
The Relevant Statutory Provisions
Equality Act 2010 (' EA')
120 (1) An employment tribunal has, subject to section 121, jurisdiction to determine a complaint relating to—
(a) a contravention of Part 5 (work);
…
144(1) A term of a contract is unenforceable by a person in whose favour it would operate in so far as it purports to exclude or limit a provision of or made under this Act.
…
(4) This section does not apply to a contract which settles a complaint within section 120 if the contract—
(a) is made with the assistance of a conciliation officer, or
(b) is a qualifying compromise contract.
…
(6) A contract within subsection (4) includes an agreement by the parties to a dispute to submit the dispute to arbitration if—
(a) the dispute is covered by a scheme having effect by virtue of an order under section 212A of the Trade Union and Labour Relations (Consolidation) Act 1992, and
(b) the agreement is to submit the dispute to arbitration in accordance with the scheme.
Employment Rights Act 1996 (' ERA')
203(1) Any provision in an agreement (whether a contract of employment or not) is void in so far as it purports—
(a) to exclude or limit the operation of any provision of this Act, or
(b) to preclude a person from bringing any proceedings under this Act before an employment tribunal.
(2) Subsection (1)—
…
(e) does not apply to any agreement to refrain from instituting or continuing proceedings where a conciliation officer has taken action under section 18 of the Employment Tribunals Act 1996, and
(f) does not apply to any agreement to refrain from instituting or continuing… any proceedings within
the following provisions of section 18(1) of the Employment Tribunals Act 1996 (cases where conciliation available)—
(i) paragraph (d) (proceedings under this Act),
…
(3) For the purposes of subsection (2)(f) the conditions regulating compromise agreements under this Act are that—
(a) the agreement must be in writing,
(b) the agreement must relate to the particular proceedings,
(c) the employee or worker must have received advice from a relevant independent adviser as to the terms and effect of the proposed agreement and, in particular, its effect on his ability to pursue his rights before an employment tribunal,
(d) there must be in force, when the adviser gives the advice, a contract of insurance, or an indemnity provided for members of a profession or professional body, covering the risk of a claim by the employee or worker in respect of loss arising in consequence of the advice,
(e) the agreement must identify the adviser, and
(f) the agreement must state that the conditions regulating compromise agreements under this Act are satisfied.
…
(5) An agreement under which the parties agree to submit a dispute to arbitration—
(a) shall be regarded for the purposes of subsection (2)(e) and (f) as being an agreement to refrain from instituting or continuing proceedings if—
(i) the dispute is covered by a scheme having effect by virtue of an order under section 212A of the Trade Union and Labour Relations (Consolidation) Act 1992, and
(ii) the agreement is to submit it to arbitration in accordance with the scheme, but
(b) shall be regarded as neither being nor including such an agreement in any other case.
Article 17
1. Member States shall ensure that, after possible recourse to other competent authorities including where they deem it appropriate conciliation procedures, judicial procedures for the enforcement of obligations under this Directive are available to all persons who consider themselves wronged by failure to apply the principle of equal treatment to them, even after the relationship in which the discrimination is...
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