Rose v Dodd: [2005] EWCA Civ 957

CA: Lord Phillips of Worth Matravers MR, Waller and Mummery LJJ: 27 July 2005

The claimant was employed as a conveyancing secretary in the respondent solicitor's firm, where the respondent was the sole practitioner. On 9 December 2002, in exercise of its statutory powers under section 35 of and Schedule 1 to the Solicitors Act 1974, the Law Society intervened in the practice on the grounds of suspected dishonesty, and the respondent's practising certificate was thereby automatically suspended under the Act. His proceedings to set aside the intervention were compromised with the Law Society on 20 December 2002 and on that date he transferred the practice as a going concern to another firm. The successor firm notified the claimant, who had continued working for the respondent and was paid by him for work done, that she had been made redundant on the date of the intervention and that she should pursue any claim against him. The claimant brought a complaint seeking a redundancy payment against the respondent, claiming that the intervention operated to terminate her contract of employment on 9 December and that the termination was to be treated as that of the respondent by virtue of section 136(5) of the Employment Rights Act 1996. The employment tribunal, dismissing the complaint, found that she had not been automatically dismissed by the intervention but that her employment continued after 9 December and was transferred to the successor practice on 20 December under regulation 5(1) of the Transfer of Undertakings (Protection of Employment) Regulations 1981. The Employment Appeal Tribunal dismissed her appeal.

The claimant appealed.

The Court of Appeal held:
Although on an intervention pursuant to section 35 of the Solicitors Act 1974 the Law Society had wide powers, it had no express power to dismiss staff, and paragraph 16 of Part II of Schedule 1 conferred only an ancillary power confined to facilitate the exercise of the express powers conferred by the Schedule. Accordingly, in the absence of any agency relationship, the Law Society had no power to terminate the employees' contracts of employment, to which it was not a party, and neither the suspension of the respondent's practising certificate, nor the possibility of his ceasing to be qualified to supervise the practice, automatically terminated his employees' contracts of employment, since he could employ staff to do other work for him as long as it did not involve the conduct of the practice of a solicitor. The act of intervention itself, therefore, did not terminate the claimant's contract of employment and was not to be taken to be a dismissal of the claimant by the respondent under section 136(5) of the Employment Rights Act 1996, and, before the transfer, neither the claimant nor the respondent, who were the only persons entitled to terminate her contract of employment, had done so, since the claimant continued to work for, and be paid by, the respondent.

The appeal was dismissed.

Appearances: Clifford Darton (Edward Harte & Co, Brighton) for the claimant; Philip Thornton (James Mead, Brighton) for the defendant; Andrew Peebles (Russell-Cooke) for the Law Society intervening.