Amanda Heap v Calvary Health Care Act Ltd T/A Calvary Health Care Bruce

[2016] FWC 9181

[2016] FWC 9181

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Amanda Heap
v
Calvary Health Care ACT Ltd T/A Calvary Health Care Bruce
(U2016/9520)

DEPUTY PRESIDENT CLANCY MELBOURNE, 21 DECEMBER 2016

Application for relief from unfair dismissal – matter settled – application dismissed pursuant to s.587 of the Act.

[1] On 18 July 2016, Mrs Amanda Heap made an application (the Application) for unfair dismissal remedy in relation to her dismissal under s.394 of the Fair Work Act 2009 (the Act).

[2] The application was referred to conciliation on 17 August 2016. At conciliation Mrs Heap was represented by Mr T Cullen of the Australian Nursing and Midwifery Federation (ANMF). After the conciliation, correspondence was sent to the parties by the conciliator. It included the statement “I confirm that you reached a settlement agreement and I attach terms of settlement.” The terms of settlement document that was attached to the letter was prepared by the Commission and it was subsequently signed by Calvary Health Care ACT Ltd T/A Calvary Health Care Bruce (Calvary) on 22 August 2016 and forwarded to Mr Cullen. Mrs Heap did not qualify for the 3-day cooling off period.

[3] Approximately two months later on 21 October 2016, Mrs Heap attended the Registry of the Fair Work Commission (the Commission) and inquired as to the status of her application. Mrs Heap was advised that because there was a settlement at conciliation the matter had been closed. Mrs Heap stated that she was told by the conciliator that she could think about the proposed settlement agreement before accepting, and that she had decided not to accept it. The Commission referred Mrs Heap to the letter sent to parties after conciliation confirming that a settlement agreement was reached. Mrs Heap stated that she wanted her matter to proceed to arbitration and was advised that she could make this request in writing.

[4] On 23 October 2016, the Commission received an email from Mrs Heap that stated she would not be signing the terms of settlement proposed at conciliation. It was asserted by Mrs Heap that she had discovered documentation clearing her of serious misconduct and because this meant her dismissal was unfair, she would like to proceed to arbitration. In this correspondence, Mrs Heap also advised that she had engaged legal representation in relation to her matter. This correspondence was subsequently forwarded to Calvary.

[5] On 25 October 2016, Calvary sent an email to the Commission objecting to Mrs Heap’s request that her matter proceed to arbitration. Calvary asserted that as Mrs Heap was represented at conciliation on 17 August 2016, a cooling off period did not apply in relation to the settlement agreement reached by parties at conciliation and the matter had settled.

[6] In a telephone conversation with the Commission on 25 October 2016, Mrs Heap was advised that her request for the matter to proceed to arbitration had been referred to the Termination of Employment Panel Head for consideration. Mrs Heap stated she would provide documents in support of her request.

[7] On the same day, Mrs Heap’s new legal representative, Ms G Sullivan, contacted the Commission and inquired as to the status of the matter and the documentation that was sent to parties following conciliation. Ms Sullivan indicated that she would send further written submissions in support of Mrs Heap’s request.

[8] On 25 October 2016, Ms Sullivan sent an email to the Commission and pressed the following points:

• Mrs Heap’s file was closed on the basis of a settlement having been reached at conciliation;

• No Notice of Discontinuance was filed;

• Mrs Heap was represented by her union at conciliation;

• An in-principle agreement was reached at conciliation, subject to the parties agreeing on the terms of a deed of release. No deed of release was available for consideration at the conciliation;

• A deed of release was prepared by Calvary after the conciliation. Mrs Heap did not agree to the terms of that deed, and no deed of release has ever been executed between the parties; and

• In the absence of any concluded agreement between the parties, Mrs Heap wishes her case to proceed to arbitration.

[9] Calvary responded to Ms Sullivan’s correspondence by stating she had erroneously apportioned responsibility for the preparation of the deed of release to Calvary, when in fact it had emanated from the conciliator. Calvary further disputed the assertion that Mrs Heap did not agree to the terms advised by her representative on the day of conciliation, or that an agreement was not reached by parties. Calvary stated that it was clearly the understanding of Mrs Heap, her representative, and the conciliator that an agreement was reached and therefore the matter was settled following conciliation on 17 August 2016.

