In R (Forsey) v Northern Derbyshire Magistrates’ Court (2017) EWHC 1152 (QB) the claimant was prosecuted as a director of a company which entered into administration, and whose 84 employees at a warehouse were made redundant. It was alleged that the company committed an offence by failing to notify the Secretary of State for Business, Innovation and Skills (“the SoS”) in writing of a proposal to dismiss and make redundant 20 or more employees. The claimant is said also to be guilty on the basis that he had consented to, connived at, or neglected to prevent this failure. The failure was alleged to be contrary to Section 194 of the Trade Union and Labour Relations (Consolidation) Act 1992 (“the Act”).
The claimant challenged the Magistrates Court decision not to stay his prosecution by the SoS. The requirement to give notice is pursuant to Section 193 of the Act. Section 194(1) provides for a failure to give notice to be an offence. Section 194(2) provides that proceedings for such an offence shall be instituted only by or with the consent of the SoS or by an officer authorised for that purpose by special or general directions of the SoS. The claimant sought a quashing order and a declaration that the institution of criminal proceedings against him was a nullity.
The core issue before the High Court was whether the SoS may lawfully rely on the principle in Carltona Ltd v Commissioner of Works [1943] 2 All ER 560 to institute criminal proceedings against the claimant. The issue, therefore, was concerned with the true construction of s.194(2) of the Act and whether that true construction has the effect of excluding the ‘Carltona principle’. The official, Mr Whittaker, who authorised the prosecution had no authorisation from the SoS.
The terms of the Carltona principle and its effect were not controversial as between the parties. What was in issue was whether an analysis of s.194(2) led to the conclusion that it did not apply in this case. An authoritative account of the principle can be found, (including a citation from the original case), in R (King) v Secretary of State for Justice, also known as R (Bourgass) v Secretary of State for Justice, [2016] AC 384 at paragraphs 48 to 53. In brief, the functions given to ministers are so multifarious that no minister could ever personally attend to all of them. In those circumstances, the duties imposed upon ministers, and the powers given to them, are normally exercised under the authority of the minister by responsible officials of the department. Constitutionally, the decision of such an official is that of the minister. This is not a matter of agency or delegation to the official, but one of devolution to the official as the alter ego of the minister. For these purposes the official must be suitably qualified. It was not in issue that the official was so qualified.
Treacy LJ, with whom Foskett J agreed, said:-
“28. The language of s.194(2) does not contain any express exclusion of the Carltona principle, for example by using words which show that the decision is to be taken by the Secretary of State personally. Therefore the issue is whether there arises a necessary implication that the principle is excluded in this case. I consider that that requires a careful examination of the statutory language and its context, including a consideration of factors said to point towards exclusion of the principle. In my judgment, there is, at the very least, a starting point that the Carltona principle applies and that it requires displacement. The principle may be displaced by materials or considerations which lead to the conclusion that Parliament intended to exclude the principle.”
“37. I next turn to consider the nature of the Act. It was not disputed that the Part IV, Chapter II of the Act mandated procedures designed to mitigate the effect of redundancies and to ensure that a required consultation process was properly adhered to. Again, it was not controversial that this was important legislation, mediating the respective interests of employers and employees in an important and sensitive area of industrial relations. Sanctions for failures in the consultation process by an employer were provided: complaint to an Employment Tribunal and the making of a protective award (s.189); prosecution for an offence (s.194), where an employer fails to notify the Secretary of State of certain redundancies under s.193.”
“48. It seems to me … that none of the wider factors relied upon as tending to show that the Carltona principle should be excluded from s.194(2), have that effect.
- I therefore revert to the terms of s.194(2). The sub-section identifies those who may institute proceedings and makes clear that only those persons have that power. Clearly a wider class of person than the Secretary of State personally is envisaged as having that power. The formula used is apparently unique. …
- The phrase “only by or with the consent of the Secretary of State” employed in s.194(2) is to very similar effect. It seems to me that concentrating on those words alone, the Carltona principle applies, permitting both a personal decision by the Secretary of State, by an appropriate official, or by some other person who has the specific consent of the Secretary of State. It does not seem to me that the final words of the sub-section “or by an officer authorised for that purpose by special directions of the Secretary of State” have the effect of excluding the Carltona principle. All these additional words do is to describe an additional class of person, who may institute proceedings by the mechanism of a direction of the Secretary of State. … it would be also apt to cover others outside the Department who could not act as the minister’s alter ego. The fact that Mr Whittaker might on one reading fall within that further category does not preclude him from coming within the Carltona principle by reference to the earlier part of the sub-section.
- There is nothing in the materials which the court has considered to suggest that the phrase “only by… The Secretary of State” excludes the application of the Carltona principle; accordingly Mr Whittaker is empowered by that route as the alter ego of the Secretary of State. There is to my mind no reason to draw the conclusion that the third category of person identified must exclude the operation of the principle. It is to be noted that the use of the word “or” is disjunctive. It has the effect of indicating that the third category of person who may institute proceedings falls into an additional category to those who either are to be treated as the Secretary of State or have his consent. As we have seen, it is possible for devolution and delegation of authority to co-exist within the same statutory provision.
- For these reasons I conclude that the claimant’s contention that the sub-section excludes the Carltona principle must fail. I would hold that in this statute the intention was to create a further category of person who could be permitted to institute criminal proceedings. The creation of such a category does not oust the Carltona principle. When Mr Whittaker instituted these proceedings it is clear that he was not acting either with the consent of the Secretary of State or with his authorisation by reason of special or general directions. I hold that he accurately represented himself as acting as the Secretary of State’s alter ego and that the proceedings were instituted in a lawful and regular manner. Accordingly, I would reject the claim, so that in this respect there is no obstacle to the case proceeding in the Magistrates’ Court.”