Injury Claim for Breach of Contract not Dead, man

Picture of Bristol Suspension Bridge

Suspend in haste; repent at leisure

Yapp v Foreign & Commonwealth Office [2013] EWHC 1098 (QB) is interesting on its facts but also, and the reason I mention it here, because it is a rare example of a Claimant recovering damages for psychiatric injury suffered as a result of a breach of contract.

There is authority for such a claim in the case of Gogay v Hertfordshire County Council [2000] EWCA Civ 228 where a care worker suffered injury after being suspended on account of allegations made by a child after a therapy session.

The Court of Appeal described the suspension as a ‘knee jerk’ reaction and declined to interfere with the trial Judge’s finding that psychiatric injury was foreseeable.

That decision has often been viewed as controversial and detractors will have felt vindicated by the decision in Deadman v Bristol City Council [2007] EWCA Civ 822 where damages for psychiatric injury were refused as being too remote.

Deadman held that when relying on contract, damages would be too remote unless, at the time of entering the contract, it would have been within the reasonable contemplation of the parties that the breach in question would have caused psychiatric injury.

In practical terms, this means the psychiatric injury would have had to have been reasonably foreseeable at the time the employment started. That is a high hurdle and some have questioned whether Gogay would be decided the same way now. The answer is probably yes.

Mr Yapp was the High Commissioner to Belize when he was suspended and withdrawn from his post following allegations of bullying and inappropriate conduct towards women at functions.

Cranston J found that the suspension and the conduct of the subsequent disciplinary procedure were unlawful. They breached an express term of Mr Yapp’s contract promising fair treatment and also the implied term of mutual trust and confidence.

The actions were also found to be a breach of the FCO’s duty of care but as damages were awarded contractually, there was no need to deal with that aspect.

The judgment contains a very useful review of the relevant cases including both Gogay and Deadman and Cranston J considered he was able to distinguish Deadman on its facts. Whereas Deadman involved what he described as a minor breach in the disciplinary procedure, this case was more serious and therefore analogous with Gogay.  He specifically found that:

it could reasonably be contemplated when the Claimant was appointed as high commissioner in 2007 that depression would be a not unlikely result of a knee-jerk withdrawal from post.

Clearly, this is a fact sensitive case but it highlights that damages for psychiatric injury caused by breach of contract may yet be recoverable if the facts are right and, of course, provided that the breach is not actual dismissal. Remember that Johnson v Unisys [2001] UKHL 13 imposes an exclusion area so that damages for personal injury caused by the dismissal cannot be recovered.

So, if the employer’s breach is treated as a repudiatory breach and accepted by the employee as constructive dismissal then the Johnson exclusion would seem to apply and bar a claim for psychiatric injury.

On the other hand, if the employee lets the contract continue then the right to claim constructive dismissal is lost but the claim for psychiatric injury is preserved.

Let no one tell you the law around psychiatric injury at work is straightforward and logical …


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Filed under Cases, Dismissal, Occupational Stress

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