[10] On 26 October 2016, the Commission sent correspondence to parties containing a direction that Mrs Heap file material and evidence as to why her application should not be dismissed by 2 November 2016.

[11] Following a request for an extension received from Ms Sullivan on 2 November 2016, Mrs Heap’s submissions became due by 4 November 2016.

[12] On 4 November 2016, Mrs Heap filed submissions and a witness statement, together with one from Mr Cullen. It was submitted that there was an insufficient factual basis to support a finding of a binding agreement between the parties. Instead, it was submitted that the parties came to an in-principle settlement agreement at conciliation that was subject to agreement on terms of a deed of release.

[13] In her witness statement, Mrs Heap stated that terms of settlement were received by her after the conciliation but because she did not agree to the terms or sign the document, an agreement has not been finalised. Mrs Heap further stated she was unhappy with the terms of settlement document as it included terms that she had no recollection of discussing at conciliation and which were unclear to her in terms of both meaning and practical operation.

[14] Also attached to Mrs Heap’s witness statement was an email response from Mr Cullen dated 9 September 2016, replying to an earlier email from Mrs Heap raising questions with regards to her application. In his email Mr Cullen stated “Calvary may raise an objection in any further actions as they were of the impression that you had agreed to settle the matter on the day … [H]owever, we did make it clear that it was subject to the wording of the Deed of Settlement/Terms of Settlement.”

[15] In his witness statement, Mr Cullen stated that after receiving a copy of the proposed terms of settlement document following conciliation, he provided this to Mrs Heap and advised her to seek legal advice regarding its terms.

[16] On 8 November 2016, the Commission directed Calvary to file and serve submissions and evidence as to why Mrs Heap’s application should be dismissed on the basis that it has no reasonable prospects of success by 14 November 2016.

[17] On 13 November 2016, Calvary submitted a letter from Mr J Kershaw dated 9 November 2016 which stated that it was obvious from the correspondence sent by the conciliator that an agreement had been reached. Mr Kershaw confirmed that the terms of settlement document had been signed by the Chief Executive Officer of Calvary, Ms K Edwards, and emailed to Mr Cullen for finalisation.

[18] With regards to Mrs Heap’s claim that her recollection of conciliation was affected by confusion and distress, Calvary noted that Mrs Heap was represented by an “experienced Industrial Officer from a recognised Union who is cognisant with the conciliation process.” As such, Calvary submitted it was highly unlikely that there could have been any doubt as to the matter being settled at conciliation.

[19] Calvary further submitted that the letter sent by the conciliator confirmed that the offered terms had been accepted, and because these terms were attached as a settlement agreement both parties had intended to be bound by them. Calvary also submitted that if either Mrs Heap or Mr Cullen had any doubts about the terms of settlement, they could and should have raised objections when they were provided with the terms of settlement document, yet neither had done so.

Consideration

[20] In Masters v Cameron, 1 the High Court held that where parties who have been in negotiation reach agreement upon terms of a contractual nature and also agree that the matter of their negotiation shall be dealt with by a formal contract, the case may belong to any of three classes. The three classes are:

1. The parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form which will be fuller or more precise but not different in effect.

2. It may be a case in which the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which their agreed terms express or imply, but nevertheless have made performance of one or more of the terms conditional upon the execution of a formal document.

3. The case may be one in which the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract.

[21] Mrs Heap contends that because the parties were not able to agree on the terms of settlement drafted by Calvary after conciliation, no binding agreement is in place. Firstly, I do not accept the assertion made by Mrs Heap that the terms of settlement were prepared by Calvary after the conciliation. The Commission file indicates the terms were prepared by the conciliator, and the subsequent correspondence indicates that no changes were made by Calvary, save for the agreement being executed and witnessed by Ms Edwards and Ms Chadwick on 22 August 2016.

[22] As to whether there is a binding agreement in place, it is clear from correspondence that both the conciliator and Calvary shared the view that the matter had been settled following the conciliation on 17 August 2016. The letter from the conciliator was unequivocal and the terms of settlement were not said to be subject to any conditions.

