The EAT has ruled that an ACAS agreed settlement (commonly referred to as a COT3) that settled an employment tribunal claim also covered a related appeal not expressly referenced in the agreement.
Mr Turner brought a claim in the employment tribunal which included alleged non-payment under his employer’s PHI scheme. The PHI complaint was struck out. Mr Turner appealed to the EAT against the strike out.
Subsequently, the parties entered into a COT3, in which the employer agreed to pay Mr Turner a settlement sum in consideration of him withdrawing his employment tribunal claim and “in full and final settlement of any and all claims which [he] has or may have” against it. The EAT was not notified about the COT3 and proceeded with Mr Turner’s appeal, directing it be considered at a full hearing. The employer argued that the appeal should no longer proceed due to the COT3 whereas Mr Turner intended it to continue. A preliminary hearing took place in the EAT to determine the effect of the COT3 on the appeal and whether it should proceed to a full hearing.
The EAT noted this was a question of objective interpretation of the words used in the COT3, not the subjective states of mind of the parties, construed in the light of the relevant context and shared background knowledge of the parties at the time. The wording of the COT3 made clear that, in exchange for the settlement sum, the employer would get not just the withdrawal of the employment tribunal claim but a full and final settlement of any claims which Mr Turner had or may have against it, subject only to what was specifically excluded (which did not include the appeal). In its ordinary meaning, this wide wording embraced the PHI complaint which had been struck out and was the subject of the ongoing appeal. Where, as was concluded here, the words of a settlement agreement, objectively construed, settle a complaint which has been struck out, the natural and logical implication is that they also settle a related appeal, which is part of the ongoing litigation.
The EAT further held that, even if that was not the right analysis, the COT3 rendered the appeal wholly academic because, once the complaint had been settled, the appeal could not lead to it being reinstated or substantively adjudicated. The EAT will not, as a general rule, entertain an appeal which is purely academic.
Case: Turner v Western Mortgage Services Ltd [2025] EAT 191 (19 December 2025) (HHJ Auerbach).
John Cook
