By Amy McNicholas, 10th February 2022
BACKGROUND
Ms Hennessy (the “Plaintiff”) was employed by Ladbrokes (Ireland) Limited (the “Defendant”) as a customer service manager from 22 April 1998 until her employment ended, due to redundancy, on 11 August 2015.
At the time, the Plaintiff signed a Compromise Agreement (the “Agreement”) which included a clause that precluded her from issuing or pursuing “any proceedings or claim of any nature whatsoever” against the Defendant.
On 6 April 2016, some eight months after signing the Agreement, the Plaintiff lodged an application with the Personal Injuries Assessment Board (PIAB). A personal injury summons subsequently issued against the Defendant claiming damages for injuries to the Plaintiff’s shoulders. The Plaintiff alleged that she was repeatedly required to engage in repetitive movements and worked in unsuitable conditions.
MOTION SEEKING TO STRIKE OUT CLAIM
The Defendant issued a motion seeking to strike out the Plaintiff’s proceedings on three grounds:
Firstly, that the Plaintiff’s case would fail at full trial on the basis that she had signed the Agreement waiving any right of action against the Defendant. The Defendant described this as providing it with an unanswerable defence to the proceedings.
Secondly, the Defendant argued that the Plaintiff’s proceedings were statute-barred. This was on the basis that the Plaintiff’s medical evidence showed the injury occurred more than 2 years before she lodged the claim with PIAB.
Finally, the Defendant submitted that the proceedings should be dismissed based on the delay in the commencement and conduct of proceedings. In this regard, the Defendant relied on a seven-year delay from when the Plaintiff first experienced shoulder pain in 2009, to when she issued proceedings in 2016. It was also argued that there were three periods of delay of 12 months, 15 months and 12 months respectively, after the personal injuries summons issued.
HIGH COURT (THE “COURT”) PROCEEDINGS
In considering the Agreement, Ms Justice Marguerite Bolger (Bolger J) noted that the Defendant confirmed in an affidavit of discovery that it never had any documentation relating to pre-agreement negotiations for the Agreement.
The Court also considered the clause contained within the Agreement which stated that the Plaintiff had taken independent legal advice prior to signing the Agreement. In her replying affidavit, the Plaintiff submitted that she had not received legal advice as to the term or effect of the Agreement and was not advised to do so by the Defendant. The Plaintiff also claimed that the Defendant presented the Agreement to her on a “take it or leave basis.” The Court held that the absence of any pre-negotiation documents supported the view that the Agreement was put to the Plaintiff on a “take it or leave it basis”. In this regard, the Court found that the Agreement contained an untrue statement that the Plaintiff had taken independent legal advice.
Considering the judgement made in Board of Management of Malahide Community School v. Conaty [1] Bolger J held that there was an obligation on employers to explain the legal effects of agreements signed by employees, particularly in circumstances where the agreement involved the loss of statutory rights.
Bolger J also held that there was an implied obligation of mutual trust and confidence in the employment relationship and the Defendant could not rely on case law which states that a signatory was bound by what they signed.
In relation to the issue regarding the statute of limitations, Bolger J accepted that the Plaintiff had suffered from issues with her shoulder since 2009 and this was supported by the medical reports of her general practitioner and consultant rheumatologist. However, the Court accepted the Plaintiff’s submission that she did not realise the injuries to her shoulder were significant until she was advised to have surgery in 2015. In this regard, Bolger J held that this issue could not be fairly determined without further evidence from the Plaintiff and her medical team. Bolger J was of the view that the evidence relied upon by the Defendant was not sufficiently clear to dismiss the Plaintiff’s proceedings as being statute barred.
Finally, in relation to the issue of delay, Bolger J rejected the Defendant’s claim that the pre-action delay was seven-years. In fact, she commented on the fact that the Defendant had delayed in bringing the motion to dismiss and held that this could factor into the Court’s discretion to grant relief. In this regard and having consideration to Mangan v. Dockeray [2] the Court held that there was not a serious risk of injustice if the case continued. However, there would be an enormous prejudice to the Plaintiff if the case was dismissed.
THE COURT’S CONCLUSION
Bolger J was not satisfied on evidence that the claim was bound to fail and held that the Plaintiff was entitled to call evidence to deal with the issues surrounding the Agreement and the statute of limitations point.
GUIDANCE FOR EMPLOYERS IN RESPECT OF THE COURT’S FINDING RELATING TO THE AGREEMENT
Settlement agreements purporting to be full and final settlements, capturing all causes of action, including claims in tort, may not be as full and final as employers may have thought. In these circumstances, it is advisable that employers ensure that employees are making informed decisions by actively encouraging them (and keeping a record of doing so) to receive independent legal advice. In this regard, employer’s should ensure that the employee is informed in writing of their right to get legal advice and given sufficient time to obtain that advice. Without this evidence at a minimum, the enforceability of a waiver agreement could be brought into question.
The full judgement can be viewed here.
[1] [2019] IEHC
[2] [1995] 2 IRM 561