[23] Although Mr Cullen stated in an email to Mrs Heap dated 9 September 2016 “we did make it clear that it was subject to the wording of the Deed of Settlement/Terms of Settlement”, this was not a position he communicated to the conciliator or Calvary. Further, Mr Cullen did not repeat this assertion in his recent statement in support of Mrs Heap’s request to have the matter proceed to arbitration. He declined to directly contradict the contents of the letter of the conciliator dated 17 August 2016 at the time he received it and in particular, he did not assert that the resolution of the matter was subject to further agreement being reached on the wording of the terms of settlement. Mr Cullen did not identify any terms that were objectionable or beyond what had been agreed at the conciliation.

[24] I am not persuaded that the agreement reached at conciliation was only an in-principle agreement and subject to the parties reaching agreement on terms of a deed of release. Despite Mrs Heap claiming in her recent statement that she was not happy with some of the terms due to not recalling their discussion at conciliation and being confused as to their practical operation, she never stated which terms she finds objectionable and why. There was nothing remarkable about these terms of settlement. They impose standard obligations on both parties and included clauses regarding confidentiality and mutual releases. I consider it would be highly unlikely for the parties to have reached agreement that involved the payment of money without there being releases. As noted by the Full Bench of the Commission in Zoiti-Licastro v Australian Taxation Office, 2terms relating to mutual releases and confidentiality “could hardly be said to be unusual.”3 It was also noted by the Full Bench that where a party has an objection to particular terms, the proper course would be for them to “simply indicate that they were not part of the agreement.”4 This did not occur in this case. There was no evidence before me that Mrs Heap or Mr Cullen advised the conciliator or Calvary of any objectionable terms upon receipt of the terms in August 2016 or in the weeks that immediately followed. As stated above, Mrs Heap only challenged the terms two months later when she made her request for arbitration.

[25] I consider the explanation Mrs Heap gave to the Commission in her email of 23 October 2016 provides the more plausible explanation as to why she asserts there is no binding agreement. In that email, sent two months after the conciliation, Mrs Heap stated the reason she will not sign the terms and instead wishes for her case to proceed to arbitration is that she has discovered documentation that she alleges clears her of serious misconduct. Mrs Heap’s more recent assertion that the proper characterisation of the status of her matter following conciliation was of an in-principle agreement subject to further agreement on terms of settlement is, in my view, a reconstruction of events.

[26] I am therefore satisfied that the parties reached an agreement by way of a binding settlement at conciliation on 17 August 2016 and that the agreement was the first type discussed in Masters v Cameron.

[27] In Australia Postal Corporation v Gorman, 5 Besanko J held that the existence of a binding settlement or “accord and satisfaction” extinguishes the existing cause of action and replaces it with a new cause of action based on the agreement.6

[28] His Honour stated:

“[33] There is nothing in the Act which suggests that an accord and satisfaction should not be recognised. At a general level the object of Chapter 3 Part 3-2 and the general statements of the manner in which FWA is to perform its functions and the matters to which it is to have regard are consistent with the recognition of an accord and satisfaction. Furthermore, the words of subsection 587(1) are wide enough to include the recognition of an accord and satisfaction. As I have said, a valid and effective accord and satisfaction extinguishes the pre-existing cause of action and continued pursuit of an application based on such cause of action is clearly capable of being considered to be frivolous or vexatious or without reasonable prospects of success.” 7

[29] As can be seen from Australia Postal Corporation v Gorman, if there is a binding agreement between the parties, the Commission has the power to dismiss an application on the basis that it has no reasonable prospects of success.

[30] Section 587(1) of the Act provides as follows:

587 Dismissing applications

(1) Without limiting when the FWC may dismiss an application, the FWC may dismiss an application if:

(a) the application is not made in accordance with this Act; or

(b) the application is frivolous or vexatious; or

(c) the application has no reasonable prospects of success.

[31] I have found that on 17 August 2016, the parties reached agreement at conciliation and I am satisfied that the agreement was of the first type discussed in Masters v Cameron.As a consequence, I am persuaded that I should exercise my power under s.587(1)(c) of the Act to dismiss the Application on the basis that it has no reasonable prospects of success. An order to this effect will be issued in conjunction with this decision.

DEPUTY PRESIDENT

 1 (1954) 91 CLR 353 at [360]-[361].

 2   PR967544.

 3 Ibid at [12].

 4   Ibid.

 5 [2011] FCA 975.

 6 Ibid at [31].

 7 Ibid at [33].

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