1. Introduction

Royal Bank of Scotland Plc v. AB ([2021] EWCA Civ 345) is a pivotal case heard by the England and Wales Court of Appeal (Civil Division). The case revolves around AB, an employee who suffered significant physical and mental injuries, leading to claims of unfair dismissal and disability discrimination against her employer, the Royal Bank of Scotland (RBS). The central legal issue concerns whether the Employment Tribunal (ET) erred in not assessing AB's capacity to litigate during the remedies hearing, a matter subsequently appealed to the Employment Appeal Tribunal (EAT) and then to the Court of Appeal.

2. Summary of the Judgment

The Court of Appeal dismissed RBS's appeal against the EAT's decision, upholding the original remedies awarded to AB. The primary contention by RBS was that the ET failed to assess AB's capacity to litigate, potentially undermining the integrity of the Tribunal's proceedings and the consequential award of £4.67 million. However, the Court of Appeal found that the lack of such an assessment did not invalidate the Tribunal's decision, as AB's capacity to litigate did not materially affect the outcome. The judgment emphasized the presumption of capacity under the Mental Capacity Act 2005 and determined that the ET's decision to proceed without an assessment was justified, especially given the lack of evidence suggesting AB lacked capacity.

3. Analysis

3.1 Precedents Cited

The judgment references several key legal precedents that influenced its outcome. Notably, Jhuti v Royal Mail Group Ltd [2018] ICR 1077 was discussed, establishing that an ET possesses the authority under Rule 29 of the Employment Tribunal Rules of Procedure 2013 to appoint a litigation friend. Additionally, Dunhill v Burgin (Nos 1 and 2) [2014] 1 WLR 933 was analyzed to distinguish the current case from scenarios where capacity assessments might invalidate Tribunal proceedings. These precedents collectively reinforce the Court's stance on the discretionary power of Employment Tribunals regarding capacity assessments and the conditions under which these assessments should influence Tribunal decisions.

3.2 Legal Reasoning

The Court's legal reasoning centered on the application of the Mental Capacity Act 2005, particularly the presumption of capacity (section 1) which asserts that individuals are assumed to have the capacity to make decisions unless proven otherwise. In this case, the ET was entrusted to determine AB's capacity based on the evidence presented, including medical reports from Dr. Ornstein and Dr. Stein. The Court found that since no evidence conclusively demonstrated that AB lacked capacity to litigate, and the ET had reasonable basis to proceed without an assessment, the Tribunal’s decision remained intact and untainted by procedural irregularities.

Furthermore, the Court addressed RBS's argument that an assessment could have provided constructive evidence to challenge AB's credibility. The Court dismissed this, noting that the primary purpose of capacity assessments is to ensure fair litigation processes, not to serve as tools for assessing the veracity of claims. The potential for discovering additional evidence during an assessment was deemed insufficient to warrant remitting the case, especially in the absence of concrete indications that AB lacked capacity.

3.3 Impact

This judgment has significant implications for Employment Law and the conduct of Employment Tribunals. It reinforces the presumption of capacity, safeguarding litigants from unnecessary and potentially prejudicial capacity assessments unless there is clear evidence to suggest incapacity. The decision underscores the necessity for tribunals to balance procedural fairness with the rights of both parties. It also delineates the boundaries of ETs’ discretion in managing capacity assessments, ensuring that such measures are employed judiciously and not as strategic tools by employers to undermine claims.

Future cases involving capacity to litigate will likely reference this judgment to determine the appropriateness and necessity of conducting capacity assessments. Employers may need to ensure that any challenges to a claimant’s capacity are substantiated with compelling evidence to avoid similar dismissals of their appeals.

4. Complex Concepts Simplified

4.1 Presumption of Capacity

Under the Mental Capacity Act 2005, there is a fundamental presumption that individuals possess the capacity to make decisions for themselves. This presumption shifts the burden of proof to those who allege that a person lacks capacity. In the context of litigation, this means that a party cannot be presumed to be incapable of participating in legal proceedings without substantial evidence.

4.2 Litigation Friend

A litigation friend is someone appointed to represent and make decisions on behalf of a person who is unable to conduct litigation themselves due to incapacity. The role ensures that the legal process is fair and that the interests of the incapacitated party are protected.

4.3 Procedural Irregularity

This refers to errors or deviations from established legal procedures during the conduct of a case. Such irregularities can sometimes lead to a case being remitted or re-examined to ensure fair treatment, but only if they significantly impact the case's outcome.

5. Conclusion

The judgment in Royal Bank of Scotland Plc v. AB reaffirms the principle that Employment Tribunals must uphold the presumption of capacity unless compelling evidence indicates otherwise. It highlights the Court of Appeal's role in ensuring that tribunals exercise their discretion appropriately, without overstepping into areas that could undermine procedural fairness. The decision serves as a crucial reference point for future cases, emphasizing that capacity assessments should be grounded in clear evidence of need rather than as strategic tools for parties to influence litigation outcomes. Ultimately, this judgment strengthens the integrity of the Employment Tribunal process, ensuring that claims of incapacity are handled with the requisite seriousness and in accordance with established legal standards.