In the case of Cheltenham Borough Council v Laird [2009] EWHC 1253 HC, the High Court has rejected the Council’s claim for damages for fraudulent or negligent misrepresentation against a Managing Director who failed to disclose a history of depression in her pre-employment medical questionnaire. The High Court held that given the ambiguity of the questions, Ms Laird’s answers being one way of truthfully answering the questions, and Ms Laird’s belief that the answers she had provided to these were true, it had not been negligent for Ms Laird to answer them as she had.

Implications

Although the consequences were fairly extreme in this case, it does highlight the need for employers to:

  • review their pre-employment medical questionnaires and the questions asked to ensure that these are as clear and unambiguous as possible;
  • ensure the questions asked enable the employer to obtain the information it needs to assess whether the job applicant is physically or mentally able to undertake the role or to avoid the risk of taking on someone who may become unable to work;
  • have a sweep up question in their medical questionnaires to ensure the job applicant discloses anything which may affect their ability to do the job now or in the future or may affect the employer’s decision to offer them the job.

The answers provided can be highly relevant for an employer in seeking to meet its obligations to make reasonable adjustments for a disabled employee under the DDA where a provision, criterion or practice applied by or on behalf of the employer, or any physical feature of the premises occupied by the employer, places a disabled employee at a substantial disadvantage.

Facts

In this case, the local authority claimed damages against Ms Laird for alleged fraudulent misrepresentations made in a medical questionnaire for a job as Managing Director of the Council. Ms Laird counter-claimed in respect of alleged conduct of the local authority including harassment and a personal injury claim, for failure to protect her health.

Between 1997 and 2001, Ms Laird had suffered three episodes of stress-related depression and in total had taken three months’ sick leave as a result. She had been regularly prescribed anti-depressants and she took them between June 2001 and February 2002.

On 7 January 2002 she was offered the position of Managing Director with the Council conditional upon medical clearance being obtained from the Council’s medical adviser. She completed the medical questionnaire on 8 January. The medical questionnaire had asked whether Ms Laird had enjoyed good health, which she answered in the positive, and whether she had any physical or mental impairment or ongoing condition which would affect her employment, which she answered in the negative. Ms Laird signed a declaration that the answers were true to the fullest of her ability and acknowledged that if she had wilfully withheld any material fact her contract could be terminated. She had been employed with a view to restructuring the Council.

Following elections the leading party changed and they were opposed to the restructure. Relations deteriorated between Ms Laird and the Council and complaints were made about Ms Laird by the Council leader. A committee of the Council found that there was sufficient merit in the complaints to require an investigation. Ms Laird subsequently suffered a nervous breakdown. A psychiatric report advised that Ms Laird was unfit to undergo the investigation and it referred to three previous episodes of depression and the fact that she continued to take anti-depressants. The Council concluded that her contract of employment had been frustrated because there was no reasonable prospect of the investigation taking place or being concluded. Ms Laird was found to be permanently unfit for work and obtained an ill-health retirement pension.

The Council subsequently brought a claim that Ms Laird, in failing to mention in her pre-employment medical questionnaire her history of stress and depression, had made fraudulent and negligent misrepresentations and that they would not have entered into the employment contract if these had not been made. The Council were seeking £1m compensation for the cost of the ill health retirement and additional costs involved in managing the process, which they said they would not have incurred with another candidate.

The High Court held that whilst the answers given in the medical questionnaire had been an inducing cause of the subsequent contract of employment, the questionnaire had been ambiguous and the answers had not been fraudulent or negligent. The Court held that at the time Ms Laird completed the questionnaire, she was not suffering from depression and would not reasonably have considered that she was suffering from a condition causing physical or mental impairment, or from a condition that was bound to affect her employment. It was standard practice to continue taking anti-depressants for six months after an episode of depression. She had given the, or at least a, correct answer to each question. Further, Ms Laird had believed the answers to be true. If the answers had been false they had not been made fraudulently or negligently. Given the ambiguity of the questions it had not been negligent for Ms Laird to answer them as she had.

The Court considered that the medical questionnaire was poorly drafted and was ambiguous. The representations given by Ms Laird in her answers were not false, nor, given the terms of the questions, were they misleading. It followed that the Council could not recover damages for “extraordinary expenses” including the employee’s ill-health pension that it would not have incurred had it employed someone else.