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FRIDAY, FEBRUARY 6 2004

Ex-director loses High Court battle

A FORMER director at the Town Hall has lost a marathon legal battle against his old council bosses.  Despite being represented by the Prime Minister's wife, Cherie Booth QC, James Foster has failed to win his claim over redundancy and retirement benefits.  The ex-director of environmental services may now be facing massive legal fees following his fight which has been the subject of no less than three High Court hearings and two in the Court of Appeal.

Judges ruled that for the council to have given him all the benefits he sought would have been 'irrationally generous' and unlawful.  Giving judgment on Tuesday Lord Jutice Keene said that, unless agreement is reached over the next 14 days, there may have to be another court hearing to decide which side will bear the legal costs of the dispute.

Over the years, the case has exercised the minds of a whole series of the nation's most senior judges.  Miss Booth had earlier told the Appeal Court the unending litigation had taken its toll on Mr Foster's health.  The dispute dates back to July 1998 when Mr Poster's job was 'abolished' during a shake-up  by the council.  Eastbourne's policy and resources sub-committee resolved to make Mr Foster redundant but, crucially, a 'compromise agreement' was reached under which his employment contract was continued until August 31 1999.  

That extra year in the job made  vital difference to Mr Foster as it entitled him to enhanced redundancy and retirement benefits.  but everything began to unravel when four days after his 50th birthday, the District Auditor began questioning the lawfulness of the compromise agreement.  Litigation quickly ensued and the High Court dealt Mr Foster a bitter blow when it ruled the council had no power to enter into the compromise agreement which was 'not worth the paper it was written on'.

In July 2001, the Appeal Court, whilst agreeing the compromise agreement was unlawful, came to his aid when it ruled his employment had not been terminated until after his 50th birthday.  And, in February last year, High Court judge Mr Justice MacKay ordered the council to reconsider Mr Foster's case.

However, even that was not an end to the dispute.  In April last year, the council's Cabinet committee decided on legal advice that it would be 'irrationally generous' to grant Mr Foster enhanced benefits.  The council was concerned that any enhanced payment made to Mr Foster might later be ruled unlawful and councillors subjected to 'surcharge'.

Mr Foster promptly went back to the High Court, but Mr Justice Moses dismissed his judicial review challenge in April this year.  The judge accepted that mr Foster had acted in reliance on the compromise agreement which he had no reason to believe was invalid at the time.  However, he ruled that the regulations stating that enhanced benefits paid after council employees reach the age of 50 'cannot be bypassed by an unlawful extension of employment'.

With Miss Booth representing him, Mr Foster took one last throw of the dice when he challenged Mr Justice Moses' ruling in the Appeal Court - only to be rebuffed this week.  Lord Justice Keene, sitting with Lod Brown of Eaton-Under-Heywood and Lord Justice Scott Baker, accepted that Mr Forster had been 'employed under a lawful contract' with the council until after his 50th birtday and that meant he was 'technically eligible' for enhanced benefits.

But he said the could not ignore the fact that the council had had no lawful power to enter into the original compromise agreement.  The judge concluded, 'I would only say that to have awarded him the full amount which he seeks would have been irrationally generous'.  Legal costs bills are bound to be enormous.

A NOTE FROM OUR EDITOR:  A similar set of circumstances surrounds a 'compromise agreement' concerning Ashley Brown, the ex-director of environmental services, of Wealden District Council.  His former employment was also severed before his 50th birthday.  Nelson Kruschandl noticed the similarity between cases and wrote to Wealden's Charlie Lant seeking clarification.  So far Mr LAnt has been shy of replying despite overstepping government targets for reply and reminder.  Consequently, we contacted the District Auditor.  however, to date the DA has not come back, or to our knowledge taken any action in the matter!

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