Ameer Ismail successfully defends Claimant’s right to rescind a COT3 agreement entered into under economic duress

Written by Cloisters

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Bulletin - Culkett

At a preliminary hearing in the case of Caulkett v Richard Faulke Johnson and Eve Johnson Houghton T/A Eve Johnson Houghton (case no. 3301362/2022), the Employment Tribunal considered whether the Claimant had entered into a COT3 agreement under duress. The Claimant had worked for the Respondent as a Stable Lass and was the recipient of tied accommodation. At the time of the alleged duress, she was 19 years old and pregnant.

The Tribunal held that a COT3 agreement entered into between the parties in October 2021 was void on grounds of economic duress. According to the Employment Judge, the circumstances of the present case were “very rare”. The Tribunal found that the Respondent had applied illegitimate and unlawful pressure on the Claimant, which included making allegations of gross misconduct with no credible basis, implicitly threatening to dismiss the Claimant and denying the Claimant her lawful right to occupy her tied accommodation. As a result of the Respondent’s illegitimate pressure, the Claimant genuinely and legitimately considered herself to be homeless and needed an eviction letter from her employer to access local authority accommodation. The Respondent offered to provide the eviction letter on the basis that the Claimant entered into a COT3 agreement. In the circumstances, this left the Claimant with no real practicable alternative but to enter into a COT3 agreement with the Respondent and thus, the COT3 agreement was voidable on grounds of economic duress.

The Claimant also succeeded in her alternative submission that applying the ordinary principles of construction, the scope of the COT3 agreement did not, in light of the specific wording of the contract and the intention of the parties, settle the Claimant’s claim of pregnancy/maternity discrimination. The Tribunal distinguished the present case from the recent EAT decision in Arvunescu v Quick Release (Automotive) Ltd [2022] EAT 26.

Ameer Ismail was instructed by Reesha Panchal of CJJ Law. The judgment can be found here.