Co-op overturns £600,000 compensation ruling for former chief executive

The Channel Islands Co-op has won an appeal against a ruling that would have required it to pay former chief executive Colin MacLeod £600,000 in compensation.

MacLeod, who led the Co-op for a decade, successfully sued the organisation last year, arguing that he had been unfairly treated by directors and had suffered a psychiatric injury as a result.

The Co-op subsequently challenged the judgment.

In May, the original award of £600,000 was confirmed, although the appeal had yet to be heard. However, on 1 September, three appeal judges ruled in favour of the Co-op and overturned the compensation award.

The appeal court accepted that MacLeod had been subjected to an unfair and inappropriate campaign by some directors and upheld findings that there had been a “deliberate campaign” to remove him.

It also found that the actions of three directors amounted to “bad faith”.

Among the issues highlighted by the court were secret meetings held without proper records, concerns that were not raised through formal procedures and two expenses audits that specifically targeted MacLeod.

However, the judges ruled that it was not reasonably foreseeable that the treatment would result in psychiatric injury.

The court described MacLeod as a “strong personality” with no known vulnerability or susceptibility to psychiatric harm.

While the judges accepted that it would have been foreseeable that he would feel distressed, upset and angry, they concluded that psychiatric injury itself could not reasonably have been anticipated.

MacLeod previously described his legal battle with the Co-op as “long and excruciating”.

Despite overturning the compensation award, the appeal court maintained its findings that the campaign to remove the former chief executive had been deliberate and that the conduct of the directors involved had been improper.