Dr Hashmukhray Bhatt v 1. Westminster Healthcare Trust and Another
| Jurisdiction | England & Wales |
| Judgment Date | 15 May 2000 |
| Judgment citation (vLex) | [2000] EWCA Civ J0515-3 |
| Date | 15 May 2000 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | A1/97/1378 |
[2000] EWCA Civ J0515-3
IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM EMPLOYMENT APPEAL TRIBUNAL
(MR JUSTICE KIRKWOOD)
Royal Courts of Justice
Strand
London WC2A 2LL
Lord Justice Otton
Lord Justice Buxton
Mr Justice Hooper
A1/97/1378
MR BRIAN LANGSTAFF QC and MR THOMAS KIBLING (Instructed by Messrs Booth & Blackwell, London, EC4A 3JB) appeared on behalf of the Appellant
MR SELWYN BLOCK QC (Instructed by Messrs Stephenson Harwood, London, EC4M 3SH) appeared on behalf of the Respondent
LORD JUSTICE OTTON: I will ask Lord Justice Buxton to give the first judgment.
LORD JUSTICE BUXTON: This appeal comes before the court in somewhat unusual circumstances. It is agreed between the parties that the issue it raises is determined, so far as authority in this court is concerned, by the decision of this court in the case of British Broadcasting Corporation v Kelly Phillips [1998] ICR 587. In that case this court did not grant leave to appeal to the House of Lords but the House of Lords on a petition granted such leave. However, the case of Kelly Phillips did not proceed before their Lordships' House. We do not know for what reason and the reason does not matter.
It is therefore accepted by the appellant that we are bound to dismiss this appeal on the basis of the authority of Kelly Phillips. The appellant has however strongly argued, through Mr Brian Langstaff QC, that the case of Kelly Phillips was wrongly decided and the issue that it raises should again be considered by the House of Lords, it being contended that it raises an issue of general importance. The only way that can be achieved is if this court in this case gives such leave.
In order to enable us to consider whether we should proceed in that way we have had the advantage of a detailed submission from Mr Langstaff both on paper and orally before us today as to why Kelly Phillips was wrongly decided and as to why the matter needs to be further considered. In order to explain those submissions, it is necessary that I should briefly state the background facts and the issues to which they give rise.
The appellant, Dr Bhatt, was employed by the Charing Cross and Westminster Medical School. He is a distinguished expert in a particular area of medicine, the management of vitamin B12 disorders. He first took up employment in 1984 with the medical school in that capacity but, as we understand is often the case with doctors working in such a capacity, the funding for his employment depended upon outside sources. Because the availability of such funding altered from time to time, Dr Bhatt was employed under a series of contracts.
The first contract (although not arising at the beginning of Dr Bhatt's association with the medical school) was entered into in 1985. It provided that Dr Bhatt would be appointed as a research fellow in the Department of Child Health for an initial period of three years with effect from 1 June 1985. The letter that constituted the contractual terms dealt with various matters such as salary, superannuation, leave and notice. It stated:
"In the course of the fixed term nature of your appointment it is a condition of employment that you waive your rights to redundancy payment or to claim unfair dismissal should your employment not be renewed after 31 May 1988."
That clause is conventionally referred to as a waiver clause. Dr Bhatt confirmed his acceptance of that employment.
Between 1988 and 1995 there was a series of what I will call, for the purposes of identification only at this stage, "extensions" of Dr Bhatt's employment for periods varying in duration from two months to three years. In each case the hospital wrote to him saying that since they had received further funding the hospital was able "to offer you an extension of employment in this capacity" until a certain date. The last of these extensions was from 31 October 1995 until 31 January 1996. Each of these subsequent letters of contracts offering an extension had a waiver clause attached to it.
