Preston v President of the Methodist Conference

JurisdictionEngland & Wales
CourtCourt of Appeal (Civil Division)
JudgeLord Justice Maurice Kay,Lord Justice Longmore,Sir David Keene
Judgment Date20 Dec 2011
Neutral Citation[2011] EWCA Civ 1581
Docket NumberCase No: A2/2011/0852

[2011] EWCA Civ 1581

IN THE COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL

MR JUSTICE UNDERHILL (PRESIDENT), MR EVANS, AND

MR WORTHINGTON

UKEAT/0219/10DM

Royal Courts of Justice

Strand, London, WC2A 2LL

Before:

Lord Justice Maurice Kay, Vice President of the Court of Appeal, Civil Division

Lord Justice Longmore

and

Sir David Keene

Case No: A2/2011/0852

Between:
The President of the Methodist Conference
Appellant
and
Preston (Formerly Moore)
Respondent

Mr Oliver Hyams (instructed by Messrs Pothecary Witham Weld) for the Appellant

Mr John Bowers QC and Mr James Bax (instructed by Nalders LLP) for the Respondent

Hearing date : 16 November 2011

Lord Justice Maurice Kay
1

The respondent was ordained as a Minister (or, to use the correct terms, received into full connexion with) the Methodist Church in 2003, following a period of time as a Probationer Minister. In 2006 she was appointed to the post of Superintendant Minister to the Redruth Circuit in Cornwall. On 10 June 2009 she submitted a letter of resignation. On 9 September 2009 she commenced proceedings in the Employment Tribunal (ET) alleging unfair constructive dismissal. Her claim raised a preliminary issue: was she an employee of the Church within the meaning of section 230 of the Employment Rights Act 1996? Section 230 provides:

"(1) In this Act 'employee' means an individual who has entered into or works under (or, where the employment has ceased, worked under) a contract of employment.

(2) In this Act 'contract of employment' means a contract of service or apprenticeship, whether express or implied, and (if it is express) whether oral or in writing."

2

The respondent faced an obvious difficulty. In President of the Methodist Conference v Parfitt [1984] ICR 176 the Court of Appeal had held (and I quote the headnote):

"… a correct appreciation of the spiritual nature of the relationship between a minister and the Methodist Church showed that the arrangements between the minister and the Church in relation to his stationing throughout his ministry, and the spiritual discipline which the Church was entitled to exercise over the minister in relation to his cases, were non-contractual; … therefore, the applicant was not employed by the Church under a contract of service and, accordingly, the industrial tribunal had no jurisdiction to consider the applicant's claim of unfair dismissal."

The current arrangements between a Minister and the Church are not precisely the same as pertained at the time of Parfitt but they are substantially similar.

3

On 16 December 2009, at a pre-hearing review, the ET considered the section 230 point as a preliminary issue. It considered itself to be bound by Parfitt, which it could not distinguish on the facts. It held that the respondent was not an employee of the Church and it dismissed her claim.

4

The respondent appealed to the Employment Appeal Tribunal (EAT) which, in a judgment handed down on 15 March 2011, UKEAT/0219/10/DM, allowed the appeal, concluding that the ET had been wrong simply to follow Parfitt in the light of the more recent decision of the House of Lords in Percy v Board of National Mission of the Church of Scotland [2006] 2 AC 28. Underhill J (President of the EAT) stated (at paragraph 54):

"… we do not believe that the reasoning of Parfitt can be sustained in the light of Percy, even on the same facts."

5

Although Percy was concerned with the position of a Minister in a different Church, the Appellate Committee gave close attention to Parfitt. It did not expressly overrule it. Essentially, the decision of the EAT in the present case was that Percy had impliedly overruled Parfitt and, in this Court, the respondent's case is that we are no longer bound by Parfitt because, by reference to the second limb of Young v Bristol Aeroplane Co [1944] KB 718, per Lord Greene MR giving the judgment of the Court (at page 729):

"The court is bound to refuse to follow a decision of its own which, though not expressly overruled, cannot, in its opinion, stand with a decision of the House of Lords."

