It is well established in law that claimants can claim for losses suffered as a result of a detriment to which they have been subjected, unless a new act broke the chain of causation. In McNicholas v Care and Learning Alliance and anor, the EAT held that an intervention by a third party (in this case a professional regulator) in a chain of causation will only constitute a “new act” if it is the “sole effective cause of the loss, damage or injury suffered”.
Basic facts
Ms McNicholas, a qualified teacher, was regulated by the General Teaching Council for Scotland (GTCS). She started working on a casual basis in 2016 for Cala Staffbank (CS), a wholly owned subsidiary of the Care and Learning Alliance (CLA) whose principal client was the Highland Council. The following year, she also started working at a nursery run by CLA which provided nursery places for the council.
In June 2018, she lodged tribunal claims alleging that she had been subjected to detriments (disadvantages) by both CS and CLA as a result of having made protected disclosures about arrangements for the care of a child with autism who attended the nursery run by CLA. CS and CLA complained to the GTCS about her fitness to teach.
Tribunal decision
The tribunal agreed with Ms McNicholas that she had been subjected to five specific detriments by CS and CLA; that CLA had forced her to resign; and CS had unfairly dismissed her. In addition, it held that the complaints made by the two organisations to the GTCS were:
- not made in good faith
- based on allegations that probably had no real or genuine substance
- retaliation against the appellant for having made the protected disclosures about practices within the nursery, as CS and CLA knew at the time of the referral
- motivated by a desire to discredit Ms McNicholas and to appease Highland Council.
Following a remedies hearing in 2021, the tribunal made awards against both CS and CLA for past and future loss, injury to feelings and psychiatric injury. However, it limited the awards for any losses she suffered to February 2019, the date when GTCS decided, after compiling an initial report, that it had enough material to proceed to an investigation about her.
The tribunal held that this decision constituted a “a novus actus interveniens”. In other words, a new act that broke the chain of causation between the detriments to which she was subjected and the losses she incurred as a result. The tribunal also refused to make any awards for pension loss or legal costs that she had incurred in defending the GTCS proceedings and refused an application for the expenses of the liability hearing.
Ms McNicholas appealed, arguing that the tribunal was wrong to conclude that the decision by the GTCS to investigate was a new act breaking the chain of causation.
EAT decision
Agreeing with Ms McNicholas, the EAT held that to constitute “a novus actus interveniens” in law, it must be the “sole effective cause of the loss, damage or injury suffered such that the prior wrongdoing, whilst it might still be a 'but for' cause, has been eclipsed so that it is no longer an effective or contributory cause” of the loss.
In this case, the decision by the GTCS to investigate the allegations after its initial report was not an independent, supervening cause of loss, but was instead a natural and reasonable consequence of the wrongful act by CS and CLA to refer her in the first place. That wrongful act, therefore, remained the effective cause of her loss.
The tribunal’s conclusion on novus actus was also irreconcilable with its earlier findings that CS and CLA had not made the referral in good faith as it was motivated by a desire to discredit Ms McNicholas and to appease the Highland Council. In the eyes of the law, the referral was “malicious” as it had been made without proper cause and for improper purposes.
Comment
This case reiterates the law in relation to “a novus actus interveniens”. The interesting aspect is that it relates to a professional regulator and its interaction with the claimant’s complaint against her employer.
What this case makes clear is that even if the regulator does decide to investigate the matter further, that is likely to be considered a natural consequence of actions of the referrer and will not be considered as an act independent of the wrongful act.
