Buckland v Bournemouth University Higher Education Corporation [2010] EWCA Civ 121

Professor Buckland resigned after the university re-marked his exam papers without authority, undermining his integrity. The Court of Appeal held that the test for repudiatory breach in employment is objective, not 'range of reasonable responses', and that a repudiatory breach, once committed, cannot be unilaterally cured.

Facts

Professor Paul Buckland held a chair in environmental archaeology at Bournemouth University. In 2006 he marked resit examination papers, failing 14 of 16 candidates. The second marker, Mr Haslam, endorsed the marks, and the board of examiners, chaired by Dr Astin, confirmed them. Shortly afterwards, Dr Russell unilaterally re-marked the papers, and Dr Astin then arranged a further re-marking by Mr Hewitt, whose marks moved some students from a clear fail to a marginal zone. Following the claimant’s protests, an inquiry chaired by Professor Vinney was set up. Its report, published in January 2007, vindicated Professor Buckland and criticised the manner of the re-marking. Dissatisfied, Professor Buckland resigned by letter of 22 February 2007, with effect from the end of July 2007, and brought a claim for unfair constructive dismissal.

Issues

The Court of Appeal identified the following central issues:

• Whether a fundamental (repudiatory) breach of the contract of employment by an employer is to be judged by a unitary objective contract test or by a ‘range of reasonable responses’ test.
• Whether an employer who has committed a fundamental breach can cure that breach before the employee elects to accept it as terminating the contract.
• If cure is possible, whether the Vinney report had cured the breach on the facts.
• Whether there was a triable case that any constructive dismissal was fair under s.98(4) of the Employment Rights Act 1996.

Arguments

For the University (Respondent)

Mr Galbraith-Marten QC argued that the employer’s conduct must fall outside the range of reasonable responses to amount to a repudiatory breach, and that this test applied both at the breach stage and the fairness stage. He also submitted that a repudiatory breach could be cured before acceptance, and that the Vinney report had cured any breach. If the appeal otherwise succeeded, he sought remission on s.98(4) fairness.

For the Claimant (Appellant)

Mr White QC argued that the test for repudiatory breach is objective and unitary, derived from Mahmud v BCCI and Western Excavating v Sharp. He further contended that the law of contract, including employment contracts, does not permit a party in repudiatory breach to cure that breach so as to preclude acceptance by the innocent party; the wronged party retains an unfettered choice to accept or affirm.

Judgment

The test for repudiatory breach

Sedley LJ, with whom Carnwath and Jacob LJJ agreed, endorsed the EAT’s formulation that in determining whether the employer is in fundamental breach of the implied term of trust and confidence, the ‘unvarnished Mahmud test’ applies. The court rejected the submission that the ‘range of reasonable responses’ test forms part of the breach analysis. Citing Lord Nicholls in Mahmud v BCCI:

A breach occurs when the proscribed conduct takes place

Sedley LJ noted that Western Excavating v Sharp [1978] ICR 221 had counterposed objective and unreasonableness tests and held the objective one to be correct. The range of reasonable responses test could only enter at stage (4), when assessing fairness under s.98(4). To illustrate, he gave the example of an employer who fails to pay wages because of a customer default — possibly reasonable, but still a fundamental breach. Reasonableness might be a useful factual tool but cannot be a legal requirement for breach. The cross-appeal was therefore dismissed.

Whether a repudiatory breach can be cured

The court held that, as a matter of general contract law, once a repudiatory breach has been committed (as opposed to a merely anticipatory breach), it cannot be unilaterally cured by the contract-breaker so as to deprive the innocent party of the right to accept it. Sedley LJ relied upon Stocznia Gdanska v Latvian Shipping (No 2) [2002] 2 Ll Rep 236, where Rix LJ described the alternatives following a repudiatory breach without admitting a doctrine of cure. Sedley LJ acknowledged that the result might appear harsh in the employment context but considered that employment law forms an integral part of general contract law, and a doctrine of cure could not be introduced solely for employment cases. Tribunals can, however, take a ‘reasonably robust approach to affirmation’.

Jacob LJ expressed no regret at this conclusion, observing that the rule that the innocent party has a clear choice — affirm or go — has worked for centuries and itself discourages repudiatory breaches.

The Vinney report and cure on the facts

Had a doctrine of cure existed, Sedley LJ would have held that the tribunal’s conclusion that the Vinney report had not cured the breach was objectively arrived at and tenable, and that the EAT had wrongly criticised it as subjective. The tribunal had been careful to find that Professor Buckland was ‘entitled to feel’ as he did.

Fairness under s.98(4)

Sedley LJ addressed the awkwardness of fitting constructive dismissal into the statutory fairness regime. Since the University had not consciously dismissed the claimant, asking whether it acted reasonably in treating something as a sufficient reason for dismissal made little sense; translated as whether it behaved reasonably in undermining his status, the answer was self-evident. No remission was warranted. Jacob LJ added that the EAT could and should have decided the issue itself, noting that ‘ping pong’ between courts and tribunals serves litigants badly.

Implications

The decision settles two important points in English employment law:

• Objective test for repudiatory breach: The ‘range of reasonable responses’ test, familiar from unfair dismissal under s.98(4), has no role at the breach stage. Whether an employer’s conduct is a fundamental breach of the implied term of mutual trust and confidence is to be judged objectively in accordance with Mahmud and Western Excavating v Sharp. This eliminates the conflicting line of authority represented by Abbey National v Fairbrother.
• No cure of completed repudiatory breach: Once a repudiatory breach is complete, the wronged party retains the choice to affirm or accept; the contract-breaker cannot unilaterally cure the breach to preclude acceptance. This aligns employment law with general contract law.
• Affirmation: Tribunals will look carefully at the facts before finding affirmation, recognising the practical pressures on an employee. Reasonable delay (for example, to await the outcome of an internal inquiry, or to fulfil obligations to students) will not necessarily amount to affirmation.
• Statutory fairness in constructive dismissal: The court recognised an inherent awkwardness in applying s.98(4) to constructive dismissal cases, particularly where the employer has not consciously dismissed the employee.
• Procedural point: The court (per Jacob and Carnwath LJJ) discouraged unnecessary remission, encouraging the EAT to decide issues itself where it is in a position to do so.

The decision is important to employers, employees, trade unions and practitioners because it provides clear guidance on the legal threshold for constructive dismissal and confirms that an employer cannot escape liability simply by attempting to make amends after the event, although such attempts may be relevant to whether the employee has affirmed the contract.

Verdict: The appeal was allowed and the cross-appeal dismissed, restoring the employment tribunal’s determination that Professor Buckland had been constructively dismissed.

Source: Buckland v Bournemouth University Higher Education Corporation [2010] EWCA Civ 121