The operation and effect of the waiver clause is important in the present case because of its effect upon the unfair dismissal regime under the Employment Rights Act 1996 ("the 1996 Act"). Section 197(1) of the 1996 Act provides that part X of that Act (which contains the provisions in relation to unfair dismissal):
"….does not apply to dismissal from employment under a contract for a fixed term of one year or more if-
(a) the dismissal consists only of the expiry of that term without its being renewed; and
(b) before the term expires the employee has agreed in writing to exclude any claim in respect of rights under that Part in relation to the contract."
Section 203(2)(d) of the 1996 Act excludes from the provisions prohibiting contracting-out employment rights, any agreement relating to dismissal from employment that falls under section 197(1).
The question therefore is whether, as at 31 January 1996, after which date no renewal of the contract was offered, Dr Bhatt was employed under a contract for a fixed term or more. His last extension, as we have seen, did not so qualify, standing on its own, because it was for a period of only three months. The hospital authority contends, as the employer successfully contended before this court in Kelly Phillips, that Dr Bhatt was employed under the original contract of 1 June 1985, albeit extended.
These conflicting arguments have already been debated in the case of Kelly Phillips. Since this appeal was effectively a review of that case, it is appropriate that I should refer to the leading judgment of Peter Gibson LJ. It is not necessary to set out the facts of Kelly Phillips, but to go straight to the substance of the judgment at page 592G. Looking at the terms of section 197(1), Peter Gibson LJ set out the argument that had been advanced in that case by leading counsel for the employee to the effect that the fixed term to which the section referred was, and was only, the original fixed term. In the present case that would be of three years under the original contract. Any further extension would be under a new and different fixed term contract.
Peter Gibson LJ, when approaching the question of statutory construction, said at page 593C:
"For my part I can see force in this reasoning if section 197(1) could be construed on its own. But, as [counsel for the employer] submitted, it cannot be so construed. In particular, section 95(1)(b) is of crucial importance because that recognises that there can be an extension of a fixed term of a contract 'under the same contract'."
Section 95(1)(b) reads as follows:
"For the purposes of [this Part] an employee is dismissed by his employer if ….(b) he is employed under a contract for a fixed term and that term expires without being renewed under the same contract…."
Peter Gibson LJ continued:
"In other words the extension does not necessarily mean that there is a new contract whereby the term is extended. That gives rise to the question of the significance of the preposition 'under'. In the course of argument I raised the possibility that it might signify that the extension was effected pursuant to some right or power in the contract, and [counsel for the employee] adopted that suggestion. But on reflection I do not think that it would be right to give the word so limited a meaning. Such a provision would, I think, be unusual to find in a contract of employment for a fixed term and it would mean that save in such a case there was a dismissal every time the fixed term expired, even though the employee continued to be employed on precisely the same terms and the only variation of the contract was the extension of the term. In my judgment, the more natural construction of the words in section 95(1)(b) is to treat them as referring to a renewal (including an extension) of the term on the same, or substantially the same, terms as the original contract, the contrast being with a new contract."
He then referred to various other parts of the Act which he considered gave some, though not conclusive, support to the construction that he adopted in respect of section 95(1)(b).
Mr Langstaff argues that Peter Gibson LJ's first thought, proposed by him in argument, had been correct and that he had been wrong in the mature reconsideration of that thought that he set out in his judgment. It is perhaps not wholly irrelevant to observe that this argument raised by the Lord Justice had not occurred to anyone previously and was not part of the case originally put before him. However, that does not mean that Mr Langstaff's argument in favour of it should not be given careful consideration.
That argument recognises that "renewal", when used in this statute, includes extension as provided by section 235. "Renewal" therefore always means "renewal under the same contract" whenever it is used in the statute (as I understood Mr Langstaff's argument). The only meaning that can be given to that reference is renewal by the exercise of some power to extend the term as contained in the original contract. There was no such provision in this case and therefore the provisions of section 197(1) do not bite upon it. If there had been such a provision, then the original contract could have been extended under that provision and Dr Bhatt would be bound by the original waiver in the contract if so extended.
Purely as a matter of policy, I cannot see any reason why Parliament should have made that distinction. Once the possibility of extension of a...
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