6

In the present case, there were preliminary skirmishes around the question whether the EAT ought to have undertaken the task of considering whether Parfitt has been impliedly overruled rather than leaving that question to this Court. However, we heard no argument about that and the status of Parfitt is now fairly and squarely before us.

7

I say at the outset that the judgment of Underhill J contains a masterly and detailed analysis of the authorities. I agree with it and with the conclusion to which it led. I do not feel able to improve on it. For this reason I shall explain why I consider that this appeal should be dismissed in a shorter judgment than might otherwise have been necessary.

Parfitt

8

When Parfitt had passed through the Industrial Tribunal and the EAT, the lay members of both tribunals had found in favour of Mr Parfitt, with the chairman of the Industrial Tribunal and Waterhouse J in the EAT dissenting. As the judgment of Waterhouse J received approval in the Court of Appeal, it is necessary to set out the following passages:

"I consider that the starting point of any consideration of the relationship between the Methodist Church and its ministers must be an examination of the faith and doctrine to which they subscribe and they seek to further. The concept of a minister as a person called by God, a servant of God and the pastor of His local church members seems to me to be the central relationship … I am unable to accept that either party to the present proceedings intended to create a contractual relationship … The submission by the Methodist Church that a minister is, in effect, a person licensed by the Methodist Conference to perform the work of a minister in accordance with the doctrine of the church and subject to its discipline is, in my judgment, the most persuasive description of his status and role."

9

In the Court of Appeal, Dillon and May LJJ each gave substantive judgments, with both of which Sir John Donaldson MR simply agreed. Dillon LJ expressed agreement with Waterhouse J "for the reasons which he gave" (p.184E). His own judgment included the following passages:

"… in my judgment, the spiritual nature of the functions of the minister, the spiritual nature of the act of ordination by the imposition of hands and the doctrinal standards of the Methodist Church which are so fundamental to that church and to the position of every minister in it make it impossible to conclude that any contract, let alone a contract of service, came into being between the newly ordained minister and the Methodist Church when the minister was received into full connection. The nature of the stipend supports this view. In the spiritual sense, the minister sets out to serve God as his master; I do not think that it is right to say that in the legal sense he is at the point of ordination undertaking by contract to serve the church or the conference as his master throughout the years of ministry.

Equally, I do not think it is right to say that any contract, let alone a contract of service, comes into being between the church and the minister when the minister accepts an invitation from a circuit steward to become a minister on a particular circuit … the arrangements between the minister and the church in relation to his stationing throughout his ministry and the spiritual discipline which the church is entitled to exercise over the minister in relation to his career remain non-contractual." (Pages 182G – 183C)

… the courts have repeatedly recognised what is and what is not a contract of service and I have no hesitation in concluding that the relationship between a church and a minister of religion is not apt, in the absence of clear indications of a contrary intention in the document, to be regulated by a contract of service." (Page 183H)

10

It is plain from the passage I have emphasised that Dillon LJ was not confining his approach to the Methodist Church and that he was postulating a rebuttable presumption of an absence of intention to create legal relations. Moreover, he contemplated the probability of binding contractual obligations in relation to other aspects of a Minister's position which he described as "ancillary matters", such as the entitlement of the Minister under the superannuation scheme and his obligation to repay a proportion of training costs in the event of departure within ten years (page 184A). He ended his judgment by saying that he saw no good reason why "modern economic conditions or the development of social security and employment protection should lead to a different conclusion now". (Page 185B)

11

May LJ considered that

"… in the particular circumstances of this case the important consideration is whether the parties intended to create legal relations between them so as to make the agreement … enforceable in the courts." (Page 185F)

He set out a lengthy extract from the judgment of Waterhouse J and expressed agreement with it (page 187C). He then went on to conclude, obiter, that if there was a contract, it was not a contract of service.

Percy

12

In Percy a female Minister of the Church of Scotland commenced proceedings in the ET. Her claim was not one of unfair dismissal but was for sex discrimination. Protection under the Sex Discrimination Act 1975 is wider than unfair dismissal protection in that it extends beyond employment under a contract of service and applies also to "a contract personally to execute any work or labour": section 82(1). Nevertheless, both forms of protection are predicated upon the existence of a contractual relationship. The...

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