Compromise Contracts

Does section 147 of the Act prevent the complainant’s lawyer from acting as the independent adviser for the purpose of a compromise agreement?

No.  The logical effect of section 147(3)(c) means that such an interpretation cannot be correct.  Section 147(3)(c) requires that the “complainant” must receive advice from an “independent adviser” for a compromise agreement to be enforceable.  Obviously the “independent adviser” must be someone other than the “complainant” - the claimant cannot advise him- or herself.

Sections 147(4) and 147(5) define who can and cannot be an “independent adviser” - therefore they cannot be referring to the “complainant”.  This means that “a person who is a party to the contract or the complaint” in section 147(5)(a) cannot be the complainant - it can only refer to others (such as the employer or a fellow worker) named in the contract or complaint.  It follows that “a person who is acting for a person within paragraph (a)” in section 147(5)(d) cannot be the complainant’s lawyer.  Interpreting section 147(5)(a) as including the “complainant” goes against the logic of section 147(3)(c) and would  make section 147 meaningless. The intention was to preserve the situation as it existed under the old legislation, and that is what section 147 does.

In response to a Freedom of Information Act request in December 2010, the Government Equalities Office has released its correspondence with the Law Society about the interpretation of this provision,which includes the letter from the Law Society and the response from the GEO, and links to two Counsel’s opinions obtained by the Law Society:

http://www.lawsociety.org.uk/new/documents/2011/S147-Opinion-JohnBowersQC.pdf

and

http://www.lawsociety.org.uk/new/documents/2011/S147-Opinion-TomLindenQC